UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 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 October 29, 2006
                                       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 check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X| No |_|


Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer" and "large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

Large accelerated filer |_|   Accelerated filer | |    Non-accelerated filer [X]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes |_| No |X|

As of December 1, 2006, 31,738,183 shares of common stock were issued and
outstanding; of which 14,760,530 shares were Class A common stock.


<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 October 30, 2005 and
            October 29, 2006 (unaudited).......................................3

         Condensed Consolidated Balance Sheets as of July 30, 2006 and
            October 29, 2006 (unaudited).......................................4

         Condensed Consolidated Statements of Cash Flows for the 13 weeks ended
            October 30, 2005 and October 29, 2006 (unaudited)..................6

         Notes to Condensed Consolidated Financial Statements (unaudited)......7

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

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

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

         Results of Operations................................................24

Item 3.  Quantitative and Qualitative Disclosures about Market Risk...........26

Item 4.  Controls and Procedures..............................................26


Part II - Other Information



Item 6.  Exhibits.............................................................27


<PAGE>



Part I - Financial Information

                           Item 1 Financial Statements

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

                                                    13 weeks ended
                                   ---------------------------------------------
                                        October 30, 2005        October 29, 2006
                                          (unaudited)             (unaudited)
                                   ---------------------   ---------------------
Net revenues:
         Resort                    $             17,147    $             17,702
         Real estate                              2,969                   4,822
                                   ---------------------   ---------------------
           Total net revenues                    20,116                  22,524
                                   ---------------------   ---------------------

Operating expenses:
         Resort                                  23,963                  25,151
         Real estate                              1,942                   4,338
         Marketing, general and
           administrative                        11,568                  12,478
         Depreciation and
           amortization                           2,910                   2,714
         Impairment loss on
           property sold                          1,533                      --
                                   ---------------------   ---------------------
           Total operating expenses              41,916                  44,681
                                   ---------------------   ---------------------

Loss from operations                            (21,800)                (22,157)
Interest expense                                (21,244)                (23,111)
Interest income                                     151                     146
Gain on sale of property                            169                      --
Interest rate swap agreement                        525                    (197)
                                   ---------------------   ---------------------
Net loss                           $            (42,199)   $            (45,319)
                                   =====================   =====================

Accumulated deficit, beginning of
  period                           $           (616,880)   $           (682,533)

Net loss                                        (42,199)                (45,319)
                                   ---------------------   ---------------------

Accumulated deficit, end of period $           (659,079)   $           (727,852)
                                   =====================   =====================


Basic and diluted net loss per
  common share                     $              (1.33)   $              (1.43)
                                   =====================   =====================

Basic and diluted weighted average
  common shares outstanding                      31,738                  31,738
                                   =====================   =====================



     See accompanying Notes to Condensed Consolidated Financial Statements

                                       3
<PAGE>


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

                                        July 30, 2006           October 29, 2006
                                         (unaudited)              (unaudited)
                                   --------------------    ---------------------
Assets
Current assets
    Cash and cash equivalents      $             6,269     $              7,813
    Restricted cash                              2,679                    2,452
    Accounts receivable, net                     6,273                    6,042
    Inventory                                    4,115                    8,034
    Prepaid expenses and other                   2,885                    5,383
    Deferred income taxes                        3,923                    3,923
                                   --------------------    ---------------------
       Total current assets                     26,144                   33,647

Property and equipment, net                    330,231                  333,528
Real estate developed for sale                   2,191                    1,992
Intangible assets, net                           6,249                    6,235
Deferred financing costs, net                    5,361                    5,084
Other assets                                    12,488                   17,409
                                   --------------------    ---------------------
            Total assets           $           382,664     $            397,895
                                   ====================    =====================


                            (continued on next page)
















     See accompanying Notes to Condensed Consolidated Financial Statements

                                       4
<PAGE>


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

                                        July 30, 2006           October 29, 2006
                                         (unaudited)              (unaudited)
                                  ---------------------    ---------------------
Liabilities and Stockholders'
  Deficit
Current liabilities
    Current portion of long-term
      debt                        $              9,286     $             21,957
    Accounts payable and other
      current liabilities                       42,155                   47,308
    Deposits and deferred revenue               25,144                   51,644
                                  ---------------------    ---------------------
        Total current liabilities               76,585                  120,909

Long-term debt, net of current
  portion                                      198,021                  197,846
Subordinated notes and debentures              113,685                  114,261
Other long-term liabilities                     12,259                   14,959
Deferred income taxes                            3,923                    3,923
Mandatorily Redeemable 8 1/2%
  Series B Convertible
  Participating Preferred Stock,
  par value of $0.01 per share;
  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 $71,530
  and $73,670, respectively)                    71,320                   73,507
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 $287,624
  and $298,381, respectively)                  286,801                  297,739
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                      762,594                  823,144
                                  ---------------------    ---------------------


Stockholders' 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                         (682,533)                (727,852)
                                  ---------------------    ---------------------
        Total stockholders'
          deficit                             (379,930)                (425,249)
                                  ---------------------    ---------------------
              Total liabilities
                and stockholders'
                deficit           $            382,664     $            397,895
                                  =====================    =====================



     See accompanying Notes to Condensed Consolidated Financial Statements

                                       5
<PAGE>

                 Condensed Consolidated Statements of Cash Flows
                                 (In thousands)

                                                      13 weeks ended
                                         ---------------------------------------
                                           October 30, 2005     October 29, 2006
                                             (unaudited)          (unaudited)
                                         ------------------   ------------------
Cash flows from operating activities
Net loss                                 $         (42,199)   $         (45,319)
Adjustments to reconcile net loss to
  net cash provided by (used in)
  operating activities:
     Depreciation and amortization                   2,910                2,714
     Amortization of deferred financing
       costs and accretion of discount
       and dividends on mandatorily
       redeemable preferred stock                   11,629               13,402
     Non-cash interest on junior
       subordinated notes                            2,853                3,220
     Non-cash (increase) decrease in
       fair value of interest rate swap
       agreement                                      (686)                 487
     Non-cash Phantom Equity Plan
       compensation expense                             87                   62
     Gain from sale of property                       (902)                (452)
     Impairment loss on property sold                1,533                    --
     Decrease (increase) in assets:
              Restricted cash                         (912)                 227
              Accounts receivable, net                 705                  442
              Inventory                             (3,409)              (3,919)
              Prepaid expenses and other            (1,560)              (2,498)
              Real estate developed for
                sale                                   789                  199
              Other assets                            (115)                  92
     Increase (decrease) in liabilities:
              Accounts payable and other
                current liabilities                  2,505                5,153
              Deposits and deferred
                revenue                             25,082               24,030
              Other long-term liabilities               32                   (8)
                                         ------------------   ------------------
                 Net cash used in
                   operating activities             (1,658)              (2,168)
                                         ------------------   ------------------

Cash flows from investing activities
     Capital expenditures                           (3,593)              (8,789)
     Proceeds from sale of property                  3,345                    5
                                         ------------------   ------------------
                 Net cash used in
                   investing activities               (248)              (8,784)
                                         ------------------   ------------------

Cash flows from financing activities
     Proceeds from resort senior credit
       facilities                                   22,975               22,970
     Repayment of resort senior credit
       facilities                                  (16,007)             (10,263)
     Repayment of long-term debt                       (84)                (211)
     Repayment of real estate debt                  (1,957)                   --
                                         ------------------   ------------------
                 Net cash provided by
                   financing activities              4,927               12,496
                                         ------------------   ------------------

Net increase in cash and cash equivalents            3,021                1,544
Cash and cash equivalents, beginning of
  period                                             6,216                6,269
                                         ------------------   ------------------
Cash and cash equivalents, end of
  period                                 $           9,237    $           7,813
                                         ==================   ==================

Supplemental disclosures of cash flow
  information:
     Cash paid for interest              $           6,423    $           6,972

     See accompanying Notes to Condensed Consolidated Financial Statements
                                       6
<PAGE>


Notes to Condensed Consolidated Financial Statements (unaudited)


1.  General

         American Skiing Company (ASC), a Delaware corporation, and its
subsidiaries (collectively, the Company) own and operate resort facilities, real
estate development companies, golf courses, ski and golf schools, retail shops,
and other related companies. The Company has historically conducted its resort
operations through its wholly owned subsidiaries which operated the following
ski resorts during the 13 weeks ended October 29, 2006 and the year ended July
30, 2006 (fiscal 2006): Sugarloaf/USA and Sunday River in Maine, Attitash in New
Hampshire, Killington and Mount Snow in Vermont, The Canyons in Utah, and
Steamboat in Colorado. The Company has historically conducted its real estate
development operations through its wholly owned subsidiary, American Skiing
Company Resort Properties (Resort Properties), and Resort Properties'
subsidiaries, including Grand Summit Resort Properties, Inc. and The Canyons
Resort Properties, Inc.

         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 2007 is a fifty-two week reporting period and fiscal 2006 was a fifty-two
week reporting period, with each quarter consisting of 13 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 30, 2006 filed with the Securities and Exchange Commission on October
30, 2006.


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: allowances for doubtful accounts, long-lived
asset valuations and useful lives, inventory valuation reserves, litigation and
claims reserves, and deferred income tax asset valuation allowances. Actual
results could differ materially from these estimates. The following are the
Company's significant accounting policies:

Principles of Consolidation
         The accompanying condensed consolidated financial statements include
the accounts of ASC and its wholly owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents
         The Company considers all highly liquid debt instruments with an
original maturity of three months or less to be cash equivalents. Cash
equivalents, which consisted of short-term certificates of deposit, totaled
approximately $0.7 million and $1.0 million as of July 30, 2006 and October 29,
2006, respectively.

                                       7
<PAGE>


Restricted Cash
         Restricted cash consists of deposits received and held in escrow
related to pre-sales of real estate developed for sale, guest advance deposits
for lodging reservations, and cash held in cash collateral accounts by lenders
on behalf of the real estate companies. The cash becomes available to the
Company when the real estate units are sold, the lodging services are provided,
or upon approval of expenditures by lenders.

Inventory
         Inventory is stated at the lower of cost (first-in, first-out method)
or market, and consists primarily of retail goods, food, and beverage products.

Property and Equipment
         Property and equipment are carried at cost, net of accumulated
depreciation, amortization, and impairment charges. Depreciation and
amortization are 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, 5 to 30 years for lifts, lift lines, and
trails, and 10 to 50 years for land improvements. 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 or title
transfers to the Company 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 and
amortization relating to its winter resort operating assets during the second
and third quarters of the Company's fiscal year.

Real Estate Developed for Sale
         The Company capitalizes as real estate developed for sale the original
acquisition cost of land, direct construction and development costs, property
taxes, interest incurred on costs related to real estate under development, and
other related costs (engineering, surveying, landscaping, etc.) until the
property has been developed to the point it is ready for sale. The cost of sales
for individual parcels of real estate or quarter and eighth share units within a
project is determined using the relative sales value method. Selling costs are
charged to expense in the period in which the related revenue is recognized.

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."

As of July 30, 2006 and October 29, 2006, other intangible assets consist of the
                            following (in thousands):

    ------------------------------------------------------------------------
                                        July 30, 2006       October 29, 2006
    ------------------------------------------------------------------------
    Definite-lived Intangible Assets:
      Lease agreements                  $      1,853        $         1,853
      Less accumulated amortization             (462)                  (476)
                                        ---------------     ----------------
                                               1,391                  1,377

    Indefinite-lived Intangible Assets:
      Trade names                                170                    170
      Water rights                             4,688                  4,688
                                        ----------------    ----------------
    Intangible Assets, net              $      6,249        $         6,235
                                        ================    ================

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

         Amortization expense related to intangible assets was approximately
$14,000 for both the 13 weeks ended October 30, 2005 and the 13 weeks ended
October 29, 2006. Future amortization expense related to definite-lived
intangible assets is estimated to be approximately $58,000 for each of the next
five fiscal years.

                                       8
<PAGE>

Long-Lived Assets
         In accordance with SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets," long-lived assets, such as property, 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 is the Company's second and third quarters of its fiscal year. 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 continuing
involvement exists. Amounts received from pre-sales of real estate are recorded
as restricted cash and deposits and deferred revenue in the accompanying
condensed 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), which is more
fully described in Note 2 of the Company's fiscal 2006 Annual Report on Form
10-K, that provides 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 Plan has no
restricted stock option component. Additionally, there have been no options
granted since July 2001.

         Effective August 1, 2005, the Company adopted the fair value
recognition provisions of SFAS No. 123(R),"Share Based Payment", using the
modified prospective application method. Under this transition method,
compensation cost includes amounts of: (a) compensation cost of all stock-based
payments granted prior to, but not yet vested as of, August 1, 2005 (based on
grant-date fair value estimated in accordance with the original provisions of
SFAS No. 123, and previously presented in the pro-forma footnote disclosures),
and (b) compensation cost for all stock-based payments granted subsequent to
August 1, 2005 (based on the grant-date fair value estimated in accordance with
the provisions of SFAS No. 123(R)). The effect of adopting SFAS No. 123(R) as of
August 1, 2005 for the 13-week period ended October 30, 2005 was less than
$1,000 of reported compensation expense. No compensation expense has been
recorded in fiscal 2007, since all outstanding options were fully vested as of
October 30, 2005. Accordingly, there is no future compensation cost related to
non-vested options or non-vested restricted options not yet recognized.

<TABLE>

              The following table summarizes stock option activity during the 13
                              weeks ended October 29, 2006:
--------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                 Intrinsic Value
                                                                Weighted Average
                                             Weighted Average       Remaining
                                    Options   Exercise Price    Contractual Term
--------------------------------------------------------------------------------------------------
<S>                                <C>          <C>                   <C>          <C>
Outstanding at July 30, 2006       3,811,187    $    4.26             3.23         $         -
Granted                                  -
Exercised                                -
Forfeited                                -
                               --------------------------------------------------

Outstanding at October 29, 2006    3,811,187    $    4.26             2.98         $         -
                               ==================================================

Options vested at October 29,
  2006                             3,811,187    $    4.26             2.98         $         -
Exercisable at October 29, 2006    3,811,187    $    4.26             2.98         $         -
--------------------------------------------------------------------------------------------------
</TABLE>
                                       9
<PAGE>

              The following table summarizes information about the stock options
                     outstanding under the Plan as of October 29, 2006:
<TABLE>
----------------------------------------------------------------------------------------------
<CAPTION>
                                Weighted Average   Weighted                        Weighted
Range of          Outstanding      Remaining       Average         Exercisable     Average
Exercise Prices                   Contractual    Exercise Price                 Exercise Price
                                Life (in years)
----------------------------------------------------------------------------------------------
<C>                 <C>              <C>         <C>                 <C>        <C>
$0.72                  25,000        4.70        $   0.72               25,000  $    0.72
1.75 - 2.50         1,420,337        3.37            2.11            1,420,337       2.11
3.00 - 4.00         1,439,250        3.32            3.18            1,439,250       3.18
7.00 - 8.75           735,750        2.01            7.19              735,750       7.19
14.19 - 18.00         190,850        0.98           17.55              190,850      17.55
                 ------------                                  ---------------
                    3,811,187        2.98            4.26            3,811,187       4.26
                 ============                                  ===============
----------------------------------------------------------------------------------------------
</TABLE>


Derivative Financial Instruments
         All derivatives are recognized in the condensed consolidated balance
sheets at their fair values. During fiscal 2005, the Company entered into an
interest rate swap agreement covering a notional amount of $95.0 million related
to its Resort Senior Credit Facility. The agreement is adjusted to market value
at each reporting period and the increase or decrease is reflected in the
condensed consolidated statement of operations. For the 13-week period ended
October 29, 2006, the Company recognized $487,000 of non-cash loss from market
value adjustments to this agreement, compared to $686,000 of non-cash income in
the corresponding period of the prior year.

Accounting for Variable Interest Entities
         On May 14, 2004, Resort Properties completed the restructuring of the
Real Estate Term Facility from Fleet National Bank, Ski Partners, LLC, and Oak
Hill Capital Partners. As a result of the restructuring, a new business venture
called SP Land Company, LLC (SP Land) was created by Ski Partners, LLC, Resort
Properties, and Killington, Ltd. (Killington) (an ASC subsidiary). As part of
the restructuring, certain developmental land parcels at the Killington resort
and cash with a combined carrying value of approximately $2.2 million were
transferred by Resort Properties and Killington into SP Land Company, LLC,
together with all indebtedness, including related interest and fees, under the
Real Estate Term Facility held by Fleet National Bank and Ski Partners, LLC
(Tranche A and B of the Real Estate Term Facility) totaling $55.4 million.
Collectively, Killington and Resort Properties own 25% of the membership
interests of SP Land. The remaining 75% of the membership interests in SP Land
is owned by Ski Partners, LLC, together with a preferential interest in SP Land
of approximately $37.2 million. In accordance with FIN No. 46R, "Consolidation
of Variable Interest Entities", and APB No. 18, SP Land is a variable interest
entity and is accounted for on the equity method because it does not meet the
requirements for consolidation.

         As part of the restructuring of the Real Estate Term Facility,
Killington also contributed all of its interest in approximately 256 acres of
developmental real estate into a joint venture entity called Cherry Knoll
Associates, LLC (Cherry Knoll). Each of SP Land and Killington own 50% of the
membership interests in Cherry Knoll. In addition, Killington maintains a
preferential distribution interest in Cherry Knoll of $1.5 million. In
accordance with FIN No. 46R and APB No. 18, Cherry Knoll is a variable interest
entity and is accounted for on the equity method because it does not meet the
requirements for consolidation.

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

                                       10

<PAGE>


         SS Associates purchased a building in October 2004 for $3.5 million
(including costs to close) through cash and long-term debt of $2.5 million. The
loan is secured by the building and has 59 monthly payments of $29,000 and a
final payment in October 2009 of $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
$0.5 million per year. The non-ASC owned interest in SS Associates of $0.6
million (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 October 29, 2006.

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

Recently Issued Accounting Standards
         In June 2005, the FASB issued Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109" (FIN
No. 48), effective for fiscal years beginning after December 15, 2006. This
Interpretation clarifies the accounting for uncertainty in income taxes
recognized in accordance with FASB Statement No. 109, "Accounting for Income
Taxes." Specifically, it prescribes a recognition threshold and measurement
attribute for the financial statement recognition and measurement of a tax
position taken or expected to be taken in a tax return, and provides guidance on
derecognition, classification, interest and penalties, accounting in interim
periods, disclosure, and transition. The accounting provisions of FIN No. 48
will become effective beginning with the first quarter of the Company's 2008
fiscal year. Management is currently reviewing the requirements of FIN No. 48
and has not yet determined the impact, if any, on its financial position or
results of operations.

         In 2006, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 108, Considering the Effects of Prior Year Misstatements in Current
Year Financial Statements (SAB No. 108), which requires registrants to consider
the effect of all carry-over and reversing effects of prior-year misstatements
when quantifying errors in current year financial statements. The SAB does not
change the SEC staff's previous guidance on evaluating the materiality of
errors. The SAB allows registrants to record the effects of adopting the
guidance as a one-time cumulative-effect adjustment to retained earnings no
later than the end of the first year of adoption. The accounting provisions of
SAB No. 108 are effective no later than the end of the Company's 2007 fiscal
year, at which time the Company intends to adopt them. Management is currently
reviewing the requirements of SAB No. 108 and has not yet determined the impact,
if any, on its financial position or results of operations.


3.  Net Loss per Common Share

         Net loss per common share for the 13 weeks ended October 30, 2005 and
October 29, 2006, respectively, was determined based on the following data (in
thousands):

    ------------------------------------------------------------------------
                                           13 weeks ended    13 weeks ended
                                          October 30, 2005  October 29, 2006
    ------------------------------------------------------------------------
    Loss
    Net loss                              $       (42,199)  $       (45,319)
                                          ================  ================

    Shares
    Basic and  diluted  weighted  average
      common  shares outstanding                   31,738            31,738
                                          ================  ================

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

                                       11
<PAGE>

         As of October 30, 2005 and October 29, 2006, 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 October 30, 2005 and October 29, 2006, the Company had 40,000
shares of its mandatorily redeemable convertible participating 12% Series C-1
preferred stock (Series C-1 Preferred Stock) outstanding, which are convertible
into shares of the Company's common stock. If converted at their liquidation
preferences as of October 30, 2005 and October 29, 2006, these convertible
preferred shares would convert into approximately 52,380,000 and 58,935,000
shares of common stock, respectively. For the 13 weeks ended October 30, 2005
and October 29, 2006, 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 options
outstanding to purchase 3,811,187 shares of its common stock under the Plan as
of October 30, 2005 and October 29, 2006. 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" (SFAS No. 131), 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):

     -----------------------------------------------------------------------
                                          13 weeks ended     13 weeks ended
                                         October 30, 2005   October 29, 2006
     -----------------------------------------------------------------------
     Revenues:
         Resort                          $        17,147    $        17,702
         Real estate                               2,969              4,822
                                         ----------------   ----------------
     Total                               $        20,116    $        22,524
                                         ================   ================

     Net income (loss):
         Resort                          $       (40,862)   $       (45,838)
         Real estate                              (1,337)               519
                                         ----------------   ----------------
     Total                               $       (42,199)   $       (45,319)
                                         ================   ================

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

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 balance sheets is as follows (in thousands):

     -----------------------------------------------------------------------
                                         July 30, 2006     October 29, 2006
     -----------------------------------------------------------------------
     Identifiable Assets:
       Resort                           $     347,493      $        360,241
       Real estate                             29,687                32,186
                                        ----------------   -----------------
                                        $     377,180      $        392,427
                                        ================   =================
     Assets:
       Identifiable assets for segments $     377,180      $        392,427
       Intangible and deferred income
         tax assets not allocated to
         segments                               5,484                 5,468
                                        ----------------   -----------------
            Total consolidated assets   $     382,664      $        397,895
                                        ================   =================

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

                                       12
<PAGE>

5.  Long-Term Debt

    Resort Senior Credit Facility
         The Company entered into agreements dated November 24, 2004 with Credit
Suisse, GE Capital, and other lenders whereby the lenders provided the Company
with a $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 repay
in full the previously existing resort senior credit facility and redeem 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. The amount of
               availability under this facility is correspondingly reduced by
               the amount of each L/C issued.

         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 are provided under a
single credit agreement (collectively, the First Lien Credit Agreement), mature
in November 2010 and bear interest, at the option of the Company, either at a
rate equal to the prime rate, as publicly quoted in The Wall Street Journal,
plus 3.5%, or at a rate equal to LIBOR (as defined) plus 4.5%, payable quarterly
(11.75% based on the prime rate for the Revolving Facility and 9.79% based on
the LIBOR rate for the First Lien Term Loan as of October 29, 2006). The First
Lien Term Loan requires 23 quarterly principal payments of $212,500 beginning on
January 15, 2005 and a final payment of $80.1 million in November 2010. 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 Second
Lien Term Loan is provided under a separate credit agreement (Second Lien Credit
Agreement), matures in November 2011, bears interest at a rate equal to the
prime rate, as publicly quoted in The Wall Street Journal, plus 7.0%, or at a
rate equal to LIBOR (as defined) plus 8.0%, payable quarterly (13.28% as of
October 29, 2006 based on the LIBOR rate), and principal is due upon maturity.

         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 the Company's 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), limiting the Company's
capital expenditures, maintaining a minimum ratio of appraised asset value to
debt, and having a zero balance on the Revolving Credit Facility (excluding
L/Cs) 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 with respect to other material debt; 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 requires the Company to offer to
prepay the loans with proceeds of certain material asset sales and recovery
events, certain proceeds of debt, 50% of excess cash flow, and proceeds from the
issuance of capital stock. The Resort Senior Credit Facility also restricts the
Company's ability to pay cash dividends on or redeem its common and preferred
stock.

                                       13

<PAGE>


         Pursuant to the requirements of the Resort Senior Credit Facility, on
May 23, 2005, the Company entered into an interest rate swap agreement for 50%
of the First Lien Term Loan and the Second Lien Term Loan for a notional amount
of $95.0 million. Under the swap agreement, during the period from May 16, 2005
to November 15, 2005, the Company paid 4.16% and received the 6-month LIBOR
rate. During the period from November 16, 2005 to May 15, 2008, the Company pays
4.16% and receives the 3-month LIBOR rate. As a result of entering into this
interest rate swap agreement, the Company has fixed the cash-pay rate on the
notional amount until the maturity of the swap agreement in May 2008. Changes in
the fair value of the interest rate swap agreement are recorded in the condensed
consolidated statement of operations and changes in accumulated deficit as
increases or decreases in fair value of this interest rate swap agreement at
each reporting period-end. During the 13-week period ended October 29, 2006, the
Company recognized $487,000 of decrease in fair value of this agreement due to
market value adjustments. The total balance sheet effect as of October 29, 2006
is a net asset of $1.6 million.

         As of October 29, 2006, the Company had $17.4 million, $82.3 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 October 29, 2006, the Company had
$1.6 million in outstanding L/Cs with $21.0 million available for additional
borrowings under the Revolving Facility. The Company was in compliance with all
financial covenants of the Resort Senior Credit Facility as of October 29, 2006.

    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 Resort Properties. Grand Summit owns the existing Grand Summit
Hotel project at Steamboat, which was primarily financed through a $110.0
million Senior Construction Loan (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 in December 2003
(Subordinated Construction Loan). Together, the Senior Construction Loan and the
Subordinated Construction Loan comprise the "Construction Loan Facility". The
Construction Loan Facility is without recourse to the Company and its resort
operating subsidiaries and is collateralized by significant real estate assets
of Resort Properties and its subsidiaries, including the assets and stock of
Grand Summit, the Company's primary hotel development subsidiary.

         The outstanding principal amounts under the Construction Loan Facility
were payable incrementally as quarter and eighth share unit sales were closed,
based on a predetermined per unit amount, which approximated between 70% and 80%
of the net proceeds of each closing up until the March 18, 2006 auction held at
Steamboat and then 85% of all units sold at the auction. Mortgages against the
commercial core units and unsold unit inventory at the Grand Summit Hotel at
Steamboat and a promissory note from the Steamboat Homeowners Association
secured by the Steamboat Grand Hotel parking garage collateralize the
Construction Loan Facility, and are subject to covenants, representations, and
warranties customary for that type of construction facility.

         On March 18, 2006 Grand Summit conducted an auction for the remaining
unsold developer inventory at the Grand Summit Hotel at Steamboat. The auction,
together with subsequent sales activity, resulted in a near sell-out of the
remaining inventory of residential units. As of July 30, 2006, sales of $23.3
million were closed. As a result, Grand Summit paid off the Senior Construction
Loan, including deferred loan fees of $750,000, and the principal balance of the
Subordinated Construction Loan during fiscal 2006.

         Until July 31, 2005, the Subordinated Construction Loan carried
interest at a fixed rate of 20% per annum, payable monthly in arrears. Fifty
percent of the amount of this interest was due and payable in cash and the other
50% was automatically deferred until the final payment date of the Subordinated
Construction Loan. Subsequent to July 31, 2005, the interest rate under the
Subordinated Construction Loan was decreased to 10% per annum, all of which is
payable in cash. The total deferred interest under the Subordinated Construction
Loan as of October 29, 2006 was $3.6 million. The remaining deferred interest
balance under the Subordinated Construction Loan matures on November 30, 2007.
The Subordinated Construction Loan, including the related deferred interest
balance, is secured by the same collateral, which secured the Senior
Construction Loan and is non-recourse to the Company and its resort operating
subsidiaries other than Grand Summit.

    Other Long-Term Debt
         The Company has $15.1 million of other long-term debt as of October 29,
2006. This is comprised of $7.2 million of debt in the form of capital lease
obligations and $7.9 million of notes payable with various lenders.

                                       14
<PAGE>

6.  Subordinated Notes and Debentures

    11.3025% Junior Subordinated Notes
         On July 15, 2001, the Company entered into a securities purchase
agreement with Oak Hill Capital Partners 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
Capital Partners purchased, $12.5 million aggregate principal amount of Junior
Subordinated Notes (Junior Subordinated Notes), which are convertible into
shares of the Company's Non-voting Series D Participating Preferred Stock
(Series D Preferred Stock). The Junior Subordinated Notes 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 Company's entry into the Resort Senior
Credit Facility on November 24, 2004 to extend their maturity to May 2012. The
proceeds of the Junior Subordinated 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 October 29, 2006, the outstanding balance
on the Junior Subordinated Notes was approximately $21.7 million including
compounded interest.

    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 $76.7 million of new junior
subordinated notes due May 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 interest at a rate of
11.25%, 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, and January 1, 2006, $0.9 million
and $8.7 million, respectively, 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 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 stockholders subject to certain
limited exceptions. The outstanding balance on the New Junior Subordinated Notes
was $86.3 million as of October 29, 2006. Accrued interest on the New Junior
Subordinated Notes was $9.5 million.

    Other Subordinated Debentures
         Other subordinated debentures owed by the Company to institutions and
individuals as of October 29, 2006 are unsecured and are due as follows (dollars
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 36,626 shares of Series A
Preferred Stock outstanding. In connection with the Company's entry into 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.

    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.

                                       15
<PAGE>

         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 of ASC. The Company issued mandatorily redeemable Series C-1 Preferred
Stock and 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 currently remains
outstanding but will lose its remaining rights, including voting rights, upon
redemption of the Series C-1 Preferred Stock and Series C-2 Preferred Stock.

    Series C-1 Preferred Stock and Series 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 current 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
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 accumulated in arrears. 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-2 Preferred Stock is not convertible. Both
the Series C-1 Preferred Stock and Series C-2 Preferred Stock are mandatorily
redeemable on July 31, 2007 to the extent that the Company has legally available
funds to effect such redemption. As of October 29, 2006, cumulative dividends in
arrears totaled approximately $33.7 million and $158.9 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 and rank
senior in liquidation preference to all common stock and Class A common stock
outstanding as of October 29, 2006, common stock, Class A common stock and
Series D Preferred Stock issued in the future, and rank pari passu with each
other. The Series C-1 Preferred Stock is also participating preferred stock and
consequently has the right to participate in any dividends paid or payable to
the common stock of the Company on an as-if-converted basis.

    Series D Preferred Stock
         The Company has authorized the issuance of 5,000 shares of Series D
Preferred Stock. As of October 29, 2006, 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 Preferred Stock and Series C-2 Preferred Stock, is not
entitled to preferred dividends, and is redeemable at the option of the
shareholders.


8.  Dividend Restrictions

    Dividend Restrictions
         Borrowers under the Resort Senior Credit Facility, which include ASC,
are restricted from paying cash dividends on any of their preferred or common
stock.

         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.


    Stockholders Agreement
         The Company, Oak Hill, and Mr. Leslie B. Otten (Mr. Otten) entered into
a Stockholders Agreement, dated as of August 6, 1999, amended on July 31, 2000
(as amended, the Stockholders Agreement), pursuant to which each of Mr. Otten
and Oak Hill agreed to vote its capital stock of the Company so as to cause
there to be:

    o    Six directors of the Company nominated by Oak Hill, so long as Oak Hill
         owns 80% of the shares of common stock it owned as of July 30, 2000 on
         a fully diluted basis, such number of directors decreasing ratably with
         the percentage of Oak Hill's ownership of the common stock on a fully
         diluted basis compared to such ownership as of July 30, 2000; and

                                       16
<PAGE>

    o    Two directors of the Company nominated by Mr. Otten, so long as Mr.
         Otten owns 15% of the shares of common stock outstanding on a fully
         diluted basis, and one director so nominated, so long as Mr. Otten owns
         at least 5% of the shares of common stock outstanding on a fully
         diluted basis.

         As of October 29, 2006, Oak Hill owned not less than 80% of the shares
of common stock it owned as of July 30, 2000, on a fully diluted basis, and Mr.
Otten owned not less than 15% of the shares of common stock outstanding on a
fully diluted basis.

         The Stockholders Agreement provides that, so long as Oak Hill owns at
least 20% of the outstanding shares of common stock on a fully diluted basis,
the affirmative vote of at least one Oak Hill director is required prior to the
approval of (i) the Company's annual budget, (ii) significant executive
personnel decisions, (iii) material actions likely to have an impact of 5% or
more on the Company's consolidated revenues or earnings, amendments to the
Company's articles of incorporation or by-laws, (iv) any liquidation,
reorganization, or business combination of the Company, (v) the initiation of
certain material litigation, and (vi) any material financing of the Company.

         Under the Stockholders Agreement, Oak Hill and Mr. Otten have agreed
not to dispose of their securities of the Company if, (i) as a result of such
transfer, the transferee would own more than 10% of the outstanding shares of
common stock of the Company (on a fully diluted basis), unless such transfer is
approved by the Board of Directors (x) including a majority of the Common
Directors (as defined in the Stockholders Agreement), or (y) the public
stockholders of the Company are given the opportunity to participate in such
transfer on equivalent terms, (ii) the transferee is a competitor of the Company
or any of its subsidiaries, unless such transfer is approved by the Board of
Directors, or (iii) such transfer would materially disadvantage the business of
the Company. The Stockholders Agreement provides for additional customary
transfer restrictions applicable to each of Mr. Otten and Oak Hill as well as
standstill provisions applicable to Oak Hill.

         The Stockholders Agreement provides that, upon the Company's issuance
of shares of common stock or securities convertible into common stock, Mr. Otten
and Oak Hill will have the right to purchase at the same price and on the same
terms, the number of shares of common stock or securities convertible into
common stock necessary for each of them to maintain individually the same level
of beneficial ownership of common stock of the Company on a fully diluted basis
as it owned immediately prior to the issuance. This anti-dilution provision is
subject to customary exceptions.

9.  Phantom Equity Plan

         ASC has established the American Skiing Company Phantom Equity Plan
(LTIP). Certain of ASC's executive officers participate in the LTIP.
Participants are entitled to a payment on awards granted under the LTIP, to the
extent vested upon a Valuation Event (as defined below) or in certain cases upon
termination of employment. The amount of any award is subject to a specified
minimum amount, but is based ultimately on the Equity Value, as defined by the
LTIP, obtained through a Valuation Event. A Valuation Event is defined in the
LTIP as any of the following: (i) a sale or disposition of a significant Company
operation or property as determined by the Board of Directors; (ii) a merger,
consolidation, or similar event of the Company other than one (A) in which the
Company is the surviving entity or (B) where no Change in Control (as defined in
the LTIP) has occurred; (iii) a public offering of equity securities by the
Company that yields net proceeds to the Company in excess of $50 million; or
(iv) a Change in Control. The LTIP was ratified by the Board of Directors on
March 6, 2003. Compensation expense relating to the LTIP is estimated and
recorded based on the probability of the Company achieving a Valuation Event.
During each of the 13 weeks ended October 30, 2005 and October 29, 2006, the
Company recorded expenses relating to the LTIP of approximately $0.1 million,
which are included in marketing, general, and administrative expenses in the
accompanying consolidated statements of operations. As of October 29, 2006, the
total liability for the LTIP was $1.6 million, which is included in other
long-term liabilities in the condensed consolidated balance sheet.

                                       17
<PAGE>


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.

         In July 2006, the Company announced that it had initiated a strategic
review of business options for its Steamboat ski resort, including the potential
sale of the resort. The Company has retained investment advisors to assist in
marketing Steamboat for a possible sale, and is in talks with a small group of
potential purchasers. There is currently no contractual agreement regarding the
sale of the resort between the Company and any potential purchaser.

         With respect to additional commitments and contingencies, reference
should be made to the Company's consolidated financial statements and
disclosures thereto included in its Form 10-K for the fiscal year ended July 30,
2006 filed with the Securities and Exchange Commission on October 30, 2006.



                                     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: the loss or
termination or our leasehold rights at The Canyons as a result of any material
defaults under governing lease documents that have not been cured within
applicable cure periods; 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; 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.


                                       18
<PAGE>


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 2006, we realized
approximately 88% of resort operating segment revenues and over 100% of resort
operating segment operating income during the period from mid-November through
April. In addition, a significant portion of resort operating segment revenue
and approximately 26% of annual skier visits were generated during the Christmas
and Presidents' Day vacation weeks in fiscal 2006. Our resorts typically
experience operating losses and negative cash flows for the period from May
through mid-November.

         A high degree of seasonality in our revenues increases the impact of
certain events on our 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
ineffective in maintaining quality skiing conditions. Furthermore, unfavorable
weather conditions, regardless of actual skiing conditions, can result in
decreased skier visits.

         As a result of a stockholders' agreement and the terms of the preferred
stock held by Oak Hill Capital Partners, L.P. and certain related entities (Oak
Hill), and Leslie B. Otten (Mr. Otten), the holder of all of the 14,760,530
shares of Class A common stock, Oak Hill has the right to appoint a majority of
our board of directors. Oak Hill also owns all of our outstanding Series C-1
Preferred Stock and Series C-2 Preferred Stock. Oak Hill may have interests
different from the interests of the holders of our common stock.

         The following is our discussion and analysis of financial condition and
results of operations for the 13 weeks ended October 29, 2006. As you read the
information below, we urge you to carefully consider our fiscal 2006 Annual
Report on Form 10-K filed on October 30, 2006 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 2006 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 redeem 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 operating activities 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 October 29, 2006 was $204.7 million.

                                       19
<PAGE>


         Real estate working capital is funded primarily through unit inventory
sales and short-term rental of remaining unit inventory. Historically, 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
October 29, 2006, the carrying value of the total assets that collateralized the
Construction Loan Facility was $26.7 million. During fiscal 2006, the Company
repaid in full the Senior Construction Loan, including deferred loan fees of
$750,000, and repaid all principal amounts outstanding under the Subordinated
Construction Loan. The only amount remaining outstanding under the Construction
Loan Facility as of October 29, 2006 was $3.6 million of accrued deferred
interest under the Subordinated Construction Loan, which amount is due and
payable in full in November 2007. See "Real Estate Liquidity - Construction Loan
Facility" below.


Resort Liquidity

         We entered into agreements dated November 24, 2004 with Credit Suisse,
GE Capital, and other lenders whereby the lenders provided us with 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 redeem 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. The amount of
              availability under this facility is correspondingly reduced by the
              amount of each L/C issued.

         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 are provided under the
First Lien Credit Agreement, mature in November 2010 and bear interest, at our
option, either at a rate equal to the prime rate as publicly quoted in the Wall
Street Journal plus 3.5% or at a rate equal to LIBOR (as defined) plus 4.5%,
payable quarterly (11.75% based on the prime rate for the Revolving Facility and
9.79% based on the LIBOR rate for the First Lien Term Loan as of October 29,
2006). The First Lien Term Loan requires 23 quarterly principal payments of
$212,500 beginning on January 15, 2005 and a final payment of $80.1 million in
November 2010. 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 Second Lien Term Loan is provided under the Second Lien Credit
Agreement, matures in November 2011, bears interest at a rate equal to the prime
rate as publicly quoted in the Wall Street Journal plus 7.0% or at a rate equal
to LIBOR (as defined) plus 8.0%, payable quarterly (13.28% as of October 29,
2006 based on the LIBOR rate), and principal is due upon maturity.

        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 our assets, other than
assets held by Grand Summit, and our obligations under the Second Lien Credit
Agreement and our 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), limiting our capital
expenditures, maintaining a minimum ratio of appraised asset value to debt, and
having a zero balance on the Revolving Credit Facility (excluding L/Cs) 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 with respect to other material debt; 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 requires us to prepay the loans with
proceeds of certain material asset sales and recovery events, certain proceeds
of debt, 50% of excess cash flow, and proceeds from the issuance of capital
stock. The Resort Senior Credit Facility also restricts our ability to pay cash
dividends on or redeem our common or preferred stock.

                                       20
<PAGE>

         Pursuant to the requirements of the Resort Senior Credit Facility, on
May 23, 2005, we entered into an interest rate swap agreement for 50% of the
First Lien Term Loan and the Second Lien Term Loan for a notional amount of
$95.0 million. Under the swap agreement, during the period of May 16, 2005 to
November 15, 2005, we paid 4.16% and received the 6-month LIBOR rate. During the
period from November 16, 2005 to May 15, 2008, we pay 4.16% and receive the
3-month LIBOR rate. As a result of entering into this interest rate swap
agreement, we have fixed the cash-pay rate on the notional amount until the
maturity of the swap agreement in May 2008.

         In connection with entering into the Resort Senior Credit Facility, we
entered into an Exchange Agreement with the holder of the our Series A Preferred
Stock and issued $76.7 million of new junior subordinated notes (New Junior
Subordinated Notes) due May 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 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 and January 1, 2006, $0.9 million and $8.7
million, respectively, of interest was added to the principal outstanding. 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 our shareholders subject to certain limited exceptions.

         In connection with entering into the Resort Senior Credit Facility, the
indenture for our Junior Subordinated Notes was amended to extend their maturity
to May 2012.

         We have $15.1 million of other long-term debt as of October 29, 2006.
This is comprised of $7.2 million of debt held under capital leases and $7.9
million under other notes payable with various lenders.

         As of October 29, 2006, we had $17.4 million, $82.3 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 October 29, 2006, we had $1.6 million in
outstanding L/Cs with $21.0 million available for additional 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 first quarter of fiscal 2008.

         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.

                                       21
<PAGE>


Real Estate Liquidity

         To fund working capital, Grand Summit relies on the net proceeds from
the sale of real estate developed for sale, mortgage payments received for the
Steamboat Grand Hotel parking facility and the lease of the commercial core at
Steamboat to the resort company.

         We have historically conducted substantially all of our real estate
development through subsidiaries, each of which is a wholly owned subsidiary of
Resort Properties. Grand Summit owns the existing Grand Summit Hotel project at
Steamboat, which was primarily financed through a $110.0 million Senior
Construction Loan (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 in December 2003 (Subordinated
Construction Loan). Together, the Senior Construction Loan and the Subordinated
Construction Loan comprise the "Construction Loan Facility". The Construction
Loan Facility is without recourse to the Company and its resort operating
subsidiaries and is collateralized by significant real estate assets of Resort
Properties and its subsidiaries, including the assets and stock of Grand Summit,
the Company's primary hotel development subsidiary.

         The outstanding principal amounts under the Construction Loan Facility
were payable incrementally as quarter and eighth share unit sales were closed,
based on a predetermined per unit amount, which approximated between 70% and 80%
of the net proceeds of each closing up until the March 18, 2006 auction held at
Steamboat, and then 85% of all units sold at the auction. Mortgages against the
commercial core units and unsold unit inventory at the Grand Summit Hotel at
Steamboat and a promissory note from the Steamboat Homeowners Association
secured by the Steamboat Grand Hotel parking garage collateralize the
Construction Loan Facility, and are subject to covenants, representations, and
warranties customary for that type of construction facility.

         On March 18, 2006 Grand Summit conducted an auction for the remaining
unsold developer inventory at the Grand Summit Hotel at Steamboat. The auction,
together with subsequent sales activity, resulted in a near sell-out of the
remaining inventory of residential units. As of July 30, 2006, sales of $23.3
million were closed. As a result, the Grand Summit paid off the Senior
Construction Loan, including deferred loan fees of $750,000, and the principal
balance of the Subordinated Construction Loan during fiscal 2006.

         Until July 31, 2005, the Subordinated Construction Loan carried
interest at a fixed rate of 20% per annum, payable monthly in arrears. Fifty
percent of the amount of this interest was due and payable in cash and the other
fifty percent was automatically deferred until the final payment date of the
Subordinated Construction Loan. Subsequent to July 31, 2005, the interest rate
under the Subordinated Construction Loan was decreased to 10% per annum, all of
which was payable in cash. The total deferred interest under the Subordinated
Construction Loan as of October 29, 2006 was $3.6 million. The remaining
deferred interest balance under the Subordinated Construction Loan matures on
November 30, 2007. The Subordinated Construction Loan, including the related
deferred interest balance, is secured by the same collateral that secured the
Senior Construction Loan and is non-recourse to the Company and its resort
operating subsidiaries other than Grand Summit.


Long-Term Liquidity Needs

         Our primary long-term liquidity needs are to fund skiing-related
capital improvements at certain of our resorts. For fiscal 2006, our annual
maintenance capital requirements were $13.2 million. For each of fiscal 2007 and
fiscal 2008, we anticipate our on-going capital spending to be approximately
$15.5 million each year, as allowed under our Resort Senior Credit Facility and
excluding any contractually committed capital expenditures also allowed under
our Resort Senior Credit Facility. 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.

                                       22
<PAGE>


         We finance on-mountain capital improvements through resort cash flows,
capital leases, proceeds from sales of non-operating assets, 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 2007 and fiscal 2008 at $15.5 million each year,
including assets purchased under capital leases, with the ability to increase
this amount if certain conditions are met. We believe that the capital
expenditure limits under the Resort Senior Credit Facility (inclusive of
increases resulting from allowances for contractually committed capital
expenditures and rollovers from prior fiscal periods) will be sufficient to meet
our non-real estate capital improvement needs for fiscal 2007 and fiscal 2008.

         Our Resort Senior Credit Facility matures beginning in 2010, with the
$40 million Revolving Facility and the $85 million First Lien Term Loan maturing
in November 2010 and the $105 million Second Lien Term Loan maturing in November
2011. Our 11.3025% Junior Subordinated Notes with an outstanding balance as of
October 29, 2006, of approximately $21.7 million, including compounded interest,
mature in May 2012. Our New Junior Subordinated Notes with an outstanding
balance as of October 29, 2006, of approximately $95.8 million, including
accrued interest, also mature in May 2012.

         We also have mandatorily redeemable convertible participating 12%
preferred stock (Series C-1 Preferred Stock) with an accreted redeemable value
of $73.7 million as of October 29, 2006, and mandatorily redeemable 15%
non-voting preferred stock (Series C-2 Preferred Stock) with an accreted
redeemable value of $298.4 million as of October 29, 2006, which mature and are
redeemable on July 31, 2007, to the extent that we have legally available funds
to effect such redemption. There can be no assurance that we will be able to
retire, redeem or refinance our preferred stock on or before its redemption
date. 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
(collectively, the 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 their final maturities.

         As a result of a stockholders' agreement and the terms of the preferred
stock held by Oak Hill Capital Partners, L.P. and certain related entities (Oak
Hill), and Leslie B. Otten (Mr. Otten), the holder of all of the 14,760,530
shares of Class A common stock, Oak Hill has the right to appoint a majority of
our board of directors. Oak Hill also owns all of our outstanding Series C-1
Preferred Stock and Series C-2 Preferred Stock. Oak Hill may have interests
different from the interests of the holders of our common stock.

Contractual Obligations

         There have been no material changes outside the Company's ordinary
course of business during the quarterly period ended October 29, 2006.


Off-Balance Sheet Arrangements

         Other than as set forth under "Contractual Obligations" above and our
interest rate swap agreement described above under "Resort Liquidity", we do not
have any off-balance sheet transactions, arrangements, or obligations (including
contingent obligations) that have, or are reasonably likely to have, a material
current or future effect on our financial position, results of operations,
business prospects, liquidity, capital expenditures, or capital resources.

                                       23
<PAGE>


Results of Operations
     For the 13 weeks ended October 30, 2005 compared to the 13 weeks ended
                                October 29, 2006

Resort Operations:

         The components of resort operations for the 13 weeks ended October 30,
2005 and October 29, 2006 are as follows (unaudited, in thousands):

--------------------------------------------------------------------------------
                                           13 weeks ended
                                 ----------------------------------  -----------
                                 October 30, 2005  October 29, 2006    Variance
                                 ----------------  ----------------  -----------

Total resort revenues            $        17,147   $        17,702   $      555
                                 ----------------  ----------------  -----------

Cost of resort operations                 23,963            25,151        1,188
Marketing, general and
  administrative                          11,568            12,478          910
Depreciation and amortization              2,746             2,603         (143)
                                 ----------------  -----------------------------
Total resort expenses                     38,277            40,232        1,955
                                 ----------------  ----------------  -----------

Loss from resort operations              (21,130)          (22,530)      (1,400)
Other income (expense):
Interest expense                         (20,426)          (23,111)      (2,685)
Gain on sale of property                     169                --         (169)
Interest rate swap agreement                 525              (197)        (722)
                                 ----------------  ----------------  -----------
Loss from resort operations      $       (40,862)  $       (45,838)  $   (4,976)
                                 ================  ================  ===========

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

         Resort revenues were approximately $17.7 million as compared to $17.1
million, an increase of $0.6 million, or 3.2%, for the 13 weeks ended October
29, 2006 when compared to the 13 weeks ended October 30, 2005. This is a result
of: (a) increase in our golf revenues and lodging related revenues at our
eastern resorts due to more favorable late summer and fall weather; and (b)
increase in our lodging related revenues at Steamboat and The Canyons resorts,
primarily as a result of improved group and conference business.

         Our resort segment incurred a $45.8 million operating loss for the 13
weeks ended October 29, 2006, compared to a $40.8 million operating loss for the
13 weeks ended October 30, 2005. This $5.0 million increase in the operating
loss resulted primarily from the net effect of the following:

         Increases in costs and decreases in other income items:
             (i)     $1.2 million increase in cost of resort operations due
                     primarily to continued higher commitments to summer
                     maintenance of buildings, lifts and equipment;
             (ii)    $0.9 million increase in marketing, general and
                     administrative expenses due primarily to increased accruals
                     for legal and related expenses;
             (iii)   $0.2 million decrease in net gain on sale of property;
             (iv)    $2.7 million increase in interest expense; and
             (v)     $0.7 million decrease in the interest rate swap
                     arrangement.

         Partially offset by increases in revenues and decreases in costs:

             (vi)    $0.6 million increase in revenues; and
             (vii)   $0.1 million decrease in depreciation expense.

                                       24
<PAGE>


Recent Trends:

         Through December 3, 2006, our total skier visits for the season-to-date
were significantly lower than through the same date last year. The entire
shortfall was at our eastern resorts and was a result of warm weather, which
limited snowmaking activity, and lack of natural snowfall. Total visits at our
western resorts were flat with last year. This period represents less than two
weeks of ski operations at most of our resorts, and, in absolute amounts, the
shortfall represents less than 2% of our total annual skier visits.

         Season pass sales for the 2006-07 ski season at our eastern resorts are
pacing slightly behind sales for the same period last year, while at our western
resorts, season pass sales are pacing well ahead, thus driving company-wide
pacing ahead by approximately 3%. For the upcoming ski season (our 2nd and 3rd
quarters for fiscal 2007), hotel lodging bookings are pacing flat to the same
period last year, led primarily by improved bookings at our western resorts
offset by an aggregate decrease in bookings at our eastern resorts.

Real Estate Operations:

         The components of real estate operations for the 13 weeks ended October
30, 2005 and October 29, 2006 are as follows (unaudited, in thousands):

--------------------------------------------------------------------------------
                                         13 weeks ended
                                  ----------------------------------  ----------
                                  October 30, 2005  October 29, 2006   Variance
                                  ----------------  ----------------  ----------

Total real estate revenues        $         2,969   $         4,822   $   1,853
                                  ----------------  ----------------  ----------

Cost of real estate operations              1,942             4,338       2,396
Depreciation and amortization                 164               111         (53)
Impairment loss on sale of
  property                                  1,533                --      (1,533)
                                  ----------------  ----------------  ----------
Total real estate expenses                  3,639             4,449         810
                                  ----------------  ----------------  ----------

Income (loss) from real estate
  operations                                 (670)              373       1,043
Other income (expense):
Interest expense                             (818)               --         818
Interest income                               151               146          (5)
                                  ----------------  ----------------  ----------

Income (loss) from real estate
  operations                      $        (1,337)  $           519   $   1,856
                                  ================  ================  ==========

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

         Real estate revenues increased by $1.9 million in the 13 weeks ended
October 29, 2006 when compared to the 13 weeks ended October 30, 2005, from $2.9
million to $4.8 million, respectively. The increase was primarily due to
recognition of $3.3 million deferred revenue derived from the sale of the
Steamboat Grand Summit parking garage to the Steamboat Grand HOA, offset by
lower land sales.

         Our real estate segment generated income from operations of $0.5
million for the 13 weeks ended October 29, 2006, compared to a loss from
operations of $1.3 million for the 13 weeks ended October 30, 2005. This $1.9
million increase in income from operations results primarily from the net effect
of the following:

         Increases in revenues and decreases in costs:
         (i)      $1.9 million increase in revenues;
         (ii)     $0.1 million decrease in depreciation and amortization costs;
         (iii)    $1.5 million decrease in impairment loss on the sale of retail
                  commercial space at the Steamboat Grand Hotel; and
         (iv)     $0.8 million decrease in interest expense due to the repayment
                  of the outstanding construction loans.

         Offset by increases in costs:
         (v)      $2.4 million increase in cost of operations, due primarily to
                  $2.8 million recorded in connection with the sale of the
                  Steamboat Grand Summit parking garage to the Steamboat Grand
                  HOA.

                                       25
<PAGE>

Recent Trends:
         Resort Properties owns one remaining 1/8th interval unit at the
Steamboat Grand Hotel, which we expect will be sold during the upcoming ski
season. We expect that the proceeds from this sale, along with monthly payments
received from the Steamboat resort and the Steamboat Grand HOA under existing
lease and installment sale agreements, respectively, will be used to reduce the
balance of outstanding deferred interest under the Subordinated Construction
Loan.

Benefit from income taxes:

         We recorded no benefit from income taxes for either the 13 weeks ended
October 30, 2005 or the 13 weeks ended October 29, 2006. We believe it is more
likely than not that we will not realize income tax benefits from operating
losses in the foreseeable future, and therefore, have recorded a full valuation
allowance against our existing deferred income tax assets.


                                     Item 3
           Quantitative and Qualitative Disclosures about Market Risk

         There have been no material changes in information relating to market
risk since our disclosure included in Item 7A of Form 10-K for the fiscal year
ended July 30, 2006, as filed with the Securities and Exchange Commission on
October 30, 2006.


                                     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 were effective.

    (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 quarterly period ended October 29, 2006 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.




                                       26
<PAGE>


                           Part II - Other Information


                                     Item 6
                                    Exhibits

         Included herewith are the following exhibits:

Exhibit No.       Description

10.1              Executive Employment Agreement dated November 7, 2006, between
                  Steamboat Ski & Resort Corporation and Christopher Diamond
                  (incorporated by reference to exhibit from Form 8-K filed
                  November 8, 2006).

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.


























                                       27
<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:  December 8, 2006

                                   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)




































                                       28