===============================================================================

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                             ----------------------

                                   FORM 10-Q

 (Mark One)
    [X]         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                For the quarterly period ended May 2, 2003

                                       OR

    [ ]         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                       Commission File Number: 333-26091

                         BOOTH CREEK SKI HOLDINGS, INC.
             (Exact name of registrant as specified in its charter)

                   Delaware                         84-1359604
         (State or Other Jurisdiction            (I.R.S. Employer
       of Incorporation or Organization)      Identification Number)

       1000 South Frontage Road West,                  81657
                  Suite 100                         (Zip Code)
               Vail, Colorado
       (Address of Principal Executive
                   Offices)

                                 (970) 476-1311
              (Registrant's Telephone Number, Including Area Code)


     Indicate by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange Act of
1934  during the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports), and (2) has been subject to such
filing  requirements  for the past 90 days.  Yes[X] No[ ]

     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes [ ] No [X]


     As of  May 31,  2003,  the  number  of  shares  outstanding  of  the
registrant's  Common  Stock,  par  value  $.01 per  share,  was  1,000  shares.

===============================================================================


<PAGE>


                              TABLE OF CONTENTS



Item                                                                Page Number
----                                                                -----------
                       PART I - FINANCIAL INFORMATION

 1.  Financial Statements..............................................    1

 2.  Management's Discussion and Analysis of Financial Condition
     and Results of Operations.........................................   12

 3.  Quantitative and Qualitative Disclosures about Market Risk........   28

 4.  Controls and Procedures...........................................   28

                         PART II - OTHER INFORMATION

 1.  Legal Proceedings.................................................   29

 3.  Defaults Upon Senior Securities...................................   30

 6.  Exhibits and Reports on Form 8-K..................................   30

     Signatures........................................................   31

     Certifications....................................................   32

<PAGE>



                          PART I. FINANCIAL INFORMATION

                          ITEM 1. FINANCIAL STATEMENTS

                         BOOTH CREEK SKI HOLDINGS, INC.

                           CONSOLIDATED BALANCE SHEETS
               (In thousands, except share and per share amounts)

                                           May 2,      November 1,     May 3,
                                            2003          2002          2002
                                        ------------  -----------   ------------
                  ASSETS                 (Unaudited)                 (Unaudited)

Current assets:
 Cash and cash equivalents..............  $     915    $     664     $    7,227
 Accounts receivable, net of allowance
  of $68, $44 and $71, respectively.....      1,614        1,964          1,800
 Insurance proceeds receivable..........        800          800            800
 Inventories ...........................      1,580        2,298          1,793
 Prepaid expenses and other current
  assets ...............................      1,181        1,425          1,252
                                        ------------  -----------   ------------
Total current assets ...................      6,090        7,151         12,872

Property and equipment, net ............    115,519      119,337        135,871
Real estate held for development
 and sale ..............................      7,349        6,966          6,694
Deferred financing costs, net of
 accumulated amortization of $4,658,
 $4,609 and $3,993, respectively .......      3,164        4,137          4,701
Timber rights and other assets .........      5,921        6,071          6,057
Goodwill................................     22,938       22,938         22,938
                                        ------------  -----------   ------------
Total assets ...........................  $ 160,981    $ 166,600     $  189,133
                                        ============  ===========   ============

   LIABILITIES AND SHAREHOLDER'S EQUITY

Current liabilities:
 Revolving credit facility .............  $   6,850    $   1,245     $        -
 Current portion of long-term debt .....      5,310        5,717          3,561
 Accounts payable and accrued
  liabilities ..........................     25,067       36,124         25,318
                                        ------------  -----------   ------------
Total current liabilities ..............     37,227       43,086         28,879

Long-term debt .........................    101,332      120,195        121,986

Other long-term liabilities ............        756          756            767

Commitments and contingencies

Shareholder's equity:
 Common stock, $.01 par value; 1,000
  shares authorized, issued and
  outstanding ..........................          -            -              -
 Additional paid-in capital ............     72,000       72,000         72,000
 Accumulated deficit ...................    (50,334)     (69,437)       (34,499)
                                        ------------  -----------   ------------
Total shareholder's equity .............     21,666        2,563         37,501
                                        ------------  -----------   ------------
Total liabilities and shareholder's
 equity ................................  $ 160,981    $ 166,600     $  189,133
                                        ============  ===========   ============

                            See accompanying notes.
                                       1

<PAGE>



                         BOOTH CREEK SKI HOLDINGS, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (In thousands)


                                Three Months Ended          Six Months Ended
                               ---------------------      ---------------------
                                 May 2,      May 3,         May 2,     May 3,
                                  2003        2002           2003       2002
                               ---------   ---------      ---------   ---------
                                                  (Unaudited)
Revenue:
  Resort operations..........  $  50,431   $  51,903       $ 96,946    $101,260
  Real estate and other
   (including revenues with
   related parties of $646
   for the three and six
   months ended May 2, 2003,
   and $5,600 and $8,900 for
   the three and six months
   ended May 3, 2002,
   respectively).............        646       5,615            662       8,915
                               ---------   ---------      ---------   ---------
Total revenue................     51,077      57,518         97,608     110,175

Operating expenses:
  Cost of sales - resort
   operations................     24,598      24,502         50,694      50,020
  Cost of sales - real estate
   and other.................        197       1,502            218       2,173
  Depreciation and depletion.      3,904       4,296          7,734       8,567
  Selling, general and
   administrative expense....      6,559       6,077         13,368      13,602
                               ---------   ---------      ---------   ---------
Total operating expenses.....     35,258      36,377         72,014      74,362
                               ---------   ---------      ---------   ---------

Operating income.............     15,819      21,141         25,594      35,813


Other income (expense):
  Interest expense...........     (3,089)     (3,812)        (6,460)     (8,073)
  Amortization of deferred
   financing costs...........       (281)       (271)          (563)       (510)
  Gain on early retirement
   of debt...................          -       2,761            506       2,761
  Minority interest..........          -           -              -         (15)
  Other income...............         23          28             26          42
                               ---------   ---------      ---------   ---------
  Other income
  (expense),net..............     (3,347)     (1,294)        (6,491)     (5,795)
                               ---------   ---------      ---------   ---------

Income from continuing
  operations before change
  in accounting principle....     12,472      19,847         19,103      30,018

Discontinued operations:
  Income from discontinued
   operations of Bear
   Mountain resort...........          -       1,712              -       3,250
                               ---------   ---------      ---------   ---------

Income before change in
  accounting principle.......     12,472      21,559         19,103      33,268

Change in accounting
  principle for goodwill.....          -           -              -        (200)
                               ---------   ---------      ---------   ---------
Net income...................  $  12,472   $  21,559      $  19,103   $  33,068
                               =========   =========      =========   =========

                            See accompanying notes.
                                        2


<PAGE>


                         BOOTH CREEK SKI HOLDINGS, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)


                                                        Six Months Ended
                                                -------------------------------
                                                   May 2,              May 3,
                                                    2003                2002
                                                -------------     -------------
                                                          (Unaudited)

Cash flows from operating activities:
Net income.....................................   $  19,103         $   33,068
Adjustments to reconcile net income to
  net cash provided by operating activities:
   Depreciation and depletion..................       7,734              9,422
   Noncash cost of real estate sales ..........         190              2,129
   Amortization of deferred financing costs ...         563                510
   Gain on early retirement of debt............        (506)            (2,761)
   Minority interest ..........................           -                 15
   Change in accounting principle for goodwill.           -                200
   Changes in operating assets and liabilities:
    Accounts receivable .......................         350                137
    Insurance proceeds receivable..............           -                700
    Inventories ...............................         718                693
    Prepaid expenses and other current assets..         244                364
    Accounts payable and accrued liabilities...     (11,057)            (9,524)
                                                 -------------     -------------
Net cash provided by operating activities......      17,339             34,953

Cash flows from investing activities:
Capital expenditures for property and
 equipment ....................................      (3,227)            (4,302)
Capital expenditures for real estate
 held for development and sale ................        (573)              (603)
Other assets ..................................         143                372
                                                -------------     -------------
Net cash used in investing activities .........      (3,657)            (4,533)

Cash flows from financing activities:
Borrowings under revolving credit facility ....      36,905              8,115
Repayments under revolving credit facility ...      (31,300)           (25,743)
Proceeds of long-term debt.....................           -             25,000
Principal payments of long-term debt ..........     (19,032)           (27,872)
Deferred financing costs ......................          (4)            (2,000)
Purchase of preferred stock of subsidiary
 and payment of dividends .....................           -             (1,151)
                                                -------------     -------------
Net cash used in financing activities .........     (13,431)           (23,651)
                                                -------------     -------------
Increase in cash and cash equivalents..........         251              6,769

Cash and cash equivalents
  at beginning of period ......................         664                458
                                                -------------     -------------
Cash and cash equivalents
  at end of period ............................ $       915        $     7,227
                                                =============     =============

                            See accompanying notes.

                                        3


<PAGE>



                         BOOTH CREEK SKI HOLDINGS, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   May 2, 2003


1.   Organization,  Basis of Presentation  and Summary of Significant Accounting
Policies

     Booth Creek Ski Holdings,  Inc.  ("Booth Creek") owns and operates  various
ski  resorts,  including   Northstar-at-Tahoe   ("Northstar"),   Sierra-at-Tahoe
("Sierra"),  Waterville  Valley,  Mt. Cranmore,  Loon Mountain and the Summit at
Snoqualmie  (the  "Summit").  Booth  Creek also  conducts  certain  real  estate
development activities, primarily at Northstar.

     Booth Creek sold the Bear Mountain ski resort ("Bear  Mountain") on October
10,  2002.  The  operating  results  of Bear  Mountain  have been  reflected  as
discontinued  operations in the  accompanying  statements of operations  for the
three and six month periods  ended May 3, 2002.  Summary  operating  results for
Bear  Mountain  for the three and six  month  periods  ended May 3, 2002 were as
follows:

                                               Three Months        Six Months
                                                  Ended               Ended
                                                  May 3,              May 3,
                                                  2002                2002
                                              -------------     -------------
                                                     (In thousands)

     Total revenue......................      $      6,021      $      13,508
     Total expenses.....................            (4,309)           (10,258)
                                              -------------     -------------
     Total income from
       discontinued operations..........      $      1,712      $       3,250
                                              =============     =============

     The consolidated  financial  statements include the accounts of Booth Creek
and its subsidiaries  (collectively referred to as the "Company"),  all of which
are wholly-owned.  All significant  intercompany  transactions and balances have
been eliminated.

     Booth Creek is a wholly-owned subsidiary of Booth Creek Ski Group, Inc.

     The accompanying  consolidated  financial  statements as of May 2, 2003 and
May 3, 2002 and for the three and six month  periods  then ended are  unaudited,
but include all adjustments  (consisting only of normal,  recurring  adjustments
and  adjustments  to recognize the gains on early  retirement of debt during the
six months  ended May 2, 2003 and the three and six month  periods  ended May 3,
2002, and the change in accounting  principle for goodwill during the six months
ended May 3, 2002)  which,  in the opinion of  management  of the  Company,  are
considered necessary for a fair presentation of the Company's financial position
at May 2, 2003 and May 3, 2002, and its operating results and cash flows for the
three and six month periods then ended. Due to the highly seasonal nature of the
Company's  business,  the results for the interim  periods are not indicative of
results  for the entire  year.  Certain  information  and  footnote  disclosures
normally  included in annual  financial  statements  prepared in accordance with
generally accepted accounting principles have been omitted pursuant to generally
accepted  accounting  principles  applicable  for  interim  periods.  Management
believes  that  the  disclosures  made  are  adequate  to make  the  information
presented not misleading. The unaudited consolidated financial statements should
be read in conjunction  with the following notes and the Company's  consolidated
financial  statements and  accompanying  notes included in the Company's  Annual
Report on Form 10-K for the fiscal year ended November 1, 2002.

Cash and Cash Equivalents

     The Company  considers  all highly  liquid  investments  purchased  with an
original maturity of three months or less to be cash  equivalents.  As of May 3,
2002, cash equivalents consisted of money market funds (none at May 2, 2003).

     Included in cash at May 2, 2003 is restricted cash of $250,000, relating to
advance deposits and rental fees due to property owners for lodging and property
rentals.


                                       4
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


Inventories

     Inventories are valued at the lower of cost (first-in, first-out method) or
market. The components of inventories were as follows:

                                         May 2,       November 1,         May 3,
                                         2003            2002             2002
                                     ----------       -----------     ----------
                                                    (In thousands)

         Retail products.......     $      816       $    1,432      $      908
         Supplies..............            516              618             536
         Food and beverage.....            248              248             349
                                     ----------       -----------     ----------
                                    $    1,580       $    2,298      $    1,793
                                     ==========       ===========     ==========

Revenue Recognition

     Revenues  from  resort  operations  are  generated  from a wide  variety of
sources,  including lift ticket sales, snow school lessons,  equipment  rentals,
retail  product  sales,  food and  beverage  operations,  lodging  and  property
management services and other recreational  activities,  and are recognized when
services  are  provided  and  products  are  sold.  Sales of season  passes  are
initially  deferred in unearned revenue and recognized ratably over the expected
ski season.

     Sales  and  profits  on real  estate  sales are  recognized  using the full
accrual method at the point that the Company's  receivables  from land sales are
deemed collectible and the Company has no significant  remaining obligations for
construction or development,  which typically  occurs upon transfer of title. If
such  conditions  are not met, the  recognition  of all or part of the sales and
profit is postponed. The Company thoroughly evaluates the contractual agreements
and underlying facts and circumstances relating to its real estate transactions,
including the  involvement  of related  parties,  to determine  the  appropriate
revenue recognition  treatment of such transactions in accordance with Statement
of Financial Accounting Standards No. 66, "Accounting for Sales of Real Estate,"
and related pronouncements.

Recently Adopted Accounting Pronouncements

     In June 2001, the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of  Financial  Accounting  Standards  No. 143,  "Accounting  for Asset
Retirement  Obligations" ("SFAS No. 143"), which addresses financial  accounting
and  reporting  for  obligations  associated  with the  retirement  of  tangible
long-lived  assets and associated asset retirement costs. The new rules apply to
legal  obligations  associated  with the  retirement of  long-lived  assets that
result from the acquisition, construction, development and (or) normal operation
of a long-lived asset. The Company adopted SFAS No. 143 effective as of November
2, 2002.  The adoption of SFAS No. 143 did not have any impact on the  Company's
consolidated financial position or results of operations.

     In June 2002, the FASB issued Statement of Financial  Accounting  Standards
No. 146,  "Accounting  for Costs  Associated  with Exit or Disposal  Activities"
("SFAS No. 146"), which addresses  financial  accounting and reporting for costs
associated with exit or disposal  activities and nullifies  Emerging Issues Task
Force  ("EITF")  Issue No. 94-3,  "Liability  Recognition  for Certain  Employee
Termination  Benefits  and Other  Costs to Exit an Activity  (including  Certain
Costs Incurred in a Restructuring)."  SFAS No. 146 requires that a liability for
a cost that is associated  with an exit or disposal  activity be recognized when
the  liability  is incurred,  whereas EITF Issue No. 94-3  required an entity to
recognize  a  liability  for an exit cost on the date that the entity  committed
itself  to an exit  plan.  SFAS  No.  146 is  effective  for  exit  or  disposal
activities  initiated  after December 31, 2002. The adoption of SFAS No. 146 did
not have a material impact on the Company's  consolidated  financial position or
results of operations.


                                       5
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


Use of Estimates

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that affect the amounts  reported in the financial  statements  and
accompanying notes. Actual results could differ from those estimates.

2.   Paid Skier Visit Insurance Program

     For the 2000/01 ski season,  the Company  arranged for four  separate  paid
skier visit insurance policies covering Bear Mountain, Loon Mountain, Waterville
Valley and the Summit.  The policies had a  deductible  for the initial  decline
from targeted paid skier visit and revenue  levels and stated  maximum  coverage
levels. In addition,  the policies required the insured to experience monthly or
annual snowfall amounts below certain agreed upon levels before a claim could be
filed for the decline in paid skier visits. For the year ended November 2, 2001,
the  Company  recorded  resort  operations  revenues  of  $1,500,000  for claims
attributable  to lower than agreed upon paid skier  visits and  snowfall  levels
under the Summit and  Waterville  Valley  policies.  The  Company's  claims were
determined  based on a specified  formula  under the paid skier visit  insurance
policies and snowfall  information  verified by an independent  third party. The
Company believes that it fully complied with its obligations under the policies,
and properly reported and made claims in accordance with the policies for losses
aggregating in excess of $1,500,000. As a result of the underwriters' failure to
properly  process the Company's  claims,  in November  2001, the Company filed a
lawsuit against the underwriters seeking recovery for breach of contract, breach
of covenant of good faith and unfair and deceptive business practices.  In April
2002, the underwriters made a partial offer of settlement of $700,000, which the
Company  accepted with a reservation  of all rights and remedies under the terms
of the policies and  applicable  law with respect to its remaining  claims.  The
Company intends to vigorously  pursue  collection of its remaining  claims.  The
parties to the lawsuit are currently  conducting  discovery in the matter, which
is scheduled to be completed by the end of June 2003. The parties have agreed to
pursue  non-binding  mediation in an effort to resolve this matter.  Based on an
evaluation  of  information  to date and the  advice  of  counsel,  the  Company
believes  that  realization  of its  recorded  claims is probable.  However,  no
assurance can be given regarding the timing of the resolution of this matter.

3.   Accounts Payable and Accrued Liabilities

     Accounts payable and accrued liabilities consist of the following:

                                            May 2,     November 1,      May 3,
                                             2003          2002          2002
                                         -----------   -----------   -----------
                                                     (In thousands)

     Accounts payable....................  $   1,733     $   4,552     $   3,022
     Accrued compensation and benefits...      3,242         4,031         4,017
     Taxes other than income ............        499           972           637
     Unearned revenue and deposits-
      resort operations..................      4,712        15,232         3,855
     Unearned deposits from related
      party - real estate operations.....      5,610         5,610         5,610
     Interest............................      1,360         1,647         1,715
     Other...............................      7,911         4,080         6,462
                                         -----------   -----------   -----------
                                           $  25,067     $  36,124     $  25,318
                                         ===========   ===========   ===========

                                       6
<PAGE>


                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


4.   Financing Arrangements

Senior Credit Facility

     Effective March 15, 2002, the Company and its subsidiaries  entered into an
Amended and Restated Credit Agreement (as amended, the "Senior Credit Facility")
with Fleet  National  Bank,  as  administrative  agent  ("Agent"),  and  certain
lenders.  The following is a summary of certain  provisions of the Senior Credit
Facility, as amended to date.

          General - The Senior Credit Facility  provides for a revolving  credit
     facility (the "Revolving Credit  Facility") with borrowing  availability of
     up to  $25,000,000,  and a term loan  facility (the "Term  Facility")  with
     outstanding  borrowings as of May 2, 2003 of $23,000,000.  Borrowings under
     the Senior Credit Facility are collectively referred to herein as "Loans."

          Interest - For purposes of calculating interest,  Loans can be, at the
     election  of the  Company,  base  rate  loans  or  LIBOR  rate  loans  or a
     combination  thereof.  Base rate loans bear  interest at the sum of (a) the
     higher of (i) the Agent's  prime rate or (ii) the  federal  funds rate plus
     .5% plus (b) a margin of 1.5%.  LIBOR rate loans bear interest at the LIBOR
     rate  plus a  margin  of 4%.  Interest  on  Loans  outstanding  is  payable
     quarterly.  The Senior Credit Facility also requires commitment fees of .5%
     based  on  the  unused  borrowing  availability  of  the  Revolving  Credit
     Facility.  Borrowings  outstanding under the Term Facility bore interest at
     an  annual  rate of 5.31% as of May 2,  2003  pursuant  to the  LIBOR  rate
     option.  Borrowings  under the Revolving Credit Facility bore interest at a
     weighted  average  annual  rate of  5.35%  as of May 2,  2003  pursuant  to
     elections under both the base rate and LIBOR rate options.

          Repayment - Subject to the  provisions of the Senior Credit  Facility,
     the Company may, from time to time,  borrow,  repay and reborrow  under the
     Revolving  Credit  Facility.  The Senior Credit Facility  requires that the
     Company not have any borrowings  under the Revolving  Credit Facility for a
     period of 30 consecutive  days (20  consecutive  days for 2003)  commencing
     sometime between January 15 and February 28 of each year. The Term Facility
     provides for quarterly commitment  reductions of $1,000,000 on the last day
     of January,  April,  July and October of each year beginning on January 31,
     2003 and  continuing  through  October 31, 2005,  the maturity  date of the
     Senior  Credit   Facility.   The  Company  is  required  to  repay  amounts
     outstanding under the Term Facility on such dates by an amount equal to the
     greater of (i) the amount by which  outstanding  Term  Facility  borrowings
     exceed the  then-applicable  term loan  commitment and (ii) the Excess Cash
     Proceeds (as defined in the Senior Credit Facility)  derived from specified
     real estate asset sales determined on a cumulative  basis. No amount of the
     Term Facility which is repaid may be reborrowed.  The entire unpaid balance
     under the Senior Credit Facility is due and payable on October 31, 2005.

          Security - Borrowings  under the Senior Credit Facility are secured by
     (a) a  pledge  to the  Agent  for  the  ratable  benefit  of the  financial
     institutions  party to the Senior  Credit  Facility  of all of the  capital
     stock of Booth Creek's principal subsidiaries and (b) a grant of a security
     interest in substantially all of the consolidated assets of Booth Creek and
     its subsidiaries.

          Use of Proceeds - Borrowings  under the Revolving  Credit Facility can
     be used for working capital and other general corporate purposes including,
     with the consent of the lenders,  the  repurchase  of the  Company's  12.5%
     senior notes due March 15, 2007 (the "Senior Notes").  Borrowings under the
     Term Facility were used to repurchase the Company's Senior Notes,  together
     with accrued and unpaid interest  thereon.  As of May 2, 2003,  outstanding
     borrowings  under the  Revolving  Credit  Facility and Term  Facility  were
     $6,850,000 and $23,000,000, respectively.

          Covenants - The Senior Credit Facility  contains  financial  covenants
     relating to the  maintenance  of (a)  minimum  consolidated  resort  EBITDA
     (earnings before interest, taxes,  depreciation and amortization,  adjusted
     for  certain  items  specified  in the  Senior  Credit  Facility)  measured
     quarterly on a rolling four quarter basis ("Minimum Resort EBITDA"),  (b) a
     minimum ratio of (y) consolidated EBITDA (earnings before interest,  taxes,
     depreciation,  depletion,  amortization  and  noncash  cost of real  estate
     sales, adjusted for certain items specified in the Senior Credit Facility),
     less $5,000,000,  less cash income taxes actually paid during the period to
     (z)  consolidated  debt  service  (the sum of  interest,  cash  payments of
     principal made in respect of capitalized  lease  obligations  and mandatory
     reductions  under the Term Facility)  measured  quarterly on a rolling four
     quarter  basis  (the  "Leverage   Ratio"),   and  (c)  a  maximum  adjusted
     consolidated  leverage  ratio  (the ratio of  secured  indebtedness  of the
     Company and its  subsidiaries  (with  certain  exceptions  specified in the
     Senior Credit Facility) to the sum of the Company's consolidated net worth,
     as  adjusted  pursuant  to the Senior  Credit  Facility  and the  aggregate
     principal amount of outstanding Senior Notes ("Adjusted Leverage Ratio")).

                                       7
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


          Primarily as a result of (a) poor weather conditions at the Summit and
     Sierra during the six months ended May 2, 2003 and resulting  reductions in
     resort  operations  revenues and operating  income,  and (b) unusually high
     provisions  for workers'  compensation  exposures  during the fourth fiscal
     quarter of 2002,  the  Company  experienced  a shortfall  of  approximately
     $3,400,000 relative to the required minimum level of Minimum Resort EBITDA,
     and did not meet the  required  Leverage  Ratio  pursuant to the  covenants
     under the Senior Credit Facility for the trailing four quarter period ended
     on May 2, 2003.  On June 13, 2003,  the Company  obtained an amendment  and
     waiver (the  "Amendment  and  Waiver")  from the  lenders  under the Senior
     Credit Facility, which modified the financial covenants and waived defaults
     arising under the financial covenants for the period ended May 2, 2003.

          After  giving  effect to the  Amendment  and  Waiver,  the  Company is
     required to have a Minimum  Resort  EBITDA of (i)  $19,000,000  during each
     rolling four quarter  period  through  January 30, 2004,  (ii)  $23,500,000
     during each  rolling  four  quarter  period from  January 31, 2004  through
     January 28, 2005 and (iii)  $26,500,000  during each  rolling  four quarter
     period  from  January  29,  2005 and  thereafter.  It is also  required  to
     maintain  (a) a  minimum  Leverage  Ratio of (i) .75 to 1 from May 3,  2003
     through August 1, 2003, (ii) 1 to 1 from August 2, 2003 through October 31,
     2003,  (iii) 1.1 to 1 from November 1, 2003 through  January 30, 2004, (iv)
     1.2 to 1 from  January 31, 2004  through  January 28, 2005 and (v) 1.3 to 1
     thereafter  and  (b) a  maximum  Adjusted  Leverage  Ratio  of (i) .55 to 1
     through August 1, 2003,  (ii) .65 to 1 from August 2, 2003 through  October
     31, 2003,  (iii) .55 to 1 from  November 1, 2003 through  October 29, 2004,
     (ii) .50 to 1 from October 30, 2004 through  October 28, 2005 and (iii) .45
     to 1 thereafter.

          The  Senior  Credit  Facility  also  contains  restrictive   covenants
     pertaining  to  the  management  and  operation  of  Booth  Creek  and  its
     subsidiaries.  The covenants include, among others, significant limitations
     on  indebtedness,   guarantees,  letters  of  credit,  liens,  investments,
     distributions,  capital expenditures,  mergers, acquisitions,  asset sales,
     fundamental  corporate  changes,  transactions  with  affiliates,  optional
     payments and modification of debt instruments and issuances of stock.

     The  Company has  entered  into two  interest  rate cap  agreements  for an
aggregate  notional  amount of $15,000,000  through July 31, 2005,  declining to
$14,000,000  through  October 31, 2005.  These  interest rate cap agreements are
designed to limit the Company's exposure to the effects of rising interest rates
with respect to borrowings  outstanding under the Term Facility. In exchange for
upfront  payments of $179,000,  the Company is entitled to receive floating rate
payments  from the  counterparties  to the interest rate cap  agreements  during
those  periods in which the three month LIBOR rate exceeds 6%. These  agreements
are accounted for at their fair value,  with  fluctuations  recorded through the
statement of operations.  As of May 2, 2003, the fair value of these  agreements
was $16,000.

Senior Notes

     As of May 2,  2003,  the  Company  had  outstanding  $80,175,000  aggregate
principal amount of its Senior Notes. The Senior Notes mature on March 15, 2007,
and bear  interest  at 12.5% per annum,  payable  semi-annually  on March 15 and
September 15. The Senior Notes are  redeemable at the option of the Company,  in
whole or in part, at a current  redemption  price  (expressed as a percentage of
the principal  amount  redeemed) of 104.167%,  declining to 102.083% as of March
15, 2004 and 100% as of March 15, 2005,  plus, in each case,  accrued and unpaid
interest to the redemption  date. The Senior Notes are general senior  unsecured
obligations  of the Company  ranking  equally in right of payment with all other
existing and future  senior  indebtedness  of the Company and senior in right of
payment to any subordinated indebtedness of the Company.

                                       8
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


     The Senior Notes are  unconditionally  guaranteed,  on an unsecured  senior
basis, as to the payment of principal,  premium,  if any, and interest,  jointly
and severally (the "Guarantees"), by all Restricted Subsidiaries of the Company,
as  defined in the  indenture  for the Senior  Notes (the  "Indenture"),  having
either assets or shareholders'  equity in excess of $20,000 (the  "Guarantors").
All  of  the  Company's   direct  and  indirect   subsidiaries   are  Restricted
Subsidiaries, except DRE, L.L.C.

     The Senior Notes are  effectively  subordinated  in right of payment to all
secured indebtedness of the Company and the Guarantors,  including  indebtedness
under the Senior Credit Facility. In addition, the Senior Notes are structurally
subordinated  to any  indebtedness  of the Company's  subsidiaries  that are not
Guarantors.  The Indenture  contains covenants for the benefit of the holders of
the Senior Notes that, among other things,  limit the ability of the Company and
any Restricted  Subsidiaries  to: (i) incur  additional  indebtedness;  (ii) pay
dividends and make other distributions;  (iii) issue stock of subsidiaries; (iv)
make certain  investments;  (v) repurchase stock; (vi) create liens; (vii) enter
into  transactions  with  affiliates;  (viii)  enter  into  sale  and  leaseback
transactions;  (ix) create  dividend  or other  payment  restrictions  affecting
Restricted Subsidiaries; (x) merge or consolidate the Company or any Guarantors;
and (xi) sell assets.

     The Guarantors are wholly-owned  subsidiaries of Booth Creek and have fully
and  unconditionally  guaranteed  the Senior Notes on a joint and several basis.
Booth Creek is a holding  company and has no significant  operations,  assets or
cash flows separate from its investments in its subsidiaries.  In addition,  the
assets,  equity,  revenues,  income and cash flow of DRE, L.L.C.,  Booth Creek's
only non-guarantor  subsidiary,  are minor and the membership  interests in DRE,
L.L.C. are entirely owned by Booth Creek. There are no significant  restrictions
on the ability of the Guarantors to pay dividends or otherwise transfer funds to
Booth  Creek.  Accordingly,  Booth Creek has not  presented  separate  financial
statements and other disclosures  concerning the Guarantors or its non-guarantor
subsidiary  because  management  has  determined  that such  information  is not
material to investors.

     During  the  six  months  ended  May  2,  2003,  the  Company   repurchased
$16,000,000  aggregate  principal amount of Senior Notes for $15,080,000.  After
giving effect to the write-off of related deferred  financing costs of $414,000,
the Company recognized a gain on early retirement of debt of $506,000.

     During  the  six  months  ended  May  3,  2002,  the  Company   repurchased
$29,325,000  aggregate  principal amount of Senior Notes for $25,588,000.  After
giving effect to the write-off of related deferred  financing and other costs of
$876,000,  the  Company  recognized  a gain  on  early  retirement  of  debt  of
$2,761,000.

                                       9
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)



Other Debt

     During  the six  months  ended May 2,  2003 and May 3,  2002,  the  Company
entered into capital lease obligations of $682,000 and $1,644,000, respectively,
for the purchase of equipment.

     As of May 2, 2003,  the  maturities of long-term  debt,  including  capital
lease obligations, were as follows:

                                                           (In thousands)

     Six months ending October 2003..................       $      2,063
     Year ending October 2004........................              6,263
     Year ending October 2005........................             18,017
     Year ending October 2006........................                 99
     Year ending October 2007........................             80,200
                                                             -----------
     Total long-term debt............................            106,642

     Less current portion............................              5,310
                                                             -----------
     Long-term debt..................................       $    101,332
                                                             ===========

5.   Income Taxes

     As of  November  1, 2002,  the Company had  estimated  net  operating  loss
carryforwards  of  approximately  $88,600,000  for federal  income tax reporting
purposes,  which  expire  between  2012 and 2022.  The tax  benefits of such net
operating losses are fully offset by a valuation reserve. Based on the Company's
current tax  attributes,  no income tax provision or benefit is expected for the
year  ending  October  31,  2003.  Accordingly,  during  the three and six month
periods ended May 2, 2003, no income tax provision has been provided.

6.   Business Segments

     The Company currently operates in two business segments,  resort operations
and real estate and other. Data by segment is as follows:

                               Three Months Ended          Six Months Ended
                            -----------------------    -----------------------
                              May 2,      May 3,          May 2,     May 3,
                               2003        2002            2003       2002
                            ----------  -----------    -----------  ----------
                                             (In thousands)
   Revenue:
    Resort operations....    $  50,431   $  51,903      $   96,946   $  101,260
    Real  estate  and
      other..............          646       5,615             662        8,915
                            ----------  -----------    -----------  -----------
                             $  51,077   $  57,518      $   97,608   $  110,175
                            ==========  ===========    ===========  ===========

   Operating income (loss):
    Resort operations....    $  15,935   $  17,332      $   26,010   $   29,566
    Real  estate  and
      other.............          (116)      3,809            (416)       6,247
                            ----------  -----------    -----------  -----------
                             $  15,819   $  21,141      $   25,594   $   35,813
                            ==========  ===========    ===========  ===========


                                       10
<PAGE>


                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


                                                  May 2,        November 1,
                                                   2003            2002
                                               -------------  -------------
                                                      (In thousands)
   Segment assets:
    Resort operations..................         $ 143,716       $ 148,427
    Real estate and other..............            11,315          10,939
    Corporate and other
      nonidentifiable assets...........             5,950           7,234
                                               -------------  -------------
                                                $ 160,981       $ 166,600
                                               =============  =============

     A reconciliation  of combined  operating  income for resort  operations and
real estate and other to consolidated  income from continuing  operations before
change in accounting principle is as follows:


                                 Three Months Ended        Six Months Ended
                               ----------------------   --------------------
                                May 2,       May 3,      May 2,     May 3,
                                 2003         2002        2003       2002
                               ---------    ---------   ---------  ---------
                                                (In thousands)

   Operating income for
    reportable segments.......  $ 15,819     $ 21,141    $ 25,594   $ 35,813
   Interest expense...........    (3,089)      (3,812)     (6,460)    (8,073)
   Amortization of deferred
    financing costs...........      (281)        (271)       (563)      (510)
   Gain on early retirement
    of debt...................         -        2,761         506      2,761
   Minority interest..........         -            -           -        (15)
   Other income...............        23           28          26         42
                                ---------    ---------   ---------  ---------
   Income from continuing
    operations before change
    in accounting principle ..  $ 12,472     $ 19,847    $ 19,103   $ 30,018
                                =========    =========   =========  =========


                                       11
<PAGE>



ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS


     The following  discussion  should be read in conjunction with the unaudited
consolidated  financial  statements and related notes thereto included elsewhere
in this  Report.  The  following  discussion  contains  certain  forward-looking
statements that involve risks and  uncertainties.  The Company's  actual results
could differ materially from those discussed herein. Factors that could cause or
contribute to the differences are discussed in "Forward-Looking  Statements" and
elsewhere in this Report as well as in Part II, Item 7. "Management's Discussion
and Analysis of Financial Condition and Results of Operations - Risk Factors" in
the Company's  Annual Report on Form 10-K for its fiscal year ended  November 1,
2002.


General

     The Company's ski operations are highly sensitive to weather conditions and
the overall strength of the regional economies in the areas in which the Company
operates.  The Company believes that the geographic diversity of its resorts and
the use of extensive snowmaking  technology coupled with advanced trail grooming
equipment,   which  together  can  provide  consistent  skiing  conditions,  can
partially  mitigate  the risk of both  economic  downturns  and adverse  weather
conditions in any given region.  However, the Company remains vulnerable to warm
weather,  heavy rains, high winds,  drought and other types of severe or unusual
weather  conditions,  which  can  have a  significant  effect  on the  operating
revenues and  profitability  at any of the Company's  resorts.  Moreover,  since
2000,  the  Company  has sold two resorts  (Grand  Targhee  and Bear  Mountain),
thereby reducing its geographic diversity.

     The  Company's  three  resorts with the lowest  average  natural  snowfall,
Waterville  Valley,  Loon Mountain and Mt.  Cranmore,  have invested  heavily in
snowmaking capabilities to provide coverage on virtually all of their trails and
have been open for skiing at least 136,  139 and 99 days,  respectively,  during
each of the last five ski seasons,  including  the 2002/03 ski season.  However,
the  efficiency  and  effectiveness  of snowmaking  operations can be negatively
impacted by numerous factors, including temperature variability,  reliability of
water sources, availability and cost of adequate energy supplies and unfavorable
weather events such as heavy rains.

     Sierra and the Summit generally  experience higher natural snowfall levels,
averaging  approximately 430 and 425 inches of snowfall per year,  respectively,
for the past five ski seasons.  As a result of their historic natural  snowfall,
their snowmaking  capabilities in terms of trail coverage are considerably  less
extensive than at Waterville  Valley,  Loon Mountain or Mt.  Cranmore.  However,
such  resorts are  dependent  upon early  season  snowfall to provide  necessary
terrain for the important  Christmas holiday period,  and therefore,  the timing
and extent of natural snowfall can  significantly  impact operating  conditions.
For example, as a result of a lack of natural snowfall, the Summit was unable to
open until after  Christmas in the 2002/03 ski season,  and conditions  remained
poor for much of the season.

     Northstar  has averaged  approximately  253 inches of snowfall per year for
the past five ski seasons.  The resort has  snowmaking  capabilities  to provide
coverage on approximately  50% of its trails.  Although the resort's  operations
depend significantly on natural snowfall,  particularly in the early part of the
ski season,  in recent years the Company has invested in  additional  snowmaking
facilities to improve Northstar's snowmaking production capacity.

     The  Company's  results of  operations  are also  highly  dependent  on the
Company's  ability to compete in each of the large regional ski markets in which
it operates. Management estimates that at Northstar and Sierra approximately 70%
of the 2002/03 ski season total skier days were attributable to residents of the
San Francisco/San  Jose,  Sacramento,  Central  California Valley and Lake Tahoe
regions. At Waterville Valley, Loon Mountain and Mt. Cranmore, approximately 80%
of the 2002/03 ski season  total skier days were  attributable  to  residents of
Massachusetts and New Hampshire, with a large percentage of such visitors coming
from the Boston  metropolitan  area. At the Summit,  the Company  estimates that
more than 90% of the 2002/03 ski season  total skier days were  attributable  to
residents of the Seattle/Tacoma metropolitan region.

     The Company seeks to maximize revenues and operating income by managing the
mix of skier days and revenue per skier day. These  strategies are also designed
to  maximize  resort  cash flow.  The  strategy  for each resort is based on the
demographic  profile of its market and the physical capacity of its mountain and
facilities.  The Company seeks to increase  skier days by  developing  effective
ticket pricing and season pass  strategies  and sales and marketing  programs to
improve peak and off-peak volume.  The Company also seeks to increase skier days
by offering a quality guest experience and developing effective target marketing
programs.  The Company  seeks to improve  revenue  per skier day by  effectively
managing  the  price,  quality  and value of each of its  ski-related  services,
including  retail  shops,  equipment  rentals,  lessons  and food  and  beverage
facilities.

                                       12
<PAGE>

     The  Company's  current  resorts have  invested  approximately  $53 million
(including $8.8 million of equipment  acquired  through capital leases and other
debt) in capital  expenditures since October 1999 to upgrade chairlift capacity,
expand  terrain,  improve skier  service,  enhance  retail and food and beverage
facilities,  increase  snowmaking  capabilities  and to meet sustaining  capital
requirements,  all of which  management  believes  are  important in providing a
quality guest experience.

     A significant portion of total operating costs at the Company's resorts are
variable,  consisting  primarily  of  retail  and food  service  cost of  sales,
utilities and labor expense.  These  variable costs can fluctuate  significantly
based  upon skier  days and  seasonal  factors.  With the  exception  of certain
management,  administrative  and  maintenance  personnel,  all of the  Company's
employees are compensated on an hourly basis.  Management believes a key element
to  maximizing  profitability  during  the winter  season is to closely  monitor
staffing  requirements  and to adjust  staffing  levels  when  skier  volumes or
seasonal needs dictate.

     Each of the Company's  resorts is subject to the threat of personal  injury
claims  relating  principally to snow sports  activities as well as premises and
vehicular  operations and workers'  compensation  matters. The Company maintains
various forms of insurance  covering  claims related to its properties and usual
and customary  risks  associated  with the operation of  four-season  recreation
resorts.  As a result of the  terrorist  attacks  on  September  11,  2001,  the
insurance  industry  has  experienced   significant  losses  and  a  substantial
reduction  in   underwriting   capacity,   which  has   generally   resulted  in
significantly  higher  renewal  premiums for  companies  seeking  insurance.  In
connection  with its annual renewal of insurance  coverage for 2003, the Company
experienced an increase in insurance  premium costs of approximately  $1,500,000
over the level of such costs in 2002. In addition, the elimination of paid skier
visit insurance  coverage is likely to lead to more variability in the Company's
operating results.

     The Company sold the Bear Mountain ski resort ("Bear  Mountain") on October
10,  2002.  The  operating  results  of Bear  Mountain  have been  reflected  as
discontinued  operations in the Company's statements of operations for the three
and six month  periods  ended May 3, 2002.  Summary  operating  results for Bear
Mountain for the three and six month periods ended May 3, 2002 were as follows:


                                            Three Months        Six Months
                                              Ended               Ended
                                              May 3,              May 3,
                                               2002                2002
                                           -------------      -------------
                                                    (In thousands)

     Total revenue.................        $    6,021         $   13,508
     Total expenses................            (4,309)           (10,258)
                                           -------------      -------------
     Total income from
      discontinued operations......        $    1,712         $    3,250
                                           =============      =============

     The  Company's  real estate and other  segment is primarily  engaged in the
sale of single family lots, development real estate and timber at Northstar. The
revenues,  operating  income and cash flows of the real estate and other segment
are highly variable.


                                       13
<PAGE>

Results of Operations of the Company

     Overview

     The opening and closing dates for the Company's resorts for the 2002/03 and
2001/02 ski seasons were as follows:

                                                   Opening Dates
                                    --------------------------------------------
                                     2002/03 Season              2001/02 Season
                                    --------------------------------------------

     Northstar.............         November 22, 2002          November 29, 2001
     Sierra................         December 16, 2002          November 25, 2001
     Waterville Valley*....         November 22, 2002          November 16, 2001
     Mt. Cranmore..........         November 29, 2002          December 15, 2001
     Loon Mountain*........         November 15, 2002          November 16, 2001
     The Summit............         December 27, 2002          November 30, 2001


     *  Following their openings for the 2001/02 season, Waterville  Valley and
        Loon Mountain  ceased  operations in December 2001 for six and ten days,
        respectively, due to eroding conditions as a result of warm weather.

                                                   Closing Dates
                                    --------------------------------------------
                                    2002/03 Season             2001/02 Season
                                    --------------------------------------------

     Northstar.............         April 20, 2003             April 21, 2002
     Sierra................         April 27, 2003             April 15, 2002
     Waterville Valley.....         April 6, 2003              April 7, 2002
     Mt. Cranmore..........         March 30, 2003             March 24, 2002
     Loon Mountain.........         April 20, 2003             April 14, 2002
     The Summit............         April 13, 2003             May 5, 2002

     The Lake Tahoe region  experienced  relatively dry conditions and a lack of
natural  snowfall  through  mid-December  2002.  Due to its  snowmaking  system,
Northstar  opened on schedule.  However,  Sierra did not open until December 16,
2002 due to its dependence on natural snowfall.  During the period from December
14th to the 21st, the region received a number of powerful  storms  resulting in
over six feet of snowfall at  Northstar  and Sierra.  While the storms  provided
excellent skiing conditions for the Christmas holiday season,  the storms caused
prolonged power outages prior to Christmas,  difficult road conditions and other
factors which  negatively  affected skier  visitation on a number of days during
mid-December  2002.  For the  2001/02  season,  the Lake Tahoe  region  received
significantly  above average  snowfall in the first half of December 2001, which
allowed  Northstar and Sierra to open 100% of their terrain  earlier than usual,
and provided  favorable  conditions going into the Christmas  holiday period and
the first half of January 2002.  During  January,  February and March 2003,  the
Lake Tahoe region  experienced  natural snowfall levels that were  substantially
below both  long-term  historical  and prior  season  levels,  which  negatively
impacted customers' perception of skiing conditions in Lake Tahoe. Despite these
weather  challenges,  skier visits at Northstar for the 2002/03 season increased
by 49,000  visits,  or 9%,  due to the  relative  competitive  advantage  of its
snowmaking  system and the  introduction  of new  season  pass  products.  Skier
visitation at Sierra for the 2002/03 season  declined by 66,000 visits,  or 16%,
due  primarily  to the delayed  opening  for the 2002/03  season and skier visit
shortfalls  in the latter part of January and  February  2003 due to the lack of
natural snowfall.

     During the first half of the 2002/03 ski season,  the  northeastern  United
States  experienced much colder  temperatures and increased  natural snowfall as
compared to the record warm winter of 2001/02.  As a result,  the  Company's New
Hampshire resorts experienced  generally good operating conditions for the early
part of the 2002/03 ski season.  Bitterly  cold  temperatures  during the second
half of January and the first half of February  2003,  as well as several  major
disruptive  storms  (including  over the important  Presidents'  Day holiday) in
Boston  and other  major  cities in the  Northeast,  dampened  mid-season  skier
visitation.  Late season  conditions at the Company's New Hampshire resorts were
generally  improved  over the prior  season.  For the 2002/03 ski season,  skier
visits at the Company's New Hampshire  resorts  increased by 99,000  visits,  or
16%, from the prior season.


                                       14
<PAGE>

     For the 2002/03 season, the Pacific Northwest experienced unseasonably warm
temperatures and substantially  below average  snowfall.  Snowfall at the Summit
for the 2002/03  season was less than 60% of historical  long-term  averages and
prior season levels. Additionally, average temperatures at the Summit during the
2002/03 ski season were generally warmer than normal, and the resort experienced
a number of rain events  during the course of the season.  The Summit  commenced
partial  operations  on December 27, 2002 on limited  terrain,  as compared to a
November 30, 2001 opening for the 2001/02 ski season. Skiing conditions remained
poor  at  the  Summit  throughout  the  2002/03  season.  Conversely,  operating
conditions at the Summit were  generally  favorable  throughout  the 2001/02 ski
season.  As a result of these  conditions,  total skier visits at the Summit for
the 2002/03 season were down 283,000 visits,  or 46%, as compared to the 2001/02
season.

     Three  Months  Ended May 2, 2003  Compared to the Three Months Ended May 3,
2002

     Total  revenue for the three  months ended May 2, 2003 was  $51,077,000,  a
decrease of $6,441,000, or 11%, from the Company's revenues for the three months
ended May 3, 2002.  Revenues  from  resort  operations  for the 2003 period were
$50,431,000,  a decrease of  $1,472,000,  or 3%, as compared to the 2002 period.
Revenues from real estate operations for the three months ended May 2, 2003 were
$646,000,  due to the  close  of  escrow  on the  final  lot  within  the Unit 7
development  at Northstar.  Thirteen  lots within the Unit 7 development  closed
during  the  2002  period,  which  generated  revenues  of  $5,600,000.   Timber
operations contributed revenues of $15,000 in the 2002 period.

     The following table  summarizes the sources of the Company's  revenues from
resort operations for the three months ended May 2, 2003 and May 3, 2002:

                                 Three Months Ended
                               ----------------------             Percentage
                                May 2,       May 3,     Increase   Increase
                                 2003         2002     (Decrease) (Decrease)
                               ---------    ---------  ---------   ---------
                                        (In thousands)


   Lift Tickets...............  $ 18,638     $ 21,269    $ (2,631)       (12)%
   Season Passes..............    10,141        7,372       2,769         38
   Snow School................     4,050        4,446        (396)        (9)
   Equipment Rental...........     4,221        4,854        (633)       (13)
   Retail.....................     1,964        1,897          67          4
   Food and Beverage..........     7,539        7,568         (29)         -
   Other......................     3,878        4,497        (619)       (14)
                                ---------    ---------   ---------
   Total Resort Operations
     Revenues.................  $ 50,431     $ 51,903    $ (1,472)        (3)
                                =========    =========   =========

     Total skier visits generated by each of the Company's resorts for the three
months ended May 2, 2003 and May 3, 2002 were as follows:

                                 Three Months Ended
                               ----------------------             Percentage
                                May 2,       May 3,     Increase   Increase
                                 2003         2002     (Decrease) (Decrease)
                               ---------    ---------  ---------   ---------
                                    (Skier visits in thousands)


   Northstar..................       304          284          20        7%
   Sierra.....................       190          209         (19)      (9)
   Waterville Valley..........       117          110           7        6
   Mt. Cranmore...............        68           55          13       24
   Loon Mountain..............       185          164          21       13
   The Summit.................       176          281        (105)     (37)
                                  -------      -------     -------
                                   1,040        1,103         (63)      (6)
                                  =======      =======     =======

   Revenue Per Skier Visit....    $ 48.49      $ 47.06     $  1.43       3
                                  =======      =======     =======

                                       15
<PAGE>

     As  compared  to the three  months  ended May 3,  2002,  resort  operations
revenues for  Northstar  increased by  $465,000,  primarily  due to higher skier
visits and season pass sales,  partially offset by lower revenue per skier visit
yields due to changes in the mix of skiers.  Revenues  for Sierra  decreased  by
$858,000  due to reduced  skier  visits  during the 2003  period.  Revenues  for
Waterville  Valley  and  Mt.  Cranmore   increased  by  $157,000  and  $373,000,
respectively,  due  primarily to increases  in skier  visits.  Revenues for Loon
Mountain  increased by $121,000  due to  increased  skier visits and season pass
sales,  partially  offset by lower yields due to a greater  proportion of season
pass visits in the 2003 period.  The Summit's  revenues  decreased by $1,730,000
due primarily to substantially lower visitation.

     Cost of sales for resort  operations for the three months ended May 2, 2003
were  $24,598,000,  an increase of $96,000,  or less than 1%, as compared to the
2002  period.  The  increase  was  primarily  the result of normal  inflationary
factors and higher insurance  costs,  partially offset by lower snowmaking costs
in the 2003 period and the effect of higher workers' compensation  provisions in
the 2002  period  for  exposures  at the  Company's  Lake  Tahoe and  Washington
resorts.

     Cost of sales for real estate and timber  operations  for the three  months
ended May 2, 2003 was $197,000,  including  noncash cost of real estate sales of
$190,000,  as a result of the close of escrow on the final lot within the Unit 7
development  at Northstar.  Cost of sales for real estate and timber  operations
for the three months ended May 3, 2002 were $1,502,000,  including  noncash cost
of real  estate  sales of  $1,464,000,  as a result  of the  close of  escrow on
thirteen lots within the Unit 7 development.

     Depreciation  and depletion  expense for the three months ended May 2, 2003
was $3,904,000, a decrease of $392,000, or 9%, from the 2002 period. The decline
in  depreciation  and  depletion  expense was  primarily  due to certain  assets
acquired in connection with the Company's  resort  acquisitions in 1996 and 1997
having become fully depreciated.

     Selling, general and administrative expenses for the three months ended May
2, 2003 were $6,559,000, an increase of $482,000, or 8%, as compared to the 2002
period.  Selling,  general  and  administrative  expenses  for the 2003 and 2002
periods include $565,000 and $304,000,  respectively,  relating to the Company's
real estate segment.  The increase in selling,  general and administrative costs
between the 2003 and 2002  periods was  primarily  due to sales launch costs for
the Unit 7A development at Northstar and normal inflationary factors,  partially
offset by lower provisions under incentive compensation arrangements.

     Operating income for the three months ended May 2, 2003 was $15,819,000,  a
decrease of $5,322,000 from the operating  income generated for the 2002 period,
primarily as a result of the lower real estate revenues and, to a lesser extent,
lower resort operations revenues in the 2003 period.

     Interest expense for the three months ended May 2, 2003 totaled $3,089,000,
a decrease of $723,000,  or 19%,  from the  Company's  interest  expense for the
three  months  ended May 3, 2002,  as a result of reduced  borrowings  and lower
average interest rates.

     The Company recognized a gain on the early retirement of debt of $2,761,000
for  the  three  months  ended  May  3,  2002,  relating  to the  repurchase  of
$29,325,000  aggregate  principal amount of its 12.5% senior notes due 2007 (the
"Senior Notes") during the 2002 period.

     As of  November  1, 2002,  the Company had  estimated  net  operating  loss
carryforwards  of  approximately  $88,600,000  for federal  income tax reporting
purposes,  which  expire  between  2012 and 2022.  The tax  benefits of such net
operating losses are fully offset by a valuation reserve. Based on the Company's
current tax  attributes,  no income tax provision or benefit is expected for the
year ending October 31, 2003. Accordingly,  during the three months ended May 2,
2003, no income tax provision has been provided.

     The  Company's  net  income  for the  three  months  ended  May 2, 2003 was
$12,472,000,  a  reduction  of  $9,087,000  from the net  income of  $21,559,000
generated  for the three months ended May 3, 2002,  primarily as a result of the
$5,600,000  in  real  estate  sales,  $1,712,000  of  income  from  discontinued
operations of Bear Mountain and $2,761,000 gain on the early  retirement of debt
reflected  in the 2002 period and lower resort  operations  revenues in the 2003
period.

                                       16
<PAGE>

     The financial  information  presented below includes  information on "Total
EBITDA,"  "Noncash  Cost of Real  Estate  Sales"  and "Total  EBITDA  (Excluding
Noncash  Cost of Real Estate  Sales)."  "Total  EBITDA"  represents  income from
operations  before  depreciation  and depletion  expense.  "Noncash Cost of Real
Estate  Sales"  represents  the  allocated  portion of real  estate  development
expenditures  previously  capitalized  (including acquisition costs allocated to
real estate  development)  which relate to current real estate  sales.  Although
EBITDA is not a measure of performance  under  accounting  principles  generally
accepted in the United States  ("GAAP"),  the  information is presented  because
management believes it provides useful information regarding a company's ability
to incur and service  debt.  In  addition,  management  uses EBITDA  measures to
assess  the  Company's  operating  performance  and to make  capital  investment
decisions.  Further,  Total EBITDA (Excluding Noncash Cost of Real Estate Sales)
is calculated  consistent with the manner that "EBITDA" is calculated  under the
indenture  governing  the  Company's  Senior Notes,  and  therefore,  management
believes  this  measure is  meaningful  to holders of the Senior  Notes.  EBITDA
should  not be  considered  in  isolation  or as a  substitute  for net  income,
operating income, cash flows from operating  activities and other income or cash
flow  statement  data  prepared  in  accordance  with  GAAP,  or as a measure of
profitability  or liquidity.  In addition,  the EBITDA measures as determined by
the Company may not be comparable to related or similar  measures as reported by
other companies and do not represent funds available for discretionary  use. The
following  table  reconciles  operating  income from the Company's  consolidated
statements  of operations  to Total EBITDA and Total EBITDA  (Excluding  Noncash
Cost of Real Estate Sales) for the periods indicated:

                                   Three Months Ended
                                 ---------------------
                                  May 2,       May 3,               Percentage
                                   2003         2002    (Decrease)  (Decrease)
                                 --------     --------   --------    --------
                                           (In thousands)

     Reported Operating
      Income.................  $  15,819     $  21,141    $(5,322)       (25)%
     Depreciation and
      Depletion..............      3,904         4,296       (392)        (9)
                               ---------     ---------    -------
     Total EBITDA............     19,723        25,437     (5,714)       (22)
     Noncash Cost of Real
      Estate Sales...........        190         1,464     (1,274)       (87)
                               ---------     ---------    -------
     Total EBITDA (Excluding
      Noncash Cost of Real
      Estate Sales)..........  $  19,913     $  26,901    $(6,988)       (26)
                               =========     =========   ========

     Six Months Ended May 2, 2003 Compared to the Six Months Ended May 3, 2002

     Total  revenue  for the six  months  ended May 2, 2003 was  $97,608,000,  a
decrease of $12,567,000,  or 11%, from the Company's revenues for the six months
ended May 3, 2002.  Revenues  from  resort  operations  for the 2003 period were
$96,946,000,  a decrease of  $4,314,000,  or 4%, as compared to the 2002 period.
Revenues from real estate  operations  for the six months ended May 2, 2003 were
$646,000,  due to the  close  of  escrow  on the  final  lot  within  the Unit 7
development  at  Northstar.  Twenty  lots within the Unit 7  development  closed
during  the  2002  period,  which  generated  revenues  of  $8,900,000.   Timber
operations  contributed  revenues  of $16,000  and $15,000 for the 2003 and 2002
periods, respectively.

     The following table  summarizes the sources of the Company's  revenues from
resort operations for the six months ended May 2, 2003 and May 3, 2002:

                                  Six Months Ended
                               ----------------------             Percentage
                                May 2,       May 3,     Increase   Increase
                                 2003         2002     (Decrease) (Decrease)
                               ---------    ---------  ---------   ---------
                                        (In thousands)


   Lift Tickets...............  $ 37,328     $ 42,878    $ (5,550)       (13)%
   Season Passes..............    19,168       14,518       4,650         32
   Snow School................     7,507        8,094        (587)        (7)
   Equipment Rental...........     7,849        8,931      (1,082)       (12)
   Retail.....................     3,814        4,070        (256)        (6)
   Food and Beverage..........    13,962       14,367        (405)        (3)
   Other......................     7,318        8,402      (1,084)       (13)
                               ---------    ---------   ---------
   Total Resort Operations
     Revenues.................  $ 96,946     $101,260    $ (4,314)        (4)
                               =========    =========   =========


                                       17
<PAGE>

     Total skier visits  generated by each of the Company's  resorts for the six
months ended May 2, 2003 and May 3, 2002 were as follows:

                                  Six Months Ended
                               ----------------------             Percentage
                                May 2,       May 3,     Increase   Increase
                                 2003         2003     (Decrease) (Decrease)
                               ---------    ---------  ---------   ---------
                                    (Skier visits in thousands)


   Northstar..................       570          521          49          9%
   Sierra.....................       353          419         (66)       (16)
   Waterville Valley..........       223          205          18          9
   Mt. Cranmore...............       119           96          23         24
   Loon Mountain..............       359          301          58         19
   The Summit.................       329          612        (283)       (46)
                                  -------      -------     -------
                                   1,953        2,154        (201)        (9)
                                  =======      =======     =======

   Revenue Per Skier Visit....    $ 49.64      $ 47.01     $  2.63         6
                                  =======      =======     =======

     As compared to the six months ended May 3, 2002, resort operations revenues
for Northstar increased by $1,394,000,  primarily due to higher skier visits and
season pass sales,  partially offset by lower revenue per skier visit yields due
to changes in the mix of skiers. Revenues for Sierra decreased by $1,869,000 due
to reduced  skier  visits,  partially  offset by higher  revenue per skier visit
yields.  Revenues for Waterville  Valley and Mt. Cranmore  increased by $753,000
and $944,000,  respectively, due to increases in skier visits. Revenues for Loon
Mountain  increased by $546,000 due to increased skier visits,  partially offset
by lower  yields due to a greater  proportion  of season pass visits in the 2003
period.   The  Summit's  revenues  decreased  by  $6,082,000  due  primarily  to
substantially lower visitation.

     For the 2000/01 ski season,  the Company  arranged for four  separate  paid
skier visit insurance policies covering Bear Mountain, Loon Mountain, Waterville
Valley and the Summit.  The policies had a  deductible  for the initial  decline
from targeted paid skier visit and revenue  levels and stated  maximum  coverage
levels. In addition,  the policies required the insured to experience monthly or
annual snowfall amounts below certain agreed upon levels before a claim could be
filed for the decline in paid skier visits. For the year ended November 2, 2001,
the  Company  recorded  resort  operations  revenues  of  $1,500,000  for claims
attributable  to lower than agreed upon paid skier  visits and  snowfall  levels
under the Summit and  Waterville  Valley  policies.  The  Company's  claims were
determined  based on a specified  formula  under the paid skier visit  insurance
policies and snowfall  information  verified by an independent  third party. The
Company believes that it fully complied with its obligations under the policies,
and properly reported and made claims in accordance with the policies for losses
aggregating in excess of $1,500,000. As a result of the underwriters' failure to
properly  process the Company's  claims,  in November  2001, the Company filed a
lawsuit against the underwriters seeking recovery for breach of contract, breach
of covenant of good faith and unfair and deceptive business practices.  In April
2002, the underwriters made a partial offer of settlement of $700,000, which the
Company  accepted with a reservation  of all rights and remedies under the terms
of the policies and  applicable  law with respect to its remaining  claims.  The
Company intends to vigorously  pursue  collection of its remaining  claims.  The
parties to the lawsuit are currently  conducting  discovery in the matter, which
is scheduled to be completed by the end of June 2003. The parties have agreed to
non-binding  mediation  in  an  effort  to  resolve  this  matter.  Based  on an
evaluation  of  information  to date and the  advice  of  counsel,  the  Company
believes  that  realization  of its  recorded  claims is probable.  However,  no
assurance can be given regarding the timing of the resolution of this matter.

     Cost of sales for resort  operations  for the six months  ended May 2, 2003
were  $50,694,000,  an  increase  of  $674,000,  or 1%, as  compared to the 2002
period. The increase was primarily the result of normal inflationary factors and
higher insurance costs,  partially  offset by (i) lower snowmaking  costs,  (ii)
reduced United States Forest  Service permit fees in the 2003 period,  and (iii)
the effect of higher  workers'  compensation  provisions  in the 2002 period for
exposures at the Company's Lake Tahoe and Washington resorts.

                                       18
<PAGE>

     Cost of sales for real  estate  and  timber  operations  for the six months
ended May 2, 2003 was $218,000,  including  noncash cost of real estate sales of
$190,000,  primarily  as a result of the close of escrow on the final lot within
the Unit 7 development  at  Northstar.  Cost of sales for real estate and timber
operations  for the six  months  ended  May 3,  2002 was  $2,173,000,  including
noncash  cost of real estate sales of  $2,129,000,  primarily as a result of the
close of escrow on twenty lots within the Unit 7 development at Northstar.

     Depreciation and depletion expense for the six months ended May 2, 2003 was
$7,734,000, a decrease of $833,000, or 10%, from the 2002 period. The decline in
depreciation and depletion  expense was primarily due to certain assets acquired
in connection  with the Company's  resort  acquisitions  in 1996 and 1997 having
become fully depreciated.

     Selling,  general and administrative  expenses for the six months ended May
2, 2003 were $13,368,000, a decrease of $234,000, or 2%, as compared to the 2002
period.  Selling,  general  and  administrative  expenses  for the 2003 and 2002
periods include $853,000 and $495,000,  respectively,  relating to the Company's
real  estate  segment.  The  decrease in  selling,  general  and  administrative
expenses  between the 2003 and 2002 periods was  primarily due to a reduction in
legal  fees of  $271,000  as a result of  significant  activity  during the 2002
period for various  lawsuits  involving  Loon Mountain which have been resolved,
and reduced  provisions  under incentive  compensation  arrangements,  partially
offset by normal  inflationary  factors and sales  launch  costs for the Unit 7A
development at Northstar.

     Operating  income for the six months ended May 2, 2003 was  $25,594,000,  a
decrease of $10,219,000 from the operating income generated for the 2002 period,
primarily as a result of the  significant  real estate  revenues during the 2002
period and lower revenues from resort operations in the 2003 period.

     Interest expense for the six months ended May 2, 2003 totaled $6,460,000, a
decrease of $1,613,000,  or 20%, from the Company's interest expense for the six
months ended May 3, 2002,  as a result of reduced  borrowings  and lower average
interest rates.

     The Company  recognized  gains on the early  retirement of debt of $506,000
and  $2,761,000  for  the  six  months  ended  May 2,  2003  and  May  3,  2002,
respectively,  relating to repurchases of $16,000,000 and $29,325,000  aggregate
principal  amount  of its  Senior  Notes  during  the  2003  and  2002  periods,
respectively.

     As of  November  1, 2002,  the Company had  estimated  net  operating  loss
carryforwards  of  approximately  $88,600,000  for federal  income tax reporting
purposes,  which  expire  between  2012 and 2022.  The tax  benefits of such net
operating losses are fully offset by a valuation reserve. Based on the Company's
current tax  attributes,  no income tax provision or benefit is expected for the
year ending  October 31, 2003.  Accordingly,  during the six months ended May 2,
2003, no income tax provision has been provided.

     The  Company's  net  income  for the  six  months  ended  May 2,  2003  was
$19,103,000,  a  reduction  of  $13,965,000  from the net income of  $33,068,000
generated  for the six months  ended May 3, 2002,  primarily  as a result of the
$8,900,000  in real estate  sales,  $3,250,000  of income from the  discontinued
operations of Bear Mountain and $2,761,000 gain on the early  retirement of debt
reflected in the 2002 period,  and lower resort operations  revenues in the 2003
period.

     The financial  information  presented below includes  information on "Total
EBITDA,"  "Noncash  Cost of Real  Estate  Sales"  and "Total  EBITDA  (Excluding
Noncash  Cost of Real Estate  Sales)."  "Total  EBITDA"  represents  income from
operations  before  depreciation  and depletion  expense.  "Noncash Cost of Real
Estate  Sales"  represents  the  allocated  portion of real  estate  development
expenditures  previously  capitalized  (including acquisition costs allocated to
real estate  development)  which relate to current real estate  sales.  Although
EBITDA is not a measure of performance  under  accounting  principles  generally
accepted in the United States  ("GAAP"),  the  information is presented  because
management believes it provides useful information regarding a company's ability
to incur and service  debt.  In  addition,  management  uses EBITDA  measures to
assess  the  Company's  operating  performance  and to make  capital  investment
decisions.  Further,  Total EBITDA (Excluding Noncash Cost of Real Estate Sales)
is calculated  consistent with the manner that "EBITDA" is calculated  under the
indenture  governing  the  Company's  Senior Notes,  and  therefore,  management
believes  this  measure is  meaningful  to holders of the Senior  Notes.  EBITDA
should  not be  considered  in  isolation  or as a  substitute  for net  income,
operating income, cash flows from operating  activities and other income or cash
flow  statement  data  prepared  in  accordance  with  GAAP,  or as a measure of
profitability  or liquidity.  In addition,  the EBITDA measures as determined by
the Company may not be comparable to related or similar  measures as reported by
other companies and do not represent funds available for discretionary  use. The
following  table  reconciles  operating  income from the Company's  consolidated
statements  of operations  to Total EBITDA and Total EBITDA  (Excluding  Noncash
Cost of Real Estate Sales) for the periods indicated:



                                       19
<PAGE>


                                    Six Months Ended
                                 ---------------------
                                  May 2,       May 3,               Percentage
                                   2003         2002    (Decrease)  (Decrease)
                                 --------     --------   --------    --------
                                         (In thousands)

     Reported Operating
      Income.................  $  25,594     $  35,813    $(10,219)       (29)%
     Depreciation and
      Depletion..............      7,734         8,567        (833)       (10)
                               ---------     ---------    --------
     Total EBITDA............     33,328        44,380     (11,052)       (25)
     Noncash Cost of Real
      Estate Sales...........        190         2,129      (1,939)       (91)
                               ---------     ---------    --------
     Total EBITDA (Excluding
      Noncash Cost of Real
      Estate Sales)..........  $  33,518     $  46,509    $(12,991)       (28)
                               =========     =========   =========

Liquidity and Capital Resources

     The Company's  primary  liquidity  needs are to fund capital  expenditures,
service  indebtedness  and support seasonal  working capital  requirements.  The
Company's  primary  sources  of  liquidity  are cash  flow from  operations  and
borrowings under the Senior Credit Facility (as defined below). Virtually all of
the Company's  operating income is generated by its  subsidiaries.  As a result,
the Company is dependent on the  earnings  and cash flow of, and  dividends  and
distributions  or advances from, its subsidiaries to provide the funds necessary
to meet its debt service obligations.

     Effective March 15, 2002, the Company and its subsidiaries  entered into an
Amended  and  Restated   Credit   Agreement   with  Fleet   National   Bank,  as
administrative agent ("Agent"),  and certain lenders. The Senior Credit Facility
has since been  amended  three  times,  most  recently  on June 13,  2003 (as so
amended,  the "Senior Credit  Facility").  The following summary of the terms of
the Senior Credit  Facility is qualified by reference to the complete  agreement
governing  the  Senior  Credit  Facility,  a copy of which has been  filed as an
exhibit to our periodic reports.

     The Senior  Credit  Facility  provides a  revolving  credit  facility  (the
"Revolving Credit  Facility") with borrowing  availability of up to $25,000,000,
and a term loan facility (the "Term Facility") with outstanding borrowings as of
May 2, 2003 of $23,000,000. The Senior Credit Facility requires that the Company
not have any borrowings  under the Revolving  Credit Facility for a period of 30
consecutive  days (20 consecutive  days for 2003)  commencing  sometime  between
January 15 and February 28 of each year. The draw period under the Term Facility
has expired. The Term Facility provides for quarterly  commitment  reductions of
$1,000,000  on the last day of  January,  April,  July and  October of each year
beginning  on January 31, 2003 and  continuing  through  October 31,  2005,  the
maturity  date of the Senior Credit  Facility.  The Company is required to repay
amounts  outstanding under the Term Facility on such dates by an amount equal to
the  greater of (i) the amount by which  outstanding  Term  Facility  borrowings
exceed  the  then-applicable  term  loan  commitment  and (ii) the  Excess  Cash
Proceeds (as defined in the Senior Credit Facility)  derived from specified real
estate  asset sales  determined  on a  cumulative  basis.  No amount of the Term
Facility which is repaid may be reborrowed.  The entire unpaid balance under the
Senior Credit Facility is due and payable on October 31, 2005.  Borrowings under
the  Senior  Credit  Facility  are  secured by (a) a pledge to the Agent for the
ratable  benefit  of the  financial  institutions  party  to the  Senior  Credit
Facility of all of the capital stock of Booth Creek's principal subsidiaries and
(b) a grant of a security  interest  in  substantially  all of the  consolidated
assets of Booth Creek and its subsidiaries.

                                       20
<PAGE>

     The Senior Credit Facility  contains  financial  covenants  relating to the
maintenance of (a) minimum consolidated resort EBITDA (earnings before interest,
taxes,  depreciation and  amortization,  adjusted for certain items specified in
the Senior Credit Facility)  measured  quarterly on a rolling four quarter basis
("Minimum  Resort  EBITDA"),  (b) a  minimum  ratio of (y)  consolidated  EBITDA
(earnings  before interest,  taxes,  depreciation,  depletion,  amortization and
noncash cost of real estate sales,  adjusted for certain items  specified in the
Senior Credit Facility),  less $5,000,000,  less cash income taxes actually paid
during the period to (z)  consolidated  debt service (the sum of interest,  cash
payments of  principal  made in respect of  capitalized  lease  obligations  and
mandatory  reductions under the Term Facility)  measured  quarterly on a rolling
four  quarter  basis  (the  "Leverage  Ratio"),   and  (c)  a  maximum  adjusted
consolidated  leverage ratio (the ratio of secured  indebtedness  of the Company
and its  subsidiaries  (with certain  exceptions  specified in the Senior Credit
Facility)  to the sum of the  Company's  consolidated  net  worth,  as  adjusted
pursuant to the Senior  Credit  Facility and the aggregate  principal  amount of
outstanding Senior Notes ("Adjusted Leverage Ratio").

     Primarily  as a result of (a) poor  weather  conditions  at the  Summit and
Sierra  during  the six months  ended May 2, 2003 and  resulting  reductions  in
resort  operations  revenues  and  operating  income,  and  (b)  unusually  high
provisions for workers' compensation  exposures during the fourth fiscal quarter
of 2002,  the  Company  experienced  a  shortfall  of  approximately  $3,400,000
relative to the required  minimum level of Minimum  Resort  EBITDA,  and did not
meet the required  Leverage  Ratio  pursuant to the  covenants  under the Senior
Credit  Facility for the trailing  four quarter  period ended on May 2, 2003. On
June 13, 2003, the Company  obtained an amendment and waiver (the "Amendment and
Waiver") from the lenders under the Senior Credit  Facility,  which modified the
financial  covenants and waived defaults  arising under the financial  covenants
for the period ended May 2, 2003.

     After giving effect to the Amendment and Waiver, the Company is required to
have a Minimum Resort EBITDA of (i) $19,000,000 during each rolling four quarter
period  through  January 30,  2004,  (ii)  $23,500,000  during each rolling four
quarter  period  from  January  31,  2004  through  January  28,  2005 and (iii)
$26,500,000  during each rolling  four quarter  period from January 29, 2005 and
thereafter.  It is also required to maintain (a) a minimum Leverage Ratio of (i)
..75 to 1 from May 3, 2003  through  August 1, 2003,  (ii) 1 to 1 from  August 2,
2003  through  October 31,  2003,  (iii) 1.1 to 1 from  November 1, 2003 through
January 30, 2004,  (iv) 1.2 to 1 from January 31, 2004 through  January 28, 2005
and (v) 1.3 to 1 thereafter and (b) a maximum Adjusted Leverage Ratio of (i) .55
to 1 through August 1, 2003,  (ii) .65 to 1 from August 2, 2003 through  October
31, 2003,  (iii) .55 to 1 from November 1, 2003 through  October 29, 2004,  (ii)
..50 to 1 from  October  30,  2004  through  October  28, 2005 and (iii) .45 to 1
thereafter.

     The Senior Credit Facility also contains  restrictive  covenants pertaining
to the  management  and  operation  of Booth  Creek  and its  subsidiaries.  The
covenants  include,  among  others,  significant  limitations  on  indebtedness,
guarantees,  letters  of  credit,  liens,  investments,  distributions,  capital
expenditures, mergers, acquisitions, asset sales, fundamental corporate changes,
transactions  with  affiliates,  optional  payments  and  modification  of  debt
instruments and issuances of stock.

     For  purposes  of  calculating  interest,  loans  under the  Senior  Credit
Facility can be, at the  election of the Company,  base rate loans or LIBOR rate
loans or a combination thereof.  Base rate loans bear interest at the sum of (a)
the higher of (i) the Agent's prime rate or (ii) the federal funds rate plus .5%
plus (b) a margin of 1.5%. LIBOR rate loans bear interest at the LIBOR rate plus
a margin of 4%. Interest on loans outstanding is payable  quarterly.  The Senior
Credit  Facility  also  requires  commitment  fees of .5%  based  on the  unused
borrowing availability of the Revolving Credit Facility.  Borrowings outstanding
under the Term  Facility  bore  interest at an annual rate of 5.31% as of May 2,
2003 pursuant to the LIBOR rate option.  Borrowings  under the Revolving  Credit
Facility bore interest at a weighted  average  annual rate of 5.35% as of May 2,
2003 pursuant to elections under both the base rate and LIBOR rate options.

     Borrowings  under the  Revolving  Credit  Facility  can be used for working
capital and other general corporate purposes including,  with the consent of the
lenders, the repurchase of the Company's Senior Notes. Borrowings under the Term
Facility were used to  repurchase  the  Company's  Senior  Notes,  together with
accrued and unpaid interest thereon. As of May 2, 2003,  outstanding  borrowings
under the  Revolving  Credit  Facility and Term  Facility  were  $6,850,000  and
$23,000,000, respectively.

     The Company had a net working  capital  deficit of $31,137,000 as of May 2,
2003 (including $6,850,000 in outstanding  borrowings under the Revolving Credit
Facility),  which  will  negatively  affect  liquidity  in future  periods.  The
Company's  net  working  capital  deficit  as of May 2,  2003 was due in part to
unearned  revenue and deposits from resort  operations of $4,712,000  for season
pass and membership product sales,  lodging deposits and other prepaid products,
as well as real estate deposits of $5,610,000.


                                       21
<PAGE>

     The Company generated cash from operating activities of $17,339,000 for the
six months ended May 2, 2003 as compared to $34,953,000 for the six months ended
May 3, 2002.  The decrease in operating  cash flows,  which was primarily due to
reduced revenues and operating income in the 2003 period,  timing differences in
accounts  payable and accrued  liabilities  and the effect of the divestiture of
Bear  Mountain on operating  cash flows,  will  negatively  affect  liquidity in
future periods.

     Cash used in investing activities totaled $3,657,000 and $4,533,000 for the
six months ended May 2, 2003 and May 3, 2002, respectively.  The results for the
2003 and 2002 periods primarily reflect capital expenditures for the purchase of
property and equipment.

     Cash used in financing  activities  totaled  $13,431,000 for the six months
ended May 2, 2003,  which  reflects net  borrowings  under the Revolving  Credit
Facility of $5,605,000,  scheduled  payments of long-term debt of $3,952,000 and
the repurchase of $16,000,000 aggregate principal amount of the Company's Senior
Notes for $15,080,000. Cash used in financing activities totaled $23,651,000 for
the six months  ended May 3,  2002,  which  reflects  net  repayments  under the
Revolving Credit Facility of $17,628,000,  and scheduled repayments of long-term
debt  and  preferred   stock  of  $2,284,000   and   $1,151,000,   respectfully.
Additionally,  financing  activities for the 2002 period  reflect  borrowings of
$25,000,000  under  the  Term  Facility,  which  together  with  available  cash
resources,  were used to repurchase  $29,325,000  aggregate  principal amount of
Senior Notes for $25,588,000.

     The Company's  capital  expenditures  for property and equipment during the
six months ended May 2, 2003 were  $3,909,000  (including  $682,000 of equipment
acquired  through  capital  leases),  and  consisted  primarily of the remaining
portion of the  Company's  2002 capital  programs and  acquisitions  of grooming
equipment.  In response  to the  Company's  recent  operating  performance,  the
Company has reduced  planned  capital  expenditures  for fiscal year 2003 resort
capital  programs to a current  range from  $5,000,000  to  $6,000,000.  Capital
expenditures  for real  estate  development  projects  in  fiscal  year 2003 are
estimated  to be  approximately  $4,000,000.  The  Company  plans to fund future
capital  expenditures  from available cash flow,  vendor financing to the extent
permitted  under the Senior Credit  Facility and the Indenture for the Company's
Senior Notes and/or borrowings under the Revolving Credit Facility.  Commitments
for future capital expenditures were approximately $3,400,000 at May 2, 2003.

     Management  believes that there is a considerable  degree of flexibility in
the timing  (and,  to a lesser  degree,  the scope) of its  capital  expenditure
program,  and  even  greater  flexibility  as to  its  real  estate  development
objectives. While the capital expenditure program described above is regarded by
management  as  important,  both as to timing and scope,  discretionary  capital
spending  above  maintenance  levels  can be  deferred,  in some  instances  for
substantial periods of time, in order to address cash flow or other constraints.
However,  the  Company  is  required  to make  capital  expenditures  to satisfy
existing  and  future  regulatory  requirements,  which  in  some  cases  may be
significant. See "- Regulation and Legislation."

     With  respect  to  the   Company's   potential   real  estate   development
opportunities,  management  believes that such efforts would enhance ski-related
revenues and contribute  independently to earnings. In addition, with respect to
significant  development  projects,  the  Company  expects to continue to pursue
arrangements  that would  reduce  infrastructure  and other  development  costs.
Nonetheless,  existing  lodging  facilities  in the  vicinity of each resort are
believed  to be  adequate  to support  current  skier  volumes and a deferral or
curtailment  of  development  efforts is not regarded by management as likely to
adversely  affect  skier days and  ski-related  revenues or  profitability.  The
Company also believes that its current  infrastructure  is sufficient,  and that
development of real estate  opportunities is not presently  necessary to support
its existing operations.

     In March 2003, the Company  launched the sale of the Unit 7A subdivision at
Northstar,  which consists of fifteen  ski-in/ski-out  single family lots. As of
June 13, 2003, the Company entered into binding contracts for the sale of twelve
of the lots at an average lot price of  approximately  $770,000.  The Company is
continuing  efforts  to market  and sell the  remaining  three  lots  within the
subdivision.  The close of  escrow  for the lots  currently  under  contract  is
anticipated to occur during the Company's  fourth fiscal quarter of 2003,  which
is subject to (i)  completion of the  subdivision  infrastructure,  (ii) certain
subdivision  and  final  permitting  activities,  and  (iii)  other  normal  and
customary closing conditions.

                                       22
<PAGE>

     The Company's  significant  contractual  obligations include long-term debt
(including capital lease obligations), other long-term liabilities and operating
leases. As of May 2, 2003, the Company's scheduled maturities of long-term debt,
other  long-term  liabilities  and operating  lease  commitments for the periods
indicated were as follows:

              Six Months
              Ending            Year Ending October
              October   ----------------------------------
              2003       2004    2005     2006     2007   Thereafter    Total
              ------    ------  ------   ------   ------  ----------   ------
Long-term
 Debt         $ 2,063 $ 6,263 $ 18,017 $     99  $  80,200 $       -  $106,642
              ======= ======= ======== ========  ========= =========  ========
Other
 Long-term
 Liabilities  $    28 $    31 $    214 $     75  $      75 $     333  $    756
              ======= ======= ======== ========  ========= =========  ========
Operating
 Leases       $   262 $   905 $    742 $    366  $     110 $   2,120  $  4,505
              ======= ======= ======== ========  ========= =========  ========

     In connection with certain single family real estate  development  projects
at Northstar, self-insured workers' compensation arrangements for the Summit and
certain  other  aspects of its  operations,  the Company has arranged for surety
bonds from  third-party  surety  bonding  companies  or  letters of credit  from
financial  institutions.  The  aggregate  amount of surety  bonds and letters of
credit in place at May 2,  2003  were  approximately  $1,332,000  and  $600,000,
respectively.

     The  Company's  liquidity  has been and will  continue to be  significantly
affected  by its high  leverage.  As a result  of its  leveraged  position,  the
Company  will have  significant  cash  requirements  to  service  debt and funds
available for working capital,  capital  expenditures,  acquisitions and general
corporate  purposes are limited.  In addition,  the Company's high level of debt
may increase its  vulnerability to competitive  pressures and the seasonality of
the skiing and recreational industries. During the six months ended May 2, 2003,
the Company  experienced  a significant  decline in its  operating  performance,
which will  negatively  affect  liquidity in future  periods.  In response,  the
Company  has reduced its planned  level of resort  capital  expenditures  from a
previous  range of $7,000,000 to $11,000,000 to a current range of $5,000,000 to
$6,000,000. Additionally, the Company is undertaking cost-cutting initiatives in
an effort to improve its financial  performance in future  periods.  Any further
significant decline in the Company's expected operating performance could have a
material  adverse  effect on the Company's  ability to service its debt and make
required capital expenditures.

     In addition,  the Senior Credit  Facility and the  Indenture  governing the
Company's  Senior  Notes  each  contain  covenants  that,  among  other  things,
significantly  limit the  Company's  ability  to obtain  additional  sources  of
capital and may affect the Company's  liquidity.  These  covenants  restrict the
ability of the Company and its Restricted  Subsidiaries  to, among other things,
incur  additional  indebtedness,  create  liens,  make  investments,  consummate
certain asset sales, create subsidiaries, issue subsidiary stock, consolidate or
merge with any other person,  or transfer all or substantially all of the assets
of the Company.  Further, upon the occurrence of a Change of Control (as defined
in the Indenture), the Company may be required to repurchase the Senior Notes at
101% of the principal  amount  thereof,  plus accrued and unpaid  interest.  The
occurrence of a Change of Control may also constitute a default under the Senior
Credit  Facility.  No assurance  can be given that the Company  would be able to
finance a Change of Control  repurchase  offer.  The Senior Credit Facility also
requires the Company to maintain  specified  consolidated  financial  ratios and
satisfy  certain  consolidated  financial  tests.  On June 13, 2003, the Company
obtained  an  amendment  from the  lenders  under  the  Senior  Credit  Facility
modifying these covenants prospectively and a waiver of defaults that had arisen
as a result of the  Company's  operating  performance  through May 2, 2003.  The
Company's  ability  to meet  these  financial  covenants  in the  future  may be
affected by events  beyond its control,  and there can be no assurance  that the
Company will meet those covenants.

     As of May 2, 2003,  the Company had  $106,642,000  of total  long-term debt
outstanding.  The Company  expects  that  existing  cash,  cash  generated  from
operations and cash proceeds of planned real estate sales at Northstar, together
with borrowing availability, will be adequate to fund the Company's debt service
and other cash operating  requirements  over the next twelve months. In order to
focus the Company's resources on attractive investment  opportunities at certain
of its resorts and to satisfy short-term and long-term  liquidity  requirements,
the Company may in the future  consider  divestitures of  non-strategic  assets,
including resorts, if such transactions can be completed on favorable terms.

                                       23
<PAGE>

     Any  decline  in  the  Company's  expected  operating  performance  or  the
inability  of  management  to  successfully  implement  the  Company's  business
strategy,  could  have a  material  adverse  effect on the  Company's  financial
position and  liquidity.  In such case, the Company could be required to attempt
to refinance all or a portion of its existing debt,  sell other assets or obtain
additional  financing.  No assurance can be given of the Company's ability to do
so or the terms of any such transaction.  In addition, the Company would require
additional  financing  for  expansion of its existing  properties  or for future
acquisitions,  if any. No assurances can be given that any such financing  would
be available on commercially reasonable terms. See "Forward-Looking  Statements"
herein.

     The Company believes that inflation has had little effect on its results of
operations and any impact on costs has been largely offset by increased pricing.

Critical Accounting Policies

     The  preparation  of the  Company's  consolidated  financial  statements in
conformity with generally accepted accounting  principles requires the selection
of appropriate accounting policies, as well as the use of judgment by management
in applying such accounting policies and formulating financial estimates.  These
judgments and estimates  are based on historical  experience,  terms of existing
contracts  and  customer  arrangements  and  information  available  from  other
sources,  as  appropriate.  By their nature,  these  judgments and estimates are
subject  to an  inherent  degree  of  uncertainty.  In  applying  the  Company's
accounting  policies and determining  financial  estimates,  different  business
conditions  or  the  use of  different  assumptions  may  result  in  materially
different amounts reported in the Company's consolidated financial statements.

     The Company has identified  its most critical  accounting  policies,  which
relate  to  (i)  revenue   recognition  for  resort  operations,   (ii)  revenue
recognition  for real estate sales,  (iii)  valuation of  long-lived  assets and
goodwill,  and (iv)  evaluation  of  contingencies  and reserve  estimates.  The
critical  accounting  policies were  determined by  considering  which  policies
involved the most complexity, subjective decisions or estimation.

     Revenue Recognition for Resort Operations - Revenues from resort operations
are generated from a wide variety of sources,  including lift ticket sales, snow
school  lessons,  equipment  rentals,  retail product  sales,  food and beverage
operations,  lodging and property  management  services  and other  recreational
activities, and are recognized when services are provided and products are sold.
Sales of season passes are initially deferred in unearned revenue and recognized
ratably  over the  expected  ski season.  Revenues  relating to paid skier visit
insurance  arrangements in prior years were recognized based on an evaluation of
the policy  arrangements,  actual and forecasted  skier visits,  actual snowfall
amounts and other relevant factors. The Company also periodically  evaluates the
collectibility  of all of its  receivables,  and, if necessary,  provides for an
adequate allowance for doubtful accounts.

     Revenue  Recognition  for Real  Estate  Sales - Sales and  profits  on real
estate sales are recognized  using the full accrual method at the point that the
Company's receivables from land sales are deemed collectible and the Company has
no significant  remaining  obligations for  construction  or development,  which
typically  occurs upon transfer of title.  If such  conditions  are not met, the
recognition  of all or part of the sales and profit is  postponed.  The  Company
thoroughly  evaluates  contractual  agreements  and  the  underlying  facts  and
circumstances   relating  to  its  real  estate   transactions,   including  the
involvement of related parties, to determine the appropriate revenue recognition
treatment  of such  transactions  in  accordance  with  Statement  of  Financial
Accounting  Standards No. 66, "Accounting for Sales of Real Estate," and related
pronouncements.

     Valuation  of  Long-Lived  Assets and  Goodwill - The Company  periodically
evaluates  whether there are facts and  circumstances  that  indicate  potential
impairment of its long-lived assets. If impairment  indicators are present,  the
Company  reviews  the  carrying  value of its  long-lived  assets for  continued
appropriateness.  The  Company  also  performs  periodic  impairment  tests  for
recorded goodwill. The impairment evaluations for long-lived assets and goodwill
are based upon projections of future cash flows,  estimated  purchase  multiples
and other  relevant  factors.  While the  Company  believes  its  estimates  are
reasonable, different assumptions could materially affect these evaluations.

                                       24
<PAGE>

     Evaluation  of  Contingencies   and  Reserve   Estimates  -  The  Company's
operations  are  affected  by  various   contingencies,   including   commercial
litigation,   personal  injury  claims  relating   principally  to  snow  sports
activities, self-insured workers' compensation matters and self-insured employee
health and welfare  arrangements.  The Company performs periodic  evaluations of
these contingencies and, based on the advice of counsel, information provided by
third-party  claims  administrators  and other pertinent  information,  provides
reserves for its best estimate of the eventual  outcome of these matters.  These
estimated  liabilities are reviewed and appropriately  adjusted as the facts and
circumstances  related to these contingencies change. While the Company believes
its estimates are reasonable,  different  assumptions  could  materially  affect
these evaluations

Recently Adopted Accounting Pronouncements

     In June 2001, the FASB issued Statement of Financial  Accounting  Standards
No. 143,  "Accounting for Asset Retirement  Obligations" ("SFAS No. 143"), which
addresses financial accounting and reporting for obligations associated with the
retirement of tangible  long-lived assets and associated asset retirement costs.
The new rules  apply to legal  obligations  associated  with the  retirement  of
long-lived  assets that result from the acquisition,  construction,  development
and (or) normal  operation of a long-lived  asset.  The Company adopted SFAS No.
143 effective as of November 2, 2002.  The adoption of SFAS No. 143 did not have
any  impact on the  Company's  consolidated  financial  position  or  results of
operations.

     In June 2002, the FASB issued Statement of Financial  Accounting  Standards
No. 146,  "Accounting  for Costs  Associated  with Exit or Disposal  Activities"
("SFAS No. 146"), which addresses  financial  accounting and reporting for costs
associated with exit or disposal  activities and nullifies  Emerging Issues Task
Force  ("EITF")  Issue No. 94-3,  "Liability  Recognition  for Certain  Employee
Termination  Benefits  and Other  Costs to Exit an Activity  (including  Certain
Costs Incurred in a Restructuring)."  SFAS No. 146 requires that a liability for
a cost that is associated  with an exit or disposal  activity be recognized when
the  liability  is incurred,  whereas EITF Issue No. 94-3  required an entity to
recognize  a  liability  for an exit cost on the date that the entity  committed
itself  to an exit  plan.  SFAS  No.  146 is  effective  for  exit  or  disposal
activities  initiated  after December 31, 2002. The adoption of SFAS No. 146 did
not have a material impact on the Company's  consolidated  financial position or
results of operations.

Seasonality

     The business of the Company is highly  seasonal,  with the vast majority of
its annual revenues  expected to be generated between November and April of each
fiscal year.  Management  considers it  essential to achieve  optimal  operating
results  during key  holidays and weekends  during this  period.  The  Company's
results of operations are, in turn, significantly dependent on favorable weather
conditions and other factors beyond the Company's control.

     During the off-season months of May through October,  the Company's resorts
typically experience a substantial reduction in labor and utility expense due to
the  absence  of  ski  operations,   but  make   significant   expenditures  for
maintenance,  expansion and capital  improvements in preparation for the ensuing
ski season.

Regulation and Legislation

     The Company's  operations  are dependent upon its ownership or control over
the real property used in its ski  operations at each resort.  The real property
presently  used at the  Northstar  and Mt.  Cranmore  resorts  is  owned  by the
Company,  leased from third parties or controlled by easements.  The Company has
the right to use a substantial  portion of the real property associated with the
Sierra, Summit and Waterville Valley resorts under the terms of Term Special Use
Permits issued by the United States Forest Service (the "Forest  Service").  The
Sierra permit expires in 2039, the Waterville  Valley permit expires in 2034 and
the Summit permit expires in 2032.

                                       25
<PAGE>

     A  substantial  portion  of the  real  property  associated  with  the Loon
Mountain resort is likewise used under a Forest Service Term Special Use Permit.
In 1993, the Forest Service authorized various improvements at Loon Mountain and
an  expansion  onto the  adjacent  South  Mountain.  The United  States Court of
Appeals  for the First  Circuit  overturned  this  authorization  in 1996 on the
ground  that  the  Forest  Service  had  failed  to  properly   address  certain
environmental issues under the National  Environmental  Policy Act ("NEPA").  On
remand  from the Court of  Appeals,  the United  States  District  Court for the
District of New Hampshire  (the  "District  Court")  entered a final order dated
December 11, 1998 which imposed certain conditions and limitations on the Forest
Service  and Loon  Mountain  Recreation  Corporation  ("LMRC")  until the Forest
Service  completed an  additional  environmental  review  process under NEPA. In
response to a separate 1997 action filed by an individual  and an  environmental
group,  the  District  Court  entered an  injunction  on February 12, 1999 which
limited  LMRC's  snowmaking  and use of a snowmaking  pipeline  until the Forest
Service  completed  the  additional  environmental  review  process  under NEPA.
Effective  February  22,  2001,  certain  plaintiffs  in the  lawsuits  alleging
violations  of  environmental  laws by the Forest  Service and LMRC entered into
settlement  agreements  with LMRC which resolved all issues among the plaintiffs
and LMRC  relating to LMRC's  prior  operations  and its  proposal for near term
expansion and upgrading of Loon Mountain.  Among other things,  these agreements
impose  certain  restrictions  on the  operation  of the  resort  and the future
development of certain private land at the resort.

     LMRC notified the District Court and  interested  parties that the December
11, 1998 final order and February 12, 1999 injunction  expired under their terms
when the Forest Service (i) completed its NEPA process,  (ii) issued a Record of
Decision  ("ROD")  on  February  26,  2002  approving  the Loon  Mountain  Final
Environmental  Impact  Statement  (the  "Final  EIS"),  and (iii)  issued a Term
Special Use Permit to LMRC for Loon Mountain on June 24, 2002 (thereby replacing
Loon Mountain's  three existing Forest Service  permits).  The new Loon Mountain
Term Special Use Permit expires in 2042.

     Two  written  administrative  appeals to the ROD were filed with the Forest
Service.  One of the two  appellants  settled with LMRC and withdrew its appeal.
The Forest Service denied the other administrative  appeal and upheld the ROD in
a letter decision dated June 7, 2002. With these actions, the Forest Service has
concluded its administrative  appeal process for the ROD. The ROD and the Forest
Service's June 7, 2002 letter decision are subject to judicial review in federal
court  under  the   Administrative   Procedure  Act  by  the   appellant   whose
administrative  appeal was denied by the Forest Service.  As of the date of this
Report,  no action for judicial  review had been filed.  The Company can give no
assurance  regarding  whether such a judicial appeal will be filed or the timing
or outcome of such a process.

     Elements of the expansion and development activities addressed in the Final
EIS that occur on private lands will be subject to separate  federal,  state and
local permitting processes. While the Company believes that it will successfully
navigate these remaining  steps to undertaking the activities  authorized in the
ROD, it can give no assurance regarding the timing or outcome of such processes.

     The  Forest  Service  has the right to  approve  the  location,  design and
construction  of improvements  in permit areas and many  operational  matters at
resorts  with  permits.  Under the Term  Special  Use  Permits,  the  Company is
required  to pay  fees to the  Forest  Service.  The  fees  range  from  1.5% to
approximately  4.0% of certain  revenues,  with the rate  generally  rising with
increased  revenues.  The  calculation of gross revenues  includes,  among other
things,  revenue from lift  ticket,  season pass,  ski school  lesson,  food and
beverage,  rental equipment and retail merchandise sales. Total fees paid to the
Forest  Service  by the  Company  during the year  ended  November  1, 2002 were
$1,352,000.

     The Company  believes that its relations  with the Forest Service are good,
and, to the best of its knowledge,  no Term Special Use Permit for any major ski
resort  has ever been  terminated  by the  Forest  Service.  The  United  States
Secretary of Agriculture  has the right to terminate any Term Special Use Permit
upon 180-days  notice if, in planning for the uses of the national  forest,  the
public  interest  requires  termination.  Term  Special  Use Permits may also be
terminated or suspended because of non-compliance by the permittee; however, the
Forest  Service  would be required to notify the Company of the grounds for such
action  and  to  provide  it  with   reasonable  time  to  correct  any  curable
non-compliance.

     The Company's  resorts are subject to a wide variety of federal,  state and
local laws and  regulations  relating to land use, water  resources,  discharge,
storage,  treatment and disposal of various  materials  and other  environmental
matters.  Management  believes  that the  Company's  resorts  are  presently  in
compliance with all land use and environmental laws, except where non-compliance
is not  expected  to  result  in a  material  adverse  effect  on its  financial
condition.  However,  the  Company is  required  from time to time to  undertake
remediation  activities at its resorts to assure  compliance with  environmental
laws or to address  instances of  non-compliance.  The cost of these  activities
could be  significant.  The  failure by the  Company to comply  with  applicable
environmental  laws could result in the imposition of severe penalties and other
costs or restrictions on operations by government  agencies or courts that could
materially adversely affect operations.

                                       26
<PAGE>

     The operations at the resorts require  numerous  permits and approvals from
federal,  state and local  authorities,  including permits relating to land use,
ski  lifts and the sale of  alcoholic  beverages.  In  addition,  the  Company's
operations  are heavily  dependent on its continued  ability,  under  applicable
laws, regulations,  policies, permits, licenses or contractual arrangements,  to
have  access to  adequate  supplies of water with which to make snow and service
the other needs of its  facilities,  and  otherwise  to conduct its  operations.
There can be no assurance that new  applications  of existing laws,  regulations
and policies,  or changes in such laws,  regulations and policies will not occur
in a manner  that  could  have a  detrimental  effect  on the  Company,  or that
material permits,  licenses or agreements will not be canceled,  or renewed,  or
will be  renewed  on terms  materially  less  favorable  to the  Company.  Major
expansions of any one or more of the  Company's  resorts  could  require,  among
other  things,  the  filing  of  an  environmental  impact  statement  or  other
documentation  with the Forest Service and state or local governments under NEPA
and  certain  state or local  NEPA  counterparts  if it is  determined  that the
expansion  may have a  significant  impact upon the  environment.  Although  the
Company has no reason to believe that it will not be successful in  implementing
its operations and  development  plans, no assurance can be given that necessary
permits and approvals will be obtained or renewed.

     Certain regulatory  approvals associated with a snowmaking pipeline at Loon
Mountain, as well as certain contractual obligations, impose minimum stream flow
requirements on Loon Mountain.  These  requirements will compel Loon Mountain to
construct water storage  facilities  within  approximately  four years, and such
construction  may  require  further   regulatory   approvals  and  environmental
documentation  under  NEPA.  No  assurances  can be given  that such  regulatory
approvals will be obtained or that the Company will have the financial resources
to complete such construction.

     Except for certain permitting and environmental compliance matters relating
to Loon Mountain  described  above and in Part II, Item 1. "Legal  Proceedings,"
the Company has not received any notice of material non-compliance with permits,
licenses or approvals  necessary for the  operation of its  properties or of any
material liability under any environmental law or regulation.

Forward-Looking Statements

     Except for  historical  matters,  the matters  discussed in Part I, Item 2.
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  and elsewhere in this Report are  forward-looking  statements  that
involve  risks  and  uncertainties.  The  forward-looking  statements  are  made
pursuant to the safe harbor  provisions  of the  Private  Securities  Litigation
Reform Act of 1995. The reader can identify these statements by  forward-looking
words  such  as  "may,"  "will,"  "expect,"   "plan,"  "intend,"   "anticipate,"
"believe,"   "estimate,"  and  "continue"  or  similar  words.   Forward-looking
statements are based on  management's  current views and assumptions and involve
risks and uncertainties that could  significantly  affect the Company's business
and expected  operating  results.  The Company wishes to caution the reader that
certain  factors,  including  those described  below,  could  significantly  and
materially  affect  the  Company's  actual  results,  causing  results to differ
materially from those in any forward-looking  statement.  These factors include,
but are not limited to:

     o    Uncertainty as to future financial results,
     o    The substantial leverage and liquidity constraints of the Company,
     o    Significant   operating   restrictions   under  the   Company's   debt
          agreements,
     o    The capital  intensive  nature of  development  of the  Company's  ski
          resorts,
     o    Uncertainties  associated  with  obtaining  financing  for future real
          estate projects and to undertake future capital improvements,
     o    Uncertainties  regarding  the  timing and  success of our real  estate
          development  projects  and  their  ultimate  impact  on our  operating
          results,
     o    Demand for and costs associated with real estate development,
     o    The discretionary  nature of consumers' spending for skiing and resort
          real estate,
     o    Regional and national economic conditions,
     o    Weather conditions,
     o    Negative demand for our services and products resulting from potential
          terrorism threats,
     o    Availability and cost of commercial air service,

                                       27
<PAGE>

     o    The threat or commencement of wars,
     o    Availability and terms of insurance coverage,  as well as increases in
          the cost of insurance coverage,
     o    Natural disasters (such as earthquakes and floods),
     o    Competition and pricing pressures,
     o    Governmental regulation and litigation and other risks associated with
          expansion and development,
     o    The adequacy of the water supplies at each of the Company's resorts,
     o    Availability  of adequate  energy  supplies  for the  operation of the
          Company's resorts,  including snowmaking operations, and volatility in
          the prices charged for energy and fuel,
     o    The  occupancy of leased  property and property  used  pursuant to the
          United States Forest Service permits, and
     o    Other  factors  identified  under "- Risk Factors" in Part II, Item 7.
          "Management's  Discussion  and  Analysis of  Financial  Condition  and
          Results of Operations" in the Company's Annual Report on Form 10-K for
          the year ended November 1, 2002.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     During  the six  months  ended May 2,  2003,  there  have been no  material
changes in information  relating to market risk from the Company's disclosure in
Item 7a. of the Company's Annual Report on Form 10-K for the year ended November
1, 2002 as filed with the Securities and Exchange Commission.

ITEM 4.  CONTROLS AND PROCEDURES

     a)   The Company,  under the supervision and with the  participation of the
          Company's management, including the Company's Chief Executive Officer,
          President and Chief  Operating  Officer and Chief  Financial  Officer,
          carried  out an  evaluation  of the  effectiveness  of the  design and
          operation of the Company's  disclosure  controls and  procedures  (the
          "Evaluation") as of the last day of the period covered by this Report.
          Based upon the  Evaluation,  the Company's  Chief  Executive  Officer,
          President  and Chief  Operating  Officer and Chief  Financial  Officer
          concluded  that the Company's  disclosure  controls and procedures are
          effective to ensure that  information  required to be disclosed in our
          periodic reports filed with the Securities and Exchange  Commission is
          recorded, processed,  summarized and reported as and when required. In
          addition,  they concluded that there were no significant  deficiencies
          or material weaknesses in the design or operation of internal controls
          which  could  significantly  affect the  Company's  ability to record,
          process,  summarize and report financial data. It should be noted that
          the design of any  system of  controls  is based in part upon  certain
          assumptions about the likelihood of future events, and there can be no
          assurance  that any design will succeed in achieving  its stated goals
          under all potential future conditions, regardless of how remote.

     b)   There were no significant  changes in the Company's  internal controls
          or in other  factors that could  significantly  affect these  controls
          subsequent to the date of the Evaluation.


                                       28
<PAGE>

                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     Each of the  Company's  resorts  has pending  and is  regularly  subject to
litigation,  and the threat  thereof,  with  respect to personal  injury  claims
relating  principally  to snow  sports  activities  at its resorts as well as to
premises and vehicular operations and workers' compensation matters. The Company
maintains  liability  insurance  that the Company  considers  adequate to insure
claims related to such usual and customary  risks  associated with the operation
of four-season recreation resorts.

     In  connection  with  the  Company's  1998  acquisition  of  Loon  Mountain
Recreation  Corporation  ("LMRC"),  certain  shareholders  of LMRC filed several
lawsuits  challenging the transaction and seeking to exercise dissenters' rights
under the New Hampshire  Business  Corporation  Act. Each of these  lawsuits has
been decided or otherwise resolved in favor of the Company,  LMRC and its former
directors,  resulting  in no further  liability  or  obligation  relating to the
transaction  for LMRC, its former  directors or the Company and its  affiliates.
The New Hampshire Superior Court has awarded attorneys fees to the defendants in
certain of these cases in the amount of $972,000 (with $420,000 for LMRC and the
Company and $552,000 for the insurer that funded  certain costs of defending the
former LMRC  directors),  although the amount of such award  remains  subject to
appeal and the likelihood or timing of collection of such amount is uncertain.

     In 1995, an individual  sued the United States Forest  Service (the "Forest
Service") in the United States  District Court for the District of New Hampshire
(the  "District  Court")  alleging  that the Forest  Service  had  violated  the
National  Environmental Policy Act ("NEPA"),  the Clean Water Act ("CWA") and an
executive order in approving  improvements to and an expansion at Loon Mountain.
The District  Court  entered a final order dated  December 11, 1998 that imposed
certain  conditions and limitations on LMRC's  operations.  Under its terms, the
order  was  effective   until  the  Forest   Service   completed  an  additional
environmental review process under NEPA and issued a new Term Special Use Permit
for Loon  Mountain.  In 1997, an individual and an  environmental  group filed a
second  lawsuit  against the Forest  Service in the District Court alleging that
the Forest Service  violated NEPA in authorizing LMRC to construct and operate a
snowmaking  pipeline.  The District  Court entered an injunction on February 12,
1999  which  limited  LMRC's  use of the  snowmaking  pipeline  until the Forest
Service completed its additional  environmental analysis under NEPA and issued a
Record of Decision ("ROD").

     As described in Part I, Item 2.  "Management's  Discussion  and Analysis of
Financial  Condition and Results of Operations - Regulation and Legislation," on
February 26, 2002, the Forest Service completed its environmental analysis under
NEPA and issued a ROD approving  the Final  Environmental  Impact  Statement for
Loon  Mountain.  The Forest Service issued a Term Special Use Permit to LMRC for
Loon  Mountain on June 24, 2002.  The Forest  Service  denied an  administrative
appeal of the ROD in a June 7,  2002  letter  decision.  The ROD and the June 7,
2002 letter  decision are subject to judicial review in federal court. As of the
date of this Report,  no action for judicial review had been filed.  The Company
can give no assurance  regarding whether such a judicial appeal will be filed or
the timing or outcome of such process.

     Effective  February 22, 2001, certain plaintiffs in lawsuits (each of which
have now been dismissed or settled) alleging violations of environmental laws by
LMRC entered into  settlement  agreements  with LMRC,  which  resolve all issues
among them and LMRC relating to LMRC's prior operations and current proposal for
near term  expansion  and  upgrading of the Loon  Mountain  resort.  Among other
things,  these  agreements  impose certain  restrictions on the operation of the
resort and the future development of certain private land at the resort.

     On November 13, 2001, the Company filed a lawsuit against ASU International
LLC,  Essex  Insurance   Company  and  Certain   Underwriters,   Lloyd's  London
(collectively,  the "Insurers") in Superior Court in Massachusetts.  The Company
had placed  with the  Insurers  weather/income  stabilization  coverage  for the
2000/01 ski season for certain of its resorts.  During the applicable  period of
the  policies,  the  Company  incurred  losses at two of its  resorts  which the
Company  believes  were covered  under the terms of such  policies.  The Company
believes  that it  complied  with its  obligations  under the  policies  and has
properly  reported  and made claims in  accordance  with the policies for losses
aggregating  in excess of  $1,500,000.  In response to the Insurers'  failure to
properly process the Company's claims,  the Company seeks recovery for breach of
contract,  breach of  covenant of good faith and unfair and  deceptive  business
practices.  The Company's  complaint  seeks  recovery for the full amount of its
claims as well as multiple damages and attorneys' fees based on its assertion of
unfair and deceptive claims practices by the Insurers.



                                       29
<PAGE>

     Partial  resolution of the claims was reached and a payment of $700,000 was
made by the Insurers in April 2002.  This payment was made and accepted  without
prejudice to the remainder of the Company's claims.  The discovery phase of this
lawsuit  is  scheduled  by the  Court to close at the end of June  2003,  with a
limited number of depositions remaining to be completed. The parties have agreed
to pursue non-binding mediation in an effort to resolve this matter. Based on an
evaluation  of  information  and progress of discovery to date and the advice of
counsel,  the  Company  believes  that  realization  of its  recorded  claims is
probable.  However, no assurance can be given regarding the timing of resolution
of this matter.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

     The Company did not satisfy  the  minimum  consolidated  resort  EBITDA and
ratio of consolidated  EBITDA to consolidated  debt service  covenants under the
Senior  Credit  Facility for the four quarter  period ended May 2, 2003. On June
13, 2003,  the Company  obtained an amendment  and waiver from the lenders under
the Senior Credit Facility  modifying these covenants  prospectively and waiving
any default or event of default  arising as a result of having  failed to comply
with the  covenants  through  May 2,  2003.  See Part I,  Item 2.  "Management's
Discussion  and  Analysis  of  Financial  Condition  and  Results  Operations  -
Liquidity and Capital Resources."

ITEM 6. EXHIBITS AND REPORTS ON FORM-8-K

a.   Exhibits

     Exhibit No.    Description of Exhibit
     -----------    ----------------------

     10.1           Third  Amendment and Waiver dated as of June 13, 2003 to the
                    Amended and Restated Credit  Agreement dated as of March 15,
                    2002  among  Booth  Creek  Ski  Holdings,  Inc.,  the  other
                    Borrowers  thereunder,  the  Guarantor  named  therein,  the
                    Lenders named therein, and Fleet National Bank, as Agent for
                    the Lenders.

     99.1           Certification  of George N. Gillett,  Jr.,  Chief  Executive
                    Officer,  pursuant  to 18 U.S.C.  Section  1350,  as adopted
                    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

     99.2           Certification  of Christopher P. Ryman,  President and Chief
                    Operating  Officer,  pursuant to 18 U.S.C.  Section 1350, as
                    adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                    2002.

     99.3           Certification of Elizabeth J. Cole, Executive Vice President
                    and Chief Financial Officer,  pursuant to 18 U.S.C.  Section
                    1350,   as  adopted   pursuant   to   Section   906  of  the
                    Sarbanes-Oxley Act of 2002.

b.   Reports on Form 8-K

No reports on Form 8-K were filed during the quarterly period ended May 2, 2003.



                                       30
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                           BOOTH CREEK SKI HOLDINGS, INC.
                                                   (Registrant)


                                           By:/s/ ELIZABETH J. COLE
                                             -----------------------------------
                                                  Elizabeth J. Cole
                                             Executive Vice President and
                                               Chief Financial Officer
                                             (Principal Financial Officer)


                                           By:/s/ BRIAN J. POPE
                                             -----------------------------------
                                                  Brian J. Pope
                                             Vice President of Accounting
                                                  and Finance
                                            (Principal Accounting Officer)





June 16, 2003



                                       31
<PAGE>


                                 CERTIFICATIONS



I, George N. Gillett, Jr., certify that:

1.   I have  reviewed  this  quarterly  report on Form  10-Q of Booth  Creek Ski
     Holdings, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

June 16, 2003


                                        By:/s/ GEORGE N. GILLETT, JR.
                                          -----------------------------------
                                               George N. Gillett, Jr.
                                              Chief Executive Officer


                                       32
<PAGE>

I, Christopher P. Ryman, certify that:

1.   I have  reviewed  this  quarterly  report on Form  10-Q of Booth  Creek Ski
     Holdings, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


June 16, 2003


                                        By:/s/ CHRISTOPHER P. RYMAN
                                          -----------------------------------
                                               Christopher P. Ryman
                                         President and Chief Operating Officer


                                       33
<PAGE>

I, Elizabeth J.Cole, certify that:

1.   I have  reviewed  this  quarterly  report on Form  10-Q of Booth  Creek Ski
     Holdings, Inc.;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

June 16, 2003


                                        By:/s/ ELIZABETH J. COLE
                                          -----------------------------------
                                               Elizabeth J. Cole
                                          Executive Vice President and
                                            Chief Financial Officer


                                       34