Norwegian Cruise Line Holdings exceeded analyst expectations for the third quarter as demand for cruising stayed robust through the three-month period that ends during one of the industry’s two shoulder seasons.
The Miami-based cruise operator that owns 28 passenger ships posted $346m in net profit for the quarter to 30 September, up from $295m in net loss recorded during the same period last year.
The shoulder seasons are periods in April and May and September and October when ticket prices are low but tourist destinations are not as crowded as they usually get during the summer peak season.
On an adjusted basis, New York-listed Norwegian earned $388m in net profit for the quarter, up from $268m in net profit for the same quarter in 2022.
That amounted $0.76 in adjusted earnings per share, which beat analyst consensus by $0.06.
“We achieved strong third-quarter results, meeting or beating guidance on all key metrics, driven not only by healthy demand from our target upmarket consumer but also as our ongoing margin enhancement initiative, including relentless efforts to right-size our cost base, continues to bear fruit,” chief executive Harry Sommer said in a statement.
Revenue came in at $2.54bn for the third quarter, up from $1.62bn collected a year ago.
Norwegian achieved higher results despite dealing with disruptions such as wildfires on the Hawaiian island of Maui and the escalating conflict in Israel.
As a result of the Maui wildfires, Norwegian’s 2,186-berth Pride of America (built 2005) is said to have changed certain itineraries to the island to avoid stressing local resources.
Norwegian also sends the Norwegian Spirit to the Hawaiian islands, as about 6% of total passenger capacity is scheduled to go there during this year’s fourth quarter.
“Demand has improved in recent weeks and is now approaching normalised levels,” the company said.
Meanwhile, Norwegian has cancelled and redirected calls to Israel and certain calls to the surrounding region for the rest of 2023. It is also in the process of cancelling all calls to Israel in 2024 and will closely monitor and evaluate future sailings and adjust as needed, as previously reported in TradeWinds.
Before the Israel-Hamas conflict, visitors to the Middle East made up about 7% of fourth-quarter capacity for this year and 4% of capacity for all of 2024.
Norwegian reduced its total debt, which ballooned during Covid-19, to $14.2bn as of 30 September and plans to get it down to $1.89bn by the end of 2028.
Norwegian posted net profit of $273m for the first nine months of 2023, up from $1.79bn in net loss for the same time span in 2022.
Revenue for the first nine months of 2023 reached $6.56bn, almost double the $3.33bn taken in during the same period last year.
