Fresh off a strong quarter that saw revenue climb 28 percent and net income spike 80 percent, Vail Resorts Inc. (NYSE: MTN) plans to reinvest those funds in more than just increased snowmaking, faster chairlifts, and new guest digs for the 2021/22 ski season.
It will also pad the paychecks of the people who make the company’s operations run smoothly.
The world’s largest ski resort operator this week said it will increase wages for many of its workers, including a $15 minimum wage at several resorts such as Vail Mountain, Breckenridge Ski Resort, and Park City Mountain.
“Talent and staffing is critical to our ongoing success,” said Lynanne Kunkel, chief human resources officer. “We are thrilled that, coming out of the uncertainty of last winter season, we are in a position to make such a substantial investment in our employees.”
Vail said its hourly minimum wage will increase to $15 per hour, effective for the 2021/22 winter season, at 10 resorts across Colorado, California, Utah, and Washington. The company also plans to increase the minimum entry wage an average of 37 percent across its Eastern resorts. This includes raising the minimum wage to $15 per hour at destination resorts in New York and Vermont—Hunter, Stowe, Okemo, and Mt. Snow—in line with the rates set for U.S. resorts in the Rockies and the West.
The company said it will adjust earnings for hourly employees who earn just above minimum wage to account for the raise across its properties. Moreover, Vail is adding sick time off benefits for seasonal full-time employees who are not already eligible, giving them the same perks as year-round full-time employees.
Vail’s pockets are plenty deep to handle the wage and benefit increase. In June, the company said it had “$1.3 billion of cash on hand as of April 30 and $621 million of availability under our U.S. and Whistler Blackcomb revolving credit facilities.”
During its fiscal third quarter ended April 30, Vail reported sales of $889.1 million, a 28.1 percent jump from the same quarter a year ago, and net income of $274.6 million, up 80 percent.
The company benefited, of course, from an especially favorable comp since ski resorts were forced to shut down during 2020 fiscal Q3 amid the onset of Covid. But a profitable quarter this year—one that improved with each month of the period—padded the company’s fortunes.
“Results continued to improve as the season progressed, primarily as a result of stronger destination visitation at our Colorado and Utah resorts, including improved lift ticket purchases relative to fiscal 2021 second-quarter results,” CEO Rob Katz said on Vail’s most recent earnings call.
This move comes as many U.S. businesses are struggling to fill positions, especially at the entry level, due to several factors that include what many argue is an unwillingness on employers’ part to provide competitive wages.
With a surge in skier visits expected again at its resorts, plus continued financial strength on the horizon, it appears Vail wasn’t willing to risk being short-staffed when its lifts start spinning again.