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Norwegian group 2016 net profit rises 48% to $637 million

Norwegian Cruise Line Holdings, Limited (NCLH), the world's third largest cruise shipping group, has reported a strong rise in 2016 net profit ad the company sees a strong start for the present year.

Group net profit rose to $637.1 million in 2016 from $427.1 million in the previous year as revenues climbed to $4.87 billion from $4.35 billion.

In the final quarter, the profit reached $72.2 million compared to $38.3 million in the same period in 2015, while revenues increased to $1.13 billion from $1.04 billion.

Earnings per share (EPS) reached 2.78 last year, an increase from $1.86 in 2015, in GAAP terms.

“(The year 2016 marks another record year of earnings, continuing our track record of solid EPS growth, which has grown fivefold since 2013, the year of our initial public offering," said Frank Del Rio, president and chief executive officer of Norwegian Cruise Line Holdings Ltd.

"This solid revenue and earnings trend is expected to continue in 2017 as we are now in the best booked position in our company's history with pricing slightly above the prior year," continued Del Rio.

Adjusted net revenue increased 12.7% to $3.8 billion compared to $3.3 billion in 2015.  Gross yield increased 0.7% and Adjusted net yield increased 1.8% on a constant currency basis and 1.2% on an as reported basis primarily due to improved pricing. 

Gross cruise cost increased 9.5% due to an increase in total cruise operating expense as a result of an increase in capacity days along with an increase in marketing, general and administrative expenses. 

Gross cruise costs per capacity day decreased 1.7%.  Adjusted net cruise cost excluding fuel per capacity day increased 1.7% on a constant currency basis and 1.5% on an as reported basis.

The company reported fuel expense of $335.2 million in the period.  In addition, a loss of $16.1 million was recorded in other income (expense), net in 2016 related to the ineffective portion of the Company's fuel hedge portfolio due to market volatility.