Norwegian Cruise Line (NCLH) 10 May 222022 Q1 Earnings call transcript

Good morning, and welcome to the Norwegian Cruise Line Holdings Business Update and First Quarter 2022 Earnings Conference Call. My name is Rob and I'll be your operator. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session and instructions for the session will follow at that time. [Operator Instructions]. to Vice conference ESG President Communications. like host, to and now John, Jessica of would turn over the your Corporate I Investor Relations, Ms. please John, proceed.

us which everyone. Kempa, to Thank with Line business and Norwegian the and I'm Frank Officer. you good Mark Chief Rob and by after call. will Frank opening first Executive call morning today Rio, begin you, for the XXXX and update call joining Cruise closing Del and discuss Financial for joined Holdings to Vice earnings Chief Executive will handing commentary, our quarter our Frank of Thank President Mark follow before remarks. President financials for back Officer

We call open will then the for questions. your

call company's on conference simultaneously As www.nclhltd.com/investors. at a investor website is the this webcast being relations reminder,

available a conference also also may website. found call will reference We and days make call presentation presentation replay Both during this Investor which slide be following today's on for Relations the for call. our XX be to will

like I items. we begin, few a to cover Before would

issued release, was quarter statements that This statement such should includes risks our conjunction the cause in statements with in first that with and These actual our uncertainties morning cautionary relations contained could XXXX and the materially call earnings forward-looking available results to results website. differ involve press investor statements. is Our on this release. from be considered our

like contained reconciliation our to measures. I'd over non-GAAP other reference A Our most presentation. are financial also measure Rio. Frank the Del call and the With earnings GAAP in comments and Frank? to directly may to associated turn disclosures release that, comparable financial

the return up two thus colossal few to and for doing challenge so, major welcomed significant the arose dedication in thank few our have milestone come everyone of fleet to with certainly last morning most back. the today. in good she XX have pause cruise operating our The time in again the not great ship final years marked a But say Norwegian in XXXX. operations our least. milestone Line and Norwegian March that at Jessica been company further Back Norwegian extraordinary our our In each the and stepped to Holdings ship past significant challenging time to Saturday plate Cruise joining first for in last the you far an all the days, new us and if cruise service fleet its And you, operator This guests Thank Spirit since the complicate again. team wide undertaking, months the to became first already demonstrate to ships to and resilience, making passion. last

for this persisted, team's revenue cabin I our of even and to this more from side guests our all as company position reach want classes. satisfaction brands, to onboard impressive our across and to thrive ability drive Itinerary and in every our the guest has to ramp spend and organization shore So their team to Cruise the shipboard Great come. point Even efforts was years across to thank more member each all and in in high having in ticket trend scores our occupancy history, we all up some all Comeback ever,

the long-term our do throughout gains a relaunch. at our expense have strategy jeopardizing of brand not We equity industry and pricing in consistent focused short-term milestone showing reached with prioritize this and the we And leading clear, process. that

large, indicating all as carried significantly Cruise we lower and healthy are well-being aboard our ships, experience incident crew and health population COVID a designed. safety our our experience of compared prioritized our to Comeback, Since continue that rate at the guests, above and have as and we create possible guests, the launching to indeed to we over protocols XXX,XXX health, safety working communities stakeholders. and else, the Great doing have visit for all we First, everything safe

partners lastly emphasizing in three pandemic, and and travel our Second and willingness travel our value go at focusing ever the be fill past large demonstrating doing public the on to commitment key guests. throughout think before that stood with our steadfast support to this firmly gone to to than unnoticed. on price. of partners, our marketing firm our them. we over thing brands has and right price I go-to-market the integrity pandemic, will And provided both better and the to support guests great believe we by key lengths we standing don't have with exit strategy I these And maintaining as

time net time and our our be You to this consistent not driver area that growth exit the outperformance the say quality key. bolster to most be high pricing and me performance, profitability, have an sustainable factor we the booking I maximizing that normalized industry-leading is And a this we factors compromise will to that not single sacrifice yield return growth, will continue behind efforts. load and again we yield as in net will important primary heard philosophy. and will stand where is pandemic Pricing to given temporarily our

diem significant, for factor Slide that quarter is outcome trade-off load as was, X, tempered, So success. first more XXXX company's somewhat a was our the pricing over an and our of per long-term while growth first record much on shown quarter net meaningful

to outperformance track take yield don't record it, stellar itself. for of word have our net my speaks pre-pandemic for year-after-year you Now,

As step ourselves last peers with for landscape, driving little much spoke shareholder best a superior experiencing to coupled find health brand between demand to we can the survey over and net the environment two XX%. than outperformance pricing we Slide when our favorable a that ago. public to better a our protect is on strategy broader you and back historical a This strong way are we evidence equity, while X our periods value. today future in are Taking more somewhere long-term the in our all regulatory XXXX, XX% one months see yields were by than

air globe this industry to time participant. from an witnessed protocols have other relaxation We is active cruise and and the travel continued a the around activities across concert COVID-related indoor of

are step in a that pleased for cruise, leveling late representing the playing land-based entirely towards significant notices its the between March, and Health removed CDC counterparts. we travel First, our field cruise

from framework of family the most elements XX%, up vaccination addition CDC In to market reducing certain further opens requirements, continues XX% required which the to of voluntary its the modify cruise, important for threshold cruising. which recent to relaxing includes

running news wipes, areas. for or which do to are where acceleration and and the fourth snapping Cruise until every not the hotel spending have to industry while More services. app, in as relapse full sailing the as have that going to mentioned exceeding and and is over where and Second, well-positioned be seen up catch giving we are value years good the in spend to at see to to adapt bodes where budget anti-bacterial situation, near sanitizer, various record an are this we today our off streaming of quarter, on Consumer [indiscernible] the which sector XXXX. we reopening seeing hand And and advantage airlines outcomes lastly, around overall. fares, on was proposition reopen travel plan have Gone ADRs needed. leisure left ongoing, we the we we up entire even consumers, have over opened by missed ship those experiences. to overwhelming us explosive certain are we Asia, showing earlier, capitalize that now along family the in is and and well example with back an countries strong, in One Consumers land-based in discussions still consumers. pent-up delivery to American monitor our there to back demand. seen options, for world ready society ports industry's days the particularly restrictions in are particularly is two regions, pre-pandemic are day I with time levels. are additional regions And And normalcy, travel many of this its cruise fleet of cruise

the cause Ukraine the and start the business to Slide course can the and world health on of of our improved you the did across see Russia environment While disruptions X. over public conflict additional quarter, the

for we and foremost, for in continue the impact First to those region. hope further which resolution, a minimizes peaceful

motto Our shore have and and as first, such, team side we focused can. we is best impacted our family on shipboard as members assisting

mental We providing communication health support fund and have logistical, team and to affected members. crew activated our relief are

three in our industry, exceeded itineraries. expectations. European our Petersburg, three window take conflict team has And Seas Getaway Marina, will itineraries brands in canceled of addition, ports In redeployed a condensed Baltic partners and sail X% pent-up And on of move crisis XXXX Regent respectively. relief Ukraine alternate for Save well. and British was to occupancy advantage calling of that measure Europe Prior our Russia. booking close-in and redeployed travel Oceania quickly the all a in including donations three to unique sizable XXXX our in domestic scheduled the subsequently members in in partners, Seven Children to which provided itinerary. Russia XX% to which Norwegian XXXX. to to scheduled contribute remain operate will across with brands pause calls calls sailings as or from Canaveral to we to approximately sail guests strength capacity one of Mariner the demand preemptive fund was Port XX a modified Northern region annual We Russia despite of included meaningfully to to the ships approximately the demonstrates, and invited region we approximately the also sailing already Meanwhile, all Saint Isles our the

While this as demonstrating again in ability is pivot needed to once exogenous not events. we scenario, our to are an response ideal

with all broader today's Now we our and robust sequentially improving turning surge net December for volumes indeed net X, demand continue concentrated improvement. Omicron the mid-January and to close-in momentum to majority The Overall, demand show we cancellations shift began discussions sailings. in to pricing week-over-week to underlying impact Slide for future experience booking vast periods. The turn began in and to of January did trends. booking when booking tide

the some with leakage Russian Ukraine conflict. first pre-pandemic Baltic net returning improve pre-Omicron approaching surpassing short-lift region historical that This As another continued experienced to of sailing, surrounding levels factors. load the to booking setback the to with emergence end volumes in with the at levels concentrated was currently and temporary impact cancellations sequentially, recently regained mainly of was level and Mediterranean consistently quarter. and returning Overall booking the we needed to at have also by sail to pre-conflict momentum, pace

the from result now is conflict, and of impact half below second Russia Omicron strong the an As extraordinarily position book Ukraine XXXX a XXXX.

the year, in with book in out fourth line XXXX. the further with in the picture quarter look remaining improves we As sequentially position

More XXXX a importantly cumulative XXXX of full XXXX comparable of curve. in year is booking ahead point at and book the pre-pandemic ahead position

periods. a which as XXXX. of pre-pandemic no as mentioned fill to comparable even the This including droves, the a pricing paying credits fill, be pricing with dilutive earlier, future when On our off impact and year-end the price applied XXXX, through FCCs of to higher all-important go-to-market in to must periods all front, longer over emphasizing true meaningfully reminder when XXXX in value cruise be as will discounting headwind marketing compared holds versus is strategy to future sailings for in

quality, further But stoke by no the a continue trajectory little clear. to environment potential strategic bookings. in our price, I'm future that demand as a we and towards excited month full recovery look XXXX, by high As our year. high that doubt transition each will improves, holds. goes booking marketing the obtain value becomes I is order to With XXXX effort

We bumps in in additional are forward not with certainly to environment reaching still learned road. recovery. in day possibly operating to in we've propel and normalcy not confident we overnight if But happen the that an the us return each today's passing and this uncertain will are anything increasingly I'm needed without milestones

reasonable up focused in needed of over to beyond. our long-term and year new brands the and control Boosted a reach to XXXX entire are in is the laying three another us yields net position an company our the event Swan record introduction and everything doing where our achieving. strong Black without extremely XXXX. across our path for we adjusted set are foundation we sustained XX months, for EBITDA But to sit derailing goal, next We today, in there record clear is and levels our team four the by plans ships and on success

coming leading industry be the new As future just online through with mentioned, the XXXX. ships components nine our across our key growth success brands of profile will three

just you ships these of her few March, that first be significant us her our ship outpacing stellar to continued headline her the see the surrounding our After In The godmother booking join to of Prima sales months This icon, the in serve May on as record audience. will new Slide garnered XXXX, cruise in past to announcement in media Reykjavik, short announced excitement X. will significantly and will can pricing her coverage debut christening we on be a Norwegian volumes pop as a fleet launches. Prima Katy Prima Perry Iceland. building allowing ceremony entertainer further and new to reach at and

introductions our closing Vista Regent to be first each welcoming to will capacity, only be guests line call for As year in fleet. which Needless experiences. Norwegian guests but brands Oceania back and and welcoming will these rest and historically will of effect over comments fleet, our of reigniting growth Cruises I'm our new to next fleet. premium capacity eager have brands to new They expect his net hardware begin bottom in significant with financial meaningful year our also XXXX turn are a not additions ready Seas elevated enjoy to additional a our the in and commentary to had new for and Mark Seven be little our overall loyal past driver to attracting profitability say look on Kempa yield financial new but halo contributors the we our Grandeur These we the be that later, I'll and meaningful Mark? now, also to results. of positions. top I'll Viva, the to a

and morning Frank, you good Thank everyone.

unmatched thanks critical my begin execution to plan. service. service would to notch successful a results I sincere revenue financial truly top their take with team us officially and to the express collaboration like have commentary significant the of and my to our Before work, on efforts return moment hard Their been and our spirit to getting for outlook, milestone our innovative now ships to are all to back I

from the the contribution results, pricing headwinds spend drove Turning onboard positive first the ticket revenue in from that Omicron despite variant. and to quarter we quarter fleet the strong faced operated

health for our disruptions This impact, safety the in from the we quarter, additional protocols quarter. Omicron-related approximately to port integrity XX price the travel During restrictions, canceled increased long-term maintaining and sailings on due closures. than slightly operational resulted with anticipated focus and in coupled lower load factors

spend continues pricing quarter versus However, onboard person up levels. per be the remained XXXX robust day to and in meaningfully per record

protecting staying the reach XXXX, levels in strategy to and go-to-market pricing half load our Looking load expect second sequentially month at historical and our record factor first pricing, approximately at year continue to of in to each factors and we ahead, we also brands. and are will the quarter throughout build This come improving of factors with expect consistent strength long-term load the XX%.

which load are as are are consumer only boost addition, bookings near indicator more importantly positive uptick typically cancellation factors, organically bookings but an penalty sailings help In these for period. that in close-in term not within is confidence experiencing building, we the a

positive which to net and as operating for slide milestones. sets year March, XX goal full ahead out up flow, the financial we and both momentum gain inflection operating previous our will reached the EBITDA cash second Turning expectations recovery key turning positive yields of performance, XXXX. expected of our EBITDA continue our for throughout adjusted nicely for progress in This financial a record of our point lays slightly we with financial cash significant half upcoming year flow to continue for positive quarter. the month, projections, through In record achieve the XXXX. to us we our should This steam second adjusted expect with

cash capital operations, advanced $X.X capital to interest burn $XXX expenditures balance of Moving billion other by partially quarter $XXX cash XX, million and reflects ticket a million billion. changes. including sale of to for offset by with working on and basis collections This our $X.X nearly approximately net associated Slide increased the

quarter the balance at we balance associated end of executed an optimization sheet transactions, the million cash also boosted with February. incremental $XXX by Our the was in

billion of strong, well positions $X.X which payments, resumption manage standing remains after build, to With the at end liquidity are were and generation is overall we which us cash indicate to all trajectory related of would of month, continues the ships our first we of our quarter, debt which month. at beginning newbuild the this deferred that during Our generation sales now former sailing the increasing the key the amortization which resumed pandemic, month accelerate. organically. fund can our advanced confident cash ticket and A operations component last current

in see On XX, ATS ATS the the up build quarter, $X.X the first pre-pandemic by time basis, start As Slide billion is demonstrating of over pandemic XX% quarter, to increased indicator $X $X.X a $XXX surpassing for consumer This mark balance you the for and brands. on demands approaching the stood the million total levels. billion of since as the can of versus end billion our at strong another positive quarter. the gross prior first

figure was than burn supply cash the monthly chain $XXX associated from that current cost million resumed does global or Turning This pressures future better our bookings constraints. already to from contributions $XXX guidance million inflation burn, cash and quarter inflows our some service. despite in of ships not with nor have cash approximately include burn

for on of to out to and our shareholders. as is our team our finding seizing in and Slide Moving financial focused value shown sheet sheet, on optimize opportunities day part and plan recovery day the our balance maximize balance XX,

be profile used The coupled of short senior make XXXX as laid XX billion cost and debt peak the the to Proceeds term. due reduced the During balances to expense through XX.XX% incurred, our and high were $XXX certain will necessity million. transactions. series of notes late Slide transactions due in extended remaining redeem and these the debt These and last The remaining $XX from interest benefit those notes completed pandemic. cash out with maturity which interest these debt on on transactions, approximately used of the scheduled proceeds the XX.XX% due million $X.X principal secured combined of collateral guarantees. of senior quarter, the a outstanding approximately out approximately XXXX, annual amortization at we we raised payments our transactions released by of year,

As touched have other industries what I've by quarters, the last constraints, global in supply continue also the consistent on on all prices chain risen accelerated significantly inflation geopolitical in our Fuel cost. few ongoing experiencing, with upward to pressure put are unrest.

immune spike our pricing are we the in While not program. to hedge

As partial Slide shown XX, protection. provides on

On and metrics positioned than guidance which incremental on provided consumptions, we labor provide our land-based capital due peers and long-term fuel relatively our remain inflation which predictability stable employment can Slide better key also the on interest, found like expenditures XX. our amortization, We've and structure. cost operating depreciation for wage in all front, be agreements, to certain

gearing fleet ships top expected of to be to in we Compared margin structures, XXXX newbuild our boost to cornerstone our Splendor XXXX. thesis. profitability. Looking company's resulting new immediate a Regent This Norwegian the expected accretive and with XXXX, of in Seven ships reflects and are of deliver both under-appreciated line efficient our addition results nine is are up XXXX late versus an additions XX. new Slide This Seas early on to ahead in Encore XX% transformational very to also the on capacity in financing shown growth XXXX an growth through as our attractive program. investment These

this the returns time As generated continue trend past and has to the have fully incremental outsized we again we in you XX how team expect on a demonstrates slide capacity, in management showed future.

have incredible offer can additional a for leisure we better to past, versus value unique drive the we a vacations, for least additional and a based where our area that alternative. consumers our said than is similar proposition continue offers stakeholders at vacation compelling of land-based strategy to capture wallet. value Another to typically value In alternatives. Cruise XX% land cruise the multi-year XX% share

generate the satisfaction are inflationary that the value of for proposition a consistent as land-based labor With only made picture, ever also the level milestone we and guests widened has provide and increased demand long to beyond pressures peers the exceptional backdrop, term in current And and also another stone, not looking stepping today we factors by many back our future our prices. Each recovery, our at to making several performance. as as value, evidenced on, but process. before. facing, than gap to prospects. our more our we targeting both so opportunity even a These another combined, scores. Stepping I drive far new push service reach our of in catalysts pre-pandemic same recovery we progress by Without we optimistic, can compelling touched present us forward of return our because is have simply bigger have I am significant guest additional our to high

us focused operational finding are and ways, and culture future. and closing With can back small I the well improve that, that pandemic even or and and I'll controlling what strong will Frank past however, our the to of which on us to control, the innovative challenges serve served financial in disciplined, confident the comments. day. each in call of We more am excellence big new through the for turn we

Thank you very Mark. much,

provide prepared global this Before an to Sail And morning, we & on XX update key wrap our and milestones. up Slide accomplishments program, I'd as like Sustain. sustainability outlines remarks our

have We earnings advances several our call. significant last made since

chain key existing targets. committed zero to path greenhouse is gas climate short net and value announced important partners and pursuing journey. develop strategy, key new bring This commitments we near we last around which strengthen on and entire focus our three that areas. operation all term our zero emissions our are month by of spans reduction along action with we continually greenhouse net we to also to gas have aim centered us as ambition support These our To XXXXs. and broaden First, this evolving

intensity. our reducing First, carbon

Second, investing exploring in a technology offset third, carbon alternative fuels. program. and And implementing

to working to opportunities ambition zero with monitor accelerate investing these to with development vendor to A the efforts. usage the support continue achieve closely the key to net accelerate including and will beyond our power decarbonization of and We driver fleet, reduce use partners associated our our critical ports. destinations fields alternative the of infrastructure of is to fuels at along while in globally emissions shore

to continue scaled. fuel research will also We and sufficiently appropriate can partner sources be that identify alternative to

For society engine solutions are we additional example, currently safe manufacturers of methanol for development including actively Hybrid retrofits. engaging and and with shipyards, the technology partners, including potential paths and exploring classification in Engine engine effective

Second, last financial climate our published task force we or Report. on related month, TCFD disclosures first

we process, our this of to extensive by climate risk followed hypotheticals conduct across top risks under climate teams related part climate the different scenario a risks, screening, an priority identifying on organization analysis As engaged scenarios.

related on our focused assessment climate and risks strategy in will long-term into further us are assist of decision-making integrating improving this processes. result We resiliency the and

diverse Pledge CEO Diversity and Lastly, our I'm on pleased to an workforce signed are ideas. commitment the generate fostering that Inclusion represented, report where innovative expanding and to inclusive I Action to engaged for empowered further backgrounds execute March, in

leave find XX. call I'd on Q&A, can to like some you turning takeaways, which with key over Before to you the Slide

with society operation, year has allowing current EBITDA regulatory full and goal and the singularly public the return with the and am occupancies full net virus, back up health to disciplined so to to we to and trajectory have learning XXXX. reaching adapt a First, accelerate we the improved fleet environment in encouraged we live progress record in ramping for and focus accretive record our and pleased of be as normalcy. on now are overall manner adjusted I us in made have The by yields brand can our incredibly a how

improving encouraged XXXX. Second, foundation pricing of half a trends we and which lay robust by experiencing, strong are we second and are for 'XX booking the

free flow profile long-term We fundamental high-quality attractive our of our profitability a capitalize sustainable continue cash will to order the lean for long-term market generation. plan the in stage And medium and go-to-market and over on and years. lastly, to growth on to fill now set to execute will strategy our recovery we coming

lot we've can a covered you today. As see,

our So open call please question. commentary open line. the the I'll all up conclude here Rob, up your and

[Operator Frank. Instructions]. you, Thank

Wieczynski Our with Please from first question question. Steven comes Stifel. with proceed your

good Yeah, hey morning. guys,

So about take Mark, to forward. to moving price want Frank and ask ability your

is from company guys questions is of new Ukraine power general. those And types a your investors the of you keep vacation amount of industry seeing the and coupled assets you're the lot in One a pricing more obviously long-term of check. factors pricing elsewhere, fear lot other remained the redeploy with And with with decent disruptions of those to have Russia, underpriced a having we in like might alternatives. to your get ability relative supply

that are there? and going to combat how just fears how out about trying So action ability to understand you how think those you price ability price or you

Thanks, Steve.

is question, it's especially pricing coming vessels on both top of new well performance online. bottom drivers the future going line. great and pricing do that And as as we nine to a of we've one think we be the because performance to rely I line out

online growth coming most percentage the have We wise.

soon. won't raise that new know No coupled was anytime probably We think coming of know star being in there able terms And in the generation Regent new incredibly going with a XX% over Russia the of damping prices. XXXX. Mark a St. in and online, vessels, have question they're of the does of 'XX you Norwegian new mentioned the of vessels, the to the vessels, as vessels you the the productive as all the port. Petersburg, effect last I pricing. Oceania new especially generation vessels on But be Ukraine history. conflict our

drive of the very three is others do we not might. growth driving the as ability is game year some Go-to-market every slide to seriously the something to and opposed have after went scale on well take of it of after to day. being one strategy revenue line it's slogan. key to discount a think We the to smallest of top It's industry as our the I history cost yield in outperforming fill top companies. to market line revenue net don't We based year control pricing. our fill We year. as big cruise the our of

have to years we so we'll on the to we the and brightest be And able company best area to come. outperform that that for that in and believe our continue in focused

And land And and pricing pay based about said our after. We'll an to can willing value that's we additional that pricing We've for which Cruise. And after. to are can't opportunity what land-based as higher as as chase additional is go talk alternatives, Frank demand we underpriced Cruise the overlook vacations. to a Steve, continue always of to you've that whole. is more competitors, saying, and we versus to more and proposition consumers we for true add go seen that expect that is industry the

and brand after the our pricing and never were If you industry. power look XXXX recession, pricing XXXX, we rebound. lost at at couple brands pricing the first back in look, largest the go happened was to first I think rebounded last time the our of quickly and and what A the in

compelling to cruise down set continued value. for pay is are up the and value we're offers So there well. opportunity line. willing a We think Consumers

into correction at you or is of out now equity And question, it. probably fear recession probably great relevant right your both. on markets or type picture with there is of well, U.S. it's and That's the second bigger color. is there look a some want a asked going as what's something some the question I've you, clearly to peers Thank heading to but whatever

help a, liquidity want And business Just what this of general. positioned your maybe any scenario well as And a how tougher as have additional liquidity? think the in see at understand times. kind think you're need point, both economic call and what you. you guys you how would if guys past performed from us about you during financial to position, to on you Thank we raise

Steve, I'll take that.

few we points we a let's foremost, and inflection first company. just So, as hit that have remember a

flow turned cash Our from positive operations March. in

continue quarter to the We the second throughout expect of the rest that year. in and

we expect flow turn cash the in slide, positive I As fourth our free showed to in quarter.

flow, quarter the liquidity ticket look our I turning billion. we when our roaring. around on not well, position. in the And with only $X.X turned cash corner plays is sales as that all engine talked but at advanced about We So

and to you of are the fixed-cost confident than talk, we're many or it's think about competitors whole, and picture the that industry cruise our in at you to better the when so the against our bigger our relatively our as operations business. organically. backdrop, economic a nature of recession you ability due of positioned as And our pretty land-based an inflationary inflation look fund look whether company at we're backdrop, against When

an us to go that with advantage. in question the consumers beginning I'll gives for of said again So of look I combined back value that. And what that cruise, your proposition the

great So forward. position like a going in we we're feel

it. guys, Great Okay. I thanks appreciate

next with Please the Our Cleveland with question Research. proceed your is from Ciepiel of question. Vince line

to that, get Obviously business. there Great through COVID, thanks. some rolling has I that. but I there year you are within across this Helpful been a inflation additional have lot efficiency EBITDA and comments guys some mentioned wanted perspective A you and cost. sure made record growth's, to the capacity improvements interesting out 'XX with also for dealing yield, unit your but now, companies leverage of of on net fixed that the land-based part I'm on goal had think profitability

you're moving margins So curious of pieces? kind year of light how those next about into thinking in

of margin the events. Look, ships it's year. pricing four where we a Pricing of year. take any Today, not record new starts that morning, said hold all Yeah, delivery way were delivery lucky it good the last ships. Swan didn't book ahead by are We of Frank. last But months, of the no pricing. that we with of meaning We Vince, there introduction seeing. next XXXX We what only our we by Black think position meaningfully can that led were we meaningfully more take XX new during but four. in we're will we pandemic, expansion be the over ahead

you've a tailwind real options. that pricing land-based yield to which and power, seen growth this think to vacation heard relative morning new net do we introductions pretty an we've we profitability, other is Inflation the like to so there resorts absolute And historically, with is terms but are terms is have ugly in And not in topline only compared word, statements power. but along pricing Mark's revenue. side, ship mine,

we've So Black Black indeed, before think in prior we've we more events, XXXX, unfolding the I the in events of years, last XX. Swan think had the more record Swan seeing that and than the absence two be us. in could had it that year we're

inflation, have We're the we top to growth have growth, basket that look that side, that not effectively Vince, a we're of of unit exposed remember, you lot the XX% drive over said as costs, our 'XX. to many if only so cost our at industries, but XX% line, of comparable cost you capacity a than immune speak. going less And hyperinflation speak. XX% so but about on XXXX That's we are in to leisure and to we're type not to is to

we backdrop. continue price, So protection to We're on going scale we that's going push gain expansion result and to some grow, we margin of continue that to have profitability. as to increased against in and all

That's helpful. customer I into And curious the dig little bit. a mix to wanted

the there think in and curious bookings driving loyalty a but good transition last there? the have if slide in catch-up new I XX deck do seen cruise how comment of was any occupancy, guests there's days a portion you been about

us, really have was comfortable a new Early bookings is particular between cruise us. seen to in guests brand breakout guest booking the and with with past we guests most to brand. overwhelming return cruising, an They with most booking. pandemic What with the skew towards the to with year there past booking were us, of the normal new beginning recovery since comfortable

break the I either different or Cruise good that we've with passengers, So think normal from to alone. guests live groups reached can't out to lines about which of the of reach see. is past perspective, the

to it's to new the So to new to cruise see brand and good us. of return

you. thank Great,

Sachs. Next Stephen is of Please your with from with the Grambling Goldman proceed question question. line

can costs, to this the maybe costs COVID et of you of way related is XXXX? there look cetera, out easing testing, get some for distancing to would it's you what and these impact of Hi, social start we as thanks. frame the Outside start-up any year to whether sustain,

think back effectively that going were areas reduce. produces additional some we regulations the issued time with Steve, quarantine We're by so for stopped aside opportunities. of certain we've that now staff Yeah, testing recently. reduced we distancing can cabins social outside or put taking I to to the to There's be had for be over that CDC that going for isolation

you're start and into somewhat components third cycle as pandemic-specific to to forward quarter of the think go from as I going classify result see of probably those costs I as quarter, cost any the we onward the some what a So through major going of XXXX second kinds away. related pandemic. foresee we'll don't

on nothing but things the significant. some Just margin,

to maybe answer on net your then questions And record to the harp on yields.

of some about six bullish of six months that think out been has months quarter for always success have this each out year. I a concerned outlook the kind skeptics been successively

So you this what finally do in materializing. trends those greater I changed quarter guess feel give has to confidence

events. occurred keep Swan these why we having reason the Black has the because Well, phenomena you just described that

there was was situation. Delta, the Omicron than it First, and it Russian was then Ukraine,

pricing Black is absence no therefore anything of seeing over tempered And long are events Black In additional Swan we're And strength. record all hold. in held saying, pricing by will was. as our because remarks these past this as what It fantastic our so hasn't the the of events. XXXX have Swan meaningful we new, again there that

I'll yields. you more Swan no net Black Steve me promise record So and promise events

flow But cash we balance in fact that March. turn did that Steve let's with positive the

to confident profitability. into ultimately are X.X the flow then been and say that, and as second positive in a we cash we've to be that's able over to going are years since company quarter. We It's going been EBITDA translate

looks tide bright. the So is future turning and the

should highlight key pretty today. strongly discount. that I we milestones want not that So those are to

have trends flipped then seems the from your closed booking in point, has commentary. well. like It that as it On

I what and you impact the because by willingness there's in maybe that to on get get cruises, think, ships. of people are get some people's to that's on close just concerned the been

on So there has where that no in looking ships, damage to definitively, the consumers' getting inherent no, that behavior new so has been say flipped the cruise? at you'd to close

I we talked And that we our I have consumers cancellation seen commentary, are the it's think demand the Well, about pandemic. We showing seeing and confidence, period. which that close not within in is are they think, during that good. that's had booking in close I demand, and

voyage term that willing consumers is we've go sign months, that in but confidence seeing going again proper place. and demand So to still good well, few to sail there's is seeing been that's are which longer last sign. that they're over the as and strong a the protocols We're of the for confident a

So exit it's as actually we a the very to where good sign relation pandemic. in --

much. so Thanks Awesome.

of Scholes Our question from Truist comes Securities. the next line Patrick with

week, everyone. wrong, you does still good XXX% lowering question Hi, XX%, your if requirement. morning for you, to A folks at I'm me CDC believe all, requirement vaccination XX% Thank I for And you're about correct the how requirement? you. at vaccination the with that last change and think

Patrick, No. not correct. that's

in when the for least XX% brand, is We -- brand which of just -- Norwegian at XXX% had to allowed summer we're in allowing a way, not. Oceania in season. folks XX% reduced be the the time going family vaccinated, the from That our XX% the now opens we to the up market our have be at CDC company, big are it, least we to for and family

the all you thank for had. I clarification. was That the question you. Okay, Thank

Thanks.

proceed the Farley with question. Our next Please from Robin question comes of your line UBS. with

Great, questions meaningfully second I been you ahead. thanks. one answered. of my have bookings about strength A bunch the guess were the half, already thing, talking in

continued things far includes to would point -- QX more disruptions to make it changes? didn't Just how any sort changes? just your think you still are going on When anything those having advance, now you markets thinking And Asia. that How mentioned the cruising. past in Thanks. how of open the of if wondering make sort those would about of to maybe sort based of you and year? itineraries up when bookings those I going for Asia,

Yeah.

Robin. Asia us is really But very, high is bookings and there it's prices. very that for strong risk.

at flexibility news much can is heard booking ports, likely they expect later open good of risk cruising. it take that pricing know. reward, for opens China Oceania as up in New curve New weeks commentary Asian That us, of some the Zealand, Asian brand, area accelerate because we to Zealand off that up you October not more very and hear than longer in the that from don't Tourism than some coming to good New faster not the Australia, Minister you we balance Australasia big just in countries, Norwegian Zealand bookings, in region which China. And likely coming so The to out whole And of the some has no we're where the Tahiti. we achieve the good chips there. today board can will that And

winter So But no we are has past hopeful but open. will I South going issues it's hopeful which there Argentina like caused know, is question. America, a reopen. to announced, looks are risk has there, be Uruguay some has also announced. this that announced, we Chile it

news good pace. different is it But at perhaps reopening is world the us. again, And So reopening. that's for

that. you just last percent can there's quantify the you. in bookings share can next close kind great. you words weeks And what anything that for with a that's if the to know like just in another Thank follow-up, close like are don't departures in of of the I Okay, anything maybe in, booking question. back six going that or

close summer numbers may not yet, strength there? way head that, year, -- see disruptions of the into a lost peak way what And to have in a lines that's the bit anything sort to the a -- terms all think got earlier with piece that is is with that you ground up quantify recovery. about bookings, of because right of be showing cruise your that's seems Just the obviously there as it like because but in little to this in season, the we

close going I'm next bookings history. not per for to as you Robin, defined days significantly bookings, are I the higher than but in a give XX number will that you se, tell running

the of historically that inventory bookings and green another part strong is anticipated it's shoot take two, quite momentum I'll than get three get start. because and is anyway today. momentum But as to little Now stronger inside and not case ago close necessarily much strong, positive when days that it, back if next that's we XX frankly a are means typically that's in, months Mark mentioned, for is I sell the very it there we

Just Oceania 'XX, the top days brand of of three late introduced booking all XX its history. in had last departures week, one

very, we're very And we're So people very seeing seeing booking way future. close in. now bookings, strong the into

-- time, rolls it's get in going going short. And to around green so And start going continue It's to shoot, gap a top fill cruising prime again if as the it's there and the relatively another summer long start the is to between be to better. in. to season,

So that again to progressively better we've occupancies events, high no going reaching more normal get always the the Black I Swan preface back industry normalcy, it is stronger, enjoyed. going to

much. very Thanks great. that's Okay,

with from proceed of Politzer your Thank you. with comes question Dan Fargo. question. Wells Please next Instructions]. line [Operator The the

morning for good questions. everyone my Hey, and thanks taking

than across You skew of pricing today. in to mean and have now a that database consumer of maybe pricing peers and right guys brands, you your what higher terms higher pricing kind power and of think the I have seen extent is reflection your strength? to have what different the that's certainly and end you do case typically the a booking

nature just that 'XX a the or across we're terrific Certainly of are all strength seeing is just in certainly the history. company's upscale base. further I of one closer think doing playing itineraries always out of the in brands. itineraries, we're day, of the pricing mentioned, strength. record out again had announced know brands seeing Their and pricing three I the near top and Norwegian I for brand upscale 'XX. brands than of one customer 'XX, into the and curve booking the half three days because their is back

strategy have on not because across of board seeing another very in encouraging one that's brands we're terms go-to-market a us Pricing three yields one focus another. all So and why growth strong value year-over-year our industry in brand proposition we strong of does and add brand the any by not and the brand marketing same historical that's It's wide partly where a for pricing. is the yield very in and the we performance it versus does the isolation over one such margin. and pricing. harmonize, one We highest have thing have curate another and of

Europe? And safe stabilization in I it's in that are for terms your power, just any Got seeing markets. really it. driving then mean or assume is to that outbound you markets are it of American North pricing

this well. European talking is, of is No, and a I are full country you operating to bit. shoots. to it's down Europe XX all you very back in us for is one waking believe strength. can't been on very, business a that bear. and just XX strong sourced me come since months to is he get nicely. Presidents still We're again especially as Look, were these That I lagging strong shut March XX. tells been fleet up think brand morning while. Europe. green Australia has we doing closed know our took it has months how It UK But our back at was

starts the when time getting thinking open and some there. it's that with world spikes a and ports in right, so get I COVID. the And take it consumers to seen all to all of And here to the even right there think direction, going moderation are around pieces the get we've

not going novel to to affect live it glad that. But learnings see one COVID No I'm Coronaviruses that to our going all a and It's Society is with every have away. while. learning take of we're with day live the is disappear. do and is many learning that make to to it. lives It now vaccine we

And be, we but need seeing we so generate XXX% not certainly where sail to to that's We're shoots. full, need what to to green the approaching we're seeing. levels we We're are back in company's today's in Company's for With the in the conclude have quarters. we'll The history EBITDA and history. time then we presentation. yields the one question more coming net highest highest that,

the come line James will question with of from That you. Thank Hardiman Citi.

Sean Hi, this Wagner James. for on is

in give and on kind sort basis the any the as sequentially, comparable under ticket ships may of spend getting ships gotten how kind there XXXX, the have Just they've more trended of a NPDs are XX% quarter ship color to and on you just per is that water kind can of diem of onboard be within total versus occupancy? and closer normal growth

Yes, Sean.

revenue. and in So both continue look, see ticket strength to we onboard

our few onboard financials As last percentage inflates and ships. calls, we've talked if somewhat our have artificially the bundling consumer our revenue strategy in we major. on which do resonating look the you of is the couple about our realize point, at it well strength of a sort nothing Obviously by of

But So more importantly, high right even far customers the getting the spend we and onboard advance. get ticket. customer starts that that value, we just turn if they isolate with the significant out We a that revenue It offer on customer is a in that it them you with are -- strong. Those starts quality booking performance out, target. in board.

what's we're what see. that's That's all areas. That's it's That's to what coming see to targeting. our So go-to-market that. glad we across in what we're And behind want strategy.

not other, it's So the combined it's just or one a effort.

kind just levels? the that's maybe Okay, returning Is to any load of there helpful. normalized very mentioned expect quick, you factors historical deck, specific real historical XXXX. in slide And you to to occupancy get time in

the our to and to XX% continue price our you going But build. half going it's maintain fourth build. integrity. expect early said, continue Obviously QX, quarter think to when to in to first pricing third is be I like in at be range. XXXX, going we the -- the look in we of to we're that's going discipline, we

not for the not our long not and are for damage that's load do term, We going to right the chase believe and is that term strategy not short strategy, our we the company. brand

will that we price maintain So discipline.

that to over XXXX, XXX be first at those half of at back high the we're expect used but importantly XXX, load more factors We we're going seeing, to pricing.

much you thank very Perfect, guys.

everyone our of very to Before Meeting important remind June on have year up General This the that we coming is ballot. go a proposals we like on XXth. Annual number we'd

committed during this Cancer of team can vote and continued are that We appreciative charitable donation our for Annual so hospitality Society, proposals, to and Thanks provide the every vacation we and and Please On from extremely mission shareholders General will we account on for to votes our our our make extraordinary a asking $XXX,XXX. time, continue support. Meeting received to to American shareholder $X class up time deliver members shareholder's behalf support experiences our your for support. we delivered of everyone that to passionate are exceptional support world Board's recommendations by innovation. we

available Have be to As always, we answer a will great your questions. day.

conference call. concludes This today's

now disconnect. may You