Norwegian Cruise Line Holdings reported a GAAP net income of $240.2 mill or EPS of $1.11 for the second quarter of this year, compared to $226.7 mill or $1.01 EPS in 2Q18.
Adjusted net income was $28.
2.1 mill or adjusted EPS of $1.30, compared to $271.9 mill or $1.21 in the same period of 2018.
Total revenue increased 9.3% to $1.7 bill. Gross yield increased by 7.5%, while net yield increased 5.8% on a constant currency basis.
Full year (2019) adjusted EPS is now expected to be in the range of $5 to $5.10, inclusive of a $0.45 adverse impact from the abrupt change in US federal regulations surrounding cruises to Cuba and a $0.07 impact from a technical issue on ‘Norwegian Pearl’ in July.
Without these headwinds, the outlook would have exceeded the May guidance primarily as a result of revenue out performance in the second quarter, coupled with a stronger revenue outlook for the back half of the year, NCLH said.
“Continued robust demand for our global brands along with our strong consumer focused value proposition, honed revenue management practices and best guest marketing strategy, enabled us to continue to drive ticket pricing higher which, when coupled with strong on board revenue performance, resulted in record second quarter results,” said Frank Del Rio, NCLH’s president and CEO. “The underlying fundamentals of our business remain strong across all core markets, and we continue to expect record financial results in 2019, despite the impact from the change in federal regulations which resulted in the cessation of premium-priced Cuba sailings.”
Total cruise operating expense increased 11.1% in 2019 compared to 2018, primarily due to a rise in capacity days as a result of the addition of ‘Norwegian Bliss’ to the fleet in 2018 and the redeployment of ‘Norwegian Joy’ to North America. Gross cruise costs per capacity day increased 8.3%., while adjusted net cruise cost, excluding fuel, per capacity day increased 6.1% on a constant currency basis and 5.1% on an as reported basis.
Fuel price per tonne, net of hedges, increased to $493 from $481 in 2018. NCLH reported a fuel expense of $100.5 mill for the period.
“The combination of the continued robust demand environment, the building excitement for the upcoming launches of ‘Norwegian Encore’ and ‘Seven Seas Splendor’ and the march towards achieving our Full Speed Ahead 2020 Targets is setting up 2020 to be another milestone year,” said Mark Kempa, NCLH executive vice president and CFO. “We remain committed to maximising shareholder returns and believe our current valuation does not reflect the strong core fundamentals of our business; therefore, we will be focusing our capital allocation strategy on opportunistic share repurchases.”
