Caribbean Demand Drives NCLH’s Income Growth
Due to a strong pricing with robust demand in the Caribbean, the US-based cruise ship operator Norwegian Cruise Line Holdings’ net income increased to USD 73.2 million during the first three months of the year from USD 38.3 million reported in the fourth quarter of 2015.
The company reported a surge of 41% in its adjusted EPS over prior year, benefiting from solid Adjusted Net Yield performance as a result of strong pricing along with the earnings benefit from the Norwegian Escape which joined the fleet in October 2015.
“We are on track to reach our stated targets of USD 5.00 adjusted EPS in 2017 and double-digit return on invested capital on an adjusted basis in 2016, growing to 14% by 2018. Our recent announcements regarding our China-dedicated ship, Norwegian Joy, have been extremely well-received in the Chinese market giving us strong momentum prior to the ship’s introduction in 2017,” said Frank Del Rio, president and chief executive officer of Norwegian Cruise Line Holdings.
Norwegian Cruise Line Holdings said that its current booked position for 2016 is on par with prior year’s record levels and at higher prices, adding that the strength in the Caribbean, Alaska, Hawaii, and other North American markets is offsetting softness in European itineraries.
“Continued strong demand in the Caribbean, Alaska, Bermuda, and Hawaii is offsetting softness in Europe which comes mainly as a result of lower demand from North American consumers,” said Wendy Beck, executive vice president and chief financial officer of Norwegian Cruise Line Holdings.
“While this softness is tempering yield growth mainly in the second quarter, strong bookings and pricing in other core markets, as well as the addition of Seven Seas Explorer to our fleet, are contributing to strong yield performance in the back half of the year, keeping us on track to deliver expected earnings growth of approximately 30%,” Beck said.
In March, the company took delivery of a new cruise vessel Sirena, which joined the Oceania Cruises’ fleet and its first sailing commenced in late April.
Seven Seas Explorer, the first newbuild for Regent Seven Seas Cruises in over thirteen years, is scheduled to join the fleet in the third quarter.
During the quarter the company reached an agreement with Italy’s shipbuilder Fincantieri to construct a sister ship to Seven Seas Explorer for its Regent Seven Seas Cruises brand scheduled for delivery in winter 2020.