UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
           ACT OF 1934 for the quarterly period ended January 30, 2005
                                       or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 for the transition period from____________ to ____________.

                        --------------------------------
                         Commission File Number 1-13507
                        --------------------------------

                             American Skiing Company
             (Exact name of registrant as specified in its charter)

         Delaware                                       04-3373730
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

                             136 Heber Avenue, #303
                                  P.O. Box 4552
                              Park City, Utah 84060
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (435) 615-0340
              (Registrant's telephone number, including area code)

                                 Not Applicable
              (Former name, former address and former fiscal year,
                         if changed since last report.)

Indicate by checkmark 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 by Rule 12b-2 of the Exchange Act).
Yes [  ] No [X]

The number of shares outstanding of each of the issuer's classes of common stock
were 14,760,530 shares of Class A common stock, $.01 par value, and 16,977,653
shares of common stock, $.01 par value, as of February 27, 2005.


                                       1
<PAGE>



                                Table of Contents

Part I - Financial Information

Item 1.  Financial Statements

         Condensed Consolidated Statements of Operations and Changes in
            Accumulated Deficit for the 13 weeks ended January 25, 2004 and the
            14 weeks ended January 30, 2005 (unaudited)........................3

         Condensed Consolidated Statements of Operations and Changes in
            Accumulated Deficit for the 26 weeks ended January 25, 2004 and the
            27 weeks ended January 30, 2005 (unaudited)........................4

         Condensed Consolidated Balance Sheets as of July 25, 2004
            and January 30, 2005 (unaudited)...................................5

         Condensed Consolidated Statements of Cash Flows for the 26 weeks
            ended January 25, 2004 and the 27 weeks ended January 30, 2005
            (unaudited)........................................................7

         Notes to Condensed Consolidated Financial Statements (unaudited)......8

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

         General..............................................................18

         Liquidity and Capital Resources......................................19

         Results of Operations................................................23

Item 3.  Quantitative and Qualitative Disclosures About Market Risk...........27

Item 4.  Controls and Procedures..............................................27


Part II - Other Information

Item 1.  Legal Proceedings....................................................27

Item 4.  Submission of Matters to a Vote of Security Holders..................28

Item 6.  Exhibits.............................................................29



                                       2
<PAGE>



Part I - Financial Information
                           Item 1 Financial Statements

   Condensed Consolidated Statements of Operations and Changes in Accumulated
                                     Deficit
               (In thousands, except share and per share amounts)

                                          13 weeks ended         14 weeks ended
                                         January 25, 2004       January 30, 2005
                                           (unaudited)            (unaudited)
Net revenues:
    Resort                              $         92,904       $        103,411
    Real estate                                   10,056                  2,663
                                        -------------------    -----------------
       Total net revenues                        102,960                106,074
                                        -------------------    -----------------

Operating expenses:
    Resort                                        62,410                 67,786
    Real estate                                    8,538                  2,155
    Marketing, general and
       administrative                             20,490                 16,210
    Depreciation and amortization                 10,631                 14,400
                                        -------------------    -----------------
       Total operating expenses                  102,069                100,551
                                        -------------------    -----------------

Imcome from operations                               891                  5,523

Interest expense and other, net                   22,580                 21,684
Write-off of deferred financing costs
    and loss on extinguishment of
    senior subordinated notes                          -                  5,983
                                        -------------------    -----------------
Net loss                                $        (21,689)      $        (22,144)
                                        ===================    =================

Accumulated deficit, beginning of
    period                              $       (556,321)      $       (581,285)

Net loss                                         (21,689)               (22,144)
                                        -------------------    -----------------

Accumulated deficit, end of period      $       (578,010)      $       (603,429)
                                        ===================    =================

Basic and diluted net loss per common
    share:
Net loss                                $          (0.68)      $          (0.70)

Weighted average common shares
    outstanding - basic and diluted           31,738,183             31,738,183





     See accompanying notes to Condensed Consolidated Financial Statements.


                                       3
<PAGE>




   Condensed Consolidated Statements of Operations and Changes in Accumulated
                                     Deficit
               (In thousands, except share and per share amounts)

                                          26 weeks ended         27 weeks ended
                                         January 25, 2004       January 30, 2005
                                           (unaudited)            (unaudited)
Net revenues:
    Resort                              $        109,032       $        121,231
    Real estate                                   12,401                  4,389
                                        -------------------    -----------------
       Total net revenues                        121,433                125,620
                                        -------------------    -----------------

Operating expenses:
    Resort                                        84,935                 91,395
    Real estate                                   10,196                  3,263
    Marketing, general and
       administrative                             30,770                 27,027
    Restructuring and asset impairment               137                      -
    Depreciation and amortization                 12,934                 16,679
                                        -------------------    -----------------
       Total operating expenses                  138,972                138,364
                                        -------------------    -----------------

Loss from operations                             (17,539)               (12,744)
Interest expense and other, net                   45,408                 41,137
Write-off of deferred financing costs
    and loss on extinguishment of senior
    subordinated notes                                 -                  5,983
                                        -------------------    -----------------
Net loss                                $        (62,947)      $        (59,864)
                                        ===================    =================

Accumulated deficit, beginning of
    period                              $       (515,063)      $       (543,565)

Net loss                                         (62,947)               (59,864)
                                        -------------------    -----------------

Accumulated deficit, end of period      $       (578,010)      $       (603,429)
                                        ===================    =================

Basic and diluted net loss per common
    share:
Net loss                                $          (1.98)      $          (1.89)

Weighted average common shares
    outstanding - basic and diluted           31,738,183             31,738,183





     See accompanying notes to Condensed Consolidated Financial Statements.


                                       4
<PAGE>



                      Condensed Consolidated Balance Sheets
               (In thousands, except share and per share amounts)

                                          July 25, 2004         January 30, 2005
                                           (unaudited)             (unaudited)
Assets
Current assets
    Cash and cash equivalents            $        7,024        $         15,830
    Restricted cash                               4,846                   3,117
    Accounts receivable, net                      5,628                   8,952
    Inventory                                     3,628                   8,021
    Prepaid expenses                              3,132                   5,787
    Other current assets                          6,953                   6,854
                                         -----------------     -----------------
       Total current assets                      31,211                  48,561

Property and equipment, net                     353,509                 362,126
Real estate developed for sale                   25,024                  24,093
Intangible assets, net                            6,365                   6,335
Deferred financing costs, net                     3,933                   6,995
Other assets                                     10,758                   9,646
                                         -----------------     -----------------
       Total assets                      $      430,800        $        457,756
                                         =================     =================


                            (continued on next page)







     See accompanying notes to Condensed Consolidated Financial Statements.


                                       5
<PAGE>

                Condensed Consolidated Balance Sheets (continued)
               (In thousands, except share and per share amounts)

                                          July 25, 2004         January 30, 2005
                                           (unaudited)             (unaudited)
Liabilities and Shareholders' Deficit
Current liabilities
    Current portion of long-term debt     $      45,191         $        27,015
    Current portion of subordinated notes
       and debentures                                 -                       -
    Accounts payable and other current
       liabilities                               44,604                  61,234
    Deposits and deferred revenue                13,144                  45,096
    Mandatorily Redeemable Convertible
       10 1/2% Series A Preferred Stock,
       par value of $0.01 per share;
       40,000 shares authorized; 36,626
       and 0 shares, respectively, issued
       and outstanding, including
       cumulative dividends (redemption
       value of $73,947 and $0,
       respectively)                             73,947                       -
                                          -----------------    -----------------

       Total current liabilities                176,886                 133,345

Long-term debt, net of current portion           74,384                 223,273
Subordinated notes and debentures, net of
    current portion and discount                142,260                 101,833
Other long-term liabilities                      10,361                  11,518
Mandatorily Redeemable 8 1/2% Series B
    Preferred Stock; 150,000 shares
    authorized, issued and outstanding
    (redemption value of $0)                          -                       -
Mandatorily Redeemable Convertible
    Participating 12% Series C-1
    Preferred Stock, par value of $0.01
    per share; 40,000 shares authorized,
    issued and outstanding, including
    cumulative dividends (redemption value
    of $56,376 and $59,934 respectively)         55,880                  59,497
Mandatorily Redeemable 15% Nonvoting
    Series C-2 Preferred Stock, par value
    of $0.01 per share; 139,453 shares
    authorized, issued and outstanding,
    including cumulative dividends
    (redemption value of $213,826 and
    $230,757, respectively)                     211,991                 229,116
Mandatorily Redeemable Nonvoting Series D
    Participating Preferred Stock, par
    value of $0.01 per share; 5,000 shares
    authorized; no shares issued or
    outstanding                                       -                       -
                                          -----------------    -----------------
       Total liabilities                        671,762                 758,582
                                          -----------------    -----------------

Shareholders' deficit
    Common stock, Class A, par value of
       $0.01 per share; 15,000,000 shares
       authorized; 14,760,530 shares
       issued and outstanding                       148                     148
    Common stock, par value of $0.01 per
       share; 100,000,000 shares
       authorized; 16,977,653 shares
       issued and outstanding                       170                     170
    Additional paid-in capital                  302,285                 302,285
    Accumulated deficit                        (543,565)               (603,429)
                                          -----------------    -----------------
       Total shareholders' deficit             (240,962)               (300,826)
                                          -----------------    -----------------
       Total liabilities and
          shareholders' deficit           $     430,800        $        457,756
                                          =================    =================


     See accompanying notes to Condensed Consolidated Financial Statements.


                                       6
<PAGE>

                 Condensed Consolidated Statements of Cash Flows
                                 (In thousands)

                                           26 weeks ended        27 weeks ended
                                          January 25, 2004      January 30, 2005
                                            (unaudited)            (unaudited)
Cash flows from operating activities
Net loss                                  $       (62,947)     $        (59,864)
Adjustments to reconcile net loss to net
    cash provided by - operating
    activities:
       Depreciation and amortization               12,934                16,679
       Amortization of deferred financing
          costs, amortization of original
          issue discount, and accretion
          of discount and dividends on
          mandatorily redeemable preferred
          stock                                    22,918                24,578
       Non-cash interest on junior
          subordinated notes                          848                 2,727
       Non-cash compensation expense                  175                  (103)
       Write-off of deferred financing
          costs and extinguishment of
          senior subordinated notes                     -                 5,983
       Gain from sale of assets                      (302)                 (754)
       Decrease (increase) in assets:
          Restricted cash                            (667)                1,729
          Accounts receivable, net                 (4,112)               (3,324)
          Inventory                                (3,587)               (4,393)
          Prepaid expenses                         (3,514)               (2,655)
          Real estate developed for sale            7,756                   931
          Other assets                                206                 1,028
       Increase (decrease) in liabilities:
          Accounts payable and other
             current liabilities                   30,440                16,630
          Deposits and deferred revenue            32,848                31,952
          Other long-term liabilities                (143)                  424
                                          -------------------  -----------------
             Net cash provided by
                operating activities               32,853                31,568
                                          -------------------  -----------------

Cash flows from investing activities
       Capital expenditures                        (6,623)              (12,663)
       Proceeds from sale of assets                   451                 1,008
                                          -------------------  -----------------
             Net cash (used in)
                investing activities               (6,172)              (11,655)
                                          -------------------  -----------------

Cash flows from financing activities
       Proceeds from resort senior credit
          facilities                               31,301               259,750
       Repayment of resort senior credit
          facilities                              (45,443)             (137,178)
       Repayment of senior subordinated
          debt                                          -              (121,875)
      Proceeds from long-term debt                      -                 2,550
      Repayment of long-term debt                  (1,172)               (5,443)
      Proceeds from real estate debt                3,667                     -
      Repayment of real estate debt                (6,994)               (1,640)
      Deferred financing costs                          -                (7,271)
                                          -------------------  -----------------
             Net cash (used in) financing
                activities                        (18,641)              (11,107)
                                          -------------------  -----------------

Net increase in cash and cash equivalents           8,040                 8,806
Cash and cash equivalents, beginning of
      period                                        6,596                 7,024
                                          -------------------  -----------------
Cash and cash equivalents, end of period  $        14,636      $         15,830
                                          ===================  =================

Supplemental disclosure of cash flow
      information:
Cash paid for interest                    $        22,820      $         13,800
Acquisition of equipment under capital
      leases                                            -                12,674
Conversion of Series A Preferred Stock
      to New Junior Subordinated Notes                  -                76,673
Addition of interest to principal
      outstanding to New Junior
      Subordinated Notes                                -                   910

     See accompanying notes to Condensed Consolidated Financial Statements.


                                       7
<PAGE>



        Notes to Condensed Consolidated Financial Statements (Unaudited)

1.  General

         American Skiing Company (ASC) is organized as a holding company and
operates through various subsidiaries (collectively, the Company). The Company
reports its results of operations in two business segments, resort operations
and real estate operations. The Company's fiscal year is a fifty-two week or
fifty-three week period ending on the last Sunday of July. Fiscal 2005 is a
fifty-three week reporting period and fiscal 2004 was a fifty-two week reporting
period, with each quarter consisting of 13 weeks, with the exception of the
second quarter of fiscal 2005, which consists of 14 weeks. The accompanying
unaudited condensed consolidated financial statements have been prepared in
accordance with U.S. generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by U.S. generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
only of normal recurring adjustments) considered necessary for a fair
presentation have been included.

         Results for interim periods are not indicative of the results expected
for the year due to the seasonal nature of the Company's business. Due to the
seasonality of the ski industry, the Company typically incurs significant
operating losses in its resort operating segment during its first and fourth
fiscal quarters. The unaudited condensed consolidated financial statements
should be read in conjunction with the following notes and the Company's
consolidated financial statements included in its Form 10-K for the fiscal year
ended July 25, 2004 (fiscal 2004) filed with the Securities and Exchange
Commission on November 9, 2004.

2.  Significant Accounting Policies

         The preparation of financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of sales and expenses
during the reporting periods. Areas where significant judgments are made
include, but are not limited to: allowance for doubtful accounts, litigation
reserves, insurance reserves, long-lived asset valuation, realizability and
useful lives, and realizability of deferred income tax assets. Actual results
could differ materially from these estimates. The following are the Company's
significant accounting policies:

Property and Equipment
         Property and equipment are carried at cost, net of accumulated
depreciation and impairment charges. Depreciation is calculated using the
straight-line method over the assets' estimated useful lives which range from 9
to 40 years for buildings, 3 to 12 years for machinery and equipment, 10 to 50
years for leasehold improvements, and 5 to 30 years for lifts, lift lines and
trails. Assets held under capital lease obligations are amortized over the
shorter of their useful lives or their respective lease lives, unless a bargain
purchase option exists at the end of the lease in which case the assets are
amortized over their estimated useful lives. Due to the seasonality of the
Company's business, the Company records a full year of depreciation relating to
its resort ski operating assets during the second and third quarters of the
Company's fiscal year.

Goodwill and Other Intangible Assets
         As prescribed in Statement of Financial Accounting Standards (SFAS) No.
142, "Goodwill and Other Intangible Assets," certain indefinite-lived intangible
assets, including trademarks, are no longer amortized but are subject to annual
impairment assessments. An impairment loss is recognized to the extent that the
carrying amount exceeds the asset's fair value. Definite-lived intangible assets
continue to be amortized on a straight-line basis over their estimated useful
lives of 31 years, and assessed for impairment utilizing guidance provided by
SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets."



                                       8
<PAGE>

As of July 25, 2004 and January 30, 2005, other intangible assets consist of the
                            following (in thousands):

              ------------------------------------------------------------------
                                        July 25, 2004           January 30, 2005
              ------------------------------------------------------------------
              Definite-lived Intangible
                Assets:
                  Lease agreements      $       1,853           $         1,853
                  Less accumulated
                    amortization                 (346)                     (376)
                                        ----------------        ----------------
                                                1,507                     1,477

              Indefinite-lived
                Intangible Assets:
                  Trade names                     170                       170
                  Water rights                  4,688                     4,688
                                        ----------------        ----------------
              Intangible Assets, net    $       6,365                     6,335
                                        ================        ================


         Amortization expense related to intangible assets was approximately
$14,000 and $15,000 respectively for the 13 weeks ended January 25, 2004 and the
14 weeks ended January 30, 2005. For the 26 weeks ended January 25, 2004 and the
27 weeks ended January 30, 2005, amortization expense was approximately $28,000
and $30,000, respectively. Future amortization expense related to definite-lived
intangible assets is estimated to be approximately $58,000 for each of the next
five fiscal years.

Long-Lived Assets
         In accordance with SFAS No. 144, long-lived assets, such as property
and equipment, and definite-lived intangibles are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable. Recoverability of assets to be held and used is
measured by a comparison of the carrying amount of an asset to the estimated
undiscounted future cash flows expected to be generated by the asset. If the
carrying amount of an asset exceeds its estimated future cash flows, an
impairment charge is recognized in the amount by which the carrying amount of
the asset exceeds the fair value of the asset. Assets to be disposed of are
reported at the lower of the carrying amount or fair value less costs to sell,
and depreciation ceases.

Revenue Recognition
         Resort revenues include sales of lift tickets, skier development, golf
course and other recreational activities fees, sales from restaurants, bars and
retail and rental shops, and lodging and property management fees (real estate
rentals). Daily lift ticket revenue is recognized on the day of purchase. Lift
ticket season pass revenue is recognized on a straight-line basis over the ski
season, which occurs during the Company's second and third fiscal quarters. The
Company's remaining resort revenues are generally recognized as the services are
performed. Real estate revenues are recognized under the full accrual method
when title has been transferred, initial and continuing investments are adequate
to demonstrate a commitment to pay for the property and no substantial
continuing involvement exists. Amounts received from pre-sales of real estate
are recorded as restricted cash and deposits and deferred revenue in the
accompanying consolidated balance sheets until the earnings process is complete.

Stock Option Plan
         Effective August 1, 1997, the Company established a fixed stock option
plan, the American Skiing Company Stock Option Plan (the Plan), to provide for
the grant of incentive and non-qualified stock options for the purchase of up to
8,688,699 shares of the Company's common stock by officers, management
employees, members of the board of directors of the Company and its
subsidiaries, and other key persons (eligible for nonqualified stock options
only) as designated by the Compensation Committee. The Compensation Committee,
which is appointed by the Board of Directors, is responsible for the Plan's
administration. The Compensation Committee determines the term of each option,
option exercise price, number of shares for which each option is granted and the
rate at which each option is exercisable. Options granted under the Plan
generally expire ten years from the date of grant and vest either immediately or
over a five-year term. Incentive stock options may not have an exercise price
less than the fair market value of the common stock at the date of grant.
Nonqualified stock options may be granted at an exercise price as determined by
the Compensation Committee. At January 30, 2005, options to purchase 3,821,187
shares were outstanding at a weighted average exercise price of $4.25 under the
Plan. No options have been granted, exercised, or forfeited since July 25, 2004.

         During fiscal 1998, the Company granted nonqualified options under the
Plan to certain key members of management to purchase 672,010 shares of common
stock with an exercise price of $2.00 per share when the fair market value of
the stock was estimated to be $18.00 per share. The majority of these options
(511,530 shares) were granted to members of senior management and were 100%
vested on the date of grant. Accordingly, the Company recognized stock


                                       9
<PAGE>

compensation expense of $8.1 million in fiscal 1998 relating to the grants based
on the intrinsic value of $16.00 per share. Under these senior management grant
agreements, the Company also agreed to pay the optionees a fixed tax "bonus" in
the aggregate of $5.8 million to provide for certain fixed tax liabilities that
the optionees will incur upon exercise. The liability for this fixed tax bonus
has been reduced to reflect $5.3 million in tax bonus payments made through
January 30, 2005 in connection with options exercised. The remaining $0.5
million tax bonus liability is reflected in accounts payable and other current
liabilities in the accompanying consolidated balance sheet as of January 30,
2005. The remainder of these original $2.00 options (160,480 shares) were
granted under the Plan to certain members of management and were vested 20% on
the date of grant and vest ratably to 100% over the following four years. For
the 13 and 26 weeks ended January 25, 2004 and the 14 and 27 weeks ended January
30, 2005, the Company recognized no stock compensation expense relating to these
options.

         The following table summarizes information about the stock options
outstanding under the Plan as of January 30, 2005:

--------------------------------------------------------------------------------
                            Weighted
                            Average                                     Weighted
  Range of                  Remaining       Weighted                    Average
  Exercise                  Contractual     Average                     Exercise
  Prices     Outstanding   Life (in years) Exercise Price  Excerisable   Price
--------------------------------------------------------------------------------
    $0.72         25,000         6.7       $        0.72       25,000   $   0.72
 1.75 - 2.50   1,420,337         5.4                2.11    1,385,003       2.11
 3.00 - 4.00   1,449,250         5.4                3.17    1,430,750       3.18
 7.00 - 8.75     735,750         4.0                7.19      733,050       7.19
14.19 - 18.00    190,850         3.0               17.55      190,850      17.55
               ---------                                 ------------
               3,821,187         5.0       $        4.25    3,764,653   $   4.28
               =========                                 ============


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

         The Company continues to account for stock-based compensation using the
method prescribed in Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees," under which no compensation expense for stock
options is recognized for stock option awards granted to employees at or above
fair market value. In December 2002, the Financial Accounting Standards Board
(FASB) issued SFAS No. 148, "Accounting for Stock-Based Compensation -Transition
and Disclosure - an amendment of FAS 123." This statement amends SFAS No. 123,
"Accounting for Stock-Based Compensation," to provide alternative methods of
transition for a voluntary change to the fair value based method of accounting
for stock-based employee compensation, and amends the disclosure requirements to
SFAS No. 123 to require prominent disclosures in both annual and interim
financial statements about the method of accounting for stock-based employee
compensation and the effect of the method used on reported results. The Company
has adopted the disclosure-only provisions of SFAS No. 148. Had stock
compensation expense been determined based on the fair value at the grant dates
for awards granted under the Plan, consistent with the provisions of SFAS No.
148, the Company's net loss and loss per common share would have been changed to
the pro forma amounts indicated below (in thousands, except per share amounts):

<TABLE>
---------------------------------------------------------------------------------------------------------
                                                13 weeks       14 weeks       26 weeks        27 weeks
                                                 ended          ended          ended           ended
                                              January 25,    January 30,    January 25,     January 30,
                                                  2004           2005           2004            2005
---------------------------------------------------------------------------------------------------------
 Net loss available to
  common shareholders
<S>                                          <C>             <C>            <C>            <C>
As reported                                  $  (21,689)     $   (22,144)   $   (62,947)   $   (59,864)
    Stock-based employee compensation
      determined under fair-value method
      for all awards, net of tax                    (55)             (34)          (174)           (68)
                                             --------------- ---------------------------------------------
    Pro forma                                $  (21,744)     $   (22,178)   $   (63,121)   $   (59,932)
                                             =============== =============================================
Basic and diluted net loss
    per common share
      As reported                            $    (0.68)     $     (0.70)   $     (1.98)   $     (1.89)
      Pro forma                                   (0.69)           (0.70)         (1.99)         (1.89)

----------------------------------------------------------------------------------------------------------
</TABLE>

         The fair value of each option grant is estimated on the date of grant
using the Black-Scholes option-pricing model. There were no options granted
during the 13 or 26 weeks ended January 25, 2004, or the 14 or 27 weeks ended
January 30, 2005.


                                       10
<PAGE>
Accounting for Variable Interest Entities
         In December 2003, the FASB issued a revision to FASB Interpretation
(FIN) No. 46R, "Consolidation of Variable Interest Entities". FIN No. 46R
clarifies the application of ARB No. 51, Consolidated Financial Statements to
certain entities in which equity investors do not have the characteristics of a
controlling financial interest or do not have sufficient equity risk for the
entity to finance its activities without additional subordinated financial
support. FIN No. 46R requires the consolidation of these entities, known as
variable interest entities, by the primary beneficiary of the entity. The
primary beneficiary is the entity, if any, that will absorb a majority of the
entities expected losses, receive a majority of the entity's expected residual
returns, or both.

         The Company, through one of its subsidiaries, acquired a 49% interest
in SS Associates, LLC (SS Associates) in October 2004 by contributing its rights
to purchase the building to SS Associates and by making a refundable security
deposit of approximately $0.4 million. In accordance with FIN No. 46R and APB
No. 18, the Company consolidates SS Associates as it meets the requirements of a
variable interest entity for which the Company is the primary beneficiary.

         SS Associates purchased a building in October 2004 for approximately
$3.5 million (including costs to close) through cash and long-term debt of
approximately $2.5 million. The loan is secured by the building and has 59
monthly payments of approximately $29,000 and a final payment in October 2009 of
approximately $1.5 million and bears interest at 6.5% per year. SS Associates is
obligated on the loan and none of the Company's remaining subsidiaries are
obligated. SS Associates leases the building to the Company for approximately
$0.5 million per year. The non-ASC interest of approximately $0.4 million in SS
Associates (owned in part by certain members of mid-level management at the
Company's Killington resort) is included in other long-term liabilities in the
accompanying condensed consolidated balance sheet as of January 30, 2005.

Recently Issued Accounting Standards
         In December 2004, the FASB issued SFAS No. 123R "Share-Based Payment",
amending SFAS No. 123, effective beginning the first quarter of the Company's
fiscal 2006. SFAS No. 123R will require the Company to expense stock options
based on grant date fair value in the condensed consolidated financial
statements. Further, the adoption of SFAS No. 123R will require additional
accounting related to the income tax effects and additional disclosure regarding
the cash flow effects resulting from share-based payment arrangements. The
effect of expensing stock options on the results of operations using a
Black-Scholes option pricing model is presented above. The adoption of SFAS No.
123R will have no effect on the Company's cash flows or financial position, but
will have an adverse effect on results of operations. The Company has not
identified the method that it will use to adopt SFAS No. 123R.

         In December 2004, the FASB issued SFAS No. 152, "Accounting for Real
Estate Time-Sharing Transactions". The FASB issued this statement as a result of
the guidance provided in AICPA Statement of Position (SOP) 04-2, "Accounting for
Real Estate Time-Sharing Transactions". SOP 04-2 applies to all real estate
time-sharing transactions. Among other items, the SOP provides guidance on the
recording of credit losses and the treatment of selling costs, but does not
change the revenue guidance in SFAS No. 66, "Accounting for Sales of Real
Estate", for real estate time-sharing transactions. SFAS No. 152 amends SFAS No.
66 to reference the guidance provided in SOP 04-2. SFAS No. 152 also amends SFAS
No. 67, "Accounting for Costs and Initial Rental Operations of Real Estate
Projects", to state that SOP 04-2 provides the relevant guidance on accounting
for incidental operations and costs related to the sale or real estate
timesharing transactions. SFAS No. 152 is effective for the Company's fiscal
2006. Management is currently evaluating the potential effects of adopting SFAS
No. 152.

         In December 2004, the FASB issued SFAS No. 153, "Exchanges of
Nonmonetary Assets - an amendment of APB Opinion No. 29". This statement amends
APB Opinion No. 29 to eliminate the exception for nonmonetary exchanges of
similar productive assets and replaces it with a general exception for exchanges
of nonmonetary assets that do not have commercial substance. A nonmonetary
exchange has commercial substance if the future cash flows of the entity are
expected to change significantly as a result of the exchange. The provisions of
SFAS 153 are effective for the Company's fiscal year ending July 30, 2006. The
adoption of SFAS 153 is not expected to have a material impact on the Company's
condensed consolidated financial position, liquidity or results of operations.

Reclassifications
         Certain amounts in the prior periods' financial statements and related
notes have been reclassified to conform to the current periods' presentation.

3.  Net Loss per Common Share

         Net loss per common share for the 13 and 26 weeks ended January 25,
2004 and the 14 and 27 weeks ended January 30, 2005, respectively, was
determined based on the following data (in thousands):

                                       11
<PAGE>

<TABLE>

--------------------------------------------------------------------------------------------------------
                                   13 weeks ended    14 weeks ended    26 weeks ended    27 weeks ended
                                  January 25, 2004  January 30, 2005  January 25, 2004  January 30, 2005
--------------------------------------------------------------------------------------------------------
<S>                               <C>               <C>               <C>               <C>
Net loss                          $       (21,689)  $       (22,144)  $       (62,947)  $       (59,864)
                                  ================  ================  ================  ================


            Shares
Weighted average common shares
outstanding - basic and diluted            31,738            31,738            31,738            31,738
                                  ================  ================  ================  ================

--------------------------------------------------------------------------------------------------------
</TABLE>

         As of January 25, 2004 and January 30, 2005, the Company had 14,760,530
shares of its Class A common stock outstanding, which are convertible into
shares of the Company's common stock. The shares of the Company's common stock
issuable upon conversion of the shares of the Company's Class A common stock
have been included in the calculation of the weighted average common shares
outstanding. As of January 25, 2004, the Company had 36,626 shares of its
mandatorily redeemable convertible 10 1/2% preferred stock (Series A Preferred
Stock) and 40,000 shares of its mandatorily redeemable convertible participating
12% preferred stock (Series C-1 Preferred Stock) outstanding, both of which were
convertible into shares of the Company's common stock. As of January 30, 2005,
the Company had no shares of Series A Preferred Stock outstanding as the shares
were exchanged for junior subordinated notes (see Note 6) and 40,000 shares of
its Series C-1 Preferred Stock outstanding which were convertible into shares of
the Company's common stock. If converted at their liquidation preferences as of
January 25, 2004 and January 30, 2005, these convertible preferred shares would
convert into approximately 45,285,000 and 47,947,000 shares of common stock,
respectively. For the 13 and 26 weeks ended January 25, 2004 and the 14 and 27
weeks ended January 30, 2005, the common shares into which these preferred
securities are convertible have not been included in the dilutive share
calculation as the impact of their inclusion would be anti-dilutive. The Company
also had 3,821,187 options outstanding to purchase shares of its common stock
under the Plan as of January 25, 2004 and January 30, 2005, respectively. These
stock options are excluded from the dilutive share calculation, as the impact of
their inclusion would be anti-dilutive.

4.  Segment Information

         In accordance with SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information", the Company has classified its operations
into two business segments, resort operations and real estate operations.
Revenues at each of the resorts are derived from the same lines of business
which include lift ticket sales, food and beverage, retail sales including
rental and repair, skier development, lodging and property management, golf,
other summer activities and miscellaneous revenue sources. The performance of
the resorts is evaluated on the same basis of profit or loss from operations.
Additionally, each of the resorts has historically produced similar operating
margins and attracts the same class of customer. Based on the similarities of
the operations at each of the resorts, the Company has concluded that the
resorts satisfy the aggregation criteria set forth in SFAS No. 131. The
Company's real estate revenues are derived from the sale, resale, and leasing of
interests in real estate development projects undertaken by the Company at its
resorts and the sale of other real property interests. Revenues and operating
losses for the two business segments are as follows (in thousands):

<TABLE>

-------------------------------------------------------------------------------------------------------------------
                                   13 weeks ended      14 weeks ended         26 weeks ended        27 weeks ended
                                  January 25, 2004    January 30, 2005       January 25, 2004      January 30, 2005
-------------------------------------------------------------------------------------------------------------------

Revenues:
<S>                               <C>                 <C>                    <C>                   <C>
    Resort                        $       92,904      $      103,411         $      109,032        $      121,231
    Real estate                           10,056               2,663                 12,401                 4,389
                                  ----------------    ----------------       ----------------      ----------------
Total                             $      102,960      $      106,074         $      121,433        $      125,620
                                  ================    ================       ================      ================


Loss from operations:
    Resort                        $      (17,701)     $      (21,426)        $      (53,573)       $      (58,548)
    Real estate                           (3,988)               (718)                (9,374)               (1,316)
                                  ----------------    ----------------       ----------------      ----------------
Total                             $      (21,689)     $      (22,144)        $      (62,947)       $      (59,864)
                                  ================    ================       ================      ================

-------------------------------------------------------------------------------------------------------------------
</TABLE>
                                    12
<PAGE>
         Identifiable assets for the two business segments and a reconciliation
of the totals reported for the operating segments to the totals reported in the
condensed consolidated financial statements is as follows (in thousands):

        ------------------------------------------------------------------------
                                             July 25, 2004      January 30, 2005
        ------------------------------------------------------------------------
        Identifiable Assets:
         Resort                              $     340,965      $        371,894
         Real Estate                                81,804                77,861
                                          ----------------      ----------------
                                             $     422,769      $        449,755
                                          ================      ================
        Assets:
         Identifiable assets for
          segments                           $     422,769      $        449,755
         Intangible and deferred
          income tax assets not
          allocated to segments                      8,031                 8,001
                                          ----------------      ----------------
            Total consolidated assets        $     430,800      $        457,756
                                          ================      ================

        ------------------------------------------------------------------------
5.  Long-Term Debt

Resort Senior Credit Facility
         The Company entered into an agreement dated November 24, 2004 with GE
Capital and other lenders whereby the lenders have provided a new $230.0 million
senior secured loan facility (Resort Senior Credit Facility) consisting of a
revolving credit facility and two term loan facilities. The proceeds of the
Resort Senior Credit Facility were used to refinance the prior resort senior
credit facility and the Company's $120.0 million senior subordinated notes
(Senior Subordinated Notes) as well as to pay fees and expenses related to the
transaction. The Resort Senior Credit Facility consists of the following:

         o    Revolving Facility - $40.0 million, including letter of credit
              (L/C) availability of up to $6.0 million of which approximately
              $1.1 million was outstanding on the funding date. The amount of
              availability under this facility will be correspondingly reduced
              by the amount of each L/C issued. The amount of availability is
              also reduced by a reserve for a remaining obligation of $2.1
              million in connection with a legal settlement. As this obligation
              is paid, the reserve will be eliminated.

         o    First Lien Term Loan - $85.0 million borrowed on the funding date
              of November 24, 2004.

         o    Second Lien Term Loan - $105.0 million borrowed on the funding
              date of November 24, 2004.

         The Revolving Facility and First Lien Term Loan (collectively the
"First Lien Credit Agreement") mature in November 2010 and bear interest, at the
option of the Company, either the prime rate as publicly quoted in the Wall
Street Journal plus 3.5% or at a rate of LIBOR (as defined) plus 4.5%, payable
quarterly (8.75% as of January 30, 2005 based on a prime rate). The First Lien
Term Loan requires 23 quarterly principal payments of $212,500 beginning on
January 15, 2005 and a final payment of approximately $80.1 million in November
2010. The Second Lien Term Loan matures in November 2011, bears interest at the
prime rate as publicly quoted in the Wall Street Journal plus 7.0% or at a rate
of LIBOR (as defined) plus 8.0% payable quarterly (12.25% as of January 30, 2005
based on a prime rate), and principal is due upon maturity. The Revolving
Facility is comprised of two sub-facilities, each in the amount of $20.0 million
and each with separate fees for the unused portion of the facilities (in the
amounts of 1.0% and 4.5% per annum, respectively).

         The Revolving Facility and the First Lien Term Loan obligations under
the First Lien Credit Agreement and the related guarantees are secured by a
first-priority security interest in substantially all of the Company's assets,
other than assets held by Grand Summit, and the Company's obligations under the
Second Lien Credit Agreement and its subsidiaries' obligations under the related
guarantees are secured by a second-priority security interest in the same
assets. Collateral matters between the lenders under the First Lien Credit
Agreement and the lenders under the Second Lien Credit Agreement are governed by
an intercreditor agreement.

         The Resort Senior Credit Facility contains affirmative, negative, and
financial covenants customary for this type of credit facility, which includes
maintaining a minimum level of EBITDA, as defined, places a limit on the
Company's capital expenditures, requires the company to maintain a minimum ratio
of appraised asset value to debt, and requires the Company to have a zero
balance on the Revolving Credit Facility on April 1 of each year. The Resort
Senior Credit Facility also contains events of default customary for such
financings, including but not limited to nonpayment of amounts when due;

                                       13
<PAGE>


violation of covenants; cross default and cross acceleration; change of control;
dissolution; insolvency; bankruptcy events; and material judgments. Some of
these events of default allow for grace periods or are qualified by materiality
concepts. The Resort Senior Credit Facility also restricts the Company's ability
to pay cash dividends on or redeem its common or preferred stock and requires
the Company to enter into interest rate swap agreements for at least 50% of the
First Lien Term Loan and the Second Lien Term Loan within 180 days of the
closing of the Resort Senior Credit Facility. As of January 30, 2005, the
Company has not yet entered into these interest rate swap agreements.

         As of January 30, 2005, the Company had $11.8 million, $84.8 million,
and $105.0 million of principal outstanding under the Revolving Facility, First
Lien Term Loan, and Second Lien Term Loan portions of the Resort Senior Credit
Facility, respectively. Furthermore, as of January 30, 2005, the Company had
approximately $1.6 million in outstanding L/Cs with approximately $24.5 million
available for future borrowings under the Revolving Facility. The Company was in
compliance with all financial covenants of the Resort Senior Credit Facility
through January 30, 2005.

         In connection with the restructuring of the prior resort senior credit
facility and the Senior Subordinated Notes, the Company expensed its remaining
deferred financing costs associated with these facilities in the amount of $3.3
million. These amounts are reflected in the accompanying condensed consolidated
statement of operations as a write-off of deferred financing costs and
extinguishment of senior subordinated notes. The Company also recorded
approximately $7.2 million of deferred financing costs in connection with the
Resort Senior Credit Facility and are being amortized over the life of the
loans.

Construction Loan Facility
         The Company has historically conducted substantially all of its real
estate development through subsidiaries, each of which is a wholly owned
subsidiary of American Skiing Company Resort Properties (a subsidiary of ASC)
(Resort Properties). Grand Summit, a subsidiary of Resort Properties, owns the
existing Grand Summit Hotel projects, which are primarily financed through a
$110.0 million construction loan facility (Senior Construction Loan) between
Grand Summit and various lenders, including Textron Financial Corporation
(Textron), the syndication and administrative agent. Due to construction delays
and cost increases at the Steamboat Grand Hotel project, Grand Summit entered
into a $10.0 million subordinated loan tranche with Textron (Subordinated
Construction Loan) on July 25, 2000, which was increased to $10.6 million in
December 2003. Grand Summit used this facility solely for the purpose of funding
the completion of the Steamboat Grand Hotel. The Senior Construction Loan and
the Subordinated Construction Loan are referred to collectively as the
"Construction Loan Facility". The Construction Loan Facility is without recourse
to ASC and its resort operating subsidiaries and is collateralized by
significant real estate assets of Grand Summit. As of January 30, 2005, there
are no future borrowings available under the Construction Loan Facility.

         The Senior Construction Loan principal is payable incrementally as unit
sales are closed based on a predetermined per unit amount, which approximates
between 70% and 80% of the net proceeds of each closing. Mortgages against the
commercial core units at the Grand Summit Hotels at Attitash, The Canyons, and
Steamboat, unsold unit inventory at the Grand Summit Hotels at Steamboat, and a
promissory note from the Steamboat Homeowners Association secured by the
Steamboat Grand Summit Hotel parking garage collateralize the Senior
Construction Loan. The Senior Construction Loan is subject to covenants,
representations and warranties customary for this type of construction facility.
The Senior Construction Loan is non-recourse to the Company and its
subsidiaries, other than Grand Summit. As of January 30, 2005, the carrying
value of the total assets that collateralized the Senior Construction Loan was
approximately $65.5 million. The maturity date for funds advanced under the
Senior Construction Loan is June 30, 2006. The principal balance outstanding
under the Senior Construction Loan was approximately $17.1 million as of January
30, 2005 and had an interest rate on funds advanced of prime plus 3.5%, with a
floor of 9.0% (9.0% as of January 30, 2005).

         The principal balance outstanding under the Subordinated Construction
Loan was approximately $10.6 million as of January 30, 2005 and is due on
November 30, 2007. The interest rate on the funds advanced under the
Subordinated Construction Loan is 20% per annum, payable monthly in arrears,
provided that 50% of the interest shall be due and payable in cash and the other
50% of such interest shall, if no events of default exist under the Subordinated
Construction Loan or the Senior Construction Loan, automatically be deferred
until the final payment date. Accrued interest on the Subordinated Construction
Loan as of January 30, 2005 was approximately $3.7 million.

        Upon the repayment of all indebtedness under the Senior Construction
Loan, the Subordinated Construction Loan and all other fees, Textron will
receive a fee equal to 25% of all gross proceeds of sales of the remaining
unsold quarter and eighth share units and commercial units occurring subsequent
to repayment. Grand Summit and the lenders also agreed to use their best efforts
to enter into an escrow agreement pursuant to which the appropriate deed-in-lieu

                                       14
<PAGE>

documentation in respect to the Senior Construction Loan and the Subordinated
Construction Loan shall be placed in escrow. In December 2004, an amendment was
entered into which reduced the mandatory principal amortization requirement at
December 31, 2004. The Company paid $25,000 in connection with the amendment.
Under the Senior Construction Loan, as amended, the following maximum principal
balances must be outstanding as of the following dates:

             March 31, 2005                            $14,000,000
             June 30, 2005                              12,000,000
             September 30, 2005                         11,000,000
             December 31, 2005                          10,000,000
             March 31, 2006                              5,000,000
             June 30, 2006                                       -

         Although the Company has recently experienced increases in sales
activities at the Steamboat project, without a significant sales increase in the
next several weeks, the Company does not anticipate that it will meet the March
31, 2005 requirement for reduction of the Senior Construction Loan principal
balance to $14.0 million. Similarly, sales volume will need to significantly
increase through the next two months in order for the Company to meet the $12.0
million maximum balance amount on June 30, 2005. The Company has commenced
discussions with the lenders under the Senior Construction Loan regarding the
terms of a waiver of these amortization requirements. There can be no assurance,
however, that the lenders will be willing to enter into such a waiver on terms
acceptable to the Company. The Company is also engaged in efforts to refinance
the Senior Construction Loan and Subordinated Construction Loan with different
lenders in a restructured facility, but similarly there can be no assurance that
a refinancing will be completed prior to the mandatory amortization dates. If
the Company is unable to obtain a waiver from the existing lenders under the
Senior Construction Loan or refinance the Construction Loan Facility, and it
does not meet the amortization requirements of the Senior Construction Loan, the
Company will be in payment default under the Construction Loan Facility and the
lenders could commence enforcement actions against Grand Summit and the assets
of Grand Summit which secure the Construction Loan Facility.

Other Long-Term Debt
         The Company has approximately $21.0 million of other long-term debt as
of January 30, 2005. This is comprised of approximately $12.6 million of debt
held under capital leases and $8.4 million under other notes payable with
various lenders. During the 14 weeks ended January 30, 2005, the Company
acquired approximately $12.7 million of equipment through capital leases, and
paid off certain other existing capital leases in accordance with the terms of
the Resort Senior Credit Facility. The equipment acquired under capital leases
historically has been acquired under operating leases.

       Included in other notes payable is a real estate mortgage note payable
with a face value of $2.4 million secured by an employee housing complex at the
Company's Steamboat resort. The principal balance outstanding on the note on
January 30, 2005 was approximately $1.9 million. The note was scheduled to
mature on February 15, 2005. Prior to the maturity, the Company received a
90-day extension from the lender. The Company is currently negotiating a
refinancing of the note with the current lender.

6.       Subordinated Notes and Debentures

    12% Senior Subordinated Notes
         As of July 25, 2004, the Company had $120.0 million of Senior
Subordinated Notes outstanding. In connection with the refinancing of the Resort
Senior Credit Facility as described in Note 5, the Company repurchased or
redeemed all Senior Subordinated Notes. Approximately $1.9 million in premium
was paid to holders for the early redemption and approximately $0.8 million of
unamortized discount is included in the condensed consolidated statement of
operations and is included in write-off of deferred financing costs and
extinguishment of senior subordinated notes.

    11.3025% Junior Subordinated Notes
         On July 15, 2001, the Company entered into a securities purchase
agreement with Oak Hill Capital Partners (Oak Hill) to assist the Company in
meeting its current financing needs. Pursuant to the terms of the securities
purchase agreement, which closed on August 31, 2001, the Company issued, and Oak
Hill purchased, $12.5 million aggregate principal amount of junior subordinated
notes (Junior Subordinated Notes), which are convertible into shares of the
Company's Series D Participating Preferred Stock (Series D Preferred Stock).
These Junior Subordinated Notes, as amended, are unsecured and bear interest at
a rate of 11.3025%, which compounds annually and is due and payable at the
maturity of the Junior Subordinated Notes. The Junior Subordinated Notes were
amended in connection with the refinancing of the Resort Senior Credit Facility
to extend the maturity to May 2012. The proceeds of the Junior Subordinated


                                       15
<PAGE>

Notes were used to fund short-term liquidity needs of Resort Properties by way
of the purchase of certain real estate assets by ASC from Resort Properties. As
of January 30, 2005, the outstanding balance on the Junior Subordinated Notes
was approximately $18.0 million.

   New Junior Subordinated Notes
         In connection with the refinancing of the Resort Senior Credit
Facility, the Company entered into an exchange agreement with the holder of the
Company's Series A Preferred Stock and issued approximately $76.7 million of new
junior subordinated notes due 2012 (New Junior Subordinated Notes) to the holder
of the Series A Preferred Stock in exchange for all outstanding shares of Series
A Preferred Stock. The New Junior Subordinated Notes accrue non-cash interest at
a rate of 11.25% upon issuance, gradually increasing to a rate of 13.0% in 2012.
No principal or interest payments are required to be made on the New Junior
Subordinated Notes until maturity. However, interest is added to the principal
outstanding on January 1 of each year. On January 1, 2005, approximately $0.9
million of interest was added to the principal outstanding. The New Junior
Subordinated Notes are subordinated to all of the Company's other debt
obligations and all trade payables incurred in the ordinary course of our
business. None of the Company's subsidiaries are obligated on the New Junior
Subordinated Notes, and none of the Company's assets serve as collateral for
repayment of the New Junior Subordinated Notes. The indenture governing the New
Junior Subordinated Notes also restricts the Company from paying cash dividends
or making other distributions to its shareholders subject to certain limited
exceptions. As of January 30, 2005, the outstanding balance on the New Junior
Subordinated Notes was approximately $77.6 million.

   Other Subordinated Debentures
         Other subordinated debentures owed by the Company to institutions and
individuals as of January 30, 2005 are unsecured and are due as follows (in
thousands):

                         ------------------------------
                                   Interest  Principal
                          Year     Rate      Amount
                         ------------------------------
                          2010       8%      $   1,292
                          2012       6%          1,155
                          2013       6%          1,065
                          2015       6%          1,500
                          2016       6%          1,196
                                             ----------
                                             $   6,208
                                             ==========

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

7.     Mandatorily Redeemable Securities

    Series A Preferred Stock
         As of July 25, 2004, the Company had 36,624 shares of Series A
Preferred Stock outstanding. As part of the refinancing of the Resort Senior
Credit Facility on November 24, 2004 all outstanding shares of the Series A
Preferred Stock were exchanged for New Junior Subordinated Notes in the
principal amount of $76.7 million (See Note 6).

    Series B Preferred Stock
         Pursuant to a Preferred Stock Subscription Agreement (the Series B
Agreement) dated July 9, 1999, the Company sold 150,000 shares of its 8.5%
Series B Convertible Participating Preferred Stock (Series B Preferred Stock) on
August 9, 1999 to Oak Hill for $150.0 million.

         On August 31, 2001, in connection with a recapitalization transaction,
the Series B Preferred Stock was stripped of all of its economic and governance
rights and preferences, with the exception of its right to elect up to six
directors. The Company issued the Series C-1 Preferred Stock and the mandatorily
redeemable 15% non-voting Series C-2 preferred stock (Series C-2 Preferred
Stock) with an aggregate initial face value of $179.5 million which was equal to
the accrued liquidation preference of the Series B Preferred Stock immediately
before being stripped of its right to such accrued liquidation preference. The
Series B Preferred Stock will lose its remaining rights upon redemption of the
Series C-1 and C-2 Preferred Stock in July 2007.

    Series C-1 and C-2 Preferred Stock
         On July 15, 2001, the Company entered into a securities purchase
agreement with Oak Hill to assist the Company in meeting its financing needs.
Pursuant to the terms of the securities purchase agreement, which closed on
August 31, 2001, the Company issued to Oak Hill two new series of Preferred
Stock: (i) $40.0 million face value of Series C-1 Preferred Stock; and (ii)
$139.5 million face value of Series C-2 Preferred Stock. The initial face values
of the Series C-1 Preferred Stock and Series C-2 Preferred Stock correspond to
the accrued liquidation preference of the Series B Preferred Stock immediately
before being stripped of its right to such accrued liquidation preference. The


                                       16
<PAGE>

Series C-1 Preferred Stock and Series C-2 Preferred Stock are entitled to annual
preferred dividends of 12% and 15%, respectively. At the Company's option,
dividends can either be paid in cash or in additional shares of preferred stock.
The Series C-1 Preferred Stock is convertible into common stock at a price of
$1.25 per share, subject to adjustments. The Series C-1 Preferred Stock is also
entitled to receive dividends as if it were fully converted into common stock,
if and when the Company declares and pays any dividend on its common stock. The
Series C-1 Preferred Stock does not have a contractual obligation to share in
the losses of the Company. The Series C-2 Preferred Stock is not convertible.
Both of the Series C-1 Preferred Stock and Series C-2 Preferred Stock are
mandatorily redeemable and mature in July 2007 to the extent that the Company
has legally available funds to effect such redemption. As of January 30, 2005,
cumulative dividends in arrears totaled approximately $19.9 million and $91.3
million for the Series C-1 Preferred Stock and Series C-2 Preferred Stock,
respectively. The Series C-1 Preferred Stock and Series C-2 Preferred Stock have
certain voting rights as defined in the securities certificates of designation
relating thereto. In addition, Series C-1 Preferred Stock and Series C-2
Preferred Stock rank senior in liquidation preference to all common stock and
Class A common stock, rank pari passu with each other and the Series B Preferred
Stock, and rank senior to the non-voting Series D Participating Preferred Stock.

    Series D Preferred Stock
         The Company has authorized the issuance of 5,000 shares of $0.01 par
value, non-voting Series D Participating Preferred Stock (Series D Preferred
Stock). As of January 30, 2005, no shares of Series D Preferred Stock have been
issued. The Series D Preferred Stock is junior in right of preference to the
Series C-1 and Series C-2 Preferred Stock, is not entitled to preferred
dividends, and is redeemable at the option of the shareholder.

8.  Dividend Restrictions

         Borrowers under the Company's Resort Senior Credit Facility, which
include ASC, are restricted from paying cash dividends on any of their preferred
or common stock other than payments to other borrowers or restricted
subsidiaries.

         Grand Summit, the borrower under the Construction Loan Facility, is
restricted from declaring dividends or advancing funds to ASC by any other
method, unless specifically approved by the Construction Loan Facility lenders.

         Under the indentures governing its New Junior Subordinated Notes, ASC
is restricted from paying cash dividends or making other distributions to its
shareholders.

9.  Phantom Equity Plan

         ASC has established the American Skiing Company Phantom Equity Plan
(the LTIP), which was ratified by the Board of Directors on March 6, 2003.
Certain of ASC's officers participate in the LTIP. Participants are entitled to
a cash payment on awards granted under the LTIP, upon a valuation event, as
defined. The amount of any awards are based ultimately on the Equity Value, as
defined, obtained through a valuation event and generally vest over a three to
five-year term as determined by the Compensation Committee. A valuation event is
any of the following: (i) a sale or disposition of substantially all of the
Company's assets; (ii) a merger, consolidation or similar event of ASC other
than one (A) in which the Company is the surviving entity or (B) where no change
in control, as defined, has occurred; (iii) a public offering of equity
securities by ASC that yields net proceeds to the Company in excess of $50
million; or (iv) a change in control, as defined. Compensation expense relating
to the LTIP will be estimated and recorded based on the probability of the
Company achieving a valuation event. During the 13 weeks and 26 weeks ended
January 25, 2004 the Company recorded a charge relating to the LTIP of
approximately $0.1 million and $0.2 million, respectively. During the 14 weeks
and 27 weeks ended January 30, 2005 the Company recorded a benefit relating to
the decrease in the value of the LTIP of approximately $0.2 million and $0.1
million, respectively. These charges are included in marketing, general and
administrative expenses in the accompanying condensed consolidated statements of
operations. The total liability for the LTIP of $0.7 million and $0.6 million is
included in other long-term liabilities in the July 25, 2004 and January 30,
2005 condensed consolidated balance sheet, respectively.

10.  Commitments and Contingencies

         Certain claims, suits and complaints in the ordinary course of business
are pending or may arise against the Company, including all of its direct and
indirect subsidiaries. In the opinion of management, all matters are adequately
covered by insurance or, if not covered, are without merit or are of such kind,
or involve such amounts as are not likely to have a material effect on the
financial position, results of operations or liquidity of the Company if
disposed of unfavorably.


                                       17
<PAGE>

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

                           Forward-Looking Statements

         Certain statements contained in this report constitute forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended (the Securities Act), and Section 21E of the Securities Exchange Act of
1934, as amended (the Exchange Act). These forward-looking statements are not
based on historical facts, but rather reflect our current expectations
concerning future results and events. Similarly, statements that describe our
objectives, plans or goals are or may be forward-looking statements. We have
tried, wherever possible, to identify such statements by using words such as
"anticipate", "assume", "believe", "expect", "intend", "plan", and words and
terms of similar substance in connection with any discussion of operating or
financial performance. Such forward-looking statements involve a number of risks
and uncertainties. In addition to factors discussed above, other factors that
could cause actual results, performances or achievements to differ materially
from those projected include, but are not limited to, the following: changes in
regional and national business and economic conditions affecting both our resort
operating and real estate segments; competition and pricing pressures; negative
impact on demand for our products resulting from terrorism and availability of
air travel (including the effect of airline bankruptcies); failure to maintain
improvements to resort operating performance at the covenant levels required by
our Resort Senior Credit Facility; failure to meet amortization requirements of
the Construction Loan Facility; the possibility of domestic terrorist activities
and their respective effects on the ski, golf, resort, leisure and travel
industries; failure of on-mountain improvements and other capital expenditures
to generate incremental revenue; adverse weather conditions regionally and
nationally; changes in weather patterns resulting from global warming; seasonal
business activity; increased gas and energy prices; changes to federal, state
and local regulations affecting both our resort operating and real estate
segments; failure to renew land leases and forest service permits; disruptions
in water supply that would impact snowmaking operations; the loss of any of our
executive officers or key operating personnel; and other factors listed from
time to time in our documents we have filed with the Securities and Exchange
Commission. We caution the reader that this list is not exhaustive. We operate
in a changing business environment and new risks arise from time to time. The
forward-looking statements included in this document are made only as of the
date of this document and under Section 27A of the Securities Act and Section
21E of the Exchange Act, we do not have or undertake any obligation to publicly
update any forward-looking statements to reflect subsequent events or
circumstances.

General

         We are organized as a holding company and operate through various
subsidiaries. We are one of the largest operators of alpine ski and snowboard
resorts in the United States. We develop, own and operate a range of
hospitality-related businesses, including skier development programs, hotels,
golf courses, restaurants and retail locations. We also develop, market and
operate ski-in/ski-out alpine villages, townhouses, condominiums, and quarter
and eighth share ownership hotels. We report our results of operations in two
business segments, resort operations and real estate operations.

         Our operating strategies include taking advantage of our multi-resort
network, increasing our revenue per skier, continuing to build brand awareness
and customer loyalty, expanding our sales and marketing efforts, continuing to
focus on cost management, expanding our golf and convention business, improving
our hotel occupancy and operating margins, and capitalizing on real estate
growth opportunities through joint ventures.

         Our revenues are highly seasonal in nature. In fiscal 2004, we realized
approximately 88% of resort operating segment revenues and over 100% of resort
operating segment operating income during the period from November through
April. In addition, a significant portion of resort operating segment revenue
and approximately 22% of annual skier visits were generated during the Christmas
and Presidents' Day vacation weeks in fiscal 2004, respectively. Our resorts
typically experience operating losses and negative cash flows for the period
from May through November.

         A high degree of seasonality in our revenues increases the impact of
certain events on its operating results. Adverse weather conditions, access
route closures, equipment failures, and other developments of even moderate or
limited duration occurring during peak business periods could reduce revenues.
Adverse weather conditions can also increase power and other operating costs
associated with snowmaking or could render snowmaking wholly or partially


                                       18
<PAGE>

ineffective in maintaining quality skiing conditions. Furthermore, unfavorable
weather conditions, regardless of actual skiing conditions, can result in
decreased skier visits.

         As discussed below, on November 24, 2004 we entered into a resort
senior credit facility (Resort Senior Credit Facility) and paid off our prior
resort senior credit facility and a substantial portion of our senior
subordinated notes. The remaining portion of the senior subordinated notes was
paid off in January 2005. In addition, our Series A Preferred Stock was
exchanged for new junior subordinated notes. This refinancing extends the
maturity dates of these obligations.

         The following is our discussion and analysis of financial condition and
results of operations for the 14 and 27 weeks ended January 30, 2005. As you
read the material below, we urge you to carefully consider our fiscal 2004
Annual Report on Form 10-K filed on November 9, 2004 and our unaudited condensed
consolidated financial statements and related notes contained elsewhere in this
report.

Liquidity and Capital Resources

Short-Term Liquidity Needs

         Our primary short-term liquidity needs involve funding seasonal working
capital requirements, marketing and selling real estate development projects,
funding our fiscal 2005 capital improvement program, and servicing our debt. Our
cash requirements for ski-related and real estate sales activities are provided
from separate sources.

         As described below, we entered into a $230.0 million Resort Senior
Credit Facility on November 24, 2004 and used initial borrowings thereunder to
refinance our prior resort senior credit facility and our $120.0 million senior
subordinated notes (Senior Subordinated Notes).

         Our primary source of liquidity for ski-related working capital and
ski-related capital improvements are cash flows from operations of our resort
operating subsidiaries and borrowings under our Resort Senior Credit Facility.
The total debt outstanding under our Resort Senior Credit Facility as of January
30, 2005 was approximately $201.6 million.

         Real estate working capital is funded primarily through unit inventory
sales, short-term rental of remaining unit inventory, as well as lease payments
from long-term commercial tenants. Historically, the senior construction loan
(Senior Construction Loan) and the subordinated construction loan (Subordinated
Construction Loan) (collectively, the Construction Loan Facility) funded such
working capital. The Construction Loan Facility is without recourse to ASC and
its subsidiaries other than Grand Summit and is collateralized by significant
real estate assets of Grand Summit. As of January 30, 2005, the carrying value
of the total assets that collateralized the Construction Loan Facility was
approximately $65.5 million. The total debt outstanding on the Construction Loan
Facility as of January 30, 2005 was approximately $17.1 million. See "Real
Estate Liquidity - Construction Loan Facility" below.

Resort Liquidity

         We entered into an agreement dated November 24, 2004 with GE Capital
and other lenders whereby the lenders have provided a new $230.0 million Resort
Senior Credit Facility consisting of a revolving credit facility and two term
loan facilities. The proceeds of the Resort Senior Credit Facility were used to
refinance our prior resort senior credit facility and our Senior Subordinated
Notes as well as to pay fees and expenses related to the transaction. The Resort
Senior Credit Facility consists of the following:

         o    Revolving Facility - $40.0 million, including letter of credit
              (L/C) availability of up to $6.0 million of which approximately
              $1.1 million was outstanding on the funding date. The amount of
              availability under this facility will be correspondingly reduced
              by the amount of each L/C issued. The amount of availability is
              also reduced by a reserve for a remaining obligation of $2.1
              million in connection with a legal settlement. As this obligation
              is paid, the reserve will be eliminated.

         o    First Lien Term Loan - $85.0 million borrowed on the funding date
              of November 24, 2004.

         o    Second Lien Term Loan - $105.0 million borrowed on the funding
              date of November 24, 2004.


                                       19
<PAGE>


         The Revolving Facility and First Lien Term Loan (collectively the
"First Lien Credit Agreement") mature in November 2010 and bear interest, at our
option, at either the prime rate as publicly quoted in the Wall Street Journal
plus 3.5% or at a rate of LIBOR (as defined) plus 4.5%, payable quarterly (8.75%
as of January 30, 2005 using prime rate as a base). The First Lien Term Loan
requires 23 quarterly principal payments of $212,500 beginning on January 15,
2005 and a final payment of approximately $80.1 million in November 2010. The
Second Lien Term Loan matures in November 2011, bears interest at the prime rate
as publicly quoted in the Wall Street Journal plus 7.0% or at a rate of LIBOR
(as defined) plus 8.0% payable quarterly (12.25% as of January 30, 2005 using
prime rate as a base), and principal is due upon maturity. The Revolving
Facility is comprised of two sub-facilities, each in the amount of $20.0 million
and each with separate fees for the unused portion of the facilities (in the
amounts of 1.0% and 4.5% per annum, respectively).

         The Revolving Facility and the First Lien Term Loan obligations under
the First Lien Credit Agreement and the related guarantees are secured by a
first-priority security interest in substantially all of the our assets, other
than assets held by Grand Summit, and our obligations under the Second Lien
Credit Agreement and its subsidiaries' obligations under the related guarantees
are secured by a second-priority security interest in the same assets.
Collateral matters between the lenders under the First Lien Credit Agreement and
the lenders under the Second Lien Credit Agreement are governed by an
intercreditor agreement.

         The Resort Senior Credit Facility contains affirmative, negative, and
financial covenants customary for this type of credit facility, which includes
maintaining a minimum level of EBITDA, as defined, places a limit on our capital
expenditures, requires us to maintain a minimum ratio of appraised asset value
to debt, and requires us to have a zero balance on the Revolving Credit
Facility on April 1 of each year. The Resort Senior Credit Facility also
contains events of default customary for such financings, including but not
limited to nonpayment of amounts when due; violation of covenants; cross default
and cross acceleration; change of control; dissolution; insolvency; bankruptcy
events; and material judgments. Some of these events of default allow for grace
periods or are qualified by materiality concepts. The Resort Senior Credit
Facility also restricts our ability to pay cash dividends on or redeem our
common or preferred stock and requires the Company to enter into interest rate
swap agreements for at least 50% of the First Lien Term Loan and the Second Lien
Term Loan within 180 days of the closing of the Resort Senior Credit Facility.
As of January 30, 2005, the Company has not yet entered into these interest rate
swap agreements.

         In conjunction with the Resort Senior Credit Facility, we closed a
tender offer and repurchased $118.5 million of the $120.0 million principal
amount of outstanding Senior Subordinated Notes. The total consideration payable
in connection with the offer was approximately $120.4 million ($118.5 million in
principal and approximately $1.9 million in a redemption premium) plus accrued
interest of approximately $5.1 million for the tendered Senior Subordinated
Notes. In connection with the tender offer, we also solicited consents from the
holders of the Senior Subordinated Notes. On October 22, 2004, we entered into a
supplemental indenture reflecting those amendments to eliminate substantially
all of the restrictive covenants and certain events which would cause default
under the indenture for the Senior Subordinated Notes. Such amendments became
operative on November 24, 2004. We also called for redemption on November 24,
2004 all the remaining $1.5 million in principal amount of outstanding Senior
Subordinated Notes which was redeemed and paid in January 2005.

         In addition, as part of the refinancing, we entered into an Exchange
Agreement with the holder of the our Series A Preferred Stock and issued
approximately $76.7 million of new junior subordinated notes (New Junior
Subordinated Notes) due 2012 to the holder of our Series A Preferred Stock in
exchange for all outstanding shares of Series A Preferred Stock. The New Junior
Subordinated Notes accrue non-cash interest at a rate of 11.25% upon issuance,
gradually increasing to a rate of 13.0% in 2012. However, interest is added to
the principal outstanding on January 1 of each year. On January 1, 2005,
approximately $0.9 million of interest was added to the principal outstanding.
No principal or interest payments are required to be made on the New Junior
Subordinated Notes until maturity. The New Junior Subordinated Notes are
subordinated to all of our other debt obligations and all trade payables
incurred in the ordinary course of our business. None of our subsidiaries are
obligated on the New Junior Subordinated Notes, and none of our assets serve as
collateral for repayment of the New Junior Subordinated Notes. The indenture
governing the New Junior Subordinated Notes also restricts us from paying cash
dividends or making other distributions to its shareholders subject to certain
limited exceptions.

         As part of the refinancing, the indenture for our 11.3025% junior
subordinated notes was amended to extend the maturity to May 2012.

         As of February 27, 2005, we had $0, $84.8 million, and $105.0 million
of principal outstanding under the Revolving Facility, First Lien Term Loan, and
Second Lien Term Loan portions of the Resort Senior Credit Facility,


                                       20
<PAGE>

respectively. Furthermore, as of February 27, 2005, we had approximately $1.6
million in outstanding L/Cs with approximately $36.3 million available for
future borrowings under the Revolving Facility. We currently anticipate that the
remaining borrowing capacity under the Resort Senior Credit Facility will be
sufficient to meet our working capital needs through the end of our third
quarter of fiscal 2006.

         We closely monitor our operating results that impact our ability to
meet the financial covenants under our Resort Senior Credit Facility. We take
various actions to maintain compliance with our financial covenants, including
selling non-core assets to increase revenues, and reducing our cost structure
during the off-season and seasonal low-visitation at our resorts. In the event
of a violation of the financial covenants under our Resort Senior Credit
Facility, we would engage in a discussion with our lenders for a waiver of those
covenants for the period in question. Due to the restrictions under our Resort
Senior Credit Facility, we have limited access to alternate sources of funding.

        Our significant debt levels affect our liquidity. As a result of our
highly leveraged position, we have significant cash requirements to service
interest and principal payments on our debt. Consequently, cash availability for
working capital needs, capital expenditures, and acquisitions is significantly
limited, outside of any availability under the Resort Senior Credit Facility.
Furthermore, our Resort Senior Credit Facility contains significant restrictions
on our ability to obtain additional sources of capital and may affect our
liquidity. These restrictions include restrictions on the sale of assets,
restrictions on the incurrence of additional indebtedness, and restrictions on
the issuance of preferred stock.

Real Estate Liquidity

         To fund working capital and fund its real estate sales plan, Grand
Summit relies primarily on unit inventory sales, short-term rental of remaining
unit inventory, as well as lease payments from long-term commercial tenants.

Construction Loan Facility: We have historically conducted our real estate
interval-ownership product development through Grand Summit, which is a wholly
owned subsidiary of American Skiing Company Resort Properties (Resort
Properties). Grand Summit owns our existing Grand Summit Hotel projects at
Steamboat, The Canyons, and Attitash, which are primarily financed through the
$110.0 million Senior Construction Loan. Due to construction delays and cost
increases at the Steamboat Grand Hotel project, on July 25, 2000, Grand Summit
entered into the $10.0 million Subordinated Construction Loan, which was
subsequently increased to $10.6 million. Together they comprise the Construction
Loan Facility. We used the Construction Loan Facility primarily for the purpose
of funding the completion of the Steamboat Grand Hotel. As of January 30, 2005,
there are no future borrowings available under the Construction Loan Facility.

         The principal is payable incrementally as unit sales are closed based
on a predetermined per unit amount, which approximates between 70% and 80% of
the net proceeds of each closing. Mortgages against the commercial core units at
the Grand Summit Hotels at Attitash, The Canyons, and Steamboat, unsold unit
inventory at the Grand Summit Hotels at Steamboat, and a promissory note from
the Steamboat Homeowners Association secured by the Steamboat Grand Summit Hotel
parking garage collateralize the Senior Construction Loan. This facility is
subject to covenants, representations and warranties customary for this type of
construction facility. The Senior Construction Loan is non-recourse to us and
our subsidiaries other than Grand Summit. As of January 30, 2005, the carrying
value of the total assets that collateralized the Senior Construction Loan was
approximately $65.5 million. The maturity date for funds advanced under the
Senior Construction Loan is June 30, 2006. The principal balance outstanding
under the Senior Construction Loan was approximately $17.1 million as of January
30, 2005 and had an interest rate on funds advanced of prime plus 3.5%, with a
floor of 9.0% (9.0% as of January 30, 2005) and there were no borrowings
available under this facility.

         The Subordinated Construction Loan bears interest at a fixed rate of
20% per annum, payable monthly in arrears, provided that only 50% of the amount
of this interest is due and payable in cash and the other 50% of such interest
will, if no events of default exist under the Subordinated Construction Loan or
the Senior Construction Loan, automatically be deferred until the final payment
date. The Subordinated Construction Loan provides for a maximum borrowing
capacity of $10.6 million. The Subordinated Construction Loan matures on
November 30, 2007. All $10.6 million had been borrowed under the Subordinated
Construction Loan as of January 30, 2005. Accrued interest on the Subordinated
Construction Loan as of January 30, 2005 was approximately $3.7 million. The
Subordinated Construction Loan is secured by the same collateral which secures
the Senior Construction Loan.

         The Senior Construction Loan, as amended, must have the following
maximum outstanding principal balances as of the following dates:


                                       21
<PAGE>

         March 31, 2005                               $14,000,000
         June 30, 2005                                 12,000,000
         September 30, 2005                            11,000,000
         December 31, 2005                             10,000,000
         March 31, 2006                                 5,000,000
         June 30, 2006                                          -

         As of February 27, 2005, the amount outstanding under the Senior
Construction Loan was approximately $16.9 million and there were no borrowings
available under this facility. As of February 27, 2005, the amounts outstanding
under the Subordinated Construction Loan were approximately $10.6 million plus
accrued interest of approximately $3.8 million and there were no borrowings
available under this facility.

         Although we have recently experienced increases in sales activities at
the Steamboat project, without a significant sales increase in the next several
weeks we do not anticipate that we will meet the March 31, 2005 requirement for
reduction of the Senior Construction Loan principal balance to $14.0 million.
Similarly, sales volume will need to significantly increase through the next two
months in order for us to meet the $12.0 million maximum balance amount on June
30, 2005. We have commenced discussions with the lenders under the Senior
Construction Loan regarding the terms of a waiver of these amortization
requirements. There can be no assurance, however, that the lenders will be
willing to enter into such a waiver on terms acceptable to us. We are also
engaged in efforts to refinance the Senior Construction Loan and Subordinated
Construction Loan with different lenders in a restructured facility, but
similarly there can be no assurance that a refinancing will be completed prior
to the mandatory amortization dates. If we are unable to obtain a waiver from
the existing lenders under the Senior Construction Loan or refinance the
Construction Loan Facility, and we do not meet the amortization requirements of
the Senior Construction Loan, we will be in payment default under the
Construction Loan Facility and the lenders could commence enforcement actions
against Grand Summit and the assets of Grand Summit which secure the
Construction Loan Facility.

Long-Term Liquidity Needs

         Our primary long-term liquidity needs are to fund skiing-related
capital improvements at certain of our resorts. For fiscal 2005, we anticipate
our annual maintenance capital needs to be approximately $8.5 million. In
addition, we have tentatively identified an additional $4.0 million of
discretionary capital needs which will likely be pursued in fiscal 2005. There
is a considerable degree of flexibility in the timing and, to a lesser degree,
scope of our growth capital program. Although we can defer specific capital
expenditures for extended periods, continued growth of skier visits, revenues
and profitability will require continued capital investment in on-mountain
improvements.

         We finance on-mountain capital improvements through resort cash flows,
capital leases, and our Resort Senior Credit Facility. The size and scope of the
capital improvement program will generally be determined annually depending upon
the strategic importance and expected financial return of certain projects,
future availability of cash flows from each season's resort operations, and
future borrowing availability and covenant restrictions under the Resort Senior
Credit Facility. The Resort Senior Credit Facility places a maximum level of
non-real estate capital expenditures for fiscal 2005 at $15.5 million, including
assets purchased under capital leases, with the ability to increase this amount
if certain conditions are met. The current year capital expenditures acquired
under capital leases is excluded from this calculation per the credit agreement.
For fiscal 2006, the Resort Senior Credit Facility places a maximum level of
non-real estate capital expenditures at $15.5 million, including assets
purchased under capital leases, with the ability to increase this amount if
certain conditions are met. During the 14 weeks ended January 30, 2005, we
converted certain types of lease agreements that we have historically entered
into as operating leases into terms that qualified them to be treated as capital
leases. We believe that the capital expenditure limits under the Resort Senior
Credit Facility will be sufficient to meet our non-real estate capital
improvement needs for fiscal 2005 and fiscal 2006.

         As described above, the Revolving Facility and First Lien Term Loan of
the Resort Credit Facility mature in November 2010. The First Lien Term Loan
requires quarterly principal payments of $212,500 and a final payment of
approximately $80.1 million in November 2010. The Second Lien Term Loan matures
in November 2011. The Senior Construction Loan has required principal payments
as described above and matures in June 2006. The Subordinated Construction Loan
matures in November 2007.

         We also have mandatorily redeemable convertible participating 12%
preferred stock (Series C-1 Preferred Stock) with an accreted value of $59.9
million as of January 30, 2005 and mandatorily redeemable 15% non voting




                                       22
<PAGE>

preferred stock (Series C-2 Preferred Stock) with an accreted value of $230.8
million as of January 30, 2005 which are mandatorily redeemable and mature in
July 2007 to the extent that we have legally available funds to effect such
redemption. We do not expect to redeem the Series C-1 Preferred Stock and the
Series C-2 Preferred Stock prior to its final maturity. We can give no assurance
that the necessary liquidity will be available to effect the redemption on a
timely basis. In conjunction with the funding of the Resort Senior Credit
Facility, the holders of the Series C-1 Preferred Stock and Series C-2 Preferred
Stock (Holders) agreed with the lenders under the Resort Senior Credit Facility
that the Holders will not exercise any remedies as a result of the failure to
redeem the Series C-1 Preferred Stock and the Series C-2 Preferred Stock prior
to its final maturity, other than an increase in accretion rate of the Series
C-1 Preferred Stock of 2% and the appointment of additional seats on our Board
of Directors.

         We closely monitor our operating results that impact our ability to
meet the financial covenants under our Resort Senior Credit Facility. We take
various actions to maintain compliance with our financial covenants, including
selling non-core assets to increase revenues, and reducing our cost structure
during the off-season and seasonal low-visitation at our resorts. In the event
of a violation of the financial covenants under our Resort Senior Credit
Facility, we would engage in a discussion with our lenders for a waiver of those
covenants for the period in question. Due to the restrictions under our Resort
Senior Credit Facility, we have limited access to alternate sources of funding.

                              Results of Operations
        For the 13 weeks ended January 25, 2004 compared to the 14 weeks ended
January 30, 2005

Resort Operations:

         The components of resort operations for the 13 weeks ended January 25,
2004 and the 14 weeks ended January 30, 2005 are as follows (in thousands):

<TABLE>

-----------------------------------------------------------------------------------------------
                                                13 Weeks ended    14 Weeks ended
                                               ---------------------------------- -------------
                                               January 25, 2004  January 30, 2005   Variance
                                               ----------------  ---------------- -------------
<S>                                            <C>              <C>                <C>
Total resort revenues                          $        92,904  $        103,411   $    10,507
                                               ---------------  -----------------  ------------

Cost of resort operations                               62,410            67,786         5,376
Marketing, general and administrative                   20,490            16,210        (4,280)
Depreciation and amortization                           10,197            13,991         3,794
Interest expense                                        17,508            20,867         3,359
Write-off of deferred financing costs and
   loss on extinguishment of senior
   subordinated notes                                        -             5,983         5,983
                                               ---------------  -----------------  ------------
Total resort expenses                                  110,605           124,837        14,232
                                               ---------------  -----------------  ------------

Loss from resort operations                    $       (17,701)        (21,426)         (3,725)
                                               ===============  =================  ============
-----------------------------------------------------------------------------------------------
</TABLE>


         Resort revenues were approximately $10.5 million, or 11.3%, higher in
the 14 weeks ended January 30, 2005 when compared to the 13 weeks ended January
25, 2004. Fiscal 2005 had an extra week of operations compared to fiscal 2004.
This week accounted for revenues of approximately $11.6 million. Without the
extra week in fiscal 2005, skier visits were down approximately 3% as compared
to fiscal 2004 due to lower amounts of natural snowfall, warmer temperatures,
and wind events from the beginning of the ski season through the end of the
Christmas holiday period.

         Resort expenses for the 14 weeks ended January 30, 2005 were
approximately $14.2 million higher than the 13 weeks ended January 25, 2004,
primarily as a result of the following:

         (i)         $5.4 million increase in cost of resort operations. As
                     discussed above, fiscal 2005 had an extra week of
                     operations which accounted for approximately $6.0 million
                     in additional costs. Cost of resort operations also
                     increased due to general increases in fuel and power costs.
                     These increases were offset by a reduction in operating
                     lease expense. We converted our operating leases associated
                     with our snow groomers and ski rental equipment to capital
                     leases which accounted for approximately a $2.0 million
                     decrease in cost of resort operations.


                                       23
<PAGE>

         (ii)        $6.0 million increase in write-off of deferred financing
                     costs and loss on extinguishment of senior subordinated
                     notes due to the refinancing of our prior senior resort
                     credit facility and Senior Subordinated Notes, in fiscal
                     2005;
         (iii)       $3.8 million increase in depreciation and amortization
                     primarily due to an increase in new assets. As described
                     above, we converted leases previously accounted for as
                     operating lease to capital leases, thus increasing the
                     depreciation; and
         (iv)        $3.4 million increase in interest expense due primarily to
                     the compounding effect of interest expense associated with
                     the junior subordinated notes and the accretion of discount
                     and dividends on mandatorily redeemable preferred stock and
                     as described above, the extra week of outstanding
                     borrowings in fiscal 2005 as compared to fiscal 2004;
                     offset by
         (v)         $4.3 million  decrease in marketing,  general and
                     administrative  expenses due primarily to legal accruals
                     made during the 13 weeks in fiscal 2004 offset by the extra
                     week of operations discussed above.

         Recent Trends: Revenues for the first four weeks of fiscal 2005 third
quarter increased approximately 10.6% from the comparable four-week period of
fiscal 2004. This year over year improvement is due to the previously reported
increase in our season pass sales, along with strong paid skier visits over the
February vacation weeks and the ancillary revenue associated with increased
total skier visits for the period. We have seen substantial improvement from our
early season performance when snow and weather conditions at our eastern resorts
were poor, even though snowfall levels year to date still remain behind
historical levels. Additionally, as of the end of February, our hotel booking
pace for the third quarter of fiscal 2005 is approximately 4% ahead of the pace
of the comparable period of fiscal 2004 due to a strong increase in our
transient room business.

Real Estate Operations:

         The components of real estate operations are as follows (in thousands):

--------------------------------------------------------------------------------
                                  13 weeks ended    14 Weeks ended
                                 ---------------------------------- ------------
                                 January 25, 2004  January 30, 2005   Variance
                                 ----------------  ---------------- ------------

Total real estate revenues       $        10,056   $         2,663  $    (7,393)
                                 ----------------  ---------------- ------------

Cost of real estate operations             8,538             2,155       (6,383)
Depreciation and amortization                434               409          (25)
Interest expense                           5,072               817       (4,255)
                                 ----------------  ---------------- ------------
Total real estate expenses                14,044             3,381      (10,663)
                                 ----------------  ---------------- ------------

Loss from real estate operations $        (3,988)  $          (718) $      3,270
                                 ================  ================ ============

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

         Real estate revenues decreased by $7.4 million in the 14 weeks ended
January 30, 2005 when compared to the 13 weeks ended January 25, 2004, from
$10.1 million to $2.7 million. The decrease was primarily due to the sale of
three parcels of land at Steamboat in fiscal 2004 for $8.9 million. The decrease
was offset by a $0.5 million increase in unit sales at The Canyons and Steamboat
in fiscal 2005. The decrease was also offset by an increase in non-operating
land sales and resell of units at our Grand Summit Hotels at all of our resorts
of approximately $1.0 million.

          Real estate operations loss decreased by $3.3 million, from $(4.0)
million in the 13 weeks ended January 25, 2004 to $(0.7) million in the 14 weeks
ended January 30, 2005. This was primarily a result of the following:

          (i)     $6.4 million decrease in cost of real estate operations
                  resulting from the decrease in revenues, and
          (ii)    $4.3 million  decrease in interest  expense due to the
                  restructuring of the real estate credit facility in May 2004
                  and lower outstanding balances on the Construction Loan
                  Facility, offset by
          (iii)   $7.4 million decrease in revenues as discussed above.

         Recent Trends: Sales volumes year-to-date at our Grand Summit Hotel at
Steamboat have continued to decline and are slightly behind pace of the prior
year. However, for the second fiscal quarter, sales are up slightly in 2005 over
2004 levels. We have recently increased the number of sales personnel at


                                       24
<PAGE>

Steamboat and contracted with a third-party real estate agency to sell whole
ownership units in an effort to increase sales. Our eastern resorts have
continued to experience a higher than normal demand for residential real estate.
We anticipate continuing to conduct periodic third party sales of developmental
real estate at certain of our eastern resorts (particularly Sunday River,
Sugarloaf and Attitash) in order to meet this continuing demand and increase our
on-mountain bed base.

Benefit from income taxes:

         We recorded no benefit from income taxes for either the 13 weeks ended
January 25, 2004 or the 14 weeks ended January 30, 2005. We believe it is more
likely than not that we will not realize income tax benefits from operating
losses in the foreseeable future.

                              Results of Operations
         For the 26 weeks ended January 25, 2004 compared to the 27 weeks ended
January 30, 2005

Resort Operations:

         The components of resort operations for the 26 weeks ended January 25,
2004 and the 27 weeks ended January 30, 2005 are as follows (in thousands):

--------------------------------------------------------------------------------
                                   26 Weeks ended    27 Weeks ended
                                  ---------------------------------- -----------
                                  January 25, 2004  January 30, 2005   Variance
                                  ----------------  ---------------- -----------
Total resort revenues             $       109,032           121,231      12,199
                                  ----------------  ---------------- -----------

Cost of resort operations                  84,935            91,395       6,460
Marketing, general and
  administrative                           30,770            27,027      (3,743)
Restructuring charges                         137                 -        (137)
Depreciation and amortization              12,067            15,863       3,796
Interest expense                           34,696            39,511       4,815
Write-off of deferred financing
  costs and loss on extinguishment
  of senior subordinated notes                  -             5,983       5,983
                                  ----------------  ---------------- -----------
Total resort expenses                     162,605           179,779      17,174
                                  ----------------  ---------------- -----------
Loss from resort operations       $       (53,573)          (58,548)     (4,975)
                                  ================  ================ ===========

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

         Resort revenues were approximately $12.2 million, or 11.2%, higher in
the 27 weeks ended January 30, 2005 when compared to the 26 weeks ended January
25, 2004. Fiscal 2005 had an extra week of operations compared to fiscal 2004.
This week accounted for revenues of approximately $11.6 million. In addition,
our lodging related revenues at our Steamboat and The Canyons resorts, primarily
as a result of strong first quarter group and conference business, also
contributed to the increase in revenues. These increases were offset by lower
skier visits. Without the extra week in fiscal 2005, skier visits were down
approximately 3% as compared to fiscal 2004 due to lower amounts of natural
snowfall, warmer temperatures, and wind events from the beginning of the ski
season through the end of the Christmas holiday period.

         Resort expenses for the 27 weeks ended January 30, 2005 were
approximately $17.2 million higher than the 26 weeks ended January 25, 2004,
primarily as a result of the following:

         (i)           $6.5 million increase in cost of resort operations. As
                       discussed above, fiscal 2005 had an extra week of
                       operations which accounted for approximately $6.0 million
                       in additional costs. Cost of resort operations also
                       increased due to general increases in fuel and power
                       costs and an increase in repairs and maintenance expense.
                       These increases were offset by a reduction of property
                       tax expense and operating lease expense. We converted our
                       operating leases associated with our snow groomers and
                       ski rental equipment to capital leases which accounted
                       for approximately a $2.0 million decrease in cost of
                       resort operations.


                                       25
<PAGE>

         (ii)          $6.0 million increase in write-off of deferred financing
                       costs and loss on extinguishment of senior subordinated
                       notes due to the refinancing of our prior senior resort
                       credit facility and Senior Subordinated Notes, in fiscal
                       2005;
         (iii)         $3.8 million increase in depreciation and amortization
                       primarily due to an increase in new assets. As described
                       above, we converted leases previously accounted for as
                       operating lease to capital leases, thus increasing the
                       depreciation; and
         (iv)          $4.8 million increase in interest expense due primarily
                       to the compounding effect of interest expense associated
                       with the junior subordinated notes and the accretion of
                       discount and dividends on mandatorily redeemable
                       preferred stock and as described above, the extra week of
                       outstanding borrowings in fiscal 2005 as compared to
                       fiscal 2004; offset by
         (v)           $3.7 million  decrease in marketing,  general and
                       administrative  expenses due primarily to legal accruals
                       made during the 13 weeks in fiscal 2004 offset by the
                       extra week of operations discussed above.

Real Estate Operations:

         The components of real estate operations are as follows (in thousands):

--------------------------------------------------------------------------------
                                   26 weeks ended    27 Weeks ended
                                  ----------------------------------  ----------
                                  January 25, 2004  January 30, 2005   Variance
                                  ----------------  ----------------  ----------

Total real estate revenues        $        12,401   $         4,389   $  (8,012)
                                  ----------------  ----------------  ----------

Cost of real estate operations             10,196             3,263      (6,933)
Depreciation and amortization                 867               816         (51)
Interest expense                           10,712             1,626      (9,086)
                                  ----------------  ----------------  ----------
Total real estate expenses                 21,775             5,705     (16,070)
                                  ----------------  ----------------  ----------

Loss from real estate operations  $        (9,374)  $        (1,316)  $   8,058
                                  ================  ================  ==========

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

         Real estate revenues decreased by $8.0 million in the 27 weeks ended
January 30, 2005 when compared to the 26 weeks ended January 25, 2004, from
$12.4 million to $4.4 million. The decrease was primarily due to the sale of
three parcels of land at Steamboat in fiscal 2004 for $8.9 million and a $0.5
million decrease in unit sales at The Canyons and Steamboat. Due to the auction
held at The Canyons in February 2004, only one unit remained to be sold and that
was sold during fiscal 2005. This decrease was offset by an increase in
non-operating land sales and resell of units at our Grand Summit Hotels at all
of our resorts of approximately $1.5 million.

         Real estate operations loss decreased by $8.1 million, from $(9.4)
million in the 26 weeks ended January 25, 2004 to $(1.3) million in the 27 weeks
ended January 30, 2005. This was primarily a result of the following:

         (i)     $6.9 million decrease in cost of real estate operations
                 resulting from the decrease in revenues, and
         (ii)    $9.1  million  decrease  in interest  expense due to the
                 restructuring  of the real  estate  credit  facility in May
                 2004 and lower outstanding balances on the Construction Loan
                 Facility, offset by
         (iii)   $8.0 million decrease in revenues as discussed above.


Benefit from income taxes:

         We recorded no benefit from income taxes for either the 26 weeks ended
January 25, 2004 or the 27 weeks ended January 30, 2005. We believe it is more
likely than not that we will not realize income tax benefits from operating
losses in the foreseeable future.


                                       26
<PAGE>


                                     Item 3
           Quantitative and Qualitative Disclosures about Market Risk

         On November 24, 2004, we refinanced our prior resort senior credit
facility and Senior Subordinated Notes with our Resort Senior Credit Facility.
The Revolving Facility and First Lien Term Loan mature in November 2010 and bear
interest, at our option, at either the prime rate as publicly quoted in the Wall
Street Journal plus 3.5% or at a rate of LIBOR (as defined) plus 4.5%, payable
quarterly (8.75% as of January 30, 2005 using prime rate as a base). The First
Lien Term Loan requires 23 quarterly payments of $212,500 beginning on January
15, 2005 and a final payment of approximately $80.1 million in November 2010.
The Second Lien Term Loan matures in November 2011, bears interest at the prime
rate as publicly quoted in the Wall Street Journal plus 7.0% or at a rate of
LIBOR (as defined) plus 8.0% payable quarterly (12.25% as of January 30, 2005
using prime rate as a base), and principal is due upon maturity. The Revolving
Facility is comprised of two sub-facilities, each in the amount of $20.0 million
and each with separate fees for the unused portion of the facilities (in the
amounts of 1.0% and 4.5% per annum, respectively). The Resort Senior Credit
Facility also requires us to enter into interest rate swap agreements for at
least 50% of the First Lien Term Loan and the Second Lien Term Loan within 180
days of the closing of the facility. As of January 30, 2005, we have not yet
entered into these interest rate swap agreements.

                                     Item 4
                             Controls and Procedures

(a)       Evaluation of disclosure controls and procedures. Our Chief Executive
          Officer and our Chief  Financial  Officer carried out an evaluation of
          the  effectiveness  of our  "disclosure  controls and  procedures" (as
          defined in the  Securities  Exchange Act of 1934 Rules  13a-15(e)  and
          15d-15(e)).  Based on that  evaluation,  these officers have concluded
          that  as of  the  end  of the  period  covered  by  this  report,  our
          disclosure  controls and  procedures  are (1) effective to ensure that
          information  required  to be  disclosed  by the Company in the reports
          that it files or submits under the Securities  Exchange Act of 1934 is
          recorded,  processed,  summarized and reported within the time periods
          specified in the Securities and Exchange Commission's rules and forms,
          and (2)  designed to ensure that  information  to be  disclosed by the
          Company in such reports is accumulated, organized, and communicated to
          the Company's  management,  including its Chief Executive  Officer and
          Chief Financial  Officer,  as appropriate,  to allow timely  decisions
          regarding required disclosure.

(b)       Changes  in  internal  control  over  financial  reporting.  No change
          occurred in the Company's  internal  control over financial  reporting
          (as defined in the Securities Exchange Act of 1934 Rules 13a-15(f) and
          15d-15(f))  during  the  quarter  ended  January  30,  2005  that  has
          materially affected, or is reasonably likely to materially affect, the
          Company's internal control over financial reporting.

         It should be noted that any system of controls, however well designed
and operated, can provide only reasonable, and not absolute, assurance that the
objectives of the system will be met. In addition, the design of any control
system is based in part upon certain assumptions about the likelihood of future
events. Because of these and other inherent limitations of control systems,
there is only reasonable assurance that our controls will succeed in achieving
their stated goals under all potential future conditions.

                           Part II - Other Information

                                     Item 1
                                Legal Proceedings

         Certain claims, suits and complaints in the ordinary course of business
are pending or may arise against the Company, including all of its direct and
indirect subsidiaries. In the opinion of management, all matters are adequately
covered by insurance or, if not covered, are without merit or are of such kind,
or involve such amounts as are not likely to have a material effect on the
financial position, results of operations or liquidity of the Company if
disposed of unfavorably.


                                       27
<PAGE>

                                     Item 4
               Submission of Matters to a Vote of Security Holders

         On January 12, 2005, the Company held its Annual Meeting of its
shareholders to approve:

         o    The election of the Company's Board of Directors; and
         o    The ratification of KPMG LLP as the Company's independent auditors
              for the 2005 fiscal year.

         The Company did solicit proxies with respect to the Annual Meeting, and
the Board of Directors listed in the Company's proxy statement with respect to
the Annual Meeting was re-elected in its entirety.



<TABLE>

         The results of the Annual Meeting were as follows:

                                                       Board Election:

                               Voting For          Voting Against or         Abstaining          Broker Non-Votes
                                                        Withheld
<S>                           <C>                       <C>                      <C>                 <C>
William J. Fair               15,823,614(1)             172,555                  0                   671,675
David Hawkes                  15,832,568(1)             163,601                  0                   671,675
Paul Wachter                  15,790,064(1)             206,105                  0                   671,675
Leslie B. Otten               14,760,530(2)                0                     0                      0
Gordon Gillies                14,760,530(2)                0                     0                      0
William Janes                 14,760,530(2)                0                     0                      0
Robert Branson                14,760,530(2)                0                     0                      0
Edward Dardani                 150,000(3)                  0                     0                      0
Steven Gruber                  150,000(3)                  0                     0                      0
Jay Crandall                   150,000(3)                  0                     0                      0

(1) Messrs. Fair, Hawkes and Wachter were elected by the holders of the Company's common stock.
(2) Messrs. Otten, Gillies, Janes and Branson were elected by the holders of the Company's Class A common stock.
(3) Messrs. Dardani, Gruber and Crandall were elected by the holders of the Company's Series B preferred stock.

</TABLE>

<TABLE>

                                                   Ratification of KPMG LLP:

                               Voting For            Voting Against          Abstaining          Broker Non-Votes
<S>                            <C>                       <C>                   <C>                   <C>
Common Stock                   15,877,585                94,471                24,113                671,675
Class A Common Stock           14,760,530                  0                     0                      0
Series C-1 Preferred
Stock                         42,093,600(1)                0                     0                      0
                          ---------------------- ----------------------- ------------------- -------------------------
Total All Classes             72,731,715(1)              94,471                24,113                671,675

(1) The Series C-1 preferred stock votes together with common stock on an "as-if-converted" basis. The 36,586 shares
    of Series C-1 preferred stock, which were voted at the meeting, together with accrued and unpaid dividends, had a
    voting right equal to 42,093,600 shares of common stock as of the date of the Annual Meeting. The results set
    forth in the "Total All Classes" row is calculated using this as-if-converted number.
</TABLE>


                                       28
<PAGE>

                                     Item 6
                                    Exhibits

         Included herewith are the following exhibits:

Exhibit No.       Description

10.1     Amendment Letter dated as of December 30, 2004 to Loan and Security
         Agreement dated as of September 1, 1998 among Grand Summit Resort
         Properties, Inc., the lenders named therein, and Textron Financial
         Corporation as administrative agent (incorporated by reference from
         exhibit to Form 8-K filed January 4, 2005)

31.1     Certification of Chief Executive Officer pursuant to Section 302 of the
         Sarbanes-Oxley Act of 2002.

31.2     Certification of Chief Financial Officer pursuant to Section 302 of the
         Sarbanes-Oxley Act of 2002.

32.1     Certification  of Chief  Executive  Officer  pursuant  to 18 U.S.C.
         Section  1350 as adopted  pursuant  to Section 906 of the
         Sarbanes-Oxley Act of 2002.

32.2     Certification  of Chief  Financial  Officer  pursuant  to 18 U.S.C.
         Section  1350 as adopted  pursuant  to Section 906 of the
         Sarbanes-Oxley Act of 2002.











                                       29
<PAGE>

                                   SIGNATURES

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

                                           American Skiing Company
Date:  March 16, 2005

                                           By: /s/ William J. Fair
                                           --------------------------------
                                           William J. Fair
                                           President and Chief Executive Officer
                                           (Principal Executive Officer)



                                           By:  /s/ Helen E. Wallace
                                           --------------------------------
                                           Helen E. Wallace
                                           Senior Vice President, Chief
                                           Financial Officer
                                           (Principal Financial Officer)








                                       30