10.

Segment Information

The Company has three reportable segments: Mountain, Lodging and Real Estate. The Mountain segment includes the operations of the Company's ski resorts and related ancillary services. The Lodging segment includes the operations of all of the Company's owned hotels, RockResorts, GTLC, condominium management, CME and golf operations. The Real Estate segment owns and develops real estate in and around the Company's resort communities. The Company's reportable segments, although integral to the success of the others, offer distinctly different products and services and require different types of management focus. As such, these segments are managed separately.

The Company reports its segment results using Reported EBITDA (defined as segment net revenue less segment operating expenses, plus or minus segment equity investment income or loss and for the Real Estate segment plus gain on sale of real property), which is a non-GAAP financial measure. The Company reports segment results in a manner consistent with management's internal reporting of operating results to the chief operating decision maker (Chief Executive Officer) for purposes of evaluating segment performance.

Reported EBITDA is not a measure of financial performance under GAAP. Items excluded from Reported EBITDA are significant components in understanding and assessing financial performance. Reported EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, net change in cash and cash equivalents or other financial statement data presented in the Consolidated Condensed Financial Statements as indicators of financial performance or liquidity. Because Reported EBITDA is not a measurement determined in accordance with GAAP and thus is susceptible to varying calculations, Reported EBITDA as presented may not be comparable to other similarly titled measures of other companies.

The Company utilizes Reported EBITDA in evaluating performance of the Company and in allocating resources to its segments. Mountain Reported EBITDA consists of Mountain net revenue less Mountain operating expense plus or minus Mountain equity investment income or loss. Lodging Reported EBITDA consists of Lodging net revenue less Lodging operating expense. Real Estate Reported EBITDA consists of Real Estate net revenue less Real Estate operating expense plus gain on sale of real property. All segment expenses include an allocation of corporate administrative expense. Assets are not allocated between segments, or used to evaluate performance, except as shown in the table below.

Following is key financial information by reportable segment which is used by management in evaluating performance and allocating resources (in thousands):


	Three Months Ended April 30,						Nine Months Ended April 30,
	2011			2010			2011			2010
Net revenue:
Lift tickets	$	187,341		$	159,772		$	342,514		$	289,289
Ski school		46,522			40,625			83,818			70,694
Dining		31,733			25,837			62,244			49,094
Retail/rental		59,364			55,107			155,737			137,671
Other		26,458			20,872			66,161			55,647

Total Mountain net revenue		351,418			302,213			710,474			602,395
Lodging		49,835			44,877			138,933			124,908

Total Resort net revenue		401,253			347,090			849,407			727,303
Real Estate		13,221			3,164			187,629			4,239

Total net revenue	$	414,474		$	350,254		$	1,037,036		$	731,542

Operating expense:
Mountain	$	182,136		$	156,454		$	456,496		$	386,940
Lodging		41,001			39,292			127,675			119,703

Total Resort operating expense		223,137			195,746			584,171			506,643
Real estate		18,309			8,391			188,716			20,985

Total segment operating expense	$	241,446		$	204,137		$	772,887		$	527,628

Gain on sale of real property	$	—		$	—		$	—		$	6,087
Mountain equity investment income, net	$	406		$	838		$	1,324		$	1,299

Reported EBITDA:
Mountain	$	169,688		$	146,597		$	255,302		$	216,754
Lodging		8,834			5,585			11,258			5,205

Resort		178,522			152,182			266,560			221,959
Real Estate		(5,088	)		(5,227	)		(1,087	)		(10,659	)

Total Reported EBITDA	$	173,434		$	146,955		$	265,473		$	211,300

Real estate held for sale and investment	$	282,162		$	445,885		$	282,162		$	445,885

Reconciliation to net income attributable to Vail Resorts, Inc:
Total Reported EBITDA	$	173,434		$	146,955		$	265,473		$	211,300
Depreciation and amortization		(30,937	)		(27,812	)		(88,945	)		(82,768	)
(Loss) gain on disposal of fixed assets, net		(35	)		18			(343	)		(83	)
Asset impairment charge		(2,561	)		—			(2,561	)		—
Investment income		114			141			578			563
Interest expense, net		(8,515	)		(3,673	)		(25,110	)		(12,656	)
Loss on extinguishment of debt		(6,615	)		—			(6,615	)		—

Income before provision for income taxes		124,885			115,629			142,477			116,356
Provision for income taxes		(48,045	)		(39,238	)		(54,140	)		(38,397	)

Net income	$	76,840		$	76,391		$	88,337		$	77,959
Net loss (income) attributable to noncontrolling interests		27			(3,602	)		58			(5,653	)

Net income attributable to Vail Resorts, Inc.	$	76,867		$	72,789		$	88,395		$	72,306