Norwegian Cruise Line's Future Bookings Rise Even as Earnings Sink

Norwegian Cruise Line's first-quarter earnings sink as the coronavirus pandemic upends the cruise-line industry, though future passenger bookings rise.

Norwegian Cruise Line  (NCLH) - Get Report on Thursday posted a significantly wider-than-expected first-quarter loss as the coronavirus pandemic upended the cruise-line industry, though future bookings remain strong.

The Miami-based company reported an adjusted loss of $211.3 million, or 99 cents a share, compared to net income of $181.8 million, or 83 cents, in the comparable year-earlier period. Analysts polled by FactSet had been expecting a loss of 28 cents a share.

Including $1.7 billion in expense-related adjustments, the cruise line operator lost $1.9 billion, or $8.80 a share in the three months ended March 31. Revenue came in at $1.25 billion vs. $1.4 billion a year ago.

Despite a strong start to the year, the company experienced “rapid and significant impacts related to the COVID-19 global pandemic including significant softness in near-term demand and an elevated rate of cancellations for existing bookings,” the company said in a statement.

On the positive side, however, “There continues to be demand for cruise vacations, particularly beginning in the fourth quarter 2020 accelerating through 2021, with the company’s overall booked position and pricing for 2021 within historical ranges,” it said.

The company had $1.8 billion of advanced ticket sales as of March 31. 

Meantime, Norwegian continues to beef up its balance sheet to weather the storm, adding $2 billion-plus in cash to its coffers from a recent debt offering.

“In recent weeks, we have taken decisive action to significantly strengthen our financial position in response to the COVID-19 global pandemic, including our highly successful and oversubscribed $2.4 billion gross simultaneous quad-tranche capital raise announced last week,” CEO Frank Del Rio said in the statement.

“We believe this capital raise, coupled with other ongoing liquidity-enhancing initiatives, makes us well-positioned to weather an unlikely scenario of over 18 months of suspended voyages.”

Shares of Norwegian Cruise Line were down 8.63% at $9.42 in trading on Thursday.