Royal Caribbean Cruises Ltd. today reported record third quarter US GAAP earnings of $4.20 per share and adjusted earnings of $4.27 per share which include a $0.13 negative impact from Hurricane Dorian.  The company also updated its full year Adjusted EPS guidance to a range of $9.50 to $9.55 per share, which includes a negative impact of approximately $0.15 per share from Hurricane Dorian.

Celebrity Edge

“Our business continues to thrive and exceed our expectations,” said Richard D. Fain, chairman and CEO.  “While Hurricane Dorian had a negative impact, stronger demand for our brands and our key itineraries exceeded our expectations.  Excluding the hurricane impact, we are not only able to maintain our yield and earnings guidance, but to raise both slightly as a result of particularly strong performance in the US and China.”

©CruiseInd
Enchantment of the Seas departing Miami.

KEY HIGHLIGHTS

Third Quarter 2019 Results:

  • US GAAP Net Income was $883.2 million or $4.20 per share and Adjusted Net Income was $896.8 million or $4.27 per share. These results include the negative impact of approximately $27 million or $0.13 per share from itinerary disruptions and relief efforts related to Hurricane Dorian. Last year, US GAAP Net Income was $810.4 million or $3.86 per share, and Adjusted Net Income was $836.3 million or $3.98 per share.
  • Gross Yields were up 6.6% in Constant-Currency (up 5.4% As-Reported). Net Yields were up 6.4% in Constant-Currency (up 5.2% As-Reported).
  • Gross Cruise Costs per Available Passenger Cruise Days (“APCD”) increased 7.5% in Constant-Currency (up 6.7% As-Reported). Net Cruise Costs (“NCC”) excluding Fuel per APCD were up 11.0% in Constant-Currency (up 10.4% As-Reported).
  • These yield and cost metrics have not been adjusted to separate out the impact of Hurricane Dorian.

Full Year 2019 Outlook:

  • Adjusted earnings for the full year are expected to be in the range of $9.50 to $9.55 per share. This range includes the negative impact of approximately $0.15 per share from itinerary disruptions and relief efforts related to Hurricane Dorian.
  • Net revenue yields are expected to increase approximately 8.0% in Constant-Currency and approximately 6.75% As-Reported.
  • NCC excluding Fuel per APCD are expected to be up approximately 11.0% in Constant-Currency (up approximately 10.5% As-Reported).

Hurricane Impact

Hurricane Dorian had an unusual, one-time impact on our financial performance.  Three main Florida embarkation ports closed on a weekend as a precautionary measure.  These measures impacted 16 sailings and made this the most disruptive storm in the company’s history.  The financial impact was particularly large because the affected ships included our very successful Oasis-class, because we closed Perfect Day at Cococay for 10 days, and because of our extensive relief efforts.  The combination of guest compensation, the closure of Perfect Day at Cococay and the relief efforts negatively impacted the third quarter by $27 million or $0.13 per share and the full year by approximately $30 million or $0.15 per share.

THIRD QUARTER 2019

US GAAP Net Income for the third quarter of 2019 was $883.2 million or $4.20 per share and Adjusted Net Income was $896.8 million or $4.27 per share.  These results include the negative impact of $27 million or $0.13 per share from itinerary disruptions and relief efforts related to Hurricane Dorian.  Last year, US GAAP Net Income was $810.4 million or $3.86 per share, and Adjusted Net Income was $836.3 million or $3.98 per share.

Gross Yields were up 6.6% and Net Yields were up 6.4% in Constant-Currency, slightly better than guidance when considering the impact of the hurricane which reduced revenue by $21 million and slightly reduced yields.

Gross Cruise Costs per APCD increased 7.5% in Constant-Currency.  NCC excluding Fuel per APCD were up 11.0% in Constant-Currency.  The reduction in capacity and relief efforts related to the hurricane negatively impacted this metric by 150 basis points.  Absolute costs for the quarter were significantly better than expected, due to timing.

Bunker pricing net of hedging for the third quarter was $469.93 per metric ton and consumption was 379,600 metric tons.

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