People are booking their cruises closer to sailing dates, while the war in Ukraine is affecting itineraries in Europe, with the Baltic suffering most, Royal Caribbean Group said.

Booking volumes in the first quarter improved consistently week-over-week and reached typical Wave levels at the end of the quarter. They have now been surpassing comparable 2019 levels for the last two months with particularly strong trends for North America based itineraries.  

In addition, the elevated cancellations experienced earlier in the year returned to pre-Omicron levels as cases subsided in February. While load factors for sailings in the second half of 2022 are currently slightly below historical levels, consumers are booking their cruises closer to sailing and the Group is capitalising on that healthy close-in demand to improve load factors.  For the full year and the second half of 2022, pricing remains higher than in 2019 both including and excluding future cruise credits (FCCs).

“Bookings for Europe sailings improved throughout the first quarter but softened due to the war in Ukraine with a bigger impact on Baltic itineraries.  While bookings for Europe are now exceeding 2019 levels for the same period, the situation in Ukraine is expected to weigh on load factors in Europe this summer,” the company said. 

Many cruise lines have stopped calling at St Petersburg in Russia in the aftermath of Russia’s attack on Ukraine.

"The performance of our core business continues to strengthen, fueled by strong demand and excellent operational execution," said Naftali Holtz, chief financial officer at Royal Caribbean Group. "Our near-term focus is to return to full operations and profitability as we execute on our recovery and build for long term success."

As of March 31, 2022, the company's customer deposit balance was $3.6 billion. This represents an improvement of about $400 million over the previous quarter despite the significant quarter-over-quarter increase in revenue recognition and near-term cancellations due to the Omicron variant, both of which reduced the customer deposit balance. 

The customer deposit balance at the end of the first quarter of 2022 was similar to the March 31, 2019 balance for the three brands. Approximately 27% of the customer deposit balance is related to FCCs compared to 32% in the prior quarter, a positive trend indicating new demand. To date, approximately 56% of FCCs have been redeemed.