Royal Caribbean Group’s first-quarter earnings blew past expectations as it kicked off 2024 with what executives described as the best peak sales season in its history.
The Miami cruise giant said it expects to bring in $10.70 to $10.90 in adjusted earnings per share this year, above the $9.50 to $9.70 guidance announced at the beginning of February.
The 2024 figure is even better than the highest estimate of 16 analysts polled by Yahoo Finance, who on average were predicting $10.06 per share this year from the New York-listed company.
The higher expectations were fuelled by a record WAVE season — the peak sales period when many cruise customers book their voyages for the year ahead. Royal Caribbean said bookings continued to be strong in April, in terms of both volume and pricing.
“Wow, what a great start to the year! Demand for our leading brands and the incredible experiences they deliver continues to be very robust, resulting in outperformance in the first quarter, a further increase of full-year earnings guidance, and 60% expected earnings growth year over year,” chief executive Jason Liberty said in the earnings statement.
“Building on this momentum, we expect to achieve all our Trifecta financial goals in 2024, which allows us to focus on a new era of growth to drive long-term shareholder returns and take a greater share of the rapidly growing $1.9trn global vacation market.”
The Trifecta is Royal Caribbean’s three-part financial goals focused on triple-digit growth in adjusted Ebitda per available passenger cruise day from the 2019 record of $87; lifting adjusted earnings per share by double digits in the same time frame; and achieving return on invested capital to a percentage in the teens.
| Q1 2024 | Q1 2023 | |
| Revenue | $3.73bn | $2.89bn |
| Cruise operating expenses | $2.06bn | $1.79bn |
| Operating income | $750m | $272m |
| Net income attributed to shareholders | $360m | -$48m |
| Adjusted net income | $478m | -$59m |
| Adjusted earnings per share | $1.77 | -$0.23 |
On Thursday, Royal Caribbean also reported a first-quarter profit of $360m, reversing a $48m loss a year earlier.
Adjusted net income rose to $478m in the first three months, compared with an adjusted loss of $59m in the same period of 2023, while revenue rose to $3.73bn, from $2.89bn.
That translated to adjusted earnings per share of $1.77, beating the $1.33 average estimate of analysts.
Net yields rose 19.3% on a constant-currency basis in the first quarter.
Royal Caribbean said it continues to be in a record booked position, and rates for 2024 are ahead of this time last year. Consumer spending, both before and after boarding, is also on the rise.
“Our existing fleet along with our new ships continue to perform exceptionally well, highlighted by the market response to the launch of Icon of the Seas, which has exceeded all expectations,” Liberty said.
