American Skiing Company Announces 34 Percent In Net Income
Revenues more than doubled third quarter and skier visits up 8.1 percent.
Edited by John Stouffer
(6-4-98)

(Press Release, June 4)—American Skiing Company (NYSE: SKI) today announced financial results for the third quarter and nine months ended April 26, 1998. Total revenues for the quarter increased 41 percent to 185.6-million dollars compared with 131.8-million dollars on a pro forma basis and 84.3-million dollars on an actual basis for the same period in 1997.

Pro forma resort revenue increased twelve percent for the third quarter to 144.6-million dollars compared with 129.2-million dollars for the previous year's quarter. Real estate revenue was 40.9-million dollars for the third quarter versus 2.7-million dollars for the comparable period in fiscal 1997.

Total pro forma earnings from operations before interest, income taxes, depreciation, and amortization ("EBITDA") grew to 79.2-million dollars, a 31-percent improvement over pro forma EBITDA of 60.4-million dollars for the third fiscal quarter of 1997. Pro forma resort EBITDA for the third quarter increased eleven percent to 66.6-million dollars versus 59.9-million dollars, and pro forma real estate EBITDA increased to 12.6-million dollars from a half- million dollars for the comparable period last year.

Net income available to common shareholders on a pro forma basis was 31.7- million dollars, or $1.03 per share diluted for the third fiscal quarter compared with 23.7-million dollars, or $.80 per share diluted for the third quarter of 1997.

For the nine-month period ended April 26, 1998 total revenues on a pro forma basis were 319.1-million dollars, up 28 percent from last year's nine- month revenue of 248.5-million dollars. Pro forma resort revenue rose eleven percent to 269.5-million dollars compared with 242.5-million dollars for the nine month period of the previous year. Pro forma real estate revenue increased to 49.6-million dollars for the nine-month period from six-million dollars in the same period last year. Pro forma total nine-month EBITDA in fiscal 1998 was 90.5-million dollars versus 69-million dollars in fiscal 1997, representing an increase of 31 percent.

The nine-month pro forma resort EBITDA was 75.4-million dollars in 1998 compared with 67.9-million dollars for the same period in 1997. Pro forma real estate EBITDA for the nine-month period was 15.1-million dollars versus 1.1- million dollars for the comparable period in 1997. On a pro forma basis income from continuing operations for the nine months ended April 26, 1998 was 9.2- million dollars, or $.31 per share diluted compared with 9.3-million dollars, or $.31 per diluted share, for the corresponding nine-month period last year.

Net income from continuing operations would have been 17.9-million dollars, excluding the tax affected stock compensation charge for the nine months ended April 26, 1998. The company reported an adjustment in interest expense for the second quarter and the six months ended January 25, 1998 in the amount of 3.5- million dollars to properly reflect interest expense for such periods. The impact of this adjustment increased the net loss for the six-month period from 22.2-million dollars, as previously reported, to 24.3-million dollars and increased the net loss per share from $1.04 to $1.14.

For the second quarter ended January 25, 1998, the adjustment decreased previously reported net income from 1.3-million dollars to a net loss of 0.9- million dollars and decreased net income per share diluted from $.05 to a net loss of $.03 per share diluted.

Total skier visits for the year increased 8.1 percent to a total of 5,322,047 visits versus 4,921,606 visits the previous year, on a pro forma basis. American Skiing Company's skier visits increased over three times the pace of the industry, accounting for more than 30 percent of the growth in the sport this past season.

"The importance of generating 400,000 of the industry's 1.3-million increase in skier visits cannot be over-emphasized," said Leslie B. Otten, chairman and chief executive officer. "This validates our success in creating real growth in the most essential element of our business-our guest."

The increase in real-estate revenue resulted from closing quartershare sales at the company's four new Grand Summit Resort Hotels: Killington, Mount Snow, Jordan Bowl, and Attitash.

According to Chris Howard, chief administrative officer and head of the company's real estate division: "Completing and opening these new Grand Summit hotels demonstrates our ability to execute our real estate development program, but represents only the first step in implementing our real estate strategy. With recent approval of a 325-room Grand Summit Hotel at Steamboat and record pre-sales at both Steamboat and the Canyons, we will be launching our real-estate strategy nationally this summer."

Pro forma results assume American Skiing Company's initial public offering and the acquisition of Steamboat and Heavenly resorts occurred at the beginning of the period presented, rather than the actual initial public offering date of November 6 and acquisition date of November 12.

Headquartered in Newry, Maine, the American Skiing Company operates Alpine ski and snowboard resorts including Steamboat in Colorado; Killington, Mount Snow, and Sugarbush in Vermont; Sunday River and Sugarloaf/USA in Maine; Attitash Bear Peak in New Hampshire; The Canyons in Utah; and Heavenly in California/Nevada.

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