Second half 2018 EBITDA of US$77.3m was a significant $146.6m improvement over the $69.3m EBITDA loss the last six months of 2017. After depreciation and amortization, operating loss was also reduced significantly to $23.7m, from $173.6m in 2H 2017.
The recent quarter's higher net loss was mainly due to a smaller net one-time gain of $10m on the disposal of the balance of the company's Norwegian Cruise Line Holdings shares versus a larger one-time gain of $203.7m from the disposal of shares of NCLH and Star Entertainment in 2H 2017.
Revenue up 25%
Buoyed by the full six-month operation of World Dream, revenue increased 25% to $822.5m from the $657.9m in 2H 2017, Capacity days increased by 11.6% and net yield improved a whopping 18%. Fleet occupancy improved to 99%, up from from 79% in 2H 2017.
Net cruise costs were higher due to an increase in capacity days but net cruise costs per capacity day were reduced by 2.8% due to efficiencies of scale. Start-up losses in the MV Werften group of shipyards were reduced, mainly due to higher shipyard utilization rate with the keel-laying of Crystal Endeavor and the first Dream Cruises' Global-class ship in 2H 2018.
Full year results
2018 revenue reached $1.6bn, up from $1.2bn in 2017. This 34% increase was mainly due to the first full year operation of two Dream-class ships, Genting Dream and World Dream, and the higher third party revenue recognized in the shipyard segment.
Cruise revenue was $1.35bn, up from $1.02bn.
The group's net loss reduced slightly, to $213.3m, down from the $244.3m loss in 2017.
Fleet capacity days up 18.5%
World Dream replaced Genting Dream in the dual Hong Kong and Guangzhou homeports in November 2017 with Genting Dream redeployed to Singapore. With a full year of operation of two Dream Cruises ships, offset by the withdrawal of the SuperStar Libra in July 2018 to serve as an accommodation ship in the MV Werften Wismar yard, fleet capacity days increased by 18.5%.
Occupancy rises
Fleet occupancy for the three brands—Crystal Cruises, Dream Cruises and Star Cruises—grew to 91%, from 77% in 2017.
Shipyard, on a standalone basis, recorded an EBITDA of $3.6m in 2018 versus an $82.5m loss in 2017. This was thanks to the higher utilization rate with the 36% completion of Crystal Endeavor and 20% of the first Global-clas ship in 2018.
However, as the shipyard is wholly owned by the group, certain revenues and expenses relating to shipbuilding for Genting HK have to be eliminated during consolidation of accounts, resulting in a lower $59.6m loss in 2018, compared with the $102.6m loss in 2018.
2019 outlook
Genting HK expects cruise segment results will continue to improve due to the low penetration rate in Asia and the reduced cruise capacity in China in 2019. The shipyard segment is expected to improve with 82% of Crystal Endeavor and 65% of the first Global-class ship due to be completed by the end of 2019. With that, the results should continue to improve in 2019.
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