© Reuters. FILE PHOTO: Royal Caribbean logo and stock graph are seen displayed in this illustration taken, May 3, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

(Reuters) -Royal Caribbean Group raised its annual profit forecast after upbeat results on Thursday, betting on higher ticket prices and pent-up leisure travel demand, sending its shares up nearly 8% in premarket trading.

The Miami, Florida-based company also projected current-quarter earnings well above Wall Street estimates and reported a smaller-than-expected quarterly loss, thanks also to strong on-board spending from passengers.

While cruise liners have raised ticket prices to shield profits from the impact of rising fuel costs, that has not deterred well-to-do Americans from splurging on cruise vacations including on-board amenities such as spas and gaming after the easing of pandemic restrictions.

That has driven a sharp rebound in booking volumes and occupancy rates at cruise companies, propelling Royal Caribbean (NYSE:) to a record-breaking “wave season”, an important period between January and March when operators offer special deals and discounts for the year.

“We knew that demand for our business was strong and strengthening, but we have been pleasantly surprised with how swiftly demand further accelerated well above historical trends and at higher rates,” Royal Caribbean CEO Jason Liberty said.

The company now expects full-year adjusted profit between $4.40 and $4.80 per share, compared with its earlier forecast of $3.00  to  $3.60 per share.

Earlier this week, rival Norwegian Cruise Line (NYSE:) Holdings Ltd also raised its annual profit forecast.

Royal Caribbean forecast second-quarter adjusted earnings per share between $1.50 and $1.60, while analysts were expecting a profit of 94 cents per share, according to Refinitiv IBES data.

It reported a loss of 23 cents per share, excluding items, for the first quarter, much smaller than expectations for a loss of 70 cents per share.

The company’s revenue of $2.89 billion topped analysts’ average estimate of $2.82 billion.

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