Royal Caribbean Cruises, Ltd (RCCL), the world’s second largest cruise shipping group, has reported record earnings for the first quarter despite an incident at a shipyard that incurred significant costs.
Group net profit rose to $249.7 million from $218.6 million, while revenues rose to $1.71 billion from $1.43 billion. Operating income (EBIT) rose to $318.8 million from $274.1 million in the first quarter of 2018.
Earnings per share (EPS) rose to $1.19, according to US GAAP, from $1.02 year on. The fresh figure was reduced by about $0.25 due to an incident involving Oasis of the Seas that was undergoing maintenance at the Grand Bahama Shipyard when an accident on 1 April involving the drydock caused two construction cranes to collapse on the stern of the ship.
“The damage to the ship was extensive and the ship had to go to a dock in Europe for repairs. As a result, the ship was taken out of service for almost a month and is expected to return back to service for its normally scheduled May 5, 2019 sailing. The company estimates the direct financial impact of this unusual event, net of insurance, will be a reduction of approximately $0.25 per share to the company's full year Adjusted EPS, mostly driven by lost revenue,” the company said in a statement.
Gross yields rose by 10.8% and Net Yields by 9.3% in Constant-Currency, higher than the January guidance due to better than anticipated demand for onboard experiential products and activities as well as strong close in demand for our core products.
Gross Cruise Costs per APCD increased 9.5% in Constant-Currency. NCC excluding Fuel per APCD were up 9.6% in Constant-Currency, slightly lower than guidance, driven by timing.
Additionally, better than expected performance below the line, mainly due to better than expected performance from our joint ventures, contributed to the first quarter's positive performance, RCCL said.
Bunker pricing net of hedging for the first quarter was $444.1 per metric ton and consumption was 360,700 metric tons.
"We are very pleased to report another record-breaking quarter and to be driving towards record earnings for the year," said Jason T. Liberty, executive vice president and CFO. "The demand trends are strong, further exhibiting the strength for our brands and the public's growing propensity to cruise."
