NEW YORK (TheStreet) -- Norwegian Cruise Line's (NCLH) second quarter demonstrated that the company's investments in new ships and fleet modernization are paying dividends.
Adjusted earnings per share came in at 58 cents, a penny above Wall Street expectations. The result represented the seventh consecutive quarter in which Norwegian Cruise Line surpassed consensus earnings expectations, based on data compiled by Bloomberg.
Net revenue growth clocked in at 18.9% year over year, below consensus estimates for 23.7% growth, marking the fifth straight quarter that Norwegian Cruise Line was light in terms of revenue. The revenue shortfall could be attributed to what chief executive officer Kevin Sheehan characterized a "promotional environment," likely in the Caribbean market, which led to on-board revenue growth outpacing ticket growth.
In the second quarter, ticket revenue rose 17.59% year over year, compared to on-board revenue that gained a more impressive 22%.
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In an interview aboard the Norwegian Breakaway earlier this month, Sheehan shared what precisely the company is doing to deliver the aforementioned improved results to shareholders. The investments involve upgrading dining amenities, focusing on premium lodging experiences on the ship, and reducing fuel consumption through hull redesigns and other measures. For example, in the second quarter, Norwegian's fuel consumption per capacity day declined 5.1%.
"I think what you find is that people, they see the brands they know, and then are more comfortable, then they engage, and hopefully while they are having a good time, spend a little more," Sheehan said. The CEO said Norwegian has been bringing land-based experiences that customers easily identify with on board its ships.