Norwegian Cruise forecasts upbeat first-quarter profit on robust demand

By Thomson Reuters Feb 27, 2024 | 6:45 AM

(Reuters) -Norwegian Cruise Line Holdings forecast a first-quarter profit on Tuesday betting on higher ticket prices and steady demand in the U.S. for cruises to the Caribbean and Europe, sending the company’s shares up 6.3% in premarket trading.

Cruise operators are experiencing record levels of bookings in 2024 as travelers look to spend on novel experiences and are choosing cruises over land-based alternatives such as hotels or theme parks.

This has given companies including Carnival Corp and Royal Caribbean more room to hike prices on their itineraries and offset still-high labor and fuel costs.

“We are determined to capitalize on our recent achievements and take advantage of the positive momentum and strong demand for cruise which resulted in turning the year at all-time highs in both our booked position and pricing,” Norwegian Cruise CEO Harry Sommer said.

The company’s advance ticket sales ended 2023 at a year-end record of $3.2 billion, about 56% higher when compared with the end of 2019.

Norwegian Cruise forecast an adjusted profit of 12 cents per share for the first quarter, compared with analysts’ estimates of a loss of 20 cents per share, according to LSEG data.

The company’s fourth-quarter revenue rose to $1.99 billion from $1.52 billion a year earlier. Analysts had expected $1.97 billion.

Norwegian, which owns the Oceania Cruises and Regent Seven Seas Cruises brands, said it returned to full-year profitability for the first time since 2019.

The company’s shares were trading at $16.93 before the bell.

(Reporting by Granth Vanaik and Ananya Mariam Rajesh in Bengaluru and Doyinsola Oladipo in New York; Editing by Shounak Dasgupta)