----

**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**

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

**Vail        Resorts, Inc.**

| **Delaware**                                                                                        |   | **51-0291762**                                        |
|-----------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------|
| (State                  or Other Jurisdiction of Incorporation or Organization)                     |   | (I.R.S.                  Employer Identification No.) |
|                                                                                                |   |                                                  |
| **390                  Interlocken Crescent, Suite 1000,****Broomfield,                  Colorado** |   | **80021**                                             |
| (Address                  of Principal Executive Offices)                                           |   | (Zip                  Code)                           |

| **(303)                  404-1800**                                                          |
|----------------------------------------------------------------------------------------------|
| (Registrant’s                  Telephone Number, Including Area                  Code) |

| **Table                  of Contents** |
|----------------------------------------|
|                                   |   |   |
| **PART                  I**            | **FINANCIAL                  INFORMATION** |   |
|                                   |   |   |
| Item                  1.               | Financial                  Statements. | F-1 |
| Item                  2.               | Management's                  Discussion and Analysis of Financial Condition                  and Results of Operations. | 1 |
| Item                  3.               | Quantitative                  and Qualitative Disclosures About Market Risk. | 13 |
| Item                  4.               | Controls                  and Procedures. | 13 |
|                                   |   |   |
|                                   |   |   |
| **PART                  II**           | **OTHER                  INFORMATION** |   |
|                                   |   |   |
| Item                  1.               | Legal                  Proceedings. | 13 |
| Item                  1A.              | Risk                  Factors. | 13 |
| Item                  2.               | Unregistered                  Sales of Equity Securities and Use of Proceeds. | 13 |
| Item                  3.               | Defaults                  Upon Senior Securities. | 14 |
| Item                  4.               | Submission                  of Matters to a Vote of Security Holders. | 14 |
| Item                  5.               | Other                  Information. | 14 |
| Item                  6.               | Exhibits. | 14 |

----

| **PART                  I**                                                                                                                                          | **FINANCIAL                  INFORMATION**             |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------|--------|
|                                                                                                                                                                 |                                                   |   |
| **Item                  1.**                                                                                                                                         | **Financial                  Statements -- Unaudited** |   |
|                                                                                                                                                                 |                                                   |   |
| Consolidated                  Condensed                  Balance Sheets as of January 31, 2007, July 31, 2006 and January                  31,                  2006 | F-2                                                    |
| Consolidated                  Condensed Statements of Operations for the Three Months Ended January                  31,                  2007 and 2006              | F-3                                                    |
| Consolidated                  Condensed Statements of Operations for the Six Months Ended January                  31,                  2007 and 2006                | F-4                                                    |
| Consolidated                  Condensed Statements of Cash Flows for the Six Months Ended January                  31,                  2007 and 2006                | F-5                                                    |
| Notes                  to Consolidated Condensed Financial Statements                                                                                                | F-6                                                    |

**Vail        Resorts, Inc.**

**Consolidated        Condensed Balance Sheets**

**(In        thousands, except share and per share amounts)**

|                                                                                                                                                                                                                                                                                         |   |   | **January                  31,** |   |   |   | **July                  31,** |   |   |   | **January                  31,** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|----------------------------------|--------|--------|--------|-------------------------------|--------|--------|--------|----------------------------------|--------|
|                                                                                                                                                                                                                                                                                         |   |   | **2007**                         |   |   |   | **2006**                      |   |   |   | **2006**                         |   |
|                                                                                                                                                                                                                                                                                         |   |   | **(Unaudited)**                  |   |   |   |                          |   |   |   | **(Unaudited)**                  |   |
| Assets                                                                                                                                                                                                                                                                                       |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Current                  assets:                                                                                                                                                                                                                                                             |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Cash                  and cash equivalents                                                                                                                                                                                                                                                   |   | $      | 254,866                          |   |   | $      | 191,794                       |   |   | $      | 175,541                          |   |
| Restricted                  cash                                                                                                                                                                                                                                                             |   |   | 26,792                           |   |   |   | 20,322                        |   |   |   | 23,715                           |   |
| Trade                  receivables, net                                                                                                                                                                                                                                                      |   |   | 43,728                           |   |   |   | 35,949                        |   |   |   | 39,712                           |   |
| Inventories,                  net                                                                                                                                                                                                                                                            |   |   | 49,825                           |   |   |   | 42,278                        |   |   |   | 43,977                           |   |
| Other                  current assets                                                                                                                                                                                                                                                        |   |   | 38,918                           |   |   |   | 35,631                        |   |   |   | 43,909                           |   |
| Total                  current assets                                                                                                                                                                                                                                                        |   |   | 414,129                          |   |   |   | 325,974                       |   |   |   | 326,854                          |   |
| Property,                  plant and equipment, net (Note 5)                                                                                                                                                                                                                                 |   |   | 868,185                          |   |   |   | 851,112                       |   |   |   | 858,200                          |   |
| Real                  estate held for sale and investment                                                                                                                                                                                                                                    |   |   | 293,219                          |   |   |   | 259,384                       |   |   |   | 221,048                          |   |
| Goodwill,                  net                                                                                                                                                                                                                                                               |   |   | 135,811                          |   |   |   | 135,811                       |   |   |   | 135,811                          |   |
| Intangible                  assets, net                                                                                                                                                                                                                                                      |   |   | 73,715                           |   |   |   | 75,109                        |   |   |   | 77,541                           |   |
| Other                  assets                                                                                                                                                                                                                                                                |   |   | 47,557                           |   |   |   | 40,253                        |   |   |   | 33,226                           |   |
| Total                  assets                                                                                                                                                                                                                                                                |   | $      | 1,832,616                        |   |   | $      | 1,687,643                     |   |   | $      | 1,652,680                        |   |
|                                                                                                                                                                                                                                                                                         |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Liabilities                  and Stockholders’ Equity                                                                                                                                                                                                                                  |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Current                  liabilities:                                                                                                                                                                                                                                                        |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Accounts                  payable and accrued expenses (Note 5)                                                                                                                                                                                                                              |   | $      | 305,690                          |   |   | $      | 230,762                       |   |   | $      | 295,092                          |   |
| Income                  taxes payable                                                                                                                                                                                                                                                        |   |   | 9,103                            |   |   |   | 17,517                        |   |   |   | 6,324                            |   |
| Long-term                  debt due within one year (Note 4)                                                                                                                                                                                                                                 |   |   | 440                              |   |   |   | 5,915                         |   |   |   | 5,673                            |   |
| Total                  current liabilities                                                                                                                                                                                                                                                   |   |   | 315,233                          |   |   |   | 254,194                       |   |   |   | 307,089                          |   |
| Long-term                  debt (Note 4)                                                                                                                                                                                                                                                     |   |   | 551,866                          |   |   |   | 525,313                       |   |   |   | 517,638                          |   |
| Other                  long-term liabilities (Note 5)                                                                                                                                                                                                                                        |   |   | 185,849                          |   |   |   | 158,490                       |   |   |   | 132,933                          |   |
| Deferred                  income taxes                                                                                                                                                                                                                                                       |   |   | 83,967                           |   |   |   | 73,064                        |   |   |   | 77,037                           |   |
| Commitments                  and contingencies (Note 11)                                                                                                                                                                                                                                     |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Put                  option liabilities (Note 9)                                                                                                                                                                                                                                             |   |   | 1,245                            |   |   |   | 1,245                         |   |   |   | --                               |   |
| Minority                  interest in net assets of consolidated subsidiaries                                                                                                                                                                                                                |   |   | 36,035                           |   |   |   | 32,560                        |   |   |   | 31,345                           |   |
| Stockholders’                  equity:                                                                                                                                                                                                                                                 |   |   |                             |   |   |   |                          |   |   |   |                             |   |
| Preferred                  stock, $0.01 par value, 25,000,000 shares authorized, zero shares                  issued                  and outstanding                                                                                                                                        |   |   | --                               |   |   |   | --                            |   |   |   | --                               |   |
| Common                  stock, $0.01, 100,000,000 shares authorized, 38,802,817 (unaudited),                  39,036,282 and 37,965,853 (unaudited) shares issued and outstanding                  as of                  January 31, 2007, July 31, 2006 and January 31, 2006, respectively |   |   | 395                              |   |   |   | 390                           |   |   |   | 380                              |   |
| Additional                  paid-in capital                                                                                                                                                                                                                                                  |   |   | 522,941                          |   |   |   | 509,505                       |   |   |   | 479,611                          |   |
| Retained                  earnings                                                                                                                                                                                                                                                           |   |   | 160,931                          |   |   |   | 143,721                       |   |   |   | 106,647                          |   |
| Treasury                  stock (Note 12)                                                                                                                                                                                                                                                    |   |   | (25,846                          | )      |   |   | (10,839                       | )      |   |   | --                               |   |
| Total                  stockholders’ equity                                                                                                                                                                                                                                            |   |   | 658,421                          |   |   |   | 642,777                       |   |   |   | 586,638                          |   |
| Total                  liabilities and stockholders’ equity                                                                                                                                                                                                                            |   | $      | 1,832,616                        |   |   | $      | 1,687,643                     |   |   | $      | 1,652,680                        |   |

**Vail        Resorts, Inc.**

**Consolidated        Condensed Statements of Operations**

**(In        thousands, except per share amounts)**

**(Unaudited)**

|                                                                           |   | **Three                  Months Ended** |     |
|--------------------------------------------------------------------------------|--------|-----------------------------------------|----------|
|                                                                           |   | **January                  31,**        |     |
|                                                                           |   |                                    | **2007** |   |   |   | **2006** |   |
| Net                  revenue:                                                  |   |                                    |     |   |   |   |   |   |
| Mountain                                                                       |   | $                                       | 272,026  |   |   | $ | 246,228 |   |
| Lodging                                                                        |   |                                    | 32,796   |   |   |   | 32,079 |   |
| Real                  estate                                                   |   |                                    | 56,216   |   |   |   | 9,709 |   |
| Total                  net revenue                                             |   |                                    | 361,038  |   |   |   | 288,016 |   |
| Segment                  operating expense:                                    |   |                                    |     |   |   |   |   |   |
| Mountain                                                                       |   |                                    | 159,871  |   |   |   | 150,666 |   |
| Lodging                                                                        |   |                                    | 30,757   |   |   |   | 32,894 |   |
| Real                  estate                                                   |   |                                    | 50,391   |   |   |   | 6,383 |   |
| Total                  segment operating expense                               |   |                                    | 241,019  |   |   |   | 189,943 |   |
| Other                  operating (expense) income:                             |   |                                    |     |   |   |   |   |   |
| Depreciation                  and amortization                                 |   |                                    | (21,759  | ) |   |   | (21,431 | ) |
| Relocation                  and separation charges (Note 7)                    |   |                                    | (500     | ) |   |   | -- |   |
| Mold                  remediation credit (Note 11)                             |   |                                    | --       |   |   |   | 852 |   |
| Loss                  on disposal of fixed assets, net                         |   |                                    | (10      | ) |   |   | (486 | ) |
| Income                  from operations                                        |   |                                    | 97,750   |   |   |   | 77,008 |   |
| Mountain                  equity investment income, net                        |   |                                    | 1,496    |   |   |   | 1,455 |   |
| Real                  estate equity investment income                          |   |                                    | --       |   |   |   | 31 |   |
| Investment                  income                                             |   |                                    | 2,417    |   |   |   | 1,046 |   |
| Interest                  expense, net                                         |   |                                    | (7,911   | ) |   |   | (9,502 | ) |
| Gain                  on sale of businesses, net (Note 8)                      |   |                                    | --       |   |   |   | 4,625 |   |
| Contract                  dispute charges (Note 11)                            |   |                                    | (672     | ) |   |   | -- |   |
| Gain                  on put options (Note 9)                                  |   |                                    | --       |   |   |   | 1,026 |   |
| Other                  income, net                                             |   |                                    | --       |   |   |   | 51 |   |
| Minority                  interest in income of consolidated subsidiaries, net |   |                                    | (6,152   | ) |   |   | (5,231 | ) |
| Income                  before provision for income taxes                      |   |                                    | 86,928   |   |   |   | 70,509 |   |
| Provision                  for income taxes                                    |   |                                    | (33,902  | ) |   |   | (27,498 | ) |
| Net                  income                                                    |   | $                                       | 53,026   |   |   | $ | 43,011 |   |
|                                                                           |   |                                    |     |   |   |   |   |   |
| Per                  share amounts (Note 3):                                   |   |                                    |     |   |   |   |   |   |
| Basic                  net income per share                                    |   | $                                       | 1.37     |   |   | $ | 1.15 |   |
| Diluted                  net income per share                                  |   | $                                       | 1.35     |   |   | $ | 1.12 |   |

**Vail        Resorts, Inc.**

**Consolidated        Condensed Statements of Operations**

**(In        thousands, except per share amounts)**

**(Unaudited)**

|                                                                           |   | **Six                  Months Ended** |     |
|--------------------------------------------------------------------------------|--------|---------------------------------------|----------|
|                                                                           |   | **January                  31,**      |     |
|                                                                           |   |                                  | **2007** |   |   |   | **2006** |   |
| Net                  revenue:                                                  |   |                                  |     |   |   |   |   |   |
| Mountain                                                                       |   | $                                     | 318,189  |   |   | $ | 286,505 |   |
| Lodging                                                                        |   |                                  | 73,204   |   |   |   | 73,829 |   |
| Real                  estate                                                   |   |                                  | 83,138   |   |   |   | 13,102 |   |
| Total                  net revenue                                             |   |                                  | 474,531  |   |   |   | 373,436 |   |
| Segment                  operating expense:                                    |   |                                  |     |   |   |   |   |   |
| Mountain                                                                       |   |                                  | 239,358  |   |   |   | 222,957 |   |
| Lodging                                                                        |   |                                  | 67,106   |   |   |   | 70,535 |   |
| Real                  estate                                                   |   |                                  | 76,509   |   |   |   | 12,452 |   |
| Total                  segment operating expense                               |   |                                  | 382,973  |   |   |   | 305,944 |   |
| Other                  operating (expense) income:                             |   |                                  |     |   |   |   |   |   |
| Depreciation                  and amortization                                 |   |                                  | (43,344  | ) |   |   | (40,354 | ) |
| Relocation                  and separation charges (Note 7)                    |   |                                  | (1,235   | ) |   |   | -- |   |
| Asset                  impairment charge                                       |   |                                  | --       |   |   |   | (136 | ) |
| Mold                  remediation credit (Note 11)                             |   |                                  | --       |   |   |   | 852 |   |
| Loss                  on disposal of fixed assets, net                         |   |                                  | (91      | ) |   |   | (726 | ) |
| Income                  from operations                                        |   |                                  | 46,888   |   |   |   | 27,128 |   |
| Mountain                  equity investment income, net                        |   |                                  | 2,331    |   |   |   | 2,305 |   |
| Real                  estate equity investment income                          |   |                                  | --       |   |   |   | 100 |   |
| Investment                  income                                             |   |                                  | 4,481    |   |   |   | 2,234 |   |
| Interest                  expense, net                                         |   |                                  | (16,847  | ) |   |   | (18,939 | ) |
| Gain                  on sale of businesses, net (Note 8)                      |   |                                  | --       |   |   |   | 4,625 |   |
| Contract                  dispute charges (Note 11)                            |   |                                  | (4,276   | ) |   |   | -- |   |
| Gain                  on put options (Note 9)                                  |   |                                  | --       |   |   |   | 34 |   |
| Other                  income, net                                             |   |                                  | --       |   |   |   | 51 |   |
| Minority                  interest in income of consolidated subsidiaries, net |   |                                  | (4,363   | ) |   |   | (3,305 | ) |
| Income                  before provision for income taxes                      |   |                                  | 28,214   |   |   |   | 14,233 |   |
| Provision                  for income taxes                                    |   |                                  | (11,004  | ) |   |   | (5,551 | ) |
| Net                  income                                                    |   | $                                     | 17,210   |   |   | $ | 8,682 |   |
|                                                                           |   |                                  |     |   |   |   |   |   |
| Per                  share amounts (Note 3):                                   |   |                                  |     |   |   |   |   |   |
| Basic                  net income per share                                    |   | $                                     | 0.44     |   |   | $ | 0.23 |   |
| Diluted                  net income per share                                  |   | $                                     | 0.44     |   |   | $ | 0.23 |   |

**Vail        Resorts, Inc.**

**Consolidated        Condensed Statements of Cash Flows**

**(In        thousands)**

**(Unaudited)**

|                                                                                |   | **Six                  Months Ended** |
|-------------------------------------------------------------------------------------|--------|---------------------------------------|
|                                                                                |   | **January                  31,**      |
|                                                                                |   | **2007**                              |   | **2006** |
| Net                  cash provided by operating activities                          |   | $                                     | 196,886 |   |   | $ | 100,426 |   |
| Cash                  flows from investing activities:                              |   |                                  |   |   |   |   |   |   |
| Capital                  expenditures                                               |   |                                  | (62,058 | ) |   |   | (55,112 | ) |
| Investments                  in real estate                                         |   |                                  | (88,567 | ) |   |   | (64,905 | ) |
| Proceeds                  from sale of businesses                                   |   |                                  | -- |   |   |   | 30,712 |   |
| Other                  investing activities, net                                    |   |                                  | 354 |   |   |   | (4,018 | ) |
| Net                  cash used in investing activities                              |   |                                  | (150,271 | ) |   |   | (93,323 | ) |
| Cash                  flows from financing activities:                              |   |                                  |   |   |   |   |   |   |
| Repurchases                  of common stock                                        |   |                                  | (15,007 | ) |   |   | -- |   |
| Proceeds                  from borrowings under Non-Recourse Real Estate Financings |   |                                  | 33,067 |   |   |   | 5,233 |   |
| Payments                  of Non-Recourse Real Estate Financings                    |   |                                  | (1,493 | ) |   |   | -- |   |
| Proceeds                  from borrowings under other long-term debt                |   |                                  | 48,012 |   |   |   | 20,980 |   |
| Payments                  of other long-term debt                                   |   |                                  | (58,508 | ) |   |   | (24,909 | ) |
| Proceeds                  from exercise of stock options                            |   |                                  | 6,803 |   |   |   | 27,635 |   |
| Other                  financing activities, net                                    |   |                                  | 3,583 |   |   |   | 2,919 |   |
| Net                  cash provided by financing activities                          |   |                                  | 16,457 |   |   |   | 31,858 |   |
| Net                  increase in cash and cash equivalents                          |   |                                  | 63,072 |   |   |   | 38,961 |   |
| Cash                  and cash equivalents:                                         |   |                                  |   |   |   |   |   |   |
| Beginning                  of period                                                |   |                                  | 191,794 |   |   |   | 136,580 |   |
| End                  of period                                                      |   | $                                     | 254,866 |   |   | $ | 175,541 |   |

**Vail        Resorts, Inc.**

**Notes        to Consolidated Condensed Financial Statements**

**(Unaudited)**

**1.**
**Organization        and Business**

**2.**
**Summary        of Significant Accounting Policies**

*Use        of Estimates--*

**3.**
**Net        Income Per Common Share**

|                                                 |   | **Three                  Months Ended January 31,** |
|------------------------------------------------------|--------|-----------------------------------------------------|
|                                                 |   | **2007**                                            |   | **2006** |
|                                                 |   | **Basic**                                           |   | **Diluted** |   | **Basic** |   | **Diluted** |
| Net                  income per share:               |   |                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income                          |   | $                                                   | 53,026 |   |   | $ | 53,026 |   |   | $ | 43,011 |   |   | $ | 43,011 |   |
|                                                 |   |                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted-average                  shares outstanding |   |                                                | 38,753 |   |   |   | 38,753 |   |   |   | 37,467 |   |   |   | 37,467 |   |
| Effect                  of dilutive securities       |   |                                                | -- |   |   |   | 486 |   |   |   | -- |   |   |   | 855 |   |
| Total                  shares                        |   |                                                | 38,753 |   |   |   | 39,239 |   |   |   | 37,467 |   |   |   | 38,322 |   |
|                                                 |   |                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income per share                |   | $                                                   | 1.37 |   |   | $ | 1.35 |   |   | $ | 1.15 |   |   | $ | 1.12 |   |

|                                                 |   | **Six                  Months Ended January 31,** |
|------------------------------------------------------|--------|---------------------------------------------------|
|                                                 |   | **2007**                                          |   | **2006** |
|                                                 |   | **Basic**                                         |   | **Diluted** |   | **Basic** | **Diluted** |
| Net                  income per share:               |   |                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income                          |   | $                                                 | 17,210 |   |   | $ | 17,210 |   |   | $ | 8,682 |   | $ | 8,682 |   |
|                                                 |   |                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted-average                  shares outstanding |   |                                              | 38,734 |   |   |   | 38,734 |   |   |   | 37,133 |   |   | 37,133 |   |
| Effect                  of dilutive securities       |   |                                              | -- |   |   |   | 465 |   |   |   | -- |   |   | 848 |   |
| Total                  shares                        |   |                                              | 38,734 |   |   |   | 39,199 |   |   |   | 37,133 |   |   | 37,981 |   |
|                                                 |   |                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income per share                |   | $                                                 | 0.44 |   |   | $ | 0.44 |   |   | $ | 0.23 |   | $ | 0.23 |   |

**4.**
**Long-Term        Debt**

|                                                             |                              | **January                  31,** | **July                  31,** | **January                  31,** |
|------------------------------------------------------------------|-----------------------------------|----------------------------------|-------------------------------|----------------------------------|
|                                                             | **Maturity                  (a)** | **2007**                         | **2006**                      | **2006**                         |
| Credit                  Facility Revolver                        | 2010                              | $                                | --                            | $                                | -- | $ | -- |
| SSV                  Facility                                    | 2011                              |                             | --                            |                             | 6,261 |   | 6,233 |
| Industrial                  Development Bonds                    | 2009-2020                         |                             | 57,700                        |                             | 61,700 |   | 61,700 |
| Employee                  Housing Bonds                          | 2027-2039                         |                             | 52,575                        |                             | 52,575 |   | 52,575 |
| Non-Recourse                  Real Estate Financings (b)         | 2009                              |                             | 44,931                        |                             | 13,357 |   | 5,233 |
| 6.75%                  Senior Subordinated Notes ("6.75% Notes") | 2014                              |                             | 390,000                       |                             | 390,000 |   | 390,000 |
| Other                                                            | 2007-2029                         |                             | 7,100                         |                             | 7,335 |   | 7,570 |
| Total                  debt                                      |                              |                             | 552,306                       |                             | 531,228 |   | 523,311 |
| Less:                  Current maturities (c)                    |                              |                             | 440                           |                             | 5,915 |   | 5,673 |
| Long-term                  debt                                  |                              | $                                | 551,866                       | $                                | 525,313 | $ | 517,638 |

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)    | Maturities                  are based on the Company's July 31 fiscal year end.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (b)    | At                  January 31, 2007, Non-Recourse Real Estate Financings consist of                  borrowings under the $175 million construction agreement for Arrabelle                  at                  Vail Square, LLC (“Arrabelle”). At July 31, 2006, Non-Recourse Real Estate                  Financings also included borrowings under the $30 million construction                  agreement for Gore Creek Place, LLC (“Gore Creek”) which were                  paid in full during the six months ended January 31,                  2007. |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (c)    | Current                  maturities represent principal payments due in the next 12                  months.                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |

| Fiscal                  2007 |   | $      | 175     |
|------------------------------|--------|--------|---------|
| Fiscal                  2008 |   |   | 363     |
| Fiscal                  2009 |   |   | 60,197  |
| Fiscal                  2010 |   |   | 262     |
| Fiscal                  2011 |   |   | 1,738   |
| Thereafter                   |   |   | 489,571 |
| Total                  debt  |   | $      | 552,306 |

**5.**
**Supplementary        Balance Sheet Information**

|                                                 |                                                 |   | **January                  31,** |      | **July                  31,** |   | **January                  31,** |
|------------------------------------------------------|------------------------------------------------------|--------|----------------------------------|-----------|-------------------------------|--------|----------------------------------|
|                                                 |                                                 |   | **2007**                         |      | **2006**                      |   | **2006**                         |
| Land                  and land improvements          |                                                 | $      | 247,997                          |      |                          | $      | 248,941                          |   |   | $ | 244,841 |   |
| Buildings                  and building improvements |                                                 |   | 538,426                          |      |                          |   | 529,316                          |   |   |   | 526,808 |   |
| Machinery                  and equipment             |                                                 |   | 455,382                          |      |                          |   | 426,457                          |   |   |   | 426,726 |   |
| Vehicles                                             |                                                 |   | 27,121                           |      |                          |   | 25,671                           |   |   |   | 25,436 |   |
| Furniture                  and fixtures              |                                                 |   | 124,201                          |      |                          |   | 113,696                          |   |   |   | 111,610 |   |
| Construction                  in progress            |                                                 |   | 41,035                           |      |                          |   | 39,149                           |   |   |   | 21,024 |   |
|                                                 | Gross                  property, plant and equipment |   |                             | 1,434,162 |                          |   |                             | 1,383,230 |   |   |   | 1,356,445 |   |
| Accumulated                  depreciation            |                                                 |   | (565,977                         | )         |                          |   | (532,118                         | ) |   |   | (498,245 | ) |
|                                                 | Property,                  plant and equipment, net  |   | $                                | 868,185   |                          |   | $                                | 851,112  |   |   | $ | 858,200 |   |

|                                                               |                                                         |   | **January                  31,** |    | **July                  31,** |   | **January                  31,** |
|--------------------------------------------------------------------|--------------------------------------------------------------|--------|----------------------------------|---------|-------------------------------|--------|----------------------------------|
|                                                               |                                                         |   | **2007**                         |    | **2006**                      |   | **2006**                         |
| Trade                  payables                                    |                                                         | $      | 103,718                          |    |                          | $      | 82,599                           |   |   | $ | 92,565 |   |
| Deferred                  revenue                                  |                                                         |   | 66,627                           |    |                          |   | 30,785                           |   |   |   | 62,048 |   |
| Deferred                  credits and deposits                     |                                                         |   | 27,071                           |    |                          |   | 24,026                           |   |   |   | 43,885 |   |
| Accrued                  salaries, wages and deferred compensation |                                                         |   | 34,709                           |    |                          |   | 31,954                           |   |   |   | 29,181 |   |
| Accrued                  benefits                                  |                                                         |   | 26,704                           |    |                          |   | 24,538                           |   |   |   | 20,011 |   |
| Accrued                  interest                                  |                                                         |   | 14,614                           |    |                          |   | 14,969                           |   |   |   | 14,686 |   |
| Liabilities                  to complete real estate projects      |                                                         |   | 5,262                            |    |                          |   | 5,951                            |   |   |   | 7,575 |   |
| Other                  accruals                                    |                                                         |   | 26,985                           |    |                          |   | 15,940                           |   |   |   | 25,141 |   |
|                                                               | Total                  accounts payable and accrued expenses |   | $                                | 305,690 |                          |   | $                                | 230,762 |   |   | $ | 295,092 |   |

|                                                          |                                               |   | **January                  31,** |    | **July                  31,** |   | **January                  31,** |
|---------------------------------------------------------------|----------------------------------------------------|--------|----------------------------------|---------|-------------------------------|--------|----------------------------------|
|                                                          |                                               |   | **2007**                         |    | **2006**                      |   | **2006**                         |
| Private                  club deferred initiation fee revenue |                                               | $      | 94,110                           |    |                          | $      | 91,438                           |   |   | $ | 90,270 |   |
| Deferred                  real estate credits                 |                                               |   | 62,774                           |    |                          |   | 54,578                           |   |   |   | 33,876 |   |
| Private                  club initiation deposits             |                                               |   | 9,330                            |    |                          |   | 1,308                            |   |   |   | 1,253 |   |
| Liabilities                  to complete real estate projects |                                               |   | 6,301                            |    |                          |   | 550                              |   |   |   | 550 |   |
| Other                  long-term liabilities                  |                                               |   | 13,334                           |    |                          |   | 10,616                           |   |   |   | 6,984 |   |
|                                                          | Total                  other long-term liabilities |   | $                                | 185,849 |                          |   | $                                | 158,490 |   |   | $ | 132,933 |   |

**6.**
**Variable        Interest Entities**

**7.**
**Relocation        and Separation Charges**

|                                               |    |                |   |    |                  |   |    | ** Facility,**                  |   |    |            |   |
|----------------------------------------------------|---------|---------------------|--------|---------|-----------------------|--------|---------|--------------------------------------|--------|---------|-----------------|--------|
|                                               |    | ** Severance** |   |    |                  |   |    | ** Employee**                   |   |    |            |   |
|                                               |    | ** and**       |   |    | ** Contact**     |   |    | ** and                  Other** |   |    |            |   |
|                                               |    | ** Retention** |   |    | ** Termination** |   |    | ** Relocation**                 |   |    |            |   |
|                                               |    | ** Benefits**  |   |    | ** Costs**       |   |    | ** Costs**                      |   |    | ** Total** |   |
|  Balance                  at July 31, 2006    |  $ |  873           |   |  $ |  --              |   |  $ |  283                            |   |  $ |  1,156     |   |
|  Relocation                  charges          |    |  67            |   |    |  303             |   |    |  865                            |   |    |  1,235     |   |
|  Payments                                     |    |  (911          | )      |    |  (106            | )      |    |  (1,060                         | )      |    |  (2,077    | )      |
|  Balance                  at January 31, 2007 |  $ |  29            |   |  $ |  197             |   |  $ |  88                             |   |  $ |  314       |   |

**8.**
**Sale        of Businesses**

**9.**
**Put        and Call Options**

**10.**
**Related        Party Transactions**

**11.**
**Commitments        and Contingencies**

*Metropolitan        Districts*

*Guarantees*

*Commitments*

*Cheeca        Lodge & Spa Contract Dispute*

*Breckenridge        Terrace Employee Housing Construction Defect/Water Intrusion        Claims*

**12.**
**Stock        Repurchase Plan**

**13.**
**Guarantor        Subsidiaries and Non-Guarantor Subsidiaries**

----

| **Supplemental                  Condensed Consolidating Balance Sheet**                     |
|---------------------------------------------------------------------------------------------|
| **As                  of January 31, 2007**                                                 |
| **(in                  thousands)**                                                         |
| **(Unaudited)**                                                                             |
|                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                        |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |
|                                                                                        |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   | **Eliminating** |   |   |
|                                                                                        |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   | **Entries** |   |   | **Consolidated** |
| Current                  assets:                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                        | Cash                  and cash equivalents | $ | -- |   | $ | 247,083 |   | $ | 7,783 |   | $ | -- |   | $ | 254,866 |
|                                                                                        | Restricted                  cash |   | -- |   |   | 25,404 |   |   | 1,388 |   |   | -- |   |   | 26,792 |
|                                                                                        | Trade                  receivables, net |   | -- |   |   | 37,578 |   |   | 6,150 |   |   | -- |   |   | 43,728 |
|                                                                                        | Inventories,                  net |   | -- |   |   | 9,034 |   |   | 40,791 |   |   | -- |   |   | 49,825 |
|                                                                                        | Other                  current assets |   | 13,338 |   |   | 23,509 |   |   | 2,071 |   |   | -- |   |   | 38,918 |
|                                                                                        |   | Total                  current assets |   | 13,338 |   |   | 342,608 |   |   | 58,183 |   |   | -- |   |   | 414,129 |
| Property,                  plant and equipment, net                                         |   | -- |   |   | 784,486 |   |   | 83,699 |   |   | -- |   |   | 868,185 |
| Real                  estate held for sale and investment                                   |   | -- |   |   | 118,917 |   |   | 174,302 |   |   | -- |   |   | 293,219 |
| Goodwill,                  net                                                              |   | -- |   |   | 118,475 |   |   | 17,336 |   |   | -- |   |   | 135,811 |
| Intangible                  assets, net                                                     |   | -- |   |   | 57,168 |   |   | 16,547 |   |   | -- |   |   | 73,715 |
| Other                  assets                                                               |   | 5,001 |   |   | 26,948 |   |   | 15,608 |   |   | -- |   |   | 47,557 |
| Investments                  in subsidiaries and advances to (from)                  parent |   | 1,059,064 |   |   | (535,123 | ) |   | (64,043 | ) |   | (459,898 | ) |   | -- |
|                                                                                        | Total                  assets | $ | 1,077,403 |   | $ | 913,479 |   | $ | 301,632 |   | $ | (459,898 | ) | $ | 1,832,616 |
|                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                  liabilities:                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                        | Accounts                  payable and accrued expenses | $ | 19,866 |   | $ | 231,873 |   | $ | 53,951 |   | $ | -- |   | $ | 305,690 |
|                                                                                        | Income                  taxes payable |   | 9,103 |   |   | -- |   |   | -- |   |   | -- |   |   | 9,103 |
|                                                                                        | Long-term                  debt due within one year |   | -- |   |   | 35 |   |   | 405 |   |   | -- |   |   | 440 |
|                                                                                        |   | Total                  current liabilities |   | 28,969 |   |   | 231,908 |   |   | 54,356 |   |   | -- |   |   | 315,233 |
| Long-term                  debt                                                             |   | 390,000 |   |   | 57,727 |   |   | 104,139 |   |   | -- |   |   | 551,866 |
| Other                  long-term liabilities                                                |   | 13 |   |   | 124,415 |   |   | 61,421 |   |   | -- |   |   | 185,849 |
| Deferred                  income taxes                                                      |   | -- |   |   | 83,946 |   |   | 21 |   |   | -- |   |   | 83,967 |
| Put                  option liabilities                                                     |   | -- |   |   | 1,245 |   |   | -- |   |   | -- |   |   | 1,245 |
| Minority                  interest in net assets of consolidated subsidiaries               |   | -- |   |   | -- |   |   | 36,035 |   |   | -- |   |   | 36,035 |
| Total                  stockholders' equity                                                 |   | 658,421 |   |   | 414,238 |   |   | 45,660 |   |   | (459,898 | ) |   | 658,421 |
|                                                                                        |   | Total                  liabilities and stockholders' equity | $ | 1,077,403 |   | $ | 913,479 |   | $ | 301,632 |   | $ | (459,898 | ) | $ | 1,832,616 |

| **Supplemental                  Condensed Consolidating Balance Sheet**       |
|-------------------------------------------------------------------------------|
| **As                  of July 31, 2006**                                      |
| **(in                  thousands)**                                           |
|                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                          |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                          |   | **Parent** |   | **Guarantor** |   | **Other** |   | **Eliminating** |   |   |   |   |
|                                                                          |   | **Company** |   | **Subsidiaries** |   | **Subsidiaries** |   | **Entries** |   | **Consolidated** |
| Current                  assets:                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                  and cash equivalents                                    |   | $ | -- |   |   | $ | 179,998 |   |   | $ | 11,796 |   |   | $ | -- |   |   | $ | 191,794 |   |
| Restricted                  cash                                              |   |   | -- |   |   |   | 14,787 |   |   |   | 5,535 |   |   |   | -- |   |   |   | 20,322 |   |
| Trade                  receivables, net                                       |   |   | -- |   |   |   | 31,030 |   |   |   | 4,919 |   |   |   | -- |   |   |   | 35,949 |   |
| Inventories,                  net                                             |   |   | -- |   |   |   | 8,595 |   |   |   | 33,683 |   |   |   | -- |   |   |   | 42,278 |   |
| Other                  current assets                                         |   |   | 11,945 |   |   |   | 21,308 |   |   |   | 2,378 |   |   |   | -- |   |   |   | 35,631 |   |
| Total                  current assets                                         |   |   | 11,945 |   |   |   | 255,718 |   |   |   | 58,311 |   |   |   | -- |   |   |   | 325,974 |   |
| Property,                  plant and equipment, net                           |   |   | -- |   |   |   | 782,158 |   |   |   | 68,954 |   |   |   | -- |   |   |   | 851,112 |   |
| Real                  estate held for sale and investment                     |   |   | -- |   |   |   | 154,330 |   |   |   | 105,054 |   |   |   | -- |   |   |   | 259,384 |   |
| Goodwill,                  net                                                |   |   | -- |   |   |   | 118,475 |   |   |   | 17,336 |   |   |   | -- |   |   |   | 135,811 |   |
| Intangible                  assets, net                                       |   |   | -- |   |   |   | 58,185 |   |   |   | 16,924 |   |   |   | -- |   |   |   | 75,109 |   |
| Other                  assets                                                 |   |   | 5,356 |   |   |   | 20,510 |   |   |   | 14,387 |   |   |   | -- |   |   |   | 40,253 |   |
| Investments                  in subsidiaries and advances to (from) parent    |   |   | 1,053,209 |   |   |   | (541,621 | ) |   |   | (51,690 | ) |   |   | (459,898 | ) |   |   | -- |   |
| Total                  assets                                                 |   | $ | 1,070,510 |   |   | $ | 847,755 |   |   | $ | 229,276 |   |   | $ | (459,898 | ) |   | $ | 1,687,643 |   |
|                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                  liabilities:                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts                  payable and accrued expenses                        |   | $ | 19,857 |   |   | $ | 161,179 |   |   | $ | 49,726 |   |   | $ | -- |   |   | $ | 230,762 |   |
| Income                  taxes payable                                         |   |   | 17,517 |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | 17,517 |   |
| Long-term                  debt due within one year                           |   |   | -- |   |   |   | 4,045 |   |   |   | 1,870 |   |   |   | -- |   |   |   | 5,915 |   |
| Total                  current liabilities                                    |   |   | 37,374 |   |   |   | 165,224 |   |   |   | 51,596 |   |   |   | -- |   |   |   | 254,194 |   |
| Long-term                  debt                                               |   |   | 390,000 |   |   |   | 57,734 |   |   |   | 77,579 |   |   |   | -- |   |   |   | 525,313 |   |
| Other                  long-term liabilities                                  |   |   | 359 |   |   |   | 121,995 |   |   |   | 36,136 |   |   |   | -- |   |   |   | 158,490 |   |
| Deferred                  income taxes                                        |   |   | -- |   |   |   | 72,919 |   |   |   | 145 |   |   |   | -- |   |   |   | 73,064 |   |
| Put                  option liabilities                                       |   |   | -- |   |   |   | 1,245 |   |   |   | -- |   |   |   | -- |   |   |   | 1,245 |   |
| Minority                  interest in net assets of consolidated subsidiaries |   |   | -- |   |   |   | 13,285 |   |   |   | 19,275 |   |   |   | -- |   |   |   | 32,560 |   |
| Total                  stockholders’ equity                             |   |   | 642,777 |   |   |   | 415,353 |   |   |   | 44,545 |   |   |   | (459,898 | ) |   |   | 642,777 |   |
| Total                  liabilities and stockholders’ equity             |   | $ | 1,070,510 |   |   | $ | 847,755 |   |   | $ | 229,276 |   |   | $ | (459,898 | ) |   | $ | 1,687,643 |   |

| **Supplemental                  Condensed Consolidating Balance Sheet**                     |
|---------------------------------------------------------------------------------------------|
| **As                  of January 31, 2006**                                                 |
| **(in                  thousands)**                                                         |
| **(Unaudited)**                                                                             |
|                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                        |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |   |
|                                                                                        |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   | **Eliminating** |   |   |   |   |
|                                                                                        |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Entries** |   |   | **Consolidated** |   |
| Current                  assets:                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                        | Cash                  and cash equivalents | $ | -- |   | $ | 134,279 |   | $ | 41,262 |   | $ | -- |   | $ | 175,541 |   |
|                                                                                        | Restricted                  cash |   | -- |   |   | 20,546 |   |   | 3,169 |   |   | -- |   |   | 23,715 |   |
|                                                                                        | Receivables,                  net |   | -- |   |   | 35,038 |   |   | 4,674 |   |   | -- |   |   | 39,712 |   |
|                                                                                        | Inventories,                  net |   | -- |   |   | 8,669 |   |   | 35,308 |   |   | -- |   |   | 43,977 |   |
|                                                                                        | Other                  current assets |   | 12,769 |   |   | 24,764 |   |   | 6,376 |   |   | -- |   |   | 43,909 |   |
|                                                                                        |   | Total                  current assets |   | 12,769 |   |   | 223,296 |   |   | 90,789 |   |   | -- |   |   | 326,854 |   |
| Property,                  plant and equipment, net                                         |   | -- |   |   | 787,860 |   |   | 70,340 |   |   | -- |   |   | 858,200 |   |
| Real                  estate held for sale and investment                                   |   | -- |   |   | 138,559 |   |   | 82,489 |   |   | -- |   |   | 221,048 |   |
| Goodwill,                  net                                                              |   | -- |   |   | 135,811 |   |   | -- |   |   | -- |   |   | 135,811 |   |
| Intangible                  assets, net                                                     |   | -- |   |   | 42,902 |   |   | 34,639 |   |   | -- |   |   | 77,541 |   |
| Other                  assets                                                               |   | 5,711 |   |   | 16,292 |   |   | 11,223 |   |   | -- |   |   | 33,226 |   |
| Investments                  in subsidiaries and advances to (from)                  parent |   | 979,831 |   |   | (449,031 | ) |   | (70,902 | ) |   | (459,898 | ) |   | -- |   |
|                                                                                        |   | Total                  assets | $ | 998,311 |   | $ | 895,689 |   | $ | 218,578 |   | $ | (459,898 | ) | $ | 1,652,680 |   |
|                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current                  liabilities:                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                        | Accounts                  payable and accrued expenses | $ | 14,986 |   | $ | 224,339 |   | $ | 55,767 |   | $ | -- |   | $ | 295,092 |   |
|                                                                                        | Income                  taxes payable |   | 6,324 |   |   | -- |   |   | -- |   |   | -- |   |   | 6,324 |   |
|                                                                                        | Long-term                  debt due within one year |   | -- |   |   | 4,044 |   |   | 1,629 |   |   | -- |   |   | 5,673 |   |
|                                                                                        |   | Total                  current liabilities |   | 21,310 |   |   | 228,383 |   |   | 57,396 |   |   | -- |   |   | 307,089 |   |
| Long-term                  debt                                                             |   | 390,000 |   |   | 57,767 |   |   | 69,871 |   |   | -- |   |   | 517,638 |   |
| Other                  long-term liabilities                                                |   | 363 |   |   | 98,648 |   |   | 33,922 |   |   | -- |   |   | 132,933 |   |
| Deferred                  income taxes                                                      |   | -- |   |   | 76,770 |   |   | 267 |   |   | -- |   |   | 77,037 |   |
| Minority                  interest in net assets of consolidated subsidiaries               |   | -- |   |   | -- |   |   | 31,345 |   |   | -- |   |   | 31,345 |   |
| Total                  stockholders' equity                                                 |   | 586,638 |   |   | 434,121 |   |   | 25,777 |   |   | (459,898 | ) |   | 586,638 |   |
|                                                                                        |   | Total                  liabilities and stockholders' equity | $ | 998,311 |   | $ | 895,689 |   | $ | 218,578 |   | $ | (459,898 | ) | $ | 1,652,680 |   |

| **Supplemental                  Condensed Consolidating Statement of Operations**               |
|-------------------------------------------------------------------------------------------------|
| **For                  the three months ended January 31, 2007**                                |
| **(in                  thousands)**                                                             |
| **(Unaudited)**                                                                                 |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   | **Eliminating** |   |   |   |   |
|                                                                                            |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Entries** |   |   | **Consolidated** |   |
| Total                  net revenue                                                              | $ | -- |   | $ | 259,244 |   | $ | 104,346 |   | $ | (2,552 | ) | $ | 361,038 |   |
| Total                  operating expense                                                        |   | 4,584 |   |   | 181,996 |   |   | 79,260 |   |   | (2,552 | ) |   | 263,288 |   |
|                                                                                            | (Loss)                  income from operations |   | (4,584 | ) |   | 77,248 |   |   | 25,086 |   |   | -- |   |   | 97,750 |   |
| Other                  expense, net                                                             |   | (6,751 | ) |   | 1,584 |   |   | (999 | ) |   | -- |   |   | (6,166 | ) |
| Equity                  investment income, net                                                  |   | -- |   |   | 1,496 |   |   | -- |   |   | -- |   |   | 1,496 |   |
| Minority                  interest in income of consolidated                  subsidiaries, net |   | -- |   |   | -- |   |   | (6,152 | ) |   | -- |   |   | (6,152 | ) |
|                                                                                            | (Loss)                  income before income taxes |   | (11,335 | ) |   | 80,328 |   |   | 17,935 |   |   | -- |   |   | 86,928 |   |
|                                                                                            | Benefit                  (provision) for income taxes |   | 4,420 |   |   | (38,400 | ) |   | 78 |   |   | -- |   |   | (33,902 | ) |
|                                                                                            | Net                  (loss) income before equity in income |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            | (loss)                  of consolidated subsidiaries |   | (6,915 | ) |   | 41,928 |   |   | 18,013 |   |   | -- |   |   | 53,026 |   |
| Equity                  in income (loss) of consolidated                  subsidiaries          |   | 59,941 |   |   | -- |   |   | -- |   |   | (59,941 | ) |   | -- |   |
| Net                  income (loss)                                                              | $ | 53,026 |   | $ | 41,928 |   | $ | 18,013 |   | $ | (59,941 | ) | $ | 53,026 |   |

| **Supplemental                  Condensed Consolidating Statement of Operations**               |
|-------------------------------------------------------------------------------------------------|
| **For                  the three months ended January 31, 2006**                                |
| **(in                  thousands)**                                                             |
| **(Unaudited)**                                                                                 |
|                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |   |
|                                                                                            |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   | **Eliminating** |   |   |   |   |
|                                                                                            |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Entries** |   |   | **Consolidated** |   |
| Total                  net revenue                                                              | $ | -- |   | $ | 226,506 |   | $ | 63,570 |   | $ | (2,060 | ) | $ | 288,016 |   |
| Total                  operating expense                                                        |   | 4,082 |   |   | 160,439 |   |   | 48,547 |   |   | (2,060 | ) |   | 211,008 |   |
|                                                                                            | (Loss)                  income from operations |   | (4,082 | ) |   | 66,067 |   |   | 15,023 |   |   | -- |   |   | 77,008 |   |
| Other                  expense, net                                                             |   | (6,872 | ) |   | (722 | ) |   | (811 | ) |   | -- |   |   | (8,405 | ) |
| Equity                  investment income, net                                                  |   | -- |   |   | 1,486 |   |   | -- |   |   | -- |   |   | 1,486 |   |
| Gain                  on sale of businesses, net                                                |   | -- |   |   | 4,625 |   |   | -- |   |   | -- |   |   | 4,625 |   |
| Gain                  on put options                                                            |   | -- |   |   | 1,026 |   |   | -- |   |   | -- |   |   | 1,026 |   |
| Minority                  interest in income of consolidated                  subsidiaries, net |   | -- |   |   | -- |   |   | (5,231 | ) |   | -- |   |   | (5,231 | ) |
|                                                                                            | (Loss)                  income before income taxes |   | (10,954 | ) |   | 72,482 |   |   | 8,981 |   |   | -- |   |   | 70,509 |   |
|                                                                                            | Benefit                  (provision) for income taxes |   | 4,272 |   |   | (31,831 | ) |   | 61 |   |   | -- |   |   | (27,498 | ) |
|                                                                                            | Net                  (loss) income before equity in income |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                            | (loss)                  of consolidated subsidiaries |   | (6,682) |   |   | 40,651 |   |   | 9,042 |   |   | -- |   |   | 43,011 |   |
| Equity                  in income (loss) of consolidated                  subsidiaries          |   | 49,691 |   |   | -- |   |   | -- |   |   | (49,691 | ) |   | -- |   |
| Net                  income (loss)                                                              | $ | 43,009 |   | $ | 40,651 |   | $ | 9,042 |   | $ | (49,691 | ) | $ | 43,011 |   |

| **Supplemental                  Condensed Consolidating Statement of                  Operations** |
|----------------------------------------------------------------------------------------------------|
| **For                  the six months ended January 31, 2007**                                     |
| **(in                  thousands)**                                                                |
| **(Unaudited)**                                                                                    |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   | **Eliminating** |   |   |   |   |
|                                                                                               |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Entries** |   |   | **Consolidated** |   |
| Total                  net revenue                                                                 | $ | -- |   | $ | 335,205 |   | $ | 143,641 |   | $ | (4,315 | ) | $ | 474,531 |   |
| Total                  operating expense                                                           |   | 7,579 |   |   | 303,372 |   |   | 121,007 |   |   | (4,315 | ) |   | 427,643 |   |
|                                                                                               | (Loss)                  income from operations |   | (7,579 | ) |   | 31,833 |   |   | 22,634 |   |   | -- |   |   | 46,888 |   |
| Other                  expense, net                                                                |   | (13,508 | ) |   | (1,089 | ) |   | (2,045 | ) |   | -- |   |   | (16,642 | ) |
| Equity                  investment income, net                                                     |   | -- |   |   | 2,331 |   |   | -- |   |   | -- |   |   | 2,331 |   |
| Minority                  interest in income of consolidated                  subsidiaries, net    |   | -- |   |   | -- |   |   | (4,363 | ) |   | -- |   |   | (4,363 | ) |
|                                                                                               | (Loss)                  income before income taxes |   | (21,087 | ) |   | 33,075 |   |   | 16,226 |   |   | -- |   |   | 28,214 |   |
|                                                                                               | Benefit                  (provision) for income taxes |   | 8,223 |   |   | (19,350 | ) |   | 123 |   |   | -- |   |   | (11,004 | ) |
|                                                                                               | Net                  (loss) income before equity in income |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | (loss)                  of consolidated subsidiaries |   | (12,864 | ) |   | 13,725 |   |   | 16,349 |   |   | -- |   |   | 17,210 |   |
| Equity                  in income (loss) of consolidated                  subsidiaries             |   | 30,074 |   |   | -- |   |   | -- |   |   | (30,074 | ) |   | -- |   |
| Net                  income (loss)                                                                 | $ | 17,210 |   | $ | 13,725 |   | $ | 16,349 |   | $ | (30,074 | ) | $ | 17,210 |   |

| **Supplemental                  Condensed Consolidating Statement of                  Operations** |
|----------------------------------------------------------------------------------------------------|
| **For                  the six months ended January 31, 2006**                                     |
| **(in                  thousands)**                                                                |
| **(Unaudited)**                                                                                    |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   | **Eliminating** |   |   |   |   |
|                                                                                               |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Entries** |   |   | **Consolidated** |   |
| Total                  net revenue                                                                 | $ | -- |   | $ | 287,303 |   | $ | 90,200 |   | $ | (4,067 | ) | $ | 373,436 |   |
| Total                  operating expense                                                           |   | 7,850 |   |   | 261,145 |   |   | 81,380 |   |   | (4,067 | ) |   | 346,308 |   |
|                                                                                               | (Loss)                  income from operations |   | (7,850 | ) |   | 26,158 |   |   | 8,820 |   |   | -- |   |   | 27,128 |   |
| Other                  expense, net                                                                |   | (13,632 | ) |   | (1,571 | ) |   | (1,451 | ) |   | -- |   |   | (16,654 | ) |
| Equity                  investment income, net                                                     |   | -- |   |   | 2,405 |   |   | -- |   |   | -- |   |   | 2,405 |   |
| Gain                  on sale of businesses, net                                                   |   | -- |   |   | 4,625 |   |   | -- |   |   | -- |   |   | 4,625 |   |
| Gain                  on put options                                                               |   | -- |   |   | 34 |   |   | -- |   |   | -- |   |   | 34 |   |
| Minority                  interest in income of consolidated                  subsidiaries, net    |   | -- |   |   | -- |   |   | (3,305 | ) |   | -- |   |   | (3,305 | ) |
|                                                                                               | (Loss)                  income before income taxes |   | (21,482 | ) |   | 31,651 |   |   | 4,064 |   |   | -- |   |   | 14,233 |   |
|                                                                                               | Benefit                  (provision) for income taxes |   | 8,378 |   |   | (14,036 | ) |   | 107 |   |   | -- |   |   | (5,551 | ) |
|                                                                                               | Net                  (loss) income before equity in income |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | (loss)                  of consolidated subsidiaries |   | (13,104 | ) |   | 17,615 |   |   | 4,171 |   |   | -- |   |   | 8,682 |   |
| Equity                  in income (loss) of consolidated subsidiaries                              |   | 21,785 |   |   | -- |   |   | -- |   |   | (21,785 | ) |   | -- |   |
| Net                  income (loss)                                                                 | $ | 8,681 |   | $ | 17,615 |   | $ | 4,171 |   | $ | (21,785 | ) | $ | 8,682 |   |

| **Supplemental                  Condensed Consolidating Statement of Cash                  Flows** |
|----------------------------------------------------------------------------------------------------|
| **For                  the six months ended January 31, 2007**                                     |
| **(in                  thousands)**                                                                |
| **(Unaudited)**                                                                                    |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   |   |   |
|                                                                                               |   |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Consolidated** |   |
| Net                  cash (used in) provided by operating activities                               | $ | (35,705 | ) | $ | 199,690 |   | $ | 32,901 |   | $ | 196,886 |   |
| Cash                  flows from investing activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | Capital                  expenditures |   | -- |   |   | (42,349 | ) |   | (19,709 | ) |   | (62,058 | ) |
|                                                                                               | Investments                  in real estate |   | -- |   |   | (38,721 | ) |   | (49,846 | ) |   | (88,567 | ) |
|                                                                                               | Other                  investing activities, net |   | -- |   |   | 2,578 |   |   | (2,224 | ) |   | 354 |   |
|                                                                                               |   | Net                  cash used in investing activities |   | -- |   |   | (78,492 | ) |   | (71,779 | ) |   | (150,271 | ) |
| Cash                  flows from financing activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | Repurchases                  of common stock |   | -- |   |   | (15,007 | ) |   | -- |   |   | (15,007 | ) |
|                                                                                               | Proceeds                  from borrowings under long-term debt |   | -- |   |   | 1,645 |   |   | 79,434 |   |   | 81,079 |   |
|                                                                                               | Payments                  of long-term debt |   | -- |   |   | (5,662 | ) |   | (54,339 | ) |   | (60,001 | ) |
|                                                                                               | Proceeds                  from exercise of stock options |   | 6,803 |   |   | -- |   |   | -- |   |   | 6,803 |   |
|                                                                                               | Other                  financing activities, net |   | 3,432 |   |   | (2,604 | ) |   | 2,755 |   |   | 3,583 |   |
|                                                                                               | Advances                  from (to) affiliates |   | 25,470 |   |   | (32,485 | ) |   | 7,015 |   |   | -- |   |
|                                                                                               |   | Net                  cash (used in) provided by financing activities |   | 35,705 |   |   | (54,113 | ) |   | 34,865 |   |   | 16,457 |   |
|                                                                                               |   |   | Net                  increase (decrease) in cash and                  cash equivalents |   | -- |   |   | 67,085 |   |   | (4,013 | ) |   | 63,072 |   |
| Cash                  and cash equivalents:                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | Beginning                  of period |   | -- |   |   | 179,998 |   |   | 11,796 |   |   | 191,794 |   |
|                                                                                               | End                  of period | $ | -- |   | $ | 247,083 |   | $ | 7,783 |   | $ | 254,866 |   |

| **Supplemental                  Condensed Consolidating Statement of Cash                  Flows** |
|----------------------------------------------------------------------------------------------------|
| **For                  the six months ended January 31, 2006**                                     |
| **(in                  thousands)**                                                                |
| **(Unaudited)**                                                                                    |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   |   |   |   | **100%                  Owned** |   |   |   |   |   |   |   |
|                                                                                               |   |   |   |   | **Parent** |   |   | **Guarantor** |   |   | **Other** |   |   |   |   |
|                                                                                               |   |   |   |   | **Company** |   |   | **Subsidiaries** |   |   | **Subsidiaries** |   |   | **Consolidated** |   |
| Net                  cash (used in) provided by operating activities                               | $ | (19,028 | ) | $ | 95,386 |   | $ | 24,068 |   | $ | 100,426 |   |
| Cash                  flows from investing activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | Capital                  expenditures |   | -- |   |   | (48,510 | ) |   | (6,602 | ) |   | (55,112 | ) |
|                                                                                               | Investments                  in real estate |   | -- |   |   | (30,513 | ) |   | (34,392 | ) |   | (64,905 | ) |
|                                                                                               | Proceeds                  from sale of businesses |   | -- |   |   | 30,712 |   |   | -- |   |   | 30,712 |   |
|                                                                                               | Other                  investing activities, net |   | -- |   |   | 414 |   |   | (4,432 | ) |   | (4,018 | ) |
|                                                                                               |   | Net                  cash used in investing activities |   | -- |   |   | (47,897 | ) |   | (45,426 | ) |   | (93,323 | ) |
| Cash                  flows from financing activities:                                             |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | Proceeds                  from borrowings under long-term debt |   | -- |   |   | 20,392 |   |   | 5,821 |   |   | 26,213 |   |
|                                                                                               | Payments                  of long-term debt |   | -- |   |   | (24,909 | ) |   | -- |   |   | (24,909 | ) |
|                                                                                               | Proceeds                  from exercise of stock options |   | 27,635 |   |   | -- |   |   | -- |   |   | 27,635 |   |
|                                                                                               | Other                  financing activities, net |   | 6,376 |   |   | 1,792 |   |   | (5,249 | ) |   | 2,919 |   |
|                                                                                               | Advances                  (to) from affiliates |   | (14,983 | ) |   | (3,364 | ) |   | 18,347 |   |   | -- |   |
|                                                                                               |   | Net                  cash provided by (used in) financing activities |   | 19,028 |   |   | (6,089 | ) |   | 18,919 |   |   | 31,858 |   |
|                                                                                               |   |   | Net                  increase (decrease) in cash and                  cash equivalents |   | -- |   |   | 41,400 |   |   | (2,439 | ) |   | 38,961 |   |
| Cash                  and cash equivalents:                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                               | Beginning                  of period |   | -- |   |   | 92,879 |   |   | 43,701 |   |   | 136,580 |   |
|                                                                                               | End                  of period | $ | -- |   | $ | 134,279 |   | $ | 41,262 |   | $ | 175,541 |   |

----

**14.**
**Subsequent        Event**

*Cheeca        Lodge & Spa Contract Dispute*

----

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

**OVERVIEW**

**TRENDS,        RISKS AND UNCERTAINTIES**

| **l** | The                  timing and amount of snowfall has an impact on skier visits. To                  mitigate                  this impact, the Company focuses efforts on sales of season passes                  prior                  to the beginning of the season to In-State skiers, who are the                  most                  weather sensitive visitors to the Company’s ski resorts. Additionally, the                  Company has invested in snowmaking upgrades in an effort to address                  the                  inconsistency of early season snowfall where possible. Season pass                  revenue, although primarily collected prior to the ski season,                  is                  recognized in the Consolidated Condensed Statements of Operations                  during                  the ski season. Total season pass sales for the 2006/2007 ski season                  increased by 20.0% over sales for the 2005/2006 ski season as of                  January                  31, 2007. Deferred revenue related to season pass sales was $34.5                  million                  and $29.5 million as of January 31, 2007 and 2006, respectively,                  which                  will be recognized as lift revenue during the Company’s third fiscal                  quarter ending April 30, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| l     | Potential                  ownership changes of hotels currently under RockResorts management                  could                  result in the termination of existing RockResorts management contracts,                  which could impact the results of operations of the Lodging segment.                  In                  February 2007, RockResorts was notified by the ownership of The                  Equinox                  that the owner intends to sell the hotel, at which time the management                  agreement will be terminated (currently anticipated to be in the                  Company’s                  third fiscal quarter ending April 30, 2007), which will result                  in the                  Company receiving a termination fee, but loss of future management                  fees.                  RockResorts                  recognized $822,000 in management fees from The Equinox in the                  year ended                  July 31, 2006. In                  August 2006, RockResorts' management agreement for The Lodge at                  Rancho                  Mirage (“Rancho Mirage”) was terminated in conjunction with the closing of                  the hotel as part of a redevelopment plan by the current hotel                  owner,                  which resulted in the Company earning a termination fee of $2.4                  million                  (pursuant to the terms of the management agreement), which the                  Company                  recorded as Lodging revenue in the six months ended January 31,                  2007.                  RockResorts                  recognized $644,000 in revenue related to the management of this                  property                  in the year ended July 31, 2006. The                  Company continues to pursue new management contracts, which may                  include,                  in addition to management fees, marketing license fees and technical                  service fees in conjunction with a project’s development and sales. For                  example, the Company recently announced that it will manage the                  new Rum                  Cay Resort on Rum Cay Island, Bahamas and will assist in the marketing                  of                  whole and fractional ownership of units within the resort and provide                  technical advisory services in the design and construction of the                  resort                  and will manage the new Eleven Biscayne Hotel & Spa in Miami, Florida                  and will provide technical advisory services for this resort.                                                                                         |
| l     | On                  February 28, 2007, the arbitrator of the JAMS Arbitration Tribunal                  in                  Chicago, Illinois, rendered a decision, awarding $8.5 million in                  damages                  in favor of RockResorts and against Cheeca Holdings, LLC, the ownership                  entity of Cheeca Lodge & Spa, the former RockResort managed property                  located in Islamorada, Florida. The arbitrator found that the ownership                  group had wrongfully terminated the hotel management contract without                  good                  cause, as RockResorts had maintained in the proceedings, and that                  RockResorts had not breached the management contract, as the ownership                  group had alleged. The Company has incurred $672,000 and $4.3 million                  in                  the three and six months ended January 31, 2007, respectively,                  and the                  Company incurred $3.3 million of legal related costs for the year                  ended                  July 31, 2006 in connection with the matter which are included                  in                  “contract dispute charges” in the Consolidated Condensed Statements of                  Operations in the respective periods. In accordance with the arbitrator’s                  ruling, RockResorts will seek recovery of costs and attorneys’ fees in the                  last stage of the proceedings, which is expected to be concluded                  by the                  end of fiscal 2007. Upon conclusion of that stage, the total award,                  which                  will incorporate the $8.5 million damage award and any additional                  cost                  recovery award, is final, binding and not subject to appeal. Upon                  completion of the cost recovery stage, RockResorts will proceed                  with the                  collection of the award and will record the actual amount received,                  upon                  receipt, in “contract dispute credit (charges), net.” As previously                  disclosed, RockResorts was notified in March 2006 by the ownership                  entity                  of Cheeca Lodge & Spa that its management agreement was being                  terminated effective immediately. RockResorts believed that the                  termination was in violation of the management agreement and sought                  monetary damages including recovery of costs and attorneys’ fees through                  binding arbitration in accordance with the dispute resolution provisions                  of the management agreement. |
| l     | Real                  Estate Reported EBITDA is highly dependent on, among other things,                  the                  timing of closings on real estate under contract. Changes to the                  anticipated timing of closing on one or more real estate projects                  could                  materially impact Real Estate Reported EBITDA for a particular                  quarter or                  fiscal year. Additionally, the magnitude of real estate projects                  currently                  under development or contemplated could result in a significant                  increase                  in Real Estate Reported EBITDA as these projects close, expected                  in the                  year ending July 31, 2008 and beyond. The profitability and/or                  viability                  of current or proposed real estate development projects could be                  adversely                  affected by continued escalation in construction costs and/or a                  slow-down                  in market demand, as well as project difficulties or delays and                  the                  resulting potential negative financial impact associated with design                  or                  construction issues that may arise in the course of construction.                  For the                  six months ended January 31, 2007, the Company has recorded $3.9                  million                  of estimated unanticipated costs associated with construction and                  design                  issues related to its Jackson Hole Golf & Tennis Club (“JHG&TC”)                  residential development. These costs include estimates to complete                  remediation work and take into consideration performance requirements                  and                  recoveries of costs from other parties involved in the design and                  construction of the JHG&TC residential development, and as such are                  subject to change which could impact future operating                  results.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| l     | In                  recent years, the Company has shifted its Real Estate focus to                  more                  vertical development, which requires significant capital investment                  prior                  to the project completion. For example, in addition to previously                  announced development projects including the Arrabelle at Vail                  Square and                  The Lodge at Vail Chalets projects, the Company expects to move                  forward                  with the development of the Crystal Peak Lodge and The Ritz-Carlton                  Residences, Vail (including the construction of related Resort                  depreciable                  assets). The Company expects to incur between $500 million and                  $575                  million of construction costs related to these projects subsequent                  to                  January 31, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| l     | In                  February 2007, the Company and GSSI, LLC (“GSSI”) entered into an amended                  operating agreement whereby the Company will acquire 20% of GSSI’s                  ownership interest for $8.4 million, which is expected to close                  March 31,                  2007. As a result of this transaction, the Company will hold an                  approximate 69.3% ownership interest in SSI Venture, LLC (“SSV”). In                  addition, the put and call rights for GSSI’s remaining interest in SSV                  were extended to begin August 1, 2010 and the existing management                  agreement was extended to coincide with the exercise of the remaining                  put                  and call rights.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| l     | In                  March 2007, the Company and RTP, LLC’s (“RTP”) minority shareholder                  entered into a definitive agreement under which RTP’s minority shareholder                  will acquire the Company’s 54.5% interest in RTP for approximately $3.5                  million. As part of this agreement the Company will retain source                  code                  rights to its internal use software and internet solutions. This                  transaction is expected to close on or around April 30, 2007. As                  a result                  of this transaction, the Company will record a net loss of approximately                  $100,000 on the sale of its investment in RTP including the elimination                  of                  the put option liability and the write-off of the associated put                  option                  intangible asset.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| l     | The                  Company is in the process of amending its senior credit facility                  (the                  “Credit Facility”) with a closing anticipated in March 2007, to reduce the                  revolving credit facility from $400 million to $300 million (the“Credit                  Facility Revolver”), extend the maturity on the Credit Facility Revolver,                  reduce pricing for interest rate margins and commitment fees and                  improve                  flexibility in the Company’s ability to make investments. Additionally,                  the amendment will include the elimination of certain covenant                  ratios and                  change, for pricing and covenant purposes, the gross debt leverage                  ratio                  to a net debt leverage ratio.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |

**RESULTS        OF OPERATIONS**

***Summary***

|                                                      |   |    |   | **Three                  Months Ended** |   | **Six                  Months Ended** |
|-----------------------------------------------------------|--------|---------|--------|-----------------------------------------|--------|---------------------------------------|
|                                                      |   |    |   | **January                  31,**        |   | **January                  31,**      |
|                                                      |   |    |   | **2007**                                |   | **2006**                              |   | **2007** |   | **2006** |
| Mountain                  Reported EBITDA                 | $      | 113,651 |   |                                    | $      | 97,017                                |   |   | $ | 81,162 |   |   | $ | 65,853 |   |
| Lodging                  Reported EBITDA                  |   | 2,039   |   |                                    |   | (815                                  | ) |   |   | 6,098 |   |   |   | 3,294 |   |
| Real                  Estate Reported EBITDA              |   | 5,825   |   |                                    |   | 3,357                                 |   |   |   | 6,629 |   |   |   | 750 |   |
| Total                  Reported EBITDA                    |   | 121,515 |   |                                    |   | 99,559                                |   |   |   | 93,889 |   |   |   | 69,897 |   |
| Income                  before provision for income taxes |   | 86,928  |   |                                    |   | 70,509                                |   |   |   | 28,214 |   |   |   | 14,233 |   |
| Net                  income                               | $      | 53,026  |   |                                    | $      | 43,011                                |   |   | $ | 17,210 |   |   | $ | 8,682 |   |

***Mountain        Segment***

|                                                    |   | **Three                  Months Ended** |    | **Percentage** |
|---------------------------------------------------------|--------|-----------------------------------------|---------|----------------|
|                                                    |   | **January                  31,**        |    | **Increase**   |
|                                                    |   | **2007**                                |    | **2006**       |   | **(Decrease)** |
| Lift                  tickets                           |   | $                                       | 128,617 |           | $ | 113,468 |   | 13.4 | % |
| Ski                  school                             |   |                                    | 34,198  |           |   | 30,752 |   | 11.2 | % |
| Dining                                                  |   |                                    | 22,468  |           |   | 21,266 |   | 5.7 | % |
| Retail/rental                                           |   |                                    | 63,291  |           |   | 56,913 |   | 11.2 | % |
| Other                                                   |   |                                    | 23,452  |           |   | 23,829 |   | (1.6) | % |
| Total                  Mountain net revenue             |   |                                    | 272,026 |           |   | 246,228 |   | 10.5 | % |
| Total                  Mountain operating expense       |   |                                    | 159,871 |           |   | 150,666 |   | 6.1 | % |
| Mountain                  equity investment income, net |   |                                    | 1,496   |           |   | 1,455 |   | 2.8 | % |
| Total                  Mountain Reported EBITDA         |   | $                                       | 113,651 |           | $ | 97,017 |   | 17.1 | % |
|                                                    |   |                                    |    |           |   |   |   |   |   |
| Total                  skier visits                     |   |                                    | 2,912   |           |   | 2,875 |   | 1.3 | % |
| ETP                                                     |   | $                                       | 44.17   |           | $ | 39.47 |   | 11.9 | % |

|                                                    |   | **Six                  Months Ended** |    |           |
|---------------------------------------------------------|--------|---------------------------------------|---------|----------------|
|                                                    |   | **January                  31,**      |    | **Percentage** |
|                                                    |   | **2007**                              |    | **2006**       |   | **Increase** |
| Lift                  tickets                           |   | $                                     | 128,617 |           | $ | 113,468 |   | 13.4 | % |
| Ski                  school                             |   |                                  | 34,198  |           |   | 30,752 |   | 11.2 | % |
| Dining                                                  |   |                                  | 26,354  |           |   | 24,772 |   | 6.4 | % |
| Retail/rental                                           |   |                                  | 87,809  |           |   | 78,618 |   | 11.7 | % |
| Other                                                   |   |                                  | 41,211  |           |   | 38,895 |   | 6.0 | % |
| Total                  Mountain net revenue             |   |                                  | 318,189 |           |   | 286,505 |   | 11.1 | % |
| Total                  Mountain operating expense       |   |                                  | 239,358 |           |   | 222,957 |   | 7.4 | % |
| Mountain                  equity investment income, net |   |                                  | 2,331   |           |   | 2,305 |   | 1.1 | % |
| Total                  Mountain Reported EBITDA         |   | $                                     | 81,162  |           | $ | 65,853 |   | 23.2 | % |
|                                                    |   |                                  |    |           |   |   |   |   |   |
| Total                  skier visits                     |   |                                  | 2,912   |           |   | 2,875 |   | 1.3 | % |
| ETP                                                     |   | $                                     | 44.17   |           | $ | 39.47 |   | 11.9 | % |

***Lodging        Segment***

|                                             |   | **Three                  Months Ended** |   | **Percentage** |
|--------------------------------------------------|--------|-----------------------------------------|--------|----------------|
|                                             |   | **January                  31,**        |   | **Increase**   |
|                                             |   | **2007**                                |   | **2006**       |   | **(Decrease)** |
| Total                  Lodging net revenue       |   | $                                       | 32,796 |           | $ | 32,079 |   | 2.2 |   | % |
| Total                  Lodging operating expense |   |                                    | 30,757 |           |   | 32,894 |   | (6.5 | ) | % |
| Total                  Lodging Reported EBITDA   |   | $                                       | 2,039  |           | $ | (815 | ) | 350.2 |   | % |
|                                             |   |                                    |   |           |   |   |   |   |   |   |
| ADR                                              |   | $                                       | 263.14 |           | $ | 242.67 |   | 8.4 |   | % |
| RevPAR                                           |   | $                                       | 127.41 |           | $ | 109.59 |   | 16.3 |   | % |

|                                             |   | **Six                  Months Ended** |   | **Percentage** |
|--------------------------------------------------|--------|---------------------------------------|--------|----------------|
|                                             |   | **January                  31,**      |   | **Increase**   |
|                                             |   | **2007**                              |   | **2006**       |   | **(Decrease)** |
| Total                  Lodging net revenue       |   | $                                     | 73,204 |           | $ | 73,829 |   | (0.8 | ) | % |
| Total                  Lodging operating expense |   |                                  | 67,106 |           |   | 70,535 |   | (4.9 | ) | % |
| Total                  Lodging Reported EBITDA   |   | $                                     | 6,098  |           | $ | 3,294 |   | 85.1 |   | % |
|                                             |   |                                  |   |           |   |   |   |   |   |   |
| ADR                                              |   | $                                     | 210.00 |           | $ | 201.00 |   | 4.5 |   | % |
| RevPAR                                           |   | $                                     | 88.62  |           | $ | 83.22 |   | 6.5 |   | % |

***Real        Estate Segment***

|                                                  |   | **Three                  Months Ended** |     | **Percentage** |
|-------------------------------------------------------|--------|-----------------------------------------|----------|----------------|
|                                                  |   | **January                  31,**        |     | **Increase**   |
|                                                  |   | **2007**                                | **2006** | **(Decrease)** |
| Single                  family unit sales             |   | $                                       | 1,250    |           | $ | -- |   | N/A |   | % |
| Multi-family                  unit sales              |   |                                    | 47,641   |           |   | -- |   | N/A |   | % |
| Developer                  land sales                 |   |                                    | 6,489    |           |   | 9,288 |   | (30.1 | ) | % |
| Other                                                 |   |                                    | 836      |           |   | 421 |   | 98.6 |   | % |
| Total                  Real Estate net revenue        |   |                                    | 56,216   |           |   | 9,709 |   | 479.0 |   | % |
| Total                  Real Estate operating expense  |   |                                    | 50,391   |           |   | 6,383 |   | 689.5 |   | % |
| Real                  Estate equity investment income |   |                                    | --       |           |   | 31 |   | (100.0 | ) | % |
| Total                  Real Estate Reported EBITDA    |   | $                                       | 5,825    |           | $ | 3,357 |   | 73.5 |   | % |

|                                                  |   | **Six                  Months Ended** |     | **Percentage** |
|-------------------------------------------------------|--------|---------------------------------------|----------|----------------|
|                                                  |   | **January                  31,**      |     | **Increase**   |
|                                                  |   | **2007**                              | **2006** | **(Decrease)** |
| Single                  family unit sales             |   | $                                     | 1,250    |           | $ | -- |   | N/A |   | % |
| Multi-family                  unit sales              |   |                                  | 67,861   |           |   | -- |   | N/A |   | % |
| Developer                  land sales                 |   |                                  | 11,791   |           |   | 12,568 |   | (6.2 | ) | % |
| Other                                                 |   |                                  | 2,236    |           |   | 534 |   | 318.7 |   | % |
| Total                  Real Estate net revenue        |   |                                  | 83,138   |           |   | 13,102 |   | 534.5 |   | % |
| Total                  Real Estate operating expense  |   |                                  | 76,509   |           |   | 12,452 |   | 514.4 |   | % |
| Real                  Estate equity investment income |   |                                  | --       |           |   | 100 |   | (100.0 | ) | % |
| Total                  Real Estate Reported EBITDA    |   | $                                     | 6,629    |           | $ | 750 |   | 783.9 |   | % |

***Other        Items***

*Depreciation        and amortization*

*Relocation        and separation charges.*

*Mold        remediation credit*

*Investment        income.*

*Interest        expense, net.*

*Gain        on sale of businesses, net*

*Contract        dispute charges*

*Gain        on put option.*

*Income        taxes.*

***Reconciliation        of Non-GAAP Measures***

|                                                                           |                                        |    |    | **Three                  Months Ended** |   | **Six                  Months Ended** |
|--------------------------------------------------------------------------------|---------------------------------------------|---------|---------|-----------------------------------------|--------|---------------------------------------|
|                                                                           |                                        |    |    | **January                  31,**        |   | **January                  31,**      |
|                                                                           |                                        |    |    | **2007**                                |   | **2006**                              |   | **2007** |   | **2006** |
| Mountain                  Reported EBITDA                                      | $                                           | 113,651 |    |                                    | $      | 97,017                                |   |   | $ | 81,162 |   |   | $ | 65,853 |   |
| Lodging                  Reported EBITDA                                       |                                        | 2,039   |    |                                    |   | (815                                  | ) |   |   | 6,098 |   |   |   | 3,294 |   |
|                                                                           | Resort                  Reported EBITDA     |    | 115,690 |                                    |   |                                  | 96,202 |   |   |   | 87,260 |   |   |   | 69,147 |   |
| Real                  Estate Reported EBITDA                                   |                                        | 5,825   |    |                                    |   | 3,357                                 |   |   |   | 6,629 |   |   |   | 750 |   |
|                                                                           | Total                  Reported EBITDA      |    | 121,515 |                                    |   |                                  | 99,559 |   |   |   | 93,889 |   |   |   | 69,897 |   |
| Depreciation                  and amortization                                 |                                        | (21,759 | )       |                                    |   | (21,431                               | ) |   |   | (43,344 | ) |   |   | (40,354 | ) |
| Relocation                  and separation charges                             |                                        | (500    | )       |                                    |   | --                                    |   |   |   | (1,235 | ) |   |   | -- |   |
| Asset                  impairment charge                                       |                                        | --      |    |                                    |   | --                                    |   |   |   | -- |   |   |   | (136 | ) |
| Mold                  remediation credit                                       |                                        | --      |    |                                    |   | 852                                   |   |   |   | -- |   |   |   | 852 |   |
| Loss                  on disposal of fixed assets, net                         |                                        | (10     | )       |                                    |   | (486                                  | ) |   |   | (91 | ) |   |   | (726 | ) |
| Investment                  income                                             |                                        | 2,417   |    |                                    |   | 1,046                                 |   |   |   | 4,481 |   |   |   | 2,234 |   |
| Interest                  expense, net                                         |                                        | (7,911  | )       |                                    |   | (9,502                                | ) |   |   | (16,847 | ) |   |   | (18,939 | ) |
| Gain                  on sale of businesses, net                               |                                        | --      |    |                                    |   | 4,625                                 |   |   |   | -- |   |   |   | 4,625 |   |
| Contract                  dispute charges                                      |                                        | (672    | )       |                                    |   | --                                    |   |   |   | (4,276 | ) |   |   | -- |   |
| Gain                  on put options                                           |                                        | --      |    |                                    |   | 1,026                                 |   |   |   | -- |   |   |   | 34 |   |
| Other                  income, net                                             |                                        | --      |    |                                    |   | 51                                    |   |   |   | -- |   |   |   | 51 |   |
| Minority                  interest in income of consolidated subsidiaries, net |                                        | (6,152  | )       |                                    |   | (5,231                                | ) |   |   | (4,363 | ) |   |   | (3,305 | ) |
| Income                  before provision for income taxes                      |                                        | 86,928  |    |                                    |   | 70,509                                |   |   |   | 28,214 |   |   |   | 14,233 |   |
|                                                                           | Provision                  for income taxes |    | (33,902 | )                                       |   |                                  | (27,498 | ) |   |   | (11,004 | ) |   |   | (5,551 | ) |
| Net                  income                                                    | $                                           | 53,026  |    |                                    | $      | 43,011                                |   |   | $ | 17,210 |   |   | $ | 8,682 |   |

|                                                |   | **January                  31,** |
|-----------------------------------------------------|--------|----------------------------------|
|                                                |   | **2007**                         |   | **2006** |
| Long-term                  debt                     |   | $                                | 551,866 |   | $ | 517,638 |
| Long-term                  debt due within one year |   |                             | 440 |   |   | 5,673 |
| Total                  debt                         |   |                             | 552,306 |   |   | 523,311 |
| Less:                  cash and cash equivalents    |   |                             | 254,866 |   |   | 175,541 |
| Net                  debt                           |   | $                                | 297,440 |   | $ | 347,770 |

**LIQUIDITY        AND CAPITAL RESOURCES**

***Significant        Sources of Cash***

***Significant        Uses of Cash***

***Covenants        and Limitations***

**OFF        BALANCE SHEET ARRANGEMENTS**

**FORWARD        LOOKING STATEMENTS **

| *·  * | *economic                downturns;* |
|----------------------|--------------------------------------|
| *·  * | *terrorist                acts upon the United States;* |
|----------------------|---------------------------------------------------------|
| *·  * | *threat                of or actual war;* |
|----------------------|-------------------------------------------|
| *·  * | *unfavorable                weather conditions;* |
|----------------------|--------------------------------------------------|
| *·  * | *our                ability to obtain financing on terms acceptable to us to finance                our real                estate investments, capital expenditures and growth                strategy;* |
|----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *·  * | *our                ability to continue to grow our resort and real estate                operations;* |
|----------------------|--------------------------------------------------------------------------------------------------------|
| *·  * | *competition                in our Mountain and Lodging                businesses;* |
|----------------------|-------------------------------------------------------------------------------------|
| *·  * | *termination                of existing hotel management                contracts;* |
|----------------------|-------------------------------------------------------------------------------------|
| *·  * | *adverse                changes in real estate markets;* |
|----------------------|----------------------------------------------------------|
| *·  * | *failure                to commence or complete the planned real estate development                projects;* |
|----------------------|---------------------------------------------------------------------------------------------------------------|
| *·  * | *failure                to achieve the anticipated short and long-term financial benefits                from the                planned real estate development                projects;* |
|----------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *·  * | *shortages                or rising costs in construction                materials;* |
|----------------------|--------------------------------------------------------------------------------------|
| *·  * | *implications                arising from new Financial Accounting Standards Board                (“FASB”)/governmental legislation, rulings or                interpretations;* |
|----------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *·  * | *our                reliance on government permits or approvals for our use of federal                land or                to make operational improvements;* |
|----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *·  * | *our                ability to integrate and successfully operate future acquisitions;                and* |
|----------------------|------------------------------------------------------------------------------------------------------------|
| *·  * | *adverse                consequences of current or future legal                claims.* |
|----------------------|-----------------------------------------------------------------------------------------|

**ITEM        3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET        RISK.**

*Interest        Rate Risk. *

**ITEM        4.  CONTROLS AND PROCEDURES.**

**Disclosure        Controls and Procedures**

**Changes        in Internal Control over Financial Reporting**

**PART        II OTHER INFORMATION**

**ITEM        1.  LEGAL PROCEEDINGS.**

**ITEM        1A. RISK FACTORS.**

**ITEM        2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF        PROCEEDS.**

***Repurchase        of equity securities***

|  **Period**                                      |   |  **Total                  Number of Shares Purchased** |   |    |  **Average                  Price Paid per Share** |   |   |  **Total                  Number of Shares Purchased as Part of Publicly Announced Plans                  or Programs                  (1)** |   |   |  **Maximum                  Number of Shares that May Yet Be Purchased Under the Plans or Programs                  (1)** |   |
|-------------------------------------------------------|--------|-------------------------------------------------------------|--------|---------|---------------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------------------------------------------------------------------------|--------|
| November                  1, 2006 - November 30, 2006 |   |  1,500                                                 |   |  $ |  38.53                                             |   |   |  1,500                                                                                                                                       |   |   |  2,492,700                                                                                                                |   |
| December                  1, 2006 - December 31, 2006 |   | 155,200                                                     |   |    | 44.82                                                   |   |   | 155,200                                                                                                                                           |   |   | 2,337,500                                                                                                                      |   |
| January                  1, 2007 - January 31, 2007   |   | 11,000                                                      |   |    | 44.89                                                   |   |   |  11,000                                                                                                                                      |   |   | 2,326,500                                                                                                                      |   |
| Total                                                 |   | 167,700                                                     |   |  $ | 44.76                                                   |   |   |  167,700                                                                                                                                     |   |   |                                                                                                                           |   |

| (1)   | On                March 9, 2006, the Company's Board of Directors approved the repurchase                of                up to 3,000,000 shares of common stock. Acquisitions under the share                repurchase program will be made from time to time at prevailing prices                as                permitted by applicable laws, and subject to market conditions and                other                factors. The stock repurchase program may be discontinued at any                time. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ITEM        3.  DEFAULTS UPON SENIOR SECURITIES.**

**ITEM        4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY        HOLDERS.**

|   | Director                             | For        |   Withheld |
|--------|--------------------------------------|------------|----------------------|
|   | John                  J. Hannan      | 33,879,469 | 3,678,706            |
|   | Roland                  A. Hernandez | 36,317,940 | 1,240,235            |
|   | Thomas                  D. Hyde      | 37,521,472 | 36,703               |
|   | Robert                  A. Katz      | 37,523,456 | 34,719               |
|   | Richard                  D. Kincaid  | 37,350,244 | 207,931              |
|   | Joe                  R. Micheletto   | 37,323,178 | 234,997              |
|   | John                  F. Sorte       | 36,894,762 | 663,413              |
|   | William                  P. Stiritz  | 37,508,079 | 50,096               |

|   | For        | Against   | Abstain | Broker                  Non-Vote |
|--------|------------|-----------|---------|----------------------------------|
|   | 27,036,870 | 5,286,413 | 25,973  | 5,208,919                        |

|   | For        | Against | Abstain | Broker                  Non-Vote |
|--------|------------|---------|---------|----------------------------------|
|   | 37,517,688 | 36,896  | 3,591   | --                               |

**ITEM        5.  OTHER INFORMATION.**

**ITEM        6.  EXHIBITS.**

| **Exhibit                  Number** | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | **Sequentially                  Numbered Page** |
|-------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------|
|  3.1                           |  Amended                  and Restated Certificate of Incorporation of Vail Resorts, Inc.,                  dated                  January 5, 2005 (incorporated by reference to Exhibit 3.1 on Form                  10-Q of                  Vail Resorts, Inc. for the quarter ended January 31,                  2005).                                                                                                                                                                                                                                                          |                                            |
|  3.2                           |  Amended                  and Restated By-Laws (incorporated by reference to Exhibit 3.1                  on Form 8-K                  of Vail Resorts, Inc. filed on September 30, 2004).                                                                                                                                                                                                                                                                                                                                                                                           |                                            |
|  4.1(a)                        |  Purchase                  Agreement, dated as of January 15, 2004 among Vail Resorts, Inc.,                  the                  guarantors named on Schedule I thereto, Banc of America Securities                  LLC,                  Deutsche Banc Securities, Inc., Bear, Stearns & Co. Inc., Lehman                  Brothers Inc., Piper Jaffray & Co. and Wells Fargo Securities LLC                  (incorporated by reference to Exhibit 4.2(c) on Form 10-Q of Vail                  Resorts,                  Inc. for the quarter ended January 31, 2004). |                                            |
|  4.1(b)                        |  Supplemental                  Purchase Agreement, dated as of January 22, 2004 among Vail Resorts,                  Inc.,                  the guarantors named thereto, Banc of America Securities LLC, Deutsche                  Banc Securities, Inc., Bear, Stearns & Co. Inc., Lehman Brothers Inc.,                  Piper Jaffray & Co. and Wells Fargo Securities LLC (incorporated by                  reference to Exhibit 4.2(d) on Form 10-Q of Vail Resorts, Inc.                  for the                  quarter ended January 31, 2004).                   |                                            |
|  4.2(a)                        |  Indenture,                  dated as of January 29, 2004, among Vail Resorts, Inc., the guarantors                  therein and the Bank of New York as Trustee (incorporated by reference                  to                  Exhibit 4.1 on Form 8-K of Vail Resorts, Inc. filed on February                  2,                  2004).                                                                                                                                                                                                                                         |                                            |
|  4.2(b)                        |  Supplemental                  Indenture dated as of March 10, 2006 to Indenture dated as of January                  29,                  2004 among Vail Resorts, Inc., as Issuer, the Guarantors named                  therein, as                  Guarantors, and The Bank of New York, as Trustee (incorporated                  by                  reference to Exhibit 10.34 on Form 10-Q of Vail Resorts, Inc. for                  the                  quarter ended January 31, 2006).                                                                                 |                                            |
|  4.3                           |  Form                  of Global Note (incorporated by reference to Exhibit 4.1 on Form                  8-K of                  Vail Resorts, Inc. filed on February 2, 2004).                                                                                                                                                                                                                                                                                                                                                                                                      |                                            |
|  4.4                           |  Registration                  Rights Agreement dated as of January 29, 2004 among Vail Resorts,                  Inc.,                  the guarantors signatory thereto, Banc of America Securities LLC,                  Deutsche                  Banc Securities, Inc., Bear, Stearns & Co. Inc., Lehman Brothers Inc.,                  Piper Jaffray & Co. and Wells Fargo Securities LLC (incorporated by                  reference to Exhibit 4.5(c) on Form 10-Q of Vail Resorts, Inc.                  for the                  quarter ended January 31, 2004). |                                            |
|  4.5                           |  Conversion                  and Registration Rights Agreement between Vail Resorts, Inc. and                  Apollo                  Ski Partners, L.P. dated as of September 30, 2004 (incorporated                  by                  reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed                  on                  September 30, 2004).                                                                                                                                                                                                              |                                            |
|  4.6                           |  Termination                  Agreement, dated as of October 5, 2004, by and among Vail Resorts,                  Inc.,                  Ralcorp Holdings, Inc. and Apollo Ski Partners, L.P. (incorporated                  by                  reference to Exhibit 99.6 on Form 10-Q of Vail Resorts, Inc. for                  the                  quarter ended October 31, 2004).                                                                                                                                                                                             |                                            |
|  10.1                          |  Amended                  and Restated 2002 Long Term Incentive and Share Award Plan (incorporated                  by reference to Schedule 14A of Vail Resorts, Inc. as filed on                  November                  22, 2006).                                                                                                                                                                                                                                                                                                                                             |                                            |
|  10.2                          |  Separation                  Agreement and General Release, dated December 7, 2006 between Martha                  D.                  Rehm and Vail Resorts, Inc. and Amendment No. 1 thereto dated March                  9,                  2007.                                                                                                                                                                                                                                                                                                                                |  17                                        |
|  31.1                          |  Certifications                  of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley                  Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                              |  28                                        |
|  31.2                          |  Certifications                  of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley                  Act of 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                              |  29                                        |
|  32                            |  Certifications                  of Chief Executive Officer and Chief Financial Officer pursuant                  to 18                  U.S.C. Section 1350 as adopted pursuant to Section 906 of the                  Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                  |  30                                        |
|  99.1                          |  Description                  of Amended and Restated 2002 Long-Term Incentive and Share Award                  Plan from                  proxy statement for the 2006 Annual Meeting of                  Stockholders.                                                                                                                                                                                                                                                                                                                                                             |  31                                        |

| b)  Exhibits                                                                                                                                                                    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                      |
| The                  exhibits filed herewith as indicated in the exhibit listed above                  following                  the Signatures section of this                  report. |

**SIGNATURES**

| Date:                  March 12, 2007 | Vail                  Resorts, Inc.                  |
|---------------------------------------|------------------------------------------------------|
|                                  |                                                 |
|                                  | By:                                                  | /s/                  Jeffrey W. Jones |
|                                  | Jeffrey                  W. Jones                    |
|                                  | Senior                  Executive Vice President and |
|                                  | Chief                  Financial Officer             |
|                                  | (Chief                  Accounting Officer and       |
|                                  | Duly                  Authorized Officer)            |