Norwegian Cruise Line (NCLH) Q2 2021 beats earnings

Norwegian cruise ship arriving in the French Mediterranean port of Marseille, July 27, 2021.

Gerard Bottino | SOPA Images | LightRocket | Getty Images

Norwegian Cruise Line reported mixed results in the second quarter on Friday, as future bookings have remained strong ahead of its first cruise in the United States since last year.

On Saturday, the Norwegian Encore will sail from Seattle to Alaska. The cruise operator said it expects to have 40% of its capacity fleet in operation by the end of the third quarter, and 75% by the end of the year. The company plans to resume at full capacity by April 1st.

The company will require all passengers to be vaccinated on all journeys in its three brands.

“We are ready and eager to welcome guests on board and continue to see incredible strength in our booking trends for future cruises,” said Frank Del Rio, President and CEO of Norwegian Cruise Line.

The company’s shares rose more than 2% in premarket business.

Here’s how the company performed for its second quarter ended June 30 compared to what analysts interviewed by Refinitiv anticipated:

  • Loss per share: $ 1.93 added vs. $ 1.97 expected
  • Revenue: $ 4.37 million vs. $ 10 million expected

During its second quarter, the company reported a net loss of $ 717.8 million, or $ 1.94 per share, compared to a loss of $ 715.2 million, or $ 2.99 per share, a year before.

Excluding the items, the company lost $ 1.93 per share, which was a narrower loss than the $ 1.97 per share forecast predicted by analysts interviewed by Refinitiv.

Revenues fell to $ 4.37 million, far short of the $ 10 million analysts who had forecast.

However, the company said bookings for 2022 are significantly ahead of record levels in 2019, taking into account future cruise credits.

By the end of the second quarter, the cruise operator had $ 1.4 billion in advance ticket sales, $ 800 million of which came from future cruise credits.

As it prepared to return to service, the company had an average monthly cash flow of $ 200 million during the quarter, higher than last quarter’s rate and previous lead of $ 190 million. The company expects its monthly cash flow rate in the third quarter to be $ 285 million, excluding cash inflows from new and existing bookings.

The company said it expects to report a net loss in the third quarter and beyond until it is able to resume regular trips.

“As a result of the COVID-19 pandemic, … the Company cannot estimate the impact on its business, financial situation or financial or operational results in the short or long term with certainty,” he said. in a Norwegian Cruise Line statement.

Shares of Norwegian Cruise Line have fallen almost 5% this year, as the cruise industry has been halted due to Covid-19.

At the time of the pandemic, there were several high-profile fires aboard ships that encouraged the Centers for Disease Control and Prevention to impose strict restrictions on cruise operators.

Earlier this year, as vaccines provided hope for a recovery in the industry, cruise stocks grew, but the spread of the highly contagious delta variant in recent weeks has changed the trend of action. .

Last month, Norwegian Cruise Line filed a lawsuit against the Florida surgeon general to end state law that prevents companies from being able to require customers to prove vaccination. In the court presentation, the company said it would like to ask guests to demonstrate a vaccination test on all their cruises.

The first scheduled cruise from Florida is on Aug. 15, which Norwegians said will be a 100% vaccinated cruise.

“The Company has not been able to reach a mutually agreeable solution with the State of Florida that would allow it to request documentation confirming the vaccination status of guests before embarking on cruises from Florida,” the Norwegian said in a statement. . “[At Friday’s hearing,] the Company hopes to receive additional clarity shortly on its way forward to resume navigation from Florida. “

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