Skiers in the western U.S. are enjoying one of the best seasons in years. But experts warn that years like this are quickly becoming the exception, not the rule.
Snow sport seasons are getting shorter, due to warmer temperatures. That is already having a distinguishable financial impact on residential and resort properties that profit from snow.
Vail Resorts, the largest player in the U.S. ski field, reported better-than-expected quarterly earnings in its latest report but had to lower its full-year guidance because of a weak start to the season. The company's CEO, Robert Katz, attributed that "to guest concerns after two prior years of poor pre-holiday conditions."
The amount of snow in the west has seen an average drop of 41 percent since the early 1980s, according to research just published in the journal Geophysical Research Letters. As a result, the snow season shrunk by 34 days.
Snow sports tourism contributes about $20 billion to the U.S. economy each year, according to researchers at the University of New Hampshire and Colorado State University. The bulk of that spending is at ski resorts, like Colorado-based Vail Resorts.
"We do hear from shareholders quite a bit about this weather variability," said Katz. "If I'm going to invest in Vail Resorts, how do I know that you can consistently drive results, even though you are subject to the weather, the snowfall, the temperatures? And we have, over the last 10 years, really made a point of showcasing to our investors that we are not only doing the right thing for the environment, but we are also changing our business model."
Vail resorts operates 15 mountain resorts across the U.S. Canada and Australia. It also owns luxury hotels and a real estate development company. Katz's answer to the climate threat against his company is to fight it from the ground up. Lead by example and at the same time protect the business.