On November 1, 2023, Norwegian Cruise Line Holdings Ltd (NCLH, Financial) released its financial results for the third quarter ended September 30, 2023. The company reported strong financial results, exceeding guidance for all key metrics despite global challenges.
Financial Performance and Highlights
NCLH reported a record total revenue of $2.5 billion in Q3 2023, a 33% increase compared to the same period in 2019. The company's GAAP net income was $345.9 million, translating to an EPS of $0.71. Adjusted EBITDA reached $752 million, surpassing the guidance of $730 million. The company's strong performance was driven by solid revenue performance and a continued focus on cost reduction.
Harry Sommer, president and chief executive officer of NCLH, commented on the results,
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 rightsize our cost base, continues to bear fruit."
Challenges and Outlook
Despite the strong performance, NCLH faced challenges due to global events, including wildfires in Maui and escalating conflict in Israel. These events impacted the company's operations and resulted in itinerary modifications and cancellations. However, the company remains optimistic about its future performance, with a strong forward booked position and robust pricing.
For the full year 2023, NCLH expects its Adjusted EBITDA to be approximately $1.86 billion, within the previously provided range. However, the Adjusted EPS is expected to be $0.73, below the prior guidance of $0.80.
Financial Position and Liquidity
NCLH ended the quarter with liquidity of $2.2 billion, which would have been $2.5 billion including the impact of the October refinancing. The company successfully completed the refinancing of its Operating Credit Facility, extending its debt maturity profile and providing incremental liquidity.
Mark A. Kempa, executive vice president and chief financial officer of NCLH, stated,
Last month we successfully completed the refinancing of our Operating Credit Facility, extending our debt maturity profile and further improving our liquidity position."
Future Guidance
Looking ahead, NCLH provided guidance for the fourth quarter and full year 2023. For Q4 2023, the company expects its Adjusted EBITDA to be approximately $360 million and Adjusted EPS to be approximately $(0.15). For the full year 2023, the company expects its Adjusted EBITDA to be approximately $1.86 billion and Adjusted EPS to be approximately $0.73.
Explore the complete 8-K earnings release (here) from Norwegian Cruise Line Holdings Ltd for further details.
