Royal Caribbean Cruises, Limited (RCCL), the world’s second largest cruise shipping group, has reported record earnings for the third quarter on strong demand and cost discipline.
Net profit rose to $752.8 million from $693.3 million in the same period last year as revenues rose to $2.57 billion from $2.56 billion. Operating profit (EBIT) rose a fraction, to $737.5 million from $734.9 million.
Earnings per share rose to $3.49 from $3.21.
In the first nine months of the year, RCCL’s net profit rose to $1.34 billion from $10.2 billion as revenues increased to $6.77 billion from $6.59 billion. Operating profit rose to $1.46 billion from $1.18 billion.
"Delivering record earnings during a period of such unprecedented disruption is a testament to the strength in demand for cruising and for our brands," said Jason T. Liberty, executive vice president and CFO.
"Strong demand trends coupled with our continued cost discipline have put us in a strong position to successfully complete our Double-Double program. As a matter of fact, I am pleased to report that we have already achieved our Double-Double targets on a trailing twelve month basis through September 2017,” he said in a statement.
Gross yields were up 5.6% on a Constant-Currency basis. Net yields increased 5.3% on a Constant-Currency basis. “This was better than previous guidance due to strong close in booking and pricing trends on China, Europe, and North American itineraries. While the hurricanes had a negative impact on overall revenue, they were neutral to Net Yields in the third quarter,” the company said in a statement.
Gross cruise costs per available passenger capacity day (APCD) increased 5.2% on a Constant-Currency basis. Net cruise costs (NCC) Excluding Fuel per APCDs were up 5.7% on a Constant-Currency basis. “The reduction in capacity due to the hurricanes mainly drove the increase in the cost metric relative to guidance. Absolute costs for the quarter were better than expected, mainly due to timing,” RCCL said.
Favourable trends in fuel, in both price and consumption, also provided a benefit to the quarter. Bunker pricing net of hedging for the third quarter was $498.55 per metric ton and consumption was 322.4 metric tons.