By ROBERT WELLER
Associated Press Writer
DENVER (AP) - Vail Resorts Inc. announced Tuesday that it has eliminated its position of president as the ski resort operator looks to cut costs amid a weak business climate.
Andy Daly's departure takes effect at the end of the month and he will not be replaced, the company said in a statement.
Daly declined to comment. A cost-cutting review is under way across Vail Resorts, which is based in Avon, Colo.
"If sacrifice is required for Vail Resorts to prosper, then that sacrifice will take place fairly up and down the line, including at the highest levels of the company," the company said in a statement.
Although the ski industry recorded a small drop in skier numbers after last year's terrorist attacks, the continuing economic decline and potential for travel disruptions have several companies on edge.
In a company e-mail obtained by The Associated Press, Vail chief executive Adam Aron wrote to employees, "I want to stress that Andy's separation from Vail Resorts is not for performance reasons, but rather because we feel our company will operate better if it does so with a lower cost structure, and to the extent possible, with fewer layers of management.
"Indeed, Andy has served with distinction."
Analyst Stacy Forbes with Janco Partners of Denver applauded the cost-cutting.
"I think they are doing what is prudent right now. They have been very conscious of cost-cutting and cost management over the past season. Now it is hitting the higher echelons. It was bound to happen, given that the economy has been weak for a prolonged period," Forbes said.
In September, Vail announced a hiring freeze and told 400 managers they would not receive bonuses. The company has 3,100 full-time employees and 15,500 seasonal workers.
Bottom line: Insiders say there'll be more layoffs next week. Vail's stock ticked upward slightly on Wednesday morning, to 13.80 -- it's been as high as $21 this year. The company isn't doing badly, with 12-month inclome of $28.7 million on sales of $613 million, based on an expanding portfolio of hotels. EBIDTA for the past 12 months is $133.7 million, and total net income is $18.7 million -- up over the past two years, but down sharply from $41 million in '98. --S.M.
Vail, Colo. - Andrew P. Daly will be leaving his position as president of Vail Resorts at the end of this month. His departure is part of Vail's cost-cutting efforts in response to a difficult destination travel market. Vail cited a sluggish economy and concern over the possibility of war with Iraq as reasons for its belt-tightening measures.
In a statement, Vail said the company "must evaluate every position to ensure that every employee is in a necessary role to contribute to the company's ultimate success." The statement continued, "If sacrifice is required for Vail Resorts to prosper, then that sacrifice will take place fairly up and down the line, including at the highest levels of the company."
"I know that I speak for all of us at Vail Resorts that we extend our sincerest appreciation to Andy for his long-standing service to our company," said Vail CEO Adam Aron. Daly had been president of Vail Resorts and Vail Associates since 1992.
"It's a great opportunity for me to make a change in my life," Daly told SAM. "Some people have treated this as a funeral, and it really isn't."
"I've had a wonderful career with Vail Resorts," he continued. "Unfortunately, the business isn't growing as fast as we had anticipated and staffed for. If the business isn't there, you have to respond, and that's especially true for a public company.
"Now, the people I've hired will have the opportunity to grow and develop on their own.
"The biggest choice I'm going to have to make is whether I stay in the ski business or not. It might be an exciting time to try ssomething else," Daly said. He admitted that it would not be easy for him to completely separate from the snowsports industry regardless. "I'll have my fingers in it one way or another because it's been such a big part of my life," he added.
Daly has no immediate professional plans. "My only commitment right now is to myself, to not look at anything for the next 60 to 90 days, and to do some fun things I haven't had time to do for a long time," he said--including skiing.
Vail press release
VAIL, Colo. -- Vail Resorts issued the following announcement today.
Andrew P. Daly will be leaving his position as president of Vail Resorts at the end of this month. The Company stated that, given the difficult external climate in the entire U.S. travel industry and the U.S. economy, as well as the prospects of war and terrorism, the Company must evaluate every position to ensure that every employee is in a necessary role to contribute to the Company's ultimate success. The times require the Company to streamline its cost structure, wherever it logically can, and operate as leanly as possible -- of course, still continuing to take great care of our guests and living up to the world-class reputations of our resorts.
The Company also noted it believes that the effort to operate cost-effectively is taking place throughout the organization, and if sacrifice is required for Vail Resorts to prosper, then that sacrifice will take place fairly up and down the line, including at the highest levels of the company.
"I know that I speak for all of us at Vail Resorts that we extend our sincerest appreciation to Andy for his long-standing service to our company. Andy has served with distinction as president of Vail Resorts and Vail Associates since 1992. He has made many contributions to our company, and has received industry accolades, including being named chairman of Colorado Ski Country USA and inducted into the Colorado Ski Hall of Fame. As important, we wish him well as he begins a new chapter in his professional career," said Adam Aron, chairman and chief executive officer of Vail Resorts.
Vail Resorts, Inc. is the leading mountain resort operator in the United States. The Company's subsidiaries operate the mountain resorts of Vail, Beaver Creek, Breckenridge and Keystone in Colorado, Heavenly in California and Nevada, and the Grand Teton Lodge Company in Jackson Hole, Wyo. The Company's subsidiary RockResorts, a luxury resort hotel company, operates 10 distinctive properties across the United States. Vail Resorts Development Company is the real estate planning, development, construction, retail leasing and management subsidiary of Vail Resorts, Inc. Vail Resorts is a publicly held company traded on the New York Stock Exchange. The Vail Resorts company website is www.vailresorts.com and consumer website is www.snow.com.