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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 2021
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission File Number: 001-09614
https://cdn.kscope.io/3569e79bd2bf9dfa88f6689508ec4262-mtn-20210131_g1.jpg
Vail Resorts, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware51-0291762
(State or Other Jurisdiction of
Incorporation or Organization)
(I.R.S. Employer
Identification No.)
390 Interlocken Crescent
Broomfield,Colorado80021
(Address of Principal Executive Offices)(Zip Code)
(303) 404-1800
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.01 par valueMTNNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.      Yes      No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).      Yes      No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer   Accelerated filer 
Non-accelerated filer   Smaller reporting company 
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).      Yes     No
As of March 8, 2021, 40,256,289 shares of the registrant’s common stock were outstanding.



Table of Contents
 
PART IFINANCIAL INFORMATIONPage
Item 1.Financial Statements (unaudited).
Item 2.
Item 3.
Item 4.
PART IIOTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.




Vail Resorts, Inc.
Consolidated Condensed Balance Sheets
(In thousands, except per share amounts)
(Unaudited)
January 31, 2021July 31, 2020January 31, 2020
Assets
Current assets:
Cash and cash equivalents$1,301,003 $390,980 $126,793 
Restricted cash11,001 11,106 13,655 
Trade receivables, net117,012 106,664 105,325 
Inventories, net86,876 101,856 113,907 
Other current assets57,559 54,482 54,122 
Total current assets1,573,451 665,088 413,802 
Property, plant and equipment, net (Note 7)2,158,863 2,192,679 2,263,781 
Real estate held for sale and investment96,801 96,844 96,944 
Goodwill, net (Note 7)1,760,908 1,709,020 1,750,011 
Intangible assets, net318,983 314,776 321,391 
Operating right-of-use assets215,377 225,744 227,394 
Other assets41,450 40,081 40,356 
Total assets$6,165,833 $5,244,232 $5,113,679 
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued liabilities (Note 7)$831,794 $499,108 $811,497 
Income taxes payable37,862 40,680 43,325 
Long-term debt due within one year (Note 5)112,796 63,677 63,556 
Total current liabilities982,452 603,465 918,378 
Long-term debt, net (Note 5)2,768,015 2,387,122 1,817,058 
Operating lease liabilities210,855 217,542 228,474 
Other long-term liabilities (Note 7)251,913 270,245 245,375 
Deferred income taxes, net266,152 234,191 254,196 
Total liabilities4,479,387 3,712,565 3,463,481 
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, $0.01 par value, 25,000 shares authorized, no shares issued and outstanding
   
Common stock, $0.01 par value, 100,000 shares authorized, 46,416, 46,350 and 46,264 shares issued, respectively
465 464 462 
Exchangeable shares, $0.01 par value, 35, 36 and 55 shares issued and outstanding, respectively (Note 4)
  1 
Additional paid-in capital1,216,489 1,131,624 1,130,906 
Accumulated other comprehensive income (loss)8,226 (56,837)(44,100)
Retained earnings639,934 645,902 717,646 
Treasury stock, at cost, 6,161, 6,161, and 6,000 shares, respectively (Note 11)
(404,411)(404,411)(379,433)
Total Vail Resorts, Inc. stockholders’ equity1,460,703 1,316,742 1,425,482 
Noncontrolling interests225,743 214,925 224,716 
Total stockholders’ equity 1,686,446 1,531,667 1,650,198 
Total liabilities and stockholders’ equity$6,165,833 $5,244,232 $5,113,679 
The accompanying Notes are an integral part of these unaudited consolidated condensed financial statements.
2


Vail Resorts, Inc.
Consolidated Condensed Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
 
Three Months Ended January 31,Six Months Ended January 31,
 2021202020212020
Net revenue:
Mountain and Lodging services and other$597,110 $753,758 $701,384 $933,789 
Mountain and Lodging retail and dining 87,219 170,674 114,477 254,233 
Resort net revenue684,329 924,432 815,861 1,188,022 
Real Estate315 206 569 4,386 
Total net revenue684,644 924,638 816,430 1,192,408 
Operating expense (exclusive of depreciation and amortization shown separately below):
Mountain and Lodging operating expense293,971 387,842 448,108 616,552 
Mountain and Lodging retail and dining cost of products sold37,366 67,135 54,498 104,870 
General and administrative78,121 91,302 137,150 166,357 
Resort operating expense409,458 546,279 639,756 887,779 
Real Estate operating expense1,615 1,505 3,065 6,798 
Total segment operating expense411,073 547,784 642,821 894,577 
Other operating (expense) income:
Depreciation and amortization(62,663)(63,812)(125,291)(121,657)
Gain on sale of real property   207 
Change in estimated fair value of contingent consideration (Note 8)(1,000)(1,600)(1,802)(2,736)
(Loss) gain on disposal of fixed assets and other, net(2,192)(709)(2,761)1,558 
Income from operations207,716 310,733 43,755 175,203 
Mountain equity investment income, net1,180 169 5,166 1,360 
Investment income and other, net167 361 510 638 
Foreign currency gain (loss) on intercompany loans
(Note 5)
5,135 (798)5,675 (438)
Interest expense, net(37,847)(26,134)(73,254)(48,824)
Income (loss) before (provision) benefit from income taxes176,351 284,331 (18,148)127,939 
(Provision) benefit from income taxes(27,221)(67,313)10,257 (20,750)
Net income (loss)149,130 217,018 (7,891)107,189 
Net (income) loss attributable to noncontrolling interests(1,332)(10,648)1,923 (7,294)
Net income (loss) attributable to Vail Resorts, Inc.$147,798 $206,370 $(5,968)$99,895 
Per share amounts (Note 4):
Basic net income (loss) per share attributable to Vail Resorts, Inc.$3.67 $5.12 $(0.15)$2.48 
Diluted net income (loss) per share attributable to Vail Resorts, Inc.$3.62 $5.04 $(0.15)$2.44 
Cash dividends declared per share$ $1.76 $ $3.52 
The accompanying Notes are an integral part of these unaudited consolidated condensed financial statements.
3



Vail Resorts, Inc.
Consolidated Condensed Statements of Comprehensive Income
(In thousands)
(Unaudited)

Three Months Ended January 31,Six Months Ended January 31,
 2021202020212020
Net income (loss)$149,130 $217,018 $(7,891)$107,189 
Foreign currency translation adjustments, net of tax75,484 (14,045)77,257 (9,025)
Change in estimated fair value of hedging instruments1,307 (4,866)5,962 (4,563)
Comprehensive income225,921 198,107 75,328 93,601 
Comprehensive income attributable to noncontrolling interests(17,510)(8,568)(16,233)(6,076)
Comprehensive income attributable to Vail Resorts, Inc.$208,411 $189,539 $59,095 $87,525 
The accompanying Notes are an integral part of these unaudited consolidated condensed financial statements.
4


Vail Resorts, Inc.
Consolidated Condensed Statements of Stockholders’ Equity
(In thousands)
(Unaudited)
Common StockAdditional Paid in CapitalAccumulated Other Comprehensive (Loss) IncomeRetained EarningsTreasury StockTotal Vail Resorts, Inc. Stockholders’ EquityNoncontrolling InterestsTotal Stockholders’ Equity
Vail ResortsExchangeable
Balance, October 31, 2019$462 $1 $1,126,492 $(27,269)$582,235 $(379,433)$1,302,488 $219,948 $1,522,436 
Comprehensive income:
Net income— — — — 206,370 — 206,370 10,648 217,018 
Foreign currency translation adjustments, net of tax— — — (11,965)— — (11,965)(2,080)(14,045)
Change in estimated fair value of hedging instruments— — — (4,866)— — (4,866)— (4,866)
Total comprehensive income189,539 8,568 198,107 
Stock-based compensation expense— — 5,538 — — — 5,538 — 5,538 
Issuance of shares under share award plans, net of shares withheld for employee taxes — (1,124)— — — (1,124)— (1,124)
Dividends (Note 4)— — — — (70,959) (70,959)— (70,959)
Distributions to noncontrolling interests, net— — — — — — — (3,800)(3,800)
Balance, January 31, 2020$462 $1 $1,130,906 $(44,100)$717,646 $(379,433)$1,425,482 $224,716 $1,650,198 
Balance, October 31, 2020$464 $ $1,130,318 $(52,387)$492,136 $(404,411)$1,166,120 $209,607 $1,375,727 
Comprehensive income:
Net income— — — — 147,798 — 147,798 1,332 149,130 
Foreign currency translation adjustments, net of tax— — — 59,306 — — 59,306 16,178 75,484 
Change in estimated fair value of hedging instruments— — — 1,307 — — 1,307 — 1,307 
Total comprehensive income208,411 17,510 225,921 
Equity component of 0.0% Convertible Notes, net (Note 5)— — 80,066 — — — 80,066 — 80,066 
Stock-based compensation expense— — 6,579 — — — 6,579 — 6,579 
Issuance of shares under share award plans, net of shares withheld for employee taxes1 — (474)— — — (473)— (473)
Distributions to noncontrolling interests, net— — — — — — — (1,374)(1,374)
Balance, January 31, 2021$465 $ $1,216,489 $8,226 $639,934 $(404,411)$1,460,703 $225,743 $1,686,446 
5


Common StockAdditional Paid in CapitalAccumulated Other Comprehensive (Loss) IncomeRetained EarningsTreasury StockTotal Vail Resorts, Inc. Stockholders’ EquityNoncontrolling InterestsTotal Stockholders’ Equity
Vail ResortsExchangeable
Balance, July 31, 2019$461 $1 $1,130,083 $(31,730)$759,801 $(357,989)$1,500,627 $226,213 $1,726,840 
Comprehensive income:
Net income— — — — 99,895 — 99,895 7,294 107,189 
Foreign currency translation adjustments, net of tax— — — (7,807)— — (7,807)(1,218)(9,025)
Change in estimated fair value of hedging instruments— — — (4,563)— — (4,563)— (4,563)
Total comprehensive income87,525 6,076 93,601 
Stock-based compensation expense— — 10,789 — — — 10,789 — 10,789 
Issuance of shares under share award plans, net of shares withheld for employee taxes1 — (9,966)— — — (9,965)— (9,965)
Repurchase of common stock (Note 11)— — — — — (21,444)(21,444)— (21,444)
Dividends (Note 4)— — — — (142,050)— (142,050)— (142,050)
Distributions to noncontrolling interests, net— — — — — — — (7,573)(7,573)
Balance, January 31, 2020$462 $1 $1,130,906 $(44,100)$717,646 $(379,433)$1,425,482 $224,716 $1,650,198 
Balance, July 31, 2020$464 $ $1,131,624 $(56,837)$645,902 $(404,411)$1,316,742 $214,925 $1,531,667 
Comprehensive income:
Net loss— — — — (5,968)— (5,968)(1,923)(7,891)
Foreign currency translation adjustments, net of tax— — — 59,101 — — 59,101 18,156 77,257 
Change in estimated fair value of hedging instruments— — — 5,962 — — 5,962 — 5,962 
Total comprehensive income59,095 16,233 75,328 
Equity component of 0.0% Convertible Notes, net (Note 5)— — 80,066 — — — 80,066 — 80,066 
Stock-based compensation expense— — 12,333 — — — 12,333 — 12,333 
Issuance of shares under share award plans, net of shares withheld for employee taxes1 — (7,534)— — — (7,533)— (7,533)
Distributions to noncontrolling interests, net— — — — — — — (5,415)(5,415)
Balance, January 31, 2021$465 $ $1,216,489 $8,226 $639,934 $(404,411)$1,460,703 $225,743 $1,686,446 
The accompanying Notes are an integral part of these unaudited consolidated condensed financial statements.
6


Vail Resorts, Inc.
Consolidated Condensed Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended January 31,
 20212020
Cash flows from operating activities:
Net (loss) income$(7,891)$107,189 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization125,291 121,657 
Stock-based compensation expense12,333 10,789 
Deferred income taxes, net(8,779)23,568 
Other non-cash expense (income), net104 (977)
Changes in assets and liabilities:
Trade receivables, net(9,014)167,417 
Inventories, net16,151 (14,237)
Accounts payable and accrued liabilities111,481 70,873 
Deferred revenue220,846 72,831 
Income taxes payable - excess tax benefit from share award exercises(1,478)(2,818)
Income taxes payable - other(2,454)(17,647)
Other assets and liabilities, net2,479 (956)
Net cash provided by operating activities459,069 537,689 
Cash flows from investing activities:
Capital expenditures(67,338)(121,788)
Acquisition of businesses, net of cash acquired (327,555)
Other investing activities, net1,608 3,597 
Net cash used in investing activities(65,730)(445,746)
Cash flows from financing activities:
Proceeds from borrowings under Vail Holdings Credit Agreement 492,625 
Proceeds from borrowings under Whistler Credit Agreement21,144  
Proceeds from borrowings under 0.0% Convertible Notes575,000  
Repayments of borrowings under Vail Holdings Credit Agreement(31,250)(355,625)
Repayments of borrowings under Whistler Credit Agreement(22,380)(18,863)
Employee taxes paid for share award exercises(7,534)(9,966)
Dividends paid (142,050)
Repurchases of common stock (21,444)
Other financing activities, net(21,693)(14,513)
Net cash provided by (used in) financing activities513,287 (69,836)
Effect of exchange rate changes on cash, cash equivalents and restricted cash3,292 (48)
Net increase in cash, cash equivalents and restricted cash909,918 22,059 
Cash, cash equivalents and restricted cash:
Beginning of period402,086 118,389 
End of period$1,312,004 $140,448 
Non-cash investing activities:
Accrued capital expenditures$12,877 $11,982 
The accompanying Notes are an integral part of these unaudited consolidated condensed financial statements.
7


Vail Resorts, Inc.
Notes to Consolidated Condensed Financial Statements
(Unaudited)

1.Organization and Business
Vail Resorts, Inc. (“Vail Resorts”) is organized as a holding company and operates through various subsidiaries. Vail Resorts and its subsidiaries (collectively, the “Company”) operate in three business segments: Mountain, Lodging and Real Estate.

The Company refers to “Resort” as the combination of the Mountain and Lodging segments. In the Mountain segment, the Company operates the following thirty-seven destination mountain resorts and regional ski areas:

https://cdn.kscope.io/3569e79bd2bf9dfa88f6689508ec4262-mtn-20210131_g2.jpg

*Denotes a destination mountain resort, which generally receives a meaningful portion of skier visits from long-distance travelers, as opposed to the Company’s regional ski areas, which tend to generate skier visits predominantly from their respective local markets.

Additionally, the Mountain segment includes ancillary services, primarily including ski school, dining and retail/rental operations, and for the Company’s Australian ski areas, including lodging and transportation operations.

In the Lodging segment, the Company owns and/or manages a collection of luxury hotels and condominiums under its RockResorts brand; other strategic lodging properties and a large number of condominiums located in proximity to the Company’s North American mountain resorts; National Park Service (“NPS”) concessionaire properties including the Grand Teton Lodge Company (“GTLC”), which operates destination resorts in Grand Teton National Park; a Colorado resort ground transportation company and mountain resort golf courses.

Vail Resorts Development Company (“VRDC”), a wholly-owned subsidiary, conducts the operations of the Company’s Real Estate segment, which owns, develops and sells real estate in and around the Company’s resort communities.

8


The Company’s mountain business and its lodging properties at or around the Company’s mountain resorts are seasonal in nature with peak operating seasons primarily from mid-November through mid-April in North America. The peak operating season at the Company’s Australian resorts, NPS concessionaire properties and golf courses generally occurs from June to early October.

2.     Summary of Significant Accounting Policies
Basis of Presentation
Consolidated Condensed Financial Statements — In the opinion of the Company, the accompanying Consolidated Condensed Financial Statements reflect all adjustments necessary to state fairly the Company’s financial position, results of operations and cash flows for the interim periods presented. All such adjustments are of a normal recurring nature. Results for interim periods are not indicative of the results for the entire fiscal year, particularly given the significant seasonality to the Company’s operating cycle. The accompanying Consolidated Condensed Financial Statements should be read in conjunction with the audited Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2020. Certain information and footnote disclosures, including significant accounting policies, normally included in fiscal year financial statements prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) have been condensed or omitted. The Consolidated Condensed Balance Sheet as of July 31, 2020 was derived from audited financial statements.
Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the balance sheet date and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.
Fair Value of Financial Instruments — The recorded amounts for cash and cash equivalents, restricted cash, receivables, other current assets and accounts payable and accrued liabilities approximate fair value due to their short-term nature. The fair value of amounts outstanding under the Company’s credit agreements and the Employee Housing Bonds (as defined in Note 5, Long-Term Debt) approximate book value due to the variable nature of the interest rate associated with the debt. The estimated fair values of the 6.25% Notes and the 0.0% Convertible Notes (each as defined in Note 5, Long-Term Debt) are based on quoted market prices (a Level 2 input). The estimated fair value of the EPR Secured Notes and EB-5 Development Notes (each as defined in Note 5, Long-Term Debt), have been estimated using analyses based on current borrowing rates for debt with similar remaining maturities and ratings (a Level 2 input).
The carrying values, including any unamortized premium or discount, and estimated fair values of the 6.25% Notes, 0.0% Convertible Notes, EPR Secured Notes and EB-5 Development Notes as of January 31, 2021 are presented below (in thousands):
January 31, 2021
Carrying ValueEstimated Fair Value
6.25% Notes$600,000 $639,984 
0.0% Convertible Notes$467,758 $580,762 
EPR Secured Notes$136,512 $181,810 
EB-5 Development Notes$49,127 $50,277 
9


Recently Issued Accounting Standards
Standards Being Evaluated
In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The ASU provides optional transition guidance, for a limited time, to companies that have contracts, hedging relationships or other transactions that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate which is expected to be discontinued because of reference rate reform. The amendments provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions if certain criteria are met. The amendments in this update are effective as of March 12, 2020 through December 31, 2022. The amendments in this update may be applied as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020, up to the date that the financial statements are available to be issued. All other amendments should be applied on a prospective basis. The Company is in the process of evaluating the effect that the adoption of this standard will have on its Consolidated Condensed Financial Statements.

In August 2020, the FASB issued ASU 2020-06, “Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” which simplifies the guidance in Accounting Standards Codifications (“ASC”) 470-20, “Debt – Debt with Conversion and Other Options” by reducing the number of accounting separation models for convertible instruments, amending the guidance in ASC 815-40, “Derivatives and Hedging – Contracts in Entity’s Own Equity” for certain contracts in an entity’s own equity that are currently accounted for as derivatives, and requiring entities to use the if-converted method for all convertible instruments in the diluted earnings per share (“EPS”) calculation. This standard will be effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years (the Company’s first quarter of the fiscal year ending July 31, 2023). Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years (the Company’s first quarter of the fiscal year ending July 31, 2022), and the guidance allows for a modified retrospective or fully retrospective method of transition. The Company is in the process of evaluating the effect that the adoption of this standard will have on its Consolidated Condensed Financial Statements, including the method of transition and timing of adoption.

3.     Revenues
2020/2021 North American Credit Offer and Epic Coverage
As a result of the COVID-19 pandemic, the Company closed its North American destination mountain resorts, regional ski areas and retail stores early during the 2019/2020 North American ski season, beginning on March 15, 2020. Subsequently, the Company announced a credit offer for all existing 2019/2020 North American ski season pass product holders to purchase 2020/2021 North American ski season pass products at a discount (the “Credit Offer”). The Credit Offer discounts ranged from a minimum of 20% to a maximum of 80% for season pass holders, depending on the number of days the pass holder used their pass product during the 2019/2020 season and a credit, with no minimum, but up to 80% for multi-day pass products, such as the Epic Day Pass, based on total unused days. The Credit Offer was considered a contract modification which constituted a material right to 2019/2020 North American ski season guests and, as such, represents a separate performance obligation to which the Company allocated a transaction price of approximately $120.9 million. As a result, the Company deferred $120.9 million of pass product revenue, which would have otherwise been recognized as lift revenue during the year ended July 31, 2020. The Credit Offer expired on September 17, 2020 and at that time, the Company estimated the amount of Credit Offer discounts redeemed would be approximately $15.4 million less than the $120.9 million of deferred pass product revenue. As a result, the Company recognized $15.4 million as lift revenue during the three months ended October 31, 2020. The remaining deferred revenue associated with the Credit Offer is being recognized as lift revenue as the performance obligations are satisfied, which the Company expects will be largely completed by the end of the third quarter of the fiscal year ending July 31, 2021. In the event that a pass product holder obtains a refund under Epic Coverage (as discussed below) for the 2020/2021 North American ski season and is eligible to utilize their credit toward the purchase of a pass product for the 2021/2022 North American ski season, this remaining deferred revenue will be recognized in the fiscal year ending July 31, 2022.
10


In April 2020, the Company announced Epic Coverage, which is included with the purchase of all 2020/2021 North American pass products for no additional charge. Epic Coverage offers refunds to 2020/2021 North American pass product holders if certain qualifying personal or resort closure events occurred before or occur during the 2020/2021 North American ski season, or if pass product holders were unable to make reservations on their preferred days by December 7, 2020. The estimated amount of refunds will reduce the amount of pass product revenue recognized during the year ending July 31, 2021. To estimate the amount of refunds under Epic Coverage, the Company considered (i) historical claims data for personal events, (ii) provincial, state, county and local COVID-19 regulations and public health orders, (iii) the ability for the Company’s pass holders to make reservations on their preferred days, and (iv) the Company’s current operating plans for its resorts. The Company believes the estimates of refunds are reasonable; however, actual results could vary materially from such estimates, and such estimates will be remeasured at each reporting date.
Additionally, for the 2020/2021 North American ski season, the Company introduced Epic Mountain Rewards, a program which provides pass product holders a discount of 20% off on-mountain food and beverage, lodging, group ski and ride school lessons, equipment rentals and more at the Company’s North American owned and operated Resorts. Epic Mountain Rewards constitutes a material right to pass product holders and as a result, the Company allocates a portion of the pass product transaction price to these other lines of business.

Disaggregation of Revenues
The following table presents net revenues disaggregated by segment and major revenue type for the three and six months ended January 31, 2021 and 2020 (in thousands):
Three Months Ended January 31,Six Months Ended January 31,
 2021202020212020
Mountain net revenue:
Lift$430,775 $484,348 $463,866 $526,177 
Ski School56,390 102,743 58,434 111,277 
Dining31,810 75,719 34,878 97,348 
Retail/Rental90,126 133,713 112,432 181,628 
Other32,354 49,022 66,559 109,947 
Total Mountain net revenue$641,455 $845,545 $736,169 $1,026,377 
Lodging net revenue:
     Owned hotel rooms$6,708 $11,251 $14,073 $31,197 
Managed condominium rooms
20,336 31,500 29,665 46,240 
Dining
2,865 11,111 3,958 29,254 
Transportation
2,947 7,725 2,947 10,076 
Golf
  8,562 10,543 
Other
8,000 13,855 17,266 27,699 
40,856 75,442 76,471 155,009 
Payroll cost reimbursements
2,018 3,445 3,221 6,636 
Total Lodging net revenue $42,874 $78,887 $79,692 $161,645 
Total Resort net revenue$684,329 $924,432 $815,861 $1,188,022 
Total Real Estate net revenue315 206 569 4,386 
Total net revenue$684,644 $924,638 $816,430 $1,192,408 

Contract Balances
Deferred revenue balances of a short-term nature were $480.4 million and $256.4 million as of January 31, 2021 and July 31, 2020, respectively. Deferred revenue balances of a long-term nature, comprised primarily of long-term private club initiation fee revenue, were $120.9 million and $121.9 million as of January 31, 2021 and July 31, 2020, respectively. For the three and six months ended January 31, 2021, the Company recognized approximately $100.3 million and $136.1 million, respectively, of revenue that was included in the deferred revenue balance as of July 31, 2020. As of January 31, 2021, the weighted average remaining period over which revenue for unsatisfied performance obligations on long-term private club contracts will be recognized was approximately 16 years. Trade receivables, net were $117.0 million and $106.7 million as of January 31, 2021 and July 31, 2020, respectively.
11



Costs to Obtain Contracts with Customers
As of January 31, 2021, $8.6 million of costs to obtain contracts with customers were recorded within other current assets on the Company’s Consolidated Condensed Balance Sheet. The amounts capitalized are subject to amortization commensurate with the revenue recognized for related skier visits. The Company recorded amortization of $7.4 million and $7.8 million, respectively, for these costs during the three and six months ended January 31, 2021, which was recorded within Mountain and Lodging operating expenses on the Company’s Consolidated Condensed Statement of Operations.

4.    Net Income (Loss) per Share
Earnings per Share
Basic EPS excludes dilution and is computed by dividing net income (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 January 31, 2021 and 2020 (in thousands, except per share amounts):
 Three Months Ended January 31,
 20212020
 BasicDilutedBasicDiluted
Net income per share:
Net income attributable to Vail Resorts$147,798 $147,798 $206,370 $206,370 
Weighted-average Vail Shares outstanding40,253 40,253 40,261 40,261 
Weighted-average Exchangeco Shares outstanding35 35 55 55 
Total Weighted-average shares outstanding40,288 40,288 40,316 40,316 
Effect of dilutive securities— 521 — 625 
Total shares40,288 40,809 40,316 40,941 
Net income per share attributable to Vail Resorts$3.67 $3.62 $5.12 $5.04 

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 5,000 and 28,000 for the three months ended January 31, 2021 and 2020, respectively.

12


Presented below is basic and diluted EPS for the six months ended January 31, 2021 and 2020 (in thousands, except per share amounts):
 Six Months Ended January 31,
 20212020
 BasicDilutedBasicDiluted
Net (loss) income per share:
Net (loss) income attributable to Vail Resorts$(5,968)$(5,968)$99,895 $99,895 
Weighted-average Vail Shares outstanding40,233 40,233 40,274