Comments from the CEO

Best year ever - Great hopes for coming winter season

Annual report 2017/18

With the 2017/18 financial year behind us, I am proud to be able to present yet another record year for SkiStar!

We are exhibiting growth in most of our branchesof activity. Valle’s Winter Weeks in January, holidayperiods, SkiStar Business conference activitie and SkiStarshop all made solid contributions to the higher earnings. Our offering is strong!

All our destinations had fantastic seasons, with cold weather and snow from mid-December until mid-April. This enabled us to offer good skiing from start to finish, which is reflected in the number of guests at the ski areas. The number of skier days (one day’s skiing with a SkiPass) totalled 5.8 million, an increase of about 404,000 days. The number of booked overnight stays (through SkiStar’s accommodation agency operations) was 517,000, an increase of 2.5 percent on the previous year.

Profit after tax increased by SEK 99 million to SEK 486 million during the financial year, allowing us greater scope to focus on and invest in SkiStar’s continued development.

Our operations include land and property exploitation. We own more than 5.4 million square metres of land for development, much of it in excellent locations. The development of land assets is happening at such a rate that we are endeavouring to maintain a good balance in relation to other operations and infrastructure at each destination. We develop and sell plots for the construction of private holiday homes, we build and sell tenant-owner apartments, we sell weekly units via our Vacation Club holiday concept and we also produce commercial accommodation. Our exploitation operations and sales of shares in Vacation Club this year have made an earnings contribution of SEK 146 million. We are not seeing any decline in interest in our development projects and we expect resulting capital gains to rise in the next financial year.

We continue to concentrate our sales on skistar.com. Bookings for the 2018/19 winter season are 5 percent higher than at the same time the previous year. Just over 50 percent of the total capacity expected to be sold in the full winter season is already booked. The highest level of growth in the foreign markets is coming from the UK and Denmark. It is also pleasing to see that SkiStar’s apps are used by about 80 percent of our guests, and that engagement in SkiStar’s MySkiStar customer club continues to increase. The number of registered members now exceeds 780,000.

Construction of the Scandinavian Mountains Airport, located between Sälen and Trysil, is continuing according to plan. The airport is expected to have a major impact on business and industry in the region and is important to our investment in Hundfjället, where we are planning a new SkiStar Lodge and opening an eight-seater express chair lift this winter.

We are also title sponsor for the ne World Ski Championships 2019 in Åre in February 2019. Presenting our destination and our skistar.com platform to up to 700 million TV viewers is consistent with our strategy of attracting more foreign guests to our destinations.

This year’s report on operations includes a full sustainability report, which aims to create transparency and clarify how we intend to pursue operations with a long-term, sustainable approach. This is something of which we are also very proud. See you on the slopes this winter!

Mats Årjes

CEO

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