Norwegian Cruise Line Holdings Ltd. NCLH reported solid third-quarter 2024 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis.
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The management attributed the performance to the strength of NCLH's business model, the appeal of its product offerings across brands, and the effective execution by both shoreside and shipboard teams. Driven by high demand and a focus on cost control and margin enhancement, the company has raised its full-year guidance for a fourth time, anticipating 2024 to set new records for revenues, Net Yield growth and Adjusted EBITDA.
Following the results, the company’s shares rose 4.4% in the pre-market trading session on Oct. 31.
NCLH’s Q3 Earnings & Revenues
Norwegian Cruise reported an adjusted EPS of 99 cents, topping the Zacks Consensus Estimate of 95 cents. In the prior-year quarter, the company reported an adjusted EPS of 76 cents.
Quarterly revenues of $2.8 billion beat the consensus mark of $2.76 billion. In the prior-year quarter, the company reported revenues of $2.54 billion.
Norwegian Cruise Line Holdings Ltd. Price, Consensus and EPS Surprise
Norwegian Cruise Line Holdings Ltd. Price, Consensus and EPS Surprise
Norwegian Cruise Line Holdings Ltd. price-consensus-eps-surprise-chart | Norwegian Cruise Line Holdings Ltd. Quote
Passenger ticket revenues were $1.94 billion compared with $1.73 billion reported in the prior-year quarter. Our model suggested passenger ticket revenues to be $1.9 billion.
Onboard and other revenues increased to $861.7 million from $802.4 million reported in the prior-year quarter. We expected onboard and other revenues to be $855.7 million.
Expenses & Operating Results
Total cruise operating expenses increased 3.8% year over year to $1.54 billion from the year-ago quarter’s levels. The company’s expenses in the quarter stemmed from a rise in Commissions, transportation, onboard and other expenses.
During the third quarter, gross cruise costs per Capacity Day were $314.39, compared with $310.65 reported in the prior year period. Adjusted net cruise costs (excluding fuel) per Capacity Day amounted to about $154.84, compared with $150.91 reported in the prior year period. During the quarter, fuel price per metric ton (net of hedges) came in at $699 compared with $727 reported in the prior-year quarter.
Net interest expenses were $175.2 million compared with $181.2 million reported in the year-ago quarter.
Balance Sheet
As of Sept. 30, 2024, the company had cash and cash equivalents of $332.5 million compared with $402.4 million at the end of 2023. Long-term debt was $11.8 billion compared with $12.31 billion as of 2023 end.
Booking Update
During the third quarter, the company reported strong consumer demand, with most new bookings shifting toward 2025 sailings. It remains in the upper range of its optimal booked position on a 12-month forward basis. Occupancy during the quarter came in at 108.1%. It reported strong advance ticket sales of $3.3 billion, up 6% from 2023 levels.
Q4 and 2024 Guidance by NCLH
For the fourth-quarter 2024, NCLH anticipates occupancy to be approximately 101% and Capacity Days to be about 5.85 million. During the quarter, adjusted interest expenses are expected to be approximately $175 million, while depreciation and amortization are anticipated to be about $230 million. Adjusted EBITDA is expected to be about $445 million. Adjusted EPS is projected to be nearly 9 cents.
For 2024, the company anticipates occupancy to be approximately 105% and Capacity Days to be about 23.5 million. During the year, adjusted interest expenses are expected to be approximately $720 million (down from the prior expectation of about $735 million). Depreciation and amortization are anticipated at nearly $895 million. Adjusted EBITDA during the year is expected to be nearly $2.43 billion, up from the previously-expected $2.35 billion. For 2024, adjusted EPS is currently expected to be nearly $1.65, up from prior expectations of about $1.53.
NCLH’s Zacks Rank
Norwegian Cruise currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
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