Lindblad almost halves losses

2017-08-14T12:50:15+00:00 August 14th, 2017|Finance|

Lindblad Expeditions Holdings reported a tour revenues increase of 3% to $55.6 mill for second quarter 2017.

The net loss fell to $2.6 mill from $4.5 mill recorded in 2Q16, while adjusted EBITDA increased by 1% to $5.3 mill.

The Lindblad segment net yield was $941 and the vessel occupancy was 85%.

Sven-Olof Lindblad, President and CEO, said “The significant operating momentum we generated over the last nine months has continued with bookings for future travel up nearly 40% in 2017, versus the same period a year ago. The demand for high quality, immersive expedition travel continues to expand and we are uniquely positioned to capitalise on this growth given our ongoing fleet expansion and our proven track record of providing authentic and differentiated expedition itineraries.

“We just launched our first newbuild vessel, the ‘National Geographic Quest’, and I am extremely excited for our guests to experience all this ship has to offer. While the delay in delivery will impact contributions in 2017, the increased capacity from this launch, as well as the ‘National Geographic Venture’ in 2018 and a new bluewater vessel in 2019, is expected to generate significant returns in the years ahead,”  he said.

Second quarter tour revenues of $55.6 mill was an increase of $1.7 mill, or 3%, compared to 2Q16. The increase was primarily due to $2.6 mill of additional contributions from Natural Habitat, which was acquired in May, 2016, partially offset by a $0.9 mill decrease in Lindblad segment revenues.

Lindblad segment revenues of $47.2 mill was a decline of 2%, compared to 2Q16, due to a $1.9 mill decrease in ticket revenues driven by lower occupancy, partially offset by a $0.9 mill increase in other tour revenues. Occupancy decreased to 85% from 92% a year ago primarily due to lower bookings during 2016. Available guest nights increased by 5%, compared with 2Q16, primarily due to fewer drydocking days, most notably with the ‘National Geographic Explorer’ and ‘National Geographic Orion’.

Lindblad segment net yield of $941 decreased 6% compared with the same period a year ago, as increased pricing was more than offset by the decline in occupancy.

The $1.9 mill improvement in the net loss primarily reflects lower depreciation and amortisation, primarily due to the accelerated depreciation of the ‘National Geographic Endeavour’ a year ago, and foreign currency gains in the current year due to the fluctuation in exchange rates.

The 2Q17 result also includes $0.9 mill of additional stock based compensation expense primarily related to grants under the 2016 CEO share allocation plan, which provides the CEO with the ability to transfer shares from his existing holdings in the company to eligible employees.

An impact of the cancelled voyages on tour revenues was calculated as booked tour revenue at the time of cancellation less insurance proceeds. The impact of the cancelled voyages on operating income and adjusted EBITDA was calculated as booked tour revenue at the time of cancellation, less insurance proceeds and estimated operating costs.

The cancellation of the 26th June, 2017 ‘National Geographic Quest’ voyage, due to her delayed launch was not material to the results for the three and six months ended 30th June, 2017.

Lindblad’s cash and cash equivalents were $99.3 mill as of 30th June, 2017, compared with $135.4 mill as of 31st December, 2016. The decrease primarily reflects purchases of property and equipment amounting to $38.7 mill, mostly for the construction of the two new coastal vessels, a $12.2 mill increase in restricted cash related to upcoming domestic voyages and $6.2 mill used to repurchase stock and warrants, partially offset by $23.2 mill in net cash provided by operating activities, due mainly to advanced bookings for future travel.

Free cash flow use was $15.5 mill for the first six months of 2017, compared with the use of $26.1 mill in 1H16, primarily due to increased bookings for future travel partially offset by higher capital expenditures for the new vessels. Free cash flow is defined as net cash provided by operating activities less purchases of property and equipment.

In July, 2017, Lindblad expanded its travel offerings with the launch of the ‘National Geographic Quest’, which is sailing in Alaska and British Columbia during the summer before voyaging to Costa Rica and Panama to provide expeditions for the Northern Hemisphere winter season.

The company cancelled four highly booked expeditions on the ‘National Geographic Quest’, due to a delay in the delivery of the vessel. Over 70% of the passengers on the cancelled voyages have already rebooked for future travel.

Lindblad’s second newbuilding coastal vessel, ‘National Geographic Venture’, is currently expected to be delivered in June, 2018.

In July, 2017, Lindblad announced its new Base Camp Baja expeditions on board the ‘National Geographic Sea Bird’, which will feature short itineraries with an active and wellness-focused programme in partnership with Exhale Spa.

The company’s current expectations for the full year 2017 are as follows:

  • Tour revenues of $272 – $276 mill.

  • Adjusted EBITDA of $44 – $46 mill.

This outlook includes an estimated $3.6 mill revenue impact and $3 mill adjusted EBITDA impact associated with the cancellation of four voyages, due to the delayed launch of the ‘National Geographic Quest’, as well as the estimated $9.1 mill revenue impact and estimated $6.5 mill adjusted EBITDA impact associated with the first quarter cancellation of four voyages on the ‘National Geographic Orion’ and two voyages on the ‘National Geographic Sea Lion’ for necessary repairs.

As of 1st August , 2017, the Lindblad segment had 98% of full year 2017 projected guest ticket revenues on the books, versus 98% of full year 2016 revenue at the same time last year.

As of 31st July, bookings in 2017 had increased nearly 40%, compared with the same period a year ago. The majority of this increase is expected to contribute to revenue growth in the back half of 2017 and full year 2018.