Norwegian Cruise Line Holdings Ltd.
Norwegian Cruise Line Earnings Beat, Revenue Miss
Adjusted EPS of 48 cents beat the 39-cent estimate but declined from 51 cents a year earlier. Revenue rose 4.9% year over year to $2.641 billion, slightly below the $2.643 billion estimate.
GAAP net income increased to $222.6 million from $30 million, while diluted EPS rose to 48 cents from 7 cents.
Adjusted EBITDA declined 4.1% to $666 million but exceeded company guidance of $632 million. Operating income fell to $363.3 million from $423.8 million.
"Norwegian Cruise Line Holdings delivered a solid second quarter with profitability ahead of guidance. At the same time, we continued to advance our strategic priorities to strengthen the business for the long term," CEO John W. Chidsey said.
Passenger Growth And Cost Performance
Passenger-ticket revenue increased to $1.73 billion from $1.71 billion. Onboard and other revenue rose to $910.7 million from $808.5 million.
Passengers carried increased to 906,689 from 738,635, while Capacity Days rose 8.9% to 6.59 million. Occupancy declined to 102.4% from 103.9%.
Constant-currency Net Yield fell 2.6%, better than guidance for a 3.6% decline. Adjusted Net Cruise Cost excluding Fuel per Capacity Day decreased 0.5%, compared with guidance for a 1% increase.
Fuel expense rose to $219 million from $157 million. The quarter included $7.5 million in restructuring costs.
Cash, Debt And Liquidity
First-half operating cash flow was $1.41 billion.
Norwegian Cruise ended June with $218 million in cash, $1.5 billion in liquidity, $15 billion in total debt and Net Leverage of 5.3 times.
Booking Environment Update
Norwegian Cruise said bookings for the next 12 months remain below its target levels as softer demand at its Norwegian Cruise Line brand continues, reflecting company-specific execution challenges and the ongoing conflict in the Middle East.
The company expects demand for Caribbean itineraries to improve over time after all amenities at its private island, Great Stirrup Cay, open to the public on Sept. 4. The expansion includes a new pier, the Great Tides Waterpark, the Great Life Lagoon and Splash Harbor.
Guidance Reflects Demand Pressure
Norwegian Cruise narrowed full-year adjusted EPS guidance from $1.45-$1.79 to about $1.50, below the $1.67 estimate. It expects adjusted EBITDA of about $2.5 billion and a roughly 5% Net Yield decline.
For the third quarter, Norwegian Cruise expects adjusted EPS of 90 cents, matching estimates, and adjusted EBITDA of $874 million.
Norwegian Cruise Line Price Action
NCLH Price Action: Norwegian Cruise Line shares were down 8.35% at $19.04 at the time of publication on Thursday, according to Benzinga Pro data.
