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Norwegian Cruise (NCLH) Q4 Earnings & Revenues Lag Estimates
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Norwegian Cruise Line Holdings Ltd. (NCLH - Free Report) reported fourth-quarter 2023 results, with earnings and revenues missing the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis.
The company reported robust demand for its Norwegian Cruise Line brand, with bookings and pricing exceeding 2023 levels. Also, it reported solid demand for Oceania Cruises and Regent Seven Seas Cruises across various geographical regions, except for itinerary adjustments due to cancellations in the Middle East and Red Sea regions.
Following the results, the company’s shares gained 9.8% in the pre-market trading session on Feb 27.
Earnings & Revenue Discussion
Norwegian Cruise reported an adjusted loss per share of 18 cents, wider than the Zacks Consensus Estimate of a loss of 13 cents per share. In the prior-year quarter, the company reported an adjusted loss per share of $1.04.
Norwegian Cruise Line Holdings Ltd. Price, Consensus and EPS Surprise
Quarterly revenues of $1.98 billion missed the consensus mark of $2 billion. In the prior-year quarter, the company reported revenues of $1.5 billion.
In the quarter under review, passenger ticket revenues were $1.33 billion compared with $1.01 billion reported in the prior-year quarter. Our model suggested passenger ticket revenues to be $1.5 billion.
Onboard and other revenues increased to $653.3 million from $507.6 million reported in the prior-year quarter. We expected onboard and other revenues to be $513.5 million.
Expenses & Operating Results
Total cruise operating expenses increased 8.4% in the quarter under review from the year-ago quarter’s levels. The company’s expenses in the quarter primarily stemmed from a rise in payroll, fuel and Commissions, transportation and other expenses.
During the fourth quarter, gross cruise costs dropped 0.2% (from 2019 levels) to $1.65 billion. Adjusted net cruise costs (excluding fuel) amounted to $889.6 million compared with $892 million in the fourth quarter of 2019. Fuel price per metric ton (net of hedges) fell to $726 from $755 in 2022.
Net interest expenses in the quarter were $197.4 million compared with $177.1 million reported in the year-ago quarter.
Balance Sheet
Cash and cash equivalents as of Dec 31, 2023, were $402.4 million compared with $947 million at the end of Dec 31, 2022. Long-term debt came in at $12.3 billion compared with $12.6 billion as of 2022-end.
2023 Highlights
Total revenues in 2023 came in at $8.5 billion compared with $4.8 billion reported in 2022.
Adjusted EBITDA in 2023 came in at $1.9 billion against $(673.9) million reported in 2022.
In 2023, adjusted earnings per share came in at 70 cents against $(4.64) reported in the previous year.
Booking Update
During the fourth quarter, the company reported strong consumer demand, achieving record-high bookings and pricing levels during Black Friday and Cyber Monday week. It reported a rise in Onboard revenue per Passenger Cruise Day (compared to 2019 levels). The company reported Advance ticket sales of $3.2 billion, up 56% from 2019 levels.
However, due to the conflict in Israel and the Red Sea, all calls to Israel were redirected, impacting occupancy rates for the quarter and year. Despite cancellations, the company remains optimistic about future performance.
2024 Guidance
For the first quarter of 2024, the company anticipates occupancy to be approximately 104.8% and Capacity Days to be about 5.9 million. During the quarter, adjusted interest expenses are expected to be approximately $190 million, while depreciation and amortization are anticipated to be approximately $225 million. Adjusted EBITDA is expected to be nearly $450 million. For the fourth quarter, adjusted earnings per share (EPS) is projected to be nearly 12 cents.
For 2024, the company now anticipates occupancy to be approximately 105.1% and Capacity Days to be about 23.5 million. During the year, adjusted interest expenses are expected at approximately $730 million. Depreciation and amortization are anticipated at nearly $895 million. Adjusted EBITDA during the year is expected to be nearly $2.2 billion. For 2024, adjusted EPS is projected to be nearly $1.23.
Marriott Vacations Worldwide Corporation (VAC - Free Report) reported fourth-quarter 2023 results, with earnings and revenues beating the Zacks Consensus Estimate after missing in the preceding quarter. The top line increased on a year-over-year basis, but the bottom line declined.
Following a challenging year, the company concluded the year positively, with contract sales increasing 4% in the reported quarter from the previous year’s levels. Volumes Per Guest remained consistent with the prior year, adjusting for the estimated impact of the Maui wildfires. Meanwhile, the company has progressed with the transition to Abound by Marriott Vacations. Looking ahead, the focus is on utilizing technology to boost revenues and enhance efficiency and cost savings across the organization.
Choice Hotels International, Inc. (CHH - Free Report) delivered mixed fourth-quarter 2023 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top line fell year over year, while the bottom line increased from the prior-year quarter’s figure.
In 2023, the company reported an uptick in growth, exceeding its full-year adjusted EBITDA and adjusted EPS guidance. The upside was propelled by the effective strategy of incorporating hotels with higher royalties per unit. The company expanded its rewards program, extended its geographic reach, utilized platform capabilities and achieved substantial growth through the rapid completion of the Radisson Americas' integration. Given the strategic initiatives and the hotel conversion opportunities, the company is optimistic and anticipates the growth momentum to continue in 2024 and beyond.
PENN Entertainment, Inc. (PENN - Free Report) reported a wider-than-expected loss in its fourth-quarter 2023 results. Both the bottom and top lines saw a year-over-year decrease.
The decline was primarily attributed to the sale of Barstool and losses incurred during the relaunch of an online betting venture ESPN BET, both of which significantly impacted the quarterly financial performance. Also, softness in the South and Northeast regions added to the decline. Nonetheless, sign-ups for the service surpassed management's expectations, with more than 1 million new customers joining within the initial two months. Penn Entertainment anticipates that ESPN BET will capture 46% of the online sports betting market once North Carolina and New York are included.
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Norwegian Cruise (NCLH) Q4 Earnings & Revenues Lag Estimates
Norwegian Cruise Line Holdings Ltd. (NCLH - Free Report) reported fourth-quarter 2023 results, with earnings and revenues missing the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis.
The company reported robust demand for its Norwegian Cruise Line brand, with bookings and pricing exceeding 2023 levels. Also, it reported solid demand for Oceania Cruises and Regent Seven Seas Cruises across various geographical regions, except for itinerary adjustments due to cancellations in the Middle East and Red Sea regions.
Following the results, the company’s shares gained 9.8% in the pre-market trading session on Feb 27.
Earnings & Revenue Discussion
Norwegian Cruise reported an adjusted loss per share of 18 cents, wider than the Zacks Consensus Estimate of a loss of 13 cents per share. In the prior-year quarter, the company reported an adjusted loss per share of $1.04.
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
Quarterly revenues of $1.98 billion missed the consensus mark of $2 billion. In the prior-year quarter, the company reported revenues of $1.5 billion.
In the quarter under review, passenger ticket revenues were $1.33 billion compared with $1.01 billion reported in the prior-year quarter. Our model suggested passenger ticket revenues to be $1.5 billion.
Onboard and other revenues increased to $653.3 million from $507.6 million reported in the prior-year quarter. We expected onboard and other revenues to be $513.5 million.
Expenses & Operating Results
Total cruise operating expenses increased 8.4% in the quarter under review from the year-ago quarter’s levels. The company’s expenses in the quarter primarily stemmed from a rise in payroll, fuel and Commissions, transportation and other expenses.
During the fourth quarter, gross cruise costs dropped 0.2% (from 2019 levels) to $1.65 billion. Adjusted net cruise costs (excluding fuel) amounted to $889.6 million compared with $892 million in the fourth quarter of 2019. Fuel price per metric ton (net of hedges) fell to $726 from $755 in 2022.
Net interest expenses in the quarter were $197.4 million compared with $177.1 million reported in the year-ago quarter.
Balance Sheet
Cash and cash equivalents as of Dec 31, 2023, were $402.4 million compared with $947 million at the end of Dec 31, 2022. Long-term debt came in at $12.3 billion compared with $12.6 billion as of 2022-end.
2023 Highlights
Total revenues in 2023 came in at $8.5 billion compared with $4.8 billion reported in 2022.
Adjusted EBITDA in 2023 came in at $1.9 billion against $(673.9) million reported in 2022.
In 2023, adjusted earnings per share came in at 70 cents against $(4.64) reported in the previous year.
Booking Update
During the fourth quarter, the company reported strong consumer demand, achieving record-high bookings and pricing levels during Black Friday and Cyber Monday week. It reported a rise in Onboard revenue per Passenger Cruise Day (compared to 2019 levels). The company reported Advance ticket sales of $3.2 billion, up 56% from 2019 levels.
However, due to the conflict in Israel and the Red Sea, all calls to Israel were redirected, impacting occupancy rates for the quarter and year. Despite cancellations, the company remains optimistic about future performance.
2024 Guidance
For the first quarter of 2024, the company anticipates occupancy to be approximately 104.8% and Capacity Days to be about 5.9 million. During the quarter, adjusted interest expenses are expected to be approximately $190 million, while depreciation and amortization are anticipated to be approximately $225 million. Adjusted EBITDA is expected to be nearly $450 million. For the fourth quarter, adjusted earnings per share (EPS) is projected to be nearly 12 cents.
For 2024, the company now anticipates occupancy to be approximately 105.1% and Capacity Days to be about 23.5 million. During the year, adjusted interest expenses are expected at approximately $730 million. Depreciation and amortization are anticipated at nearly $895 million. Adjusted EBITDA during the year is expected to be nearly $2.2 billion. For 2024, adjusted EPS is projected to be nearly $1.23.
Zacks Rank & Recent Consumer Discretionary Releases
Norwegian Cruise currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Marriott Vacations Worldwide Corporation (VAC - Free Report) reported fourth-quarter 2023 results, with earnings and revenues beating the Zacks Consensus Estimate after missing in the preceding quarter. The top line increased on a year-over-year basis, but the bottom line declined.
Following a challenging year, the company concluded the year positively, with contract sales increasing 4% in the reported quarter from the previous year’s levels. Volumes Per Guest remained consistent with the prior year, adjusting for the estimated impact of the Maui wildfires. Meanwhile, the company has progressed with the transition to Abound by Marriott Vacations. Looking ahead, the focus is on utilizing technology to boost revenues and enhance efficiency and cost savings across the organization.
Choice Hotels International, Inc. (CHH - Free Report) delivered mixed fourth-quarter 2023 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top line fell year over year, while the bottom line increased from the prior-year quarter’s figure.
In 2023, the company reported an uptick in growth, exceeding its full-year adjusted EBITDA and adjusted EPS guidance. The upside was propelled by the effective strategy of incorporating hotels with higher royalties per unit. The company expanded its rewards program, extended its geographic reach, utilized platform capabilities and achieved substantial growth through the rapid completion of the Radisson Americas' integration. Given the strategic initiatives and the hotel conversion opportunities, the company is optimistic and anticipates the growth momentum to continue in 2024 and beyond.
PENN Entertainment, Inc. (PENN - Free Report) reported a wider-than-expected loss in its fourth-quarter 2023 results. Both the bottom and top lines saw a year-over-year decrease.
The decline was primarily attributed to the sale of Barstool and losses incurred during the relaunch of an online betting venture ESPN BET, both of which significantly impacted the quarterly financial performance. Also, softness in the South and Northeast regions added to the decline. Nonetheless, sign-ups for the service surpassed management's expectations, with more than 1 million new customers joining within the initial two months. Penn Entertainment anticipates that ESPN BET will capture 46% of the online sports betting market once North Carolina and New York are included.