Yahoo Finance Norwegian Cruise Line Holdings Ltd (NCLH) Exceeds Q1 2024 Earnings Expectations and Raises ...
Revenue: $2.2 billion in Q1 2024, marking a 20% increase year-over-year, surpassing the estimate of $2.244 billion.
Net Income: Reported at $17.4 million in Q1 2024, below the estimated $48.52 million.
Earnings Per Share (EPS): Achieved $0.04 in Q1 2024, falling short of the estimated $0.11.
Adjusted EBITDA: Nearly doubled to $464 million from the previous year, exceeding the guidance of $450 million.
Occupancy Rate: Reached 104.6% for the quarter, aligning with guidance and indicating robust demand.
Net Yield Growth: Increased by approximately 16.4% year-over-year, outperforming the guidance.
Debt and Leverage: Total debt stood at $13.7 billion, with a net leverage improvement to 6.3x, down from the end of 2023.
Norwegian Cruise Line Holdings Ltd (NYSE:NCLH) disclosed its impressive first quarter 2024 financial outcomes on May 1, 2024, showcasing significant revenue growth and operational achievements. The company reported a substantial 20% increase in revenue year-over-year, reaching $2.2 billion, surpassing the estimated $2.244 billion. This growth was supported by an 8% increase in capacity. NCLH also achieved a GAAP net income of $17.4 million, translating to earnings per share (EPS) of $0.04, and an adjusted EPS of $0.16, which notably exceeded the forecasted $0.11 EPS. The detailed financial results can be explored in the company's 8-K filing.
Company Overview
Norwegian Cruise Line Holdings Ltd, the world's third-largest cruise company, operates 32 ships across its three brandsNorwegian, Oceania, and Regent Seven Seas. Known for both freestyle and luxury cruising, Norwegian sails to approximately 700 global destinations. With a full fleet redeployment completed by May 2022, and an aggressive expansion plan that includes five new passenger vessels by 2028, Norwegian is set to increase its capacity significantly, ensuring sustained growth and a stronger market presence.
Financial Highlights and Strategic Initiatives
The first quarter of 2024 was marked by robust demand and strategic operational enhancements. Adjusted EBITDA nearly doubled from the previous year to $464 million, surpassing the guidance of $450 million. This improvement was driven by a focused reduction in operating costs and an increase in gross margin per Capacity Day by 53% year-over-year. Norwegian's net leverage improved, decreasing to 6.3x from the end of 2023, reflecting effective debt management and operational efficiency.
Amidst these financial achievements, Norwegian announced a significant expansion plan, including the construction of eight state-of-the-art vessels and a new multi-ship pier at Great Stirrup Cay. This expansion underscores Norwegian's commitment to enhancing its fleet and boosting its market competitiveness.
Operational and Market Performance
The company's operational success in the first quarter was highlighted by an occupancy rate of 104.6%, aligning with guidance, and a robust onboard revenue per Capacity Day, which saw an 11% increase from the previous year. The net yield growth exceeded expectations by approximately 16.4%, indicating strong pricing power and effective capacity management. Moreover, the adjusted net cruise costs excluding fuel per Capacity Day remained flat year-over-year when adjusted for dry-dock impacts, demonstrating cost control and operational efficiency.
Outlook and Future Projections
Encouraged by the record bookings and revenue performance in Q1, Norwegian has revised its full-year 2024 guidance upwards. The company now expects a net yield growth of approximately 6.4% on a constant currency basis, an increase from the previous estimate of 5.4%. Adjusted EBITDA is projected to reach $2.25 billion, up from $2.20 billion, and adjusted net income is anticipated to rise to $680 million, reflecting a $45 million increase from earlier forecasts.
In conclusion, Norwegian Cruise Line Holdings Ltd's first quarter performance in 2024 not only surpassed analyst expectations but also set a positive trajectory for the year. With strategic expansions and a focus on enhancing operational efficiencies, NCLH is well-positioned to sustain its growth momentum and strengthen its market position in the competitive cruise industry.
For detailed insights and further information, investors and stakeholders are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from Norwegian Cruise Line Holdings Ltd for further details.
This article first appeared on GuruFocus.
