Research Update: Vail Resorts Inc. Ratings Placed On CreditWatch Negative On Reduced Winter Consumer Travel Expectations, Notes Issuance

Consumer concerns related to COVID-19, potential additional restrictions on travel and indoor activities, and limited ski resort capacity will likely impair Vail Resorts Inc.'s revenue in fiscal 2021 (ending July). Therefore, S&P Global Ratings has lowered its base-case revenue and EBITDA assumptions for Vail. Additionally, Vail plans to issue $500 million in unrated convertible senior unsecured notes due 2026 to enhance liquidity amid the ongoing pandemic. We believe the negative effects of the pandemic will be mostly limited to the 2020/2021 ski season. Specifically, we anticipate its visitation and ancillary spending could normalize by the 2021/2022 ski season if an effective vaccine is widely disseminated by mid-2021. Our recovery rating on the company's existing $600 million senior unsecured notes due

...- Consumer concerns related to COVID-19, potential additional restrictions on travel and indoor activities, and limited ski resort capacity will likely impair Vail Resorts Inc.'s revenue in fiscal 2021 (ending July). Therefore, S&P Global Ratings has lowered its base-case revenue and EBITDA assumptions for Vail. Additionally, Vail plans to issue $500 million in unrated convertible senior unsecured notes due 2026 to enhance liquidity amid the ongoing pandemic. - We believe the negative effects of the pandemic will be mostly limited to the 2020/2021 ski season. Specifically, we anticipate its visitation and ancillary spending could normalize by the 2021/2022 ski season if an effective vaccine is widely disseminated by mid-2021. - Our recovery rating on the company's existing $600 million senior unsecured notes due 2025 is unchanged; we believe the absence of subsidiary guarantees for noteholders under the terms of the proposed notes offering provides enough structural protection to existing...

Research Update