Shares dipped 15% Wednesday morning, with Bloomberg surmising the improved profit outlook 'disappointed investors’ high expectations amid an industry boom.'

Adjusted net income of $69.5m, or 16 cents EPS, was higher than Wall Street's 11-cent consensus and up from the year-ago loss of $127.7m, or 30 cents per share. US GAAP net income was $17.4m, or 4 cents EPS.

Revenue was $2.2b, on 8% capacity growth, slightly under the consensus forecast.

Net yield rose 16.4%, or 16.2% in constant currency, above guidance.

Cost, excluding fuel and dry docks, essentially flat

Adjusted EBITDA was approximately $464m, better than guidance of $450m, and almost doubled compared to 2023, driven primarily by solid revenue performance and adjusted net cruise cost, excluding fuel, of $165 per capacity day, or $164 in constant currency. Cost was essentially flat year-on-year excluding the $5 impact of dry docks.

Occupancy was 104.6%, in line with guidance, and total revenue per passenger cruise day increased approximately 8% compared to Q1 2023.

'We kicked off 2024 with impressive momentum, with record bookings in the first quarter propelling us to continue our all-time high booked position and an unprecedented level of advance ticket sales,' NCLH President/CEO Harry Sommer said.

Advance ticket sales at the end of Q1 were $3.8b, approximately 13% higher than the same period in 2023.

2024 outlook

Record Q1 bookings drove a record booked position for the next 12 months. Onboard revenue per capacity day remains robust, up 11% in the quarter compared to 2023, with broad-based strength across all revenue streams.

Full-year occupancy is expected to average 105.1%.

2024 net yield guidance on a constant currency basis increased 100 basis points from the prior guidance to approximately 6.4%, from 5.4%.

Full-year guidance goes to $1.32/share

Adjusted EPS guidance went up 9 cents from February's forecast, to $1.32, from $1.23. This is 2 cents higher than Wall Street's expectation.

The increase is driven by 'exceptional demand' across all three brands which almost fully offsets the impact of voyages redeployed from the Middle East and Red Sea.

Full-year adjusted net cruise cost, excluding fuel, per capacity day guidance remained unchanged and is expected to be approximately $159, increasing approximately 3.4% in constant currency, which includes an approximate 300 basis point impact from dry dock days and related costs in the year. Excluding this impact, net cruise cost excluding fuel would be essentially flat year-over-year.

Q2 EPS forecast 32 cents

Second quarter adjusted EPS is forecast at approximately 32 cents.

Debt and leverage

Total debt as of March 31 was $13.7b. Net leverage declined a full turn from Dec. 31, 2023, ending the quarter at 6.3x.

'We plan to continue this trend and expect to reduce net leverage 1.5 turns during the year compared to 2023 year-end, marking an important milestone in improving our balance sheet,' CFO Mark Kempa said.

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