Royal Caribbean Cruises (RCL) has reported record first quarter results and increased its outlook for the full year.
The company reported 1Q18 US GAAP earnings of $1.02 per share and Adjusted earnings of $1.09 per share beating guidance due to better revenue. Full year Adjusted earnings guidance is increased by $0.15 to a range of $8.70 to $8.90 per share.
US GAAP Net Income was $218.7 mill and Adjusted Net Income was $232.8 mill, compared with US GAAP and Adjusted Net Income of $214.7 mill, respectively in 1Q17.
Gross Yields were up 3.1% in constant-currency (up 5.1% as-reported). Net Yields were up 4.9% in constant-currency (up 7% as-reported).
Gross Cruise Costs per APCD increased 5% in constant currency (up 6.1% as-reported). Net Cruise Costs (NCC) excluding fuel per APCD were up 11.2% in constant currency (up 12.5% as-reported)
Overall for this year, the company’s booked position remains at a record level, better than last year in both rate and
volume, RCL claimed.
“This year is proving to be another strong year with all our brands firing on all cylinders,” said Richard Fain, (pictured) RCL chairman and CEO. “The market continues to support our growth as our people keep focused on delivering our targets and goals. The strength of this market plus our new ships in 2018 (‘Symphony of the Seas’, ‘Azamara Pursuit’, ‘Mein Schiff 1’ and ‘Celebrity Edge’), position us nicely for 2019 as well.”
“We are delighted to report another record breaking quarter and to be driving towards record earnings for the year, above our initial guidance,” said Jason Liberty, executive vice president and CFO. “Revenues continue to excel and expenses, even including some new demand generating initiatives, continue to be carefully controlled.”
During the quarter the company completed the $500 mill share repurchase programme authorised a year ago.
An unusually strong market in 2017 generated an unusually strong Net Yield increase of 11.5% during 2Q17. That, plus the timing of the Easter vacation period make for a tough year-over-year comparable. Nevertheless, the company said that it expected constant currency net yields to be up in the range of 1.5% to 2% for the second quarter of this year.
NCC, excluding fuel, is expected to be up about 5% in constant currency. The elevated cost comparable for the quarter is the result of additional drydock days and further investments in the product and demand generating activities.
Based on current fuel pricing, interest and currency exchange rates, and the factors detailed above, the company expects second quarter adjusted EPS to be $1.85 to $1.90 per share
