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Stronger revenues from new ships lift NCLH to record Q3

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CFO Wendy Beck cautions currency and fuel costs put pressure on expectations for the coming year
New ships at each of its three brands and improved pricing pushed Norwegian Cruise Line Holdings to a record third quarter profit, above Wall Street expectations, on a day when market volatility is forecast following the surprise upset election of Donald Trump as US president.

However, the company cautioned 2017 is being pressured by currency exchange and fuel costs.

Adjusted net income was $369.3m, or $1.62 per share, at the high end of guidance and three cents above the consensus expectation, and compared to the $311.1m, or $1.35, in Q3 2015.

US GAAP net income was $342.4m, or $1.50 per share, up from $251.8m, or $1.09, in the prior year.

Total revenue increased 15.6% to $1.5bn, while adjusted net yield increased 3.4% on a constant currency basis or 2.8% as reported, primarily due to improved pricing.

NCLH narrowed its full-year earnings per share forecast to a range of $3.38 to $3.42, compared to $3.35 to $3.45 earlier and Wall Street's $3.38 consensus expectation.

President and ceo Frank Del Rio said the highest single quarter revenue and earnings in NCLH history were bolstered by the addition of Norwegian Escape, Oceania Cruises' Sirena and Regent Seven Seas Cruises' Seven Seas Explorer.

Q4 adjusted EPS is now forecast in a range of 53 cents to 57 cents per share, compared to the 57-cent consensus and up from 51 cents a year ago.

The company is 'on track to deliver robust double-digit growth in adjusted EPS in 2016, despite headwinds from geopolitical events earlier in the year which dampened demand for Mediterranean sailings,' cfo Wendy Beck said.

Looking to the first half of 2017, where deployment is weighted to Caribbean sailings, Beck said advance bookings are ahead of the prior year's record levels at higher prices, while an early look at the full year shows occupancy commensurate with the prior year at this same time, at slightly lower prices.

'Recent significant weakening of certain foreign currencies, primarily the British pound, against the US dollar, combined with an increase in fuel prices have placed pressure on expectations for the coming year,' Beck added. 'Despite these headwinds, we still anticipate delivering double-digit growth in adjusted EPS in 2017.'