Net Income Per Common Share

3 Months Ended

Oct. 31, 2021

Earnings Per Share Reconciliation [Abstract]

Summary of Calculation of Basic And Diluted EPS

Presented below is basic and diluted EPS for the three months ended October 31, 2021 and 2020 (in thousands, except per share amounts):

	Three Months Ended October 31,
	2021				2020
	Basic		Diluted		Basic		Diluted
Net loss per share:
Net loss attributable to Vail Resorts	$	(139,332)	$	(139,332)	$	(153,766)	$	(153,766)
Weighted-average Vail Shares outstanding	40,414		40,414		40,213		40,213
Weighted-average Exchangeco Shares outstanding	34		34		35		35
Total Weighted-average shares outstanding	40,448		40,448		40,248		40,248
Effect of dilutive securities	—		—		—		—
Total shares	40,448		40,448		40,248		40,248
Net loss per share attributable to Vail Resorts	$	(3.44)	$	(3.44)	$	(3.82)	$	(3.82)

The Company computes the effect of dilutive securities using the treasury stock method and average market prices during the period. The number of shares issuable upon the exercise of share-based awards excluded from the calculation of diluted EPS because the effect of their inclusion would have been anti-dilutive totaled approximately 0.5 million and 0.6 million for the three months ended October 31, 2021 and 2020, respectively.

Net Income Per Common Share

Net Loss per Share

Earnings per Share

Basic EPS excludes dilution and is computed by dividing net loss attributable to Vail Resorts stockholders by the weighted-average shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, resulting in the issuance of shares of common stock that would then share in the earnings of Vail Resorts.

In connection with the Company’s acquisition of Whistler Blackcomb in October 2016, the Company issued consideration in the form of shares of Vail Resorts common stock (the “Vail Shares”) and shares of the Company’s wholly-owned Canadian subsidiary (“Exchangeco”). Whistler Blackcomb shareholders elected to receive 3,327,719 Vail Shares and 418,095 shares of Exchangeco (the “Exchangeco Shares”). Both Vail Shares and Exchangeco Shares have a par value of $0.01 per share, and Exchangeco Shares, while outstanding, are substantially the economic equivalent of Vail Shares and are exchangeable, at any time prior to the seventh anniversary of the closing of the acquisition, into Vail Shares. The Company’s calculation of weighted-average shares outstanding includes the Exchangeco Shares.

Presented below is basic and diluted EPS for the three months ended October 31, 2021 and 2020 (in thousands, except per share amounts):

	Three Months Ended October 31,
	2021				2020
	Basic		Diluted		Basic		Diluted
Net loss per share:
Net loss attributable to Vail Resorts	$	(139,332)	$	(139,332)	$	(153,766)	$	(153,766)
Weighted-average Vail Shares outstanding	40,414		40,414		40,213		40,213
Weighted-average Exchangeco Shares outstanding	34		34		35		35
Total Weighted-average shares outstanding	40,448		40,448		40,248		40,248
Effect of dilutive securities	—		—		—		—
Total shares	40,448		40,448		40,248		40,248
Net loss per share attributable to Vail Resorts	$	(3.44)	$	(3.44)	$	(3.82)	$	(3.82)

The Company computes the effect of dilutive securities using the treasury stock method and average market prices during the period. The number of shares issuable upon the exercise of share-based awards excluded from the calculation of diluted EPS because the effect of their inclusion would have been anti-dilutive totaled approximately 0.5 million and 0.6 million for the three months ended October 31, 2021 and 2020, respectively.

On December 18, 2020, the Company completed an offering of $575.0 million in aggregate principal amount of 0.0% Convertible Notes (as defined in Note 5, Long-Term Debt). The Company is required to settle the principal amount of the 0.0% Convertible Notes in cash and has the option to settle the conversion spread in cash or shares. The Company uses the treasury method to calculate diluted EPS, and if the conversion value of the 0.0% Convertible Notes exceeds their conversion price of $407.17 per share of common stock, then the Company will calculate its diluted EPS as if all the notes were converted and the Company issued shares of its common stock to settle the excess value over the conversion price. However, if reflecting the 0.0% Convertible Notes in diluted EPS in this manner is anti-dilutive, or if the conversion value of the notes does not exceed their initial conversion amount for a reporting period, then the shares underlying the notes will not be reflected in the Company’s calculation of diluted EPS. For the three months ended October 31, 2021, the average price of Vail Shares did not exceed the conversion price and therefore there was no impact to diluted EPS during those periods.

Dividends

The Company paid cash dividends of $0.88 per share ($35.6 million in the aggregate) during the three months ended October 31, 2021. The Company did not pay cash dividends during the three months ended October 31, 2020. On December 8, 2021, the Company’s Board of Directors approved a cash dividend of $0.88 per share payable on January 11, 2022 to stockholders of record as of December 28, 2021. Additionally, a Canadian dollar equivalent dividend on the Exchangeco Shares will be payable on January 11, 2022 to shareholders of record on December 28, 2021.