We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Norwegian Cruise (NCLH) Q3 Earnings & Revenues Beat, Stock Up
Read MoreHide Full Article
Norwegian Cruise Line Holdings Ltd. (NCLH - Free Report) reported third-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate. Moreover, both metrics improved year over year. Following the results, the company’s shares were up 2.7% in the pre-market trading session on Nov 8.
The company is benefiting from improving occupancy. In the third quarter of 2022, occupancy improved 17 basis points to nearly 82%. The company anticipates occupancy levels to improve and reach historical levels for the second quarter of 2023. In fourth-quarter 2022, the company expects occupancy to be in the mid-to-high 80 percent range.
Frank Del Rio, president and CEO of Norwegian Cruise, stated, “We are demonstrating continued positive momentum as we consistently reach key operational and financial milestones, including positive Adjusted EBITDA in the third quarter for the first time since the start of the pandemic. The underlying fundamentals of our business and our target upmarket consumer remain strong and our strategy of focusing on maximizing long-term, sustainable profitability is working as intended, evidenced by our 2023 booked position which is equal to 2019’s record levels and at record pricing, which we firmly believe is the best way to maximize long-term value for all our stakeholders.”
Earnings & Revenue Discussion
Norwegian Cruise reported an adjusted loss per share of 64 cents, narrower than the Zacks Consensus Estimate of a loss of 71 cents. In the prior-year quarter, the company reported a loss per share of $2.17.
Quarterly revenues of $1,615.5 million beat the consensus mark of $1,576 million. In the prior-year quarter, the company had reported revenues of $153.1 million. The upside can primarily be attributed to the resumption of cruise operations.
In the quarter under review, passenger ticket revenues were $1,105.9 million compared with $86.1 million reported in the prior-year quarter. Onboard and other revenues increased to $509.6 million from $67 million reported in the prior-year quarter.
Norwegian Cruise Line Holdings Ltd. Price, Consensus and EPS Surprise
Total cruise operating expenses increased 181.7% in the quarter under review from the year-ago quarter’s levels. The company’s expenses in the quarter primarily stemmed from the resumption of cruise voyages. The company noted that the increase in 2022 reflects an improvement in payroll, fuel and direct variable costs of fully operating ships.
Gross cruise costs in the third quarter increased 141.3% year over year to $1,614.2 million. Adjusted net cruise costs (excluding fuel) amounted to $947.7 million compared with $538 million in the prior-year quarter. Fuel price per metric ton (net of hedges) increased to $830 from $693 in 2021.
Net interest expenses in the quarter were $152.3 million, up from $161.2 million in the year-ago quarter.
Balance Sheet
Cash and cash equivalents as of Sep 30, 2022, were $1.2 billion compared with $1.5 billion at the end of Dec 31, 2021. Long-term debt as of Sep 30, 2022, came in at $12.9 billion compared with $11.6 billion as of Dec 31, 2021.
Guidance & Booking Updates
The company said that booked position for fourth-quarter 2022 is below the comparable 2019 level. However, booking trends for 2023 remain in line with that of 2019. Pricing is meaningfully higher than that of 2019 at the same point in time for the full year 2023.
Due to the coronavirus outbreak and the Russia-Ukraine conflict, the company is unable to estimate the impact on its business. The company expects to report a net loss for the fourth quarter of 2022. In fourth-quarter 2022, it anticipates net interest expenses to be nearly $170 million. For the full year, it expects the same to be $610 million, excluding losses on extinguishment of debt. Depreciation and amortization are forecast to be roughly $195 million for the fourth quarter of 2022 and $740 million for the full year of 2022.
The company expects occupancy to be in the mid-to-high 80% range in the fourth quarter of 2022. Capacity days are anticipated to be 5.1 million in the fourth quarter. In the fourth quarter, the company expects revenues to be in the range of $1.4-$1.5 billion. Adjusted net cruise cost (excluding fuel per capacity day) is likely to decline nearly 10% in the second half of 2022 compared to the first half of 2022.
Zacks Rank & Key Picks
Norwegian Cruise currently carries a Zacks Rank #4 (Sell).
Marriott currently carries a Zacks Rank #2 (Buy). MAR has a trailing four-quarter earnings surprise of 18.6%, on average. The stock has declined 10% in the past year.
The Zacks Consensus Estimate for MAR’s current financial year sales and EPS indicates a surge of 46.8% and 104.1%, respectively, from the year-ago period’s reported levels.
Crocs currently has a Zacks Rank #2. CROX has a long-term earnings growth rate of 15%. Shares of Crocs have plunged 55% in the past year.
The Zacks Consensus Estimate for CROX’s 2022 sales and EPS indicates a rise of 49.6% and 20.7%, respectively, from the year-ago period’s levels.
Caesars Entertainment carries a Zacks Rank #2. The stock has declined 57.2% in the past year.
The Zacks Consensus Estimate for CZR’s current financial year sales and EPS indicates growth of 14.1% and 25.9%, respectively, from the year-ago period’s reported levels.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Norwegian Cruise (NCLH) Q3 Earnings & Revenues Beat, Stock Up
Norwegian Cruise Line Holdings Ltd. (NCLH - Free Report) reported third-quarter 2022 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate. Moreover, both metrics improved year over year. Following the results, the company’s shares were up 2.7% in the pre-market trading session on Nov 8.
The company is benefiting from improving occupancy. In the third quarter of 2022, occupancy improved 17 basis points to nearly 82%. The company anticipates occupancy levels to improve and reach historical levels for the second quarter of 2023. In fourth-quarter 2022, the company expects occupancy to be in the mid-to-high 80 percent range.
Frank Del Rio, president and CEO of Norwegian Cruise, stated, “We are demonstrating continued positive momentum as we consistently reach key operational and financial milestones, including positive Adjusted EBITDA in the third quarter for the first time since the start of the pandemic. The underlying fundamentals of our business and our target upmarket consumer remain strong and our strategy of focusing on maximizing long-term, sustainable profitability is working as intended, evidenced by our 2023 booked position which is equal to 2019’s record levels and at record pricing, which we firmly believe is the best way to maximize long-term value for all our stakeholders.”
Earnings & Revenue Discussion
Norwegian Cruise reported an adjusted loss per share of 64 cents, narrower than the Zacks Consensus Estimate of a loss of 71 cents. In the prior-year quarter, the company reported a loss per share of $2.17.
Quarterly revenues of $1,615.5 million beat the consensus mark of $1,576 million. In the prior-year quarter, the company had reported revenues of $153.1 million. The upside can primarily be attributed to the resumption of cruise operations.
In the quarter under review, passenger ticket revenues were $1,105.9 million compared with $86.1 million reported in the prior-year quarter. Onboard and other revenues increased to $509.6 million from $67 million reported in the prior-year quarter.
Norwegian Cruise Line Holdings Ltd. Price, Consensus and EPS Surprise
Norwegian Cruise Line Holdings Ltd. price-consensus-eps-surprise-chart | Norwegian Cruise Line Holdings Ltd. Quote
Expenses & Operating Results
Total cruise operating expenses increased 181.7% in the quarter under review from the year-ago quarter’s levels. The company’s expenses in the quarter primarily stemmed from the resumption of cruise voyages. The company noted that the increase in 2022 reflects an improvement in payroll, fuel and direct variable costs of fully operating ships.
Gross cruise costs in the third quarter increased 141.3% year over year to $1,614.2 million. Adjusted net cruise costs (excluding fuel) amounted to $947.7 million compared with $538 million in the prior-year quarter. Fuel price per metric ton (net of hedges) increased to $830 from $693 in 2021.
Net interest expenses in the quarter were $152.3 million, up from $161.2 million in the year-ago quarter.
Balance Sheet
Cash and cash equivalents as of Sep 30, 2022, were $1.2 billion compared with $1.5 billion at the end of Dec 31, 2021. Long-term debt as of Sep 30, 2022, came in at $12.9 billion compared with $11.6 billion as of Dec 31, 2021.
Guidance & Booking Updates
The company said that booked position for fourth-quarter 2022 is below the comparable 2019 level. However, booking trends for 2023 remain in line with that of 2019. Pricing is meaningfully higher than that of 2019 at the same point in time for the full year 2023.
Due to the coronavirus outbreak and the Russia-Ukraine conflict, the company is unable to estimate the impact on its business. The company expects to report a net loss for the fourth quarter of 2022. In fourth-quarter 2022, it anticipates net interest expenses to be nearly $170 million. For the full year, it expects the same to be $610 million, excluding losses on extinguishment of debt. Depreciation and amortization are forecast to be roughly $195 million for the fourth quarter of 2022 and $740 million for the full year of 2022.
The company expects occupancy to be in the mid-to-high 80% range in the fourth quarter of 2022. Capacity days are anticipated to be 5.1 million in the fourth quarter. In the fourth quarter, the company expects revenues to be in the range of $1.4-$1.5 billion. Adjusted net cruise cost (excluding fuel per capacity day) is likely to decline nearly 10% in the second half of 2022 compared to the first half of 2022.
Zacks Rank & Key Picks
Norwegian Cruise currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Consumer Discretionary sector are Marriott International, Inc. (MAR - Free Report) , Crocs, Inc. (CROX - Free Report) and Caesars Entertainment, Inc. (CZR - Free Report) .
Marriott currently carries a Zacks Rank #2 (Buy). MAR has a trailing four-quarter earnings surprise of 18.6%, on average. The stock has declined 10% in the past year.
The Zacks Consensus Estimate for MAR’s current financial year sales and EPS indicates a surge of 46.8% and 104.1%, respectively, from the year-ago period’s reported levels.
Crocs currently has a Zacks Rank #2. CROX has a long-term earnings growth rate of 15%. Shares of Crocs have plunged 55% in the past year.
The Zacks Consensus Estimate for CROX’s 2022 sales and EPS indicates a rise of 49.6% and 20.7%, respectively, from the year-ago period’s levels.
Caesars Entertainment carries a Zacks Rank #2. The stock has declined 57.2% in the past year.
The Zacks Consensus Estimate for CZR’s current financial year sales and EPS indicates growth of 14.1% and 25.9%, respectively, from the year-ago period’s reported levels.