Ex-officer assesses American Skiing woes

PORTLAND – A former executive of American Skiing Co. blamed the company’s downfall on a flawed business model and an overreliance on real estate revenue.

Chris Howard, an executive vice president from 1996 to 2001, said Tuesday the company paid too much for ski resorts, spent too much on corporate overhead and relied too heavily on real estate sales at its resorts.

Public financing, he said, was the wrong way to finance a company so heavily influenced by weather, seasonal use and the fluctuations of vacation home markets.

“It was a flawed model from the get-go,” Howard said.

Howard, now a partner at Pierce Atwood law firm in Portland, made his remarks at a meeting of the Maine chapter of the Turnaround Management Association of New England, whose members work with financially troubled companies.

American Skiing grew out of a single ski resort, Sunday River in Newry. To raise money from potential investors for an initial public stock offering in 1997, company officials showed high-action ski video footage in 15 states and seven countries.

When the company went public, it had a stock price of $18 per share. On Tuesday, shares were selling for 13 cents.

The company last year moved its headquarters from Newry to Park City, Utah. It owns seven ski resorts in Maine, New Hampshire, Vermont, Utah and Colorado.

Howard said American Skiing’s revenues grew steadily, but couldn’t stay ahead of operating expenses and the heavy debt load brought on by excessive borrowing. The company continually found it itself in need of more money, he said.

“I spent 90 percent of my time on the road hunting for capital to feed the beast,” Howard said.