Norwegian Cruise Line Holdings Expects Record Earnings in 2016

Norwegian Cruise Line Holdings (NCLH) said it expects to generate record earnings of $3.38 to $3.42 per share for the full year 2016. That came during the release of very positive third quarter 2016 results, announced today.   

Third Quarter 2016 Net Income: In its most recent quarterly report, NCLH had $342.4 million net income for the third quarter 2016 or earnings per share of $1.50. That compares with $251.8 or $1.09 for the same period in 2015. Adjusted net income was $369.3 million or adjusted earnings per share of $1.62, compared to $311.1 million or $1.35 in the prior year.

Third Quarter 2016 Revenue: Third quarter revenue increased 15.6 percent to $1.5 billion compared to $1.3 billion in 2015. Adjusted net revenue for the quarter increased 17 percent to $1.1 billion compared to $978.2 million in 2015. NCLH said the revenue increases were primarily attributed to the addition of additional vessels to its brands' fleets.  

"In 1966, the M/S Sunward departed on her first voyage from Miami to the Caribbean, marking not just the launch of Norwegian Cruise Line, but the modern cruise industry as we know it today," said Frank Del Rio, NCLH's president and CEO.

"Fast forward fifty years, where we have reached yet another milestone, reporting the highest single quarter revenue and earnings in our history, bolstered by the addition of Norwegian Escape, Oceania Cruises' Sirena and Seven Seas Explorer to our fleet," he said. 

Other Third Quarter Metrics: NCLH said its gross cruise cost increased 10.5 percent in 2016 compared to the same period in 2015 due to an increase in total cruise operating expense; that was a result of an increase in capacity days along with an increase in marketing expense.

Company Outlook 

“We are on track to deliver robust double-digit growth in adjusted earnings per share (EPS) in 2016, despite headwinds from geopolitical events earlier in the year which dampened demand for Mediterranean sailings,” said Wendy Beck, NCLH's executive vice president and CFO. “Looking to the first half of 2017, where deployment is weighted to Caribbean sailings, advanced bookings are ahead of prior year‘s record levels at higher prices."

She added: "Recent significant weakening of certain foreign currencies, primarily the British Pound, against the U.S. dollar, combined with an increase in fuel prices have placed pressure on expectations for the coming year. Despite these headwinds, we still anticipate delivering double-digit growth in adjusted earnings per share (EPS) in 2017.”

Financial Guidance

In addition to announcing the results for the third quarter, the company also provided guidance for the fourth quarter and full year 2016. It expects full year 2016 earnings to be in the range of $3.38 to $3.42 per share.