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The cruise company predicted it would continue to be unprofitable in the third quarter.
Alexandre Meneghini/Reuters/Alamy
Shares of
Norwegian Cruise Line Holdings
fell sharply Tuesday after the cruise company predicted it would continue to be unprofitable in the third quarter.
Norwegian (ticker:
NCLH
) posted a second-quarter adjusted loss of $478.3 million, or $1.14 a share, on $1.19 billion in revenue. Analysts surveyed by FactSet were expecting a loss of 88 cents a share on revenue of $1.26 billion.
Looking toward the third quarter, the company says it continues to see strong consumer demand, but said it could not provide a more concrete outlook given the macroeconomic fluctuations. The company added, however, that it continues to expect a net loss for the third quarter of 2022.
Total revenue is expected to be $1.5 billion to $1.6 billion in the third quarter, while occupancy is expected to be in the low 80% range, the company said. Occupancy in the second quarter was 65% as the company completed its phased relaunch of its entire fleet.
The company also said that rising fuel costs were expected to have an impact on earnings per share. In the third quarter, a 10% change in fuel prices could impact adjusted earnings per share by 2 cents, and by 4 cents for fiscal 2022.
A silver lining for Norwegian is that the company expects to report slightly positive adjusted Ebitda, or earnings before interest, taxes, depreciation, and amortization, in the second half of 2022. It is also targeting exceeding historical record net yield and adjusted Ebitda levels for 2023.
“We are encouraged by the continued strong consumer demand we are experiencing which is reflected in our record pricing, accelerating booking volumes, especially for 2023 and beyond, and highest ever onboard revenue generation,” said CEO Frank Del Rio.
Shares of Norwegian fell 11.6% to $11.96. The stock has lost 40% this year, underperforming the 13.3% decline of the
S&P 500.
Rivals
RCL
) and
Carnival Corp
.
(
CCL
) were down 6.5% and 6.9%, respectively.
Write to Sabrina Escobar at [email protected]
Source: https://www.barrons.com/articles/norwegian-cruise-line-earnings-loss-51660046165?siteid=yhoof2&yptr=yahoo