Royal Caribbean Cruises (RCL) 4 May 232023 Q1 Earnings call transcript

Good morning. My name is Lisa, and I will be your conference operator today. At this time, I would like to welcome everyone to the Royal Caribbean Group First Quarter 2023 Earnings and Business Update Conference Call. [Operator Instructions].

I would now like to turn the conference over to Mr. Investor President, Vice McCarthy, Relations. Michael sir. Please go ahead,

joining Good our for for update morning, and thank everyone, us first call. today conference you quarter business XXXX

Chief our here Officer; CEO Michael of me in International. are and Liberty, Joining Caribbean Miami Bayley, President Naftali Financial Chief our Holtz, Royal Officer; and Jason Executive

from to I'd A to current forward-looking that differ factors. SEC this these our well as are of on statements for this management's current we These we as cause to call. be materially release as making Before any actual of description statements We our uncertainties. circumstances like to change. get will and do expectations. Please risks morning the a are factors earnings could not subject refer expectations our started, number during note undertake with and filings update forward-looking statements results issued to based

measures, and items Also, found earnings non-GAAP be adjusted and in com. at financial certain release non-GAAP all are of our available defined, we www.rcl discussing can our reconciliation website Investor which as on will be a

call on the and the begin of will current first overview environment. recap a an with providing the actions business. will Jason Naftali and update follow and quarter our our a strategic latest update on by booking on

for We questions. will open the your then call

that, With to over I'm pleased to call turn Jason. the

the quarter we turn the and and platform related with year. I'm be of be we this here operating and deployed numerous experience from believe results share trajectory consumers' full a would to business. to incredible to morning, strength thrilled great Thank you, desire XXXX into this travel and the first everyone. the page good Michael, world, morning XXXX to tailwinds of our the our When strong our

in quarter year. of We first expect accelerate to through more rest finally the and the even the yield growth to return it

had than was saw release the you anticipated. Well, this in months better transpired four what as much past we over press the morning,

Our blew and our yield ever QX brands are in records. previous away stronger than

the into results. entire outstanding getting Before allow financial thank XXX,XXX team, Group experiences quarter. to strong strong best us another and to very Caribbean plus Royal generating while dedication responsibly commitment Their want the detail, deliver the vacation I for

into As highlighted first tremendous meaningfully what few We a the well quarter better been to X, set just back. that and was better prices. a for it translated was expected that has record-breaking a Slide strong. that on bookings a extended than knew transpired our business on robust wave that year demand is significantly path we months has us season

a record guest In than the exceptional were and at quarter, first X.X% grew above our earned satisfaction compared to record pricing factor Yields XXX% achieved XXXX we vacations, and levels, delivered scores. XXXX, guidance. significantly X.X memorable higher million load

for higher translated ticket load Caribbean into and for demand had better-than-expected itineraries onboard. Strong both pricing factors

stronger The so are quarter a because always this and consumer the for to the yields strength transition thought already the strong. the the highs, first exceeding demand significant fact we rest to is year that while coming of particularly and of rest the be our continue strength nine the Our of now trend expected than the says the This is would record and beyond. we expectations months much about lot year brands. for we a robust period, be our of expect

margins, on our quarter generated performance. higher our in of better-than-expected both were and Adjusted Strong cash operating than timing contributed guidance, focus billion $X.X favorable increasing considerably adjusted EBITDA operating earnings continued the flow. the first and and expenses EPS revenues, we of to

revenue and for also into our higher incredible team's the full is translating with The acceleration of demand, expectations year. earnings coupled execution

expectations expectations Page see can to ticket for full-year onboard growth doubling and than on yield are increased more on our revenues. X.XX% we X, you X.XX% As to

We are $X.XX expanding share we as continue XX% focus on expectations revenue by to margins earnings increasing $X.XX, also as to accelerates. per to

some provide I'll wide first Pricing insight levels environment our was throughout quarter the and margin also demand XXXX robust the into a Now entire season. and by into very Bookings incredible all years. outpaced significantly April. resulted been higher as an driving strong our our The vacation of in acceleration into commercial relation position our apparatus demand wave channels to across has ecosystem. season quality in book prior wave

in continue window now desire consumers' plan to with to The us back is vacation to normal, demonstrating well booking advance. travel their completely

at all in sailings. strength Day While the continue products demand we for the see to has incredible, combination across North with from and markets, yields consumer. resulted record strength in has been exceptional Caribbean CocoCay American Perfect strong This our

addition, bookings model The weeks. a trending of superior levels as outpacing for see recent particularly well hardware, nicely a peak are XXXX robust enhanced sourcing and in result sailings our with offerings, products In global nimble European we our brands, execution our teams. destination by and demand summer strong

we eager memories and to our financially continue consumers As healthy vacation us. on you calls, earnings and to say see engaged me heard build with prior

Our remains is and strong by savings. high markets, excess labor wages bolstered customer sentiment and strong

was to Further, continue that continue and strong in to plan quarter prioritizing higher shows to first preferences Secular our continued shift benefit on where resulting and other than research leisure consumers as the entertainment travel to and XXXX continue in consumers experiences, the tailwinds goods. goods spend travel double on spend spend. This XX% us spend over from spend. experience trend

it in market plentiful to meaningfully than was and addressable XXXX. is Our continues larger be

from range getaway vacationers to product Perfect appeals world broad to a short a of to Our everything seeking who Day luxury are a a cruise.

Cruise too us value to outperform the we seek would travel Cruising to and to to drive as general of search leisure actually a broader is happy to to XXXX. gap the it's is significantly remains contributing the close vacations land-based of and customers. compared XX% vacation attractive versus revenue website better outpacing allowing doubling in when visitors up our search and XXXX, value growth exceptional proposition, which I an proposition. say

margin. which our ecosystem. quarter, more who are into to a customers improvements guests capture made first have broad wallet. are demand of surpassed the wide percentage more popular of share new guest In our among allows consumers, levels vacations or and to the quality Our to have range new new XXXX our of capabilities attract either The brand a us and commercial allowed us expand to by we cruise, in

In approximately of time the guest in our see so first once used incremental quarter, can figure about X/X onboard systems. of XX%, The cruise. activities guests on advance Every to spend comparable was of our dollar some have you $X.XX translates into spends upgrade their we our well board. of pre-cruise their of in XXXX booked

our a the in capabilities, of early continue and we are and in to commercial we'll our commercial features our made to While app we have engines. still and capabilities innings significant journey, leap add

of across global expect X experiences to rest the best-in-class the million Looking itineraries. record yields a our we deliver vacation to to best deploy amazing guests fleet as XXXX, over we

load return to in and expect continue to strong historical to a We factors spring from benefit environment. late pricing

expect are that higher with generating to XXXX our We to in yields every this brands of X.XX% record deliver positive one than year. profit X.XX% direct

new and pricing for revenue a is Our onboard strong growth driven strong itineraries, continued yield growth by the areas. hardware, from Caribbean environment, especially performance outlook of

and yield XXXX. to a continue new us, will are ships our has differentiator drive will to key wholly this and that and returns. hardware will advantage year, vacation experiences sure These a three for since financial ships they be from second owned each New of year. vessel. ships joined This a welcome are elevating will our for very the we fleet continue Since of great our competitive delivered in attractive guests been further benefiting of year, driver eight the brands the all deliver these be half next

Silver series, the in take and welcome this Celebrity delivery Royal Nova award-winning Edge the icon the the will new first class. of seas. Caribbean Silversea International evolution will cruises of the game-changing summer, welcome of fourth the will

the Let the about me customers. she generating minute of our with and talking Icon is excitement spend a Seas

five for is set previous With with Icon Icon, booked create the getting demand only for everyone months, compromise. more out She ultimate and on enthusiasts surpassing we is the vacation well exceptional thrill bookings sale for significantly seekers, being between Despite without records. chill in to her with Day the Caribbean CocoCay that this itineraries XXXX, new rates will at Hideaway join debut and fleet its other materially launch. year Icon than Caribbean will Perfect higher and inaugural in Beach. January any expansion, in ship season include at the Royal later

Moving to costs.

to team hard years for the Our structure enhancing margins. reshape several cost our of been have goal with working

Our vacation cost outlook the for profitability commitment to enhancing the our year delivering while reflects experiences. on focusing best

and deliver We expect adjusted EBITDA business the continue yield XXXX. in record a to to

will performance. formula for wouldn't define this success yield cost capacity growth Our strong and margins remains profitability Moderate lead proven moderate and growth, growth, to enhanced moderate financial year's I as though controls superior unchanged.

and double strategy by Sustainability We Report, our reducing just report, in-depth the progress In responsibly. an performance vacation delivering outlined update digits versus our Annual experiences best XXth this carbon our providing of published intensity by XXXX. we towards on XXXX our

We deliver on significant first-of-its-kind a expect the this waste-to-energy such advanced decarbonization new on of milestones pathway technologies cells, year our and our of LNG, introduction onboard as including fuel to ships, system.

accelerate, our the continues uniquely XXXX of to are operating and grow grow. we The brands to wrap trifecta way on our up, strength To to goals. business and earnings to cash achieving continues model in positioned our flow and

Group. We I vacation what's responsibly, about are excited Caribbean ahead committed and for Royal the more best be couldn't to delivering experiences the

Naftali. I that, to Naf? With will turn it

morning, good Thank you, everyone. and Jason,

quarter. Let our discussing for first the me begin by results

Slide on approximately we and X, share. guidance adjusted above see were of expectations end of $XX our reported can an our significantly These loss or you million high results As per $X.XX net range. the

was up our again, over quarter the significantly load higher EBITDA was the factor were flow midpoint than expectations. billion. a was at X.X% yields net XXX% operating the Total and Adjusted finished billion, revenue of above $X.X for with or that quarter points $XXX $X.X of cash our million, guidance. XXX-basis first We

load in and drove for sailings exceptional environment these drivers the demand were onboard close-in for pricing improving of continued the results. higher outperformance remainder. revenue pricing yield Higher strength Better-than-anticipated Caribbean X/X factors and the main drove and

currency first structural quarter approximately the or of XXX-basis guidance. costs. increased cruise cruise X.X% XXX-basis APCD costs, points from fuel Operating benefited first costs also quarter $X.XX the included per compared costs Net impact XXXX. Net excluding per favorable to compared to in timing of points constant APCD, of for

best commitment a attractive our teams experiences environment to deliver are proposition continued cruise the First the robust to demand quarter testament vacation strong our value results vacations responsibly. and by of

booking Bookings hardware in CocoCay Turning be to particularly consistently the combination. ever superior winning same higher The year to and into sailings time than our WAVE before. at Day where evident the XXXX, Perfect than extended been been have further Caribbean gap widening with as environment. continue has booking on strength the the

XXXX. of visit This destination in opened of itineraries perfect highest-rated driving Royal International's and at through half than the second Caribbean. Day our quarter Perfect Day sailings the Caribbean a growth. More These Caribbean is pricing which CocoCay, is are yield outsized midway

Caribbean European has of initial our booking expectations. aligned with performance also seen the While strength, our itineraries is

the peaking quality ships, European including itineraries account demand trending Several in for of have the newest sailings for outpacing this of sailing XXXX summer recent capacity Beyond, and of European at XX% summer and levels Bookings Silver in our peak our in Europe Seas third quarter. been Odyssey Dawn, with and well full-year attracting Celebrity weeks. nicely rates. particularly XX% are are

me Now XXXX review let our outlook.

to you If guidance will XXXX. updated the X, year see turn full for you Slide our

remainder QX the We year. This outlook increase point of results prior XXX-basis is our year. strong for midpoint to of to the rest full approximately due X.XX% to from increase expect of the X/X an net the for with the yield better About the business of guidance. growth due X.XX% represents

areas. The continued driven and itineraries hardware, new of is strong core growth for strong underlying performance particularly products, yield from the our revenue by onboard Caribbean improvement demand

up lapped of Yield opening highest mix. is variability and the the ramp where yield Perfect at expected we quarter QX for growth rest year, is to is the in be CocoCay our Day growth While level. benefit there from likely to deployment some of at Caribbean the the

than yields be you from can see full X%. year to by up guidance, As expected more the back the for our are half of

for X.X% From be net expected fuel, compared to excluding cruise costs, as up perspective, full X.X% to year a XXXX. the to cost are

support continuous And innovation. benefiting and Our enhanced we reflects of margins. the all culture are have cost taken to from the improvement actions over last years our outlook we several

example, also include, XXXX. of costs points Day XXX-basis Perfect structural and in the our for at cost operations to CocoCay cruise Galveston we terminal. related did new have of Net include Those full-year not costs that

categories, across human continue and We beverage, to and capital. manage inflation persistent airfare, actively including food shoreside

guest Our teams increasing maintaining ways to through to inflation continue find manage while experience exceptional and profitability.

year. XX% are and is for of be expense $X.X the Fuel the to remaining we expected billion hedged the approximately for year

consumption of outlook, ahead, pricing, Looking adjusted rates, interest adjusted with is current XXXX. X% and business currency exchange share expect per $X.XX. we fuel record to Based hedged the along $X.XX and hedged XX% rates, fuel for on and for XXXX, earnings EBITDA current

I'll quarter. in to Day Net Now capacity be operate XX.X turning yields. Caribbean color XXXX. to private the compared second to the and Slide guidance. We on provide plan about quarter island itineraries during our X. second million amazing yields strength increase driving XX.X% to is up destination some with Exceptional Perfect are XX.X% expected CocoCay combined in APCDs at to

Net cruise we to continue accelerates. on costs, expansion be focus excluding expected as revenue margin fuel, X.X% up to are while approximately

quarter. which weigh are when XXX-basis incremental structural expenses quarter approximately half timing to the on are first of Second operating to costs half points XXXX, carry and NCCx of compared from

rates, exchange share second adjusted on in current $X.XX we interest $X.XX So, based of expect for to and rates, the fuel per rates earnings quarter. summary, currency

the sheet. ended billion liquidity. to balance quarter Turning in with $X.X our We

Our liquidity EBITDA our we flow. focused remains to are further strong, margins free and very and cash expanding on enhance

quarter, During refinance of repaid senior at first as to XXXX guaranteed coupon maturities. as and well February, million XXXX the of debt we revolver In $XXX $X.X notes advances. $XXX issued of debt we billion maturities X.XX% million

resonate Our and with partners. capital access our investors financial performance and remains to strong, and execution our

and improve pay and proactively balance through downs will continue opportunistic the debt We to methodically refinancings. sheet

flow. are remaining ECA operating with up billion, XXXX maturities debt pay on expect cash which amortization, we Our to scheduled predominantly for of hand cash down and $X.X made

are we a capital to disciplined and As to Trifecta generate our to in the an profile strong flows, sheet accelerate and cash balance allocation investment-grade and line committed business return with growing continues to goals.

In on achieving on we while our we delivering business and in to margin accelerate, Trifecta expect mission yields on can record so adjusted focused closing, executing We and continues our and to EBITDA grow remain achieve XXXX. and our strategy goals. committed

will operator to ask I for session. question-and-answer open call our that, With a the

[Operator Instructions] We'll go first to Stephen Wieczynski, Stifel.

morning. Good guys. Hi,

a in wording congratulations north about to mentioned XXXX the expecting I want I you understand little a strong guys a EBITDA February. we is quarter. were back trajectory knit where EBITDA exceed XXXX $X of for the XXXX, but on EBITDA here levels in in Jason, your And change that get understand off, Trifecta by on XXXX the first look, taking you're now I'm to So probably for to in how to bit, significantly release, which just billion according you and progression think you maybe year are should now to program? relative

Steve, good morning, it's Naftali.

with So, to and And as think EBITDA you can see, we are results. very the the this translates the throughout pleased as how about progression we year.

You yields, very revenue the growth a we our because on higher line EBITDA expect are than And is because we that we enhancing that's are the the growth. yield be can costs bottom and see dropping much of increasing focused lot to and to margins.

and eyelash at from So, EBITDA away an be we look -- guidance per to we going of what look Trifecta APCD we're lot that to kind things we of if we strategies record we at And to to XXXX. lot provided, we're that continue the a expect as that a benefit goal. previous should doing the we're our of the employing towards execute us our in

it's performance we much think the had mean, just Trifecta on talked the about side. to about it, as we Obviously, Obviously, ship. I which have expected. than better -- to high-yielding coming a is year -- we Nova And And online, year this better is it this we Icon. the on of I we than Steve, add commentary think

coming online, Ascent is high-yielding. We which have

seen seeing that like-for-like that for Hideaway coming also talking commentary it's of for though we've volumes been we've price early. we're is course, in acceleration And what XXXX, in about online. You have the

us And Trifecta, yield in just to the continue need which really to for control, to you cost marks for moderate we get growth good show.

right revenue very EBITDA. be much And And that really our outperformance every it's so bottom to the penny kind is as of great would on see dropping Naf down of dropping that's the line, on right that which path. to almost to down mentioned,

from that the customer obviously we customer healthy? second ballpark extremely, board that That's they And you kind year, stays kind on a an has great back same you your those you a are extremely yields yield think question, the if down assuming of And color. guidance. been But in half are into assuming of of the obviously, now? guys. Do slowing in your them Thanks back little are then break about can of we levels? little we bit have bit, as spend terms your

get And we demand And levels then about can question, a are and demand investors into from second bit which little that part of but demand the different, lot of a questions this right that? 'XX bookings XXXX. just benefiting is year? 'XX like now from kind and Or still all of persist sense. there stuff that being into hopefully, COVID So makes next -- and reopening is is

sure. a have day. tens is of our of happening people a see tens on day. what we don't thousands basically ships. taking we minute We've we Yes, and of every XXX,XXX Well, I think, We're What crystal know XXX,XXX, every obviously, ball. spending got bookings

we And have a good idea, happening today. very in of the so, customer what's terms

to of surveying customers lot obviously they're do in do a looking also our future. We the in of terms of what

they memories gathering friends And on experiences creating us very are it's with clear obviously and to focused and their that family.

rise, add non-ticket-related appetite just future. the the So, and more for which to number what just more and their spend also they're booking the on ship the other to and on pre-cruise this spend. is, I'll point shows That is on side continues more

seeing. we're the for half think this is see continue our going we're expectation we about when So, that us, of what I year, think to back to

a more changes we little mix bit little Europe. have bit. a the However, QX,

strong, outperformance. overall the on course, our little less driving is really bit what's of commentary Caribbean is And you've heard the We exceptionally have which a Caribbean.

now While much year. the Europe as for in we is very expected coming

of I year. talks So, about that about how the think we think probably half bit back little a next

XXXX, XXXX. what bookings the we in course, ourselves XXXX as going for at seeing for have, more we and this very to focused been point are position level the we're we're now majority and again, in and now, Now we've XXXX. close acceleration what And in demand taking more. what the to of and see began again, seeing the from of as day on we similar year, Certainly, we've customer well for the day ourselves been orient strength out. and is seeing bookings what And to

That's great color. Thanks, guys, appreciated. Congratulations.

have have just I one I comment Icon Steve, it's to of Seas. -- add because talk to about

think product if new Icon 'XX business, and and with I think literally and full about you made Icon. of launch had delighted comments in is is the earlier and rate, we've ever we product. we're that really 'XX a history best-performing the volume the our about

brand-new So, you a it's proxy, stunning, wanted can and Icon product, and see if use as I it's a know a huge amount of you rate. it's but really driving demand to great

probably time be ... about -- the Michael That from you to just won't first Icon hear

guys. Thanks,

next comes from Your Barclays. Montour, question Brandt

and affect so, and have some like obviously maybe good Obviously, an you different regional could curious, capacity about for hit a normal you past know load more lot has more question which factors. load new you the looks given here spring. load But more in A looking what shift, congratulations. onboard space. of quarter, guys have Hi, are everybody. the that, it, I but morning, exceptional new historical going mix to that's

normal like the looks for guys lows? for what about you new comments any So,

to factor So, have load Icon with on, will mean, begin profile. normalized will our load And factor coming a on which that's leading load our just I an expectation mathematically, really factor standpoint, higher rise. --

But year, and the expect XXXX load we the Royal. Nova, next two Royal would Icon to next on with one into than Ascent, taking and taking load brand, Utopia on also or brand on factors which also load which point on a look we're coming has be we're than Celebrity factors lower you lower Caribbean has and Now factor coming year, beyond. our up when

And like from second China. then outbound And guys China you question Back just of limiting curious this seeing sort my if later And there's they're recall, there. super probably I you're with what's database is from China. had XXXX, of know your travel, in booked helpful. if this to over showing of engaged you're global up traveling mid-single something radar your terms international of for coming just them I starting again? constraints travel digits I'm outside for what now it's year? demand on -- that in flight but even on the China That's outbound

has of Yes, Michael. It's relatively business. percentage outbound been small our a Yes. China always

we've sales now do, now for in all early 'XX. some signals spring, our operating we reopening And late China. our of we're started but be of back encouraged hopefully, by by to in think the more still China, rebuild had in got that to we've China summer I to work we out and expect, organization

'XX.

'XX.

actual more then in that's was And sorry, of China about outbound to capacity in China. terms The question other areas.

Yes, in in Right. 'XX. That's operating of actual out China correct. that's capacity

As to outbound to started obviously it return, smaller relates from coming base. now it's but a

much. so Thanks, Great.

Robin Farley, from Next, we'll hear UBS.

ECA Thanks. to question of guidance -- money that's a talked demand to for that that, even cruise drop increases. a related directly amount have of has kind owners at looking not a Great. funding question issues, for sheet don't -- a increase. significant another a of that's related mic was order, With because actually that about but balance line if have I just I getting extras. kind ship on yield

delivery? big an to related of doing know but change not for And opportunity rate. I'm X% is we that sort of X% the opportunity ship get you for orders at and would to you I funding directly just there any wondering, a some for things ECA moment, be know is those obviously, opportunity at there there Royal? aren't because Is potentially interest guys

any puts at our they our Naftali. build financing. have partners to committed provide always been and new arrangements us. very program, Yes. to don't changes us obviously very financing expect fantastic material this we Robin, point. These There's sales it's We're takes, and from attractive but

describing new would I Robin, only decade. actually for not doing about been a a The We've just probably add, concept. you're point that is what Yes.

same we ships extras XX% adding we're the So, if to XX%-XX%, we is on the or those down, been other is it of or financed that financed, ship. the change for have have contract the orders that price have how owners’ elements concept whether XX%

the guess time like sort which I ships and ECA it's I tied seen know tied really that again, we've was of incremental that change ordered first it big more, a I order. pandemic, funding was -- the thinking wasn't it's to to very before

And So When quick not your on look full then one you the clarification just other year. situation. the at expense things. side of for expenses your

have Obviously, say, of you CocoCay I don't some some you full Galveston. I mentioned transitional. know it of you because And you and if structural a But it's year I'm of heard said wondering just some But transition costs year. fall away, create some year. be obviously, next recurring that of will as structural would, an the the amount expense of decline what because, next they

one-time? of just, So, increase full-year is many don't I points you I quantify how basis know your can if

Yes.

So, it's structural. predominantly

in base mentioned that obviously, the there. Some we And go our two you now will of examples as are there be forward.

we -- to load expecting to and full are As costs transitional minimal, we are them very our historical factors, go our away. those get

predominantly it's costs. structural So, the

mean, it of the points XXX-basis is points transition expense I this -- that will year gearing in is the ... And year or XXX-basis there costs, full for the

the QX some that's finish and movements less -- with but we protocols our it's COVID had crew than of to bit even it's less generally in up, yes, even ballpark. XXX-basis the some a -- And of need than roughly that little points. that It's we

take Yes. X%. reality, that the And basically up our talked around out the if you for and year about in of on side, were the structural, just out you costs take transition cost the

actions of through the get the model we of align So operating just inflation. you of of and cost COVID to level give our over structure kind amount a all tremendous to absorbed took effectively the sense has

So, our up assets are really to just X% in the costs X%.

say think to you of increase rate is would recur? about that would sort that expect in Or is if you X% something that now XXXX, that And of we inflation like XXXX? the moderating

it in it's very our I really I a goods we to -- -- in -- and but get do buy come best No. up mean more teams But all painful. are A it's point it's at cases, point B. around mean have coming but just is combat sometimes it moderating. of different And their it's from leverage I across definitely to trying mean, with how we pain we -- some still how our you and great it's ways. brands, solutions exceptional our still do

And the would is word right, persistent I not Yes. way it's -- the which to just us. unique say

everywhere. You It's moderating. see it definitely

way think to to focus in saw quarter, that the our line. point you that also revenue costs just down is keep is our what other accelerates, and I first we which the thing the do out as try all the the revenue to how get bottom really

Great. Thank you, very much.

We'll Vince go next to Ciepiel, Cleveland Research Company.

guidance, in little Obviously, for XX%? that up the with might XX% net consider like you how to pricing. of bit you high versus maybe maybe in singles, I'm new on the the it break looks Great. wanted that when kind And the this end continue your of hardware out more to yield net approaching a or gap versus year, is land? dig talk to Thanks. directionally of into be about to move I curious ahead up ability much zeroing just versus then CocoCay lift? like-for-like, like-for-like how value years versus even

Yes.

right. you're first, So

pricing. at lag some It have end the some on eliminated We the an digits. the If of structural lag eyelash of Silversea. you the away reporting back We year. is for of look do double kind costs, especially from

we If that take out, double you digits. are

very with So, we're pleased that.

not from in That's driver. have driver it a different comes we new yield things. XXXX. And that Yes, we have ships great and price eight did

going track the onboard on. ships to lot strength we -- we a that these continue have of yield We premiums, have that to to execute we that are CocoCay continues

pricing the strength. are all like-for-like see pricing we So, increase of And well. as pricing driving these increase and the also

So, it's all that that XXXX. environment. to to benefit going a actions these taken beyond It's demand we have us think continue are we

increase I price is see what's us. Yes. negative substantial to does China, don't encouraging not to have APCD differential add, -- for when is include which just which of very the the XXXX, also you in want -- or double-digit we average. I a side a here mean this had -- also just That obviously, effectively

We also sold Azamara, versus which was the higher-yielding a average.

brands. I of be been the so, really leisure, and a shows for strength to price increase which double-digit the has crews And strength just the strength at our of think, accelerating, and

Great. And longer-term then a little question. bit

further Your like line in as XQ back guide you suggest it builds move 'XX. fuel levels margin if basically with ex. that, the and looks was pre-COVID you through

of core that's of think the the feels about in you're long just pretty of in ROIC light how making about a the business. I how I range. longer-term operations you're ROIC? feeling that, progress reflective in which in of think the broad 'XX said margin front, you But And gains on you're target the like light really teens, So, term? feeling curious

Well, Yes. off I ROIC based latest we basis. are now an guide, off, on of in are, we think this digits double first

The with think capital and growth And so, margin on cost within you're and and have our employ basis. an discipline times a and that on much teens stays focus here ROIC good each very that is also focus bad us gets moderate we during yield us every there day, good to the control. times model the business seeing

and We in we getting of talked capacity just itself, XXXX we well scaled for feel your wasn't take, up north well which our about the Trifecta kind we business. 'XX if of our that's us pre-COVID base ROIC. levels earnings additional it crisis had north of as our goals. good is very about on think that to just you if our be will the for really, So, about actions And camp, XXXX really to

and about we the side destination coming well how have have business on the react is with online that's and the we I ships us. organic think positioning the growth So really think we

we'll Next, Benjamin to Credit go Suisse. Chaiken,

there? for of are the one pricing you Any did more two, at you demand still on the a that part same the as in then Just much context me. And On of CocoCay, itineraries the XQ a I there premiums in 'XX? just is today Thanks. to years think than being did to And I the opening. few asked those as capacity Hideaway or you portfolio Beach pricing seeing color ago. rest island

Day, to we're we about think volume Perfect with to that I attracting mean the to think Perfect pricing and guests we're the and I as the Day. take truly year, premiums earlier, comments delighted This spend I yes, on Day Benjamin, robust, Perfect X.X million of we'll continue spoke the island really robust continues be our and around well. the really to be

will accommodate So, the the X,XXX we've power gas. as to in seen volume, And decline more the Hideaway in continues increased Beach, of seen it approximately we've fact, With accelerate. we've that pricing. no --

in today, think March, And had guests Perfect I XX,XXX we're in day XXX,XXX a around now, So we we're Day. to close CocoCay. average guests in on having

in X,XXX, can Utopia Icon add June. coming time We've And Seas. for Perfect we end will another Icon open also really online at guests. of that's design week. X,XXX And of in and Icon course, to be going Hideaway, every got visit With the for single to be of will Day January,

lot demanded, And be haven't We ships their Day. a see going for our and demand very Perfect there. but the seen that demand product there's Day we of have there's will that announced also we've on deployment, of premium pricing I to itinerary strong. just particular is Perfect in mean -- any strong the Utopia that

modeling on just But purposes. one point Hideaway for

mind end so of ramp-up January. when end its online, kind at the very But as of forth, comes Just of this keep the which will is that in operations of in said, line towards Icon it's year. Michael online and be coming

you're thinking about in keep yielding that just as just mind. So costs,

That’s Thank helpful. you.

Also, did of receive and proceed through to the permitting planning the and in not add the process we government greenlight the now Bahamas. the a Benjamin, Perfect comment, from kind approval Day, but environmental quick on to Bahamian just

product have is So, in that short -- product our of at the short really Beach intention end exceptionally also is doing And Royal 'XX. new for -- the to is portfolio the of produce certainly well an spring-summer going incredible to to Club open the moment. addition the and towards the experience the for

market. continue into We short our ships product increase really and to that great put

the Club the on combination. day of on one is combination day and a Day So, really the Perfect winning Beach second

size just around -- large Club, me, more highway that forgive is or smaller, similar is a Royal to expectations standpoint? the the Beach larger, capacity And

Hideaway Hideaway. Remember, part the is from Actually, Day similar it's to very perspective, Perfect a capacity of experience.

be X,XXX But the day. a Club's So, a Perfect capacity Day be experience Beach day. will around around will to XX,XXX the capacity X,XXX

Research. question comes Your next from from Melius Cunningham Conor

that, versus deposits Just seems people billion are lot customer are new in levels. on of $X.X the you're I out curious if that of gaining just It the you to percentage a like that you historical there. momentum was have. cruise could what bookings parse

that Just Thanks. where curious sits. on

Yes.

crews of and Jason brands this the -- to The we XXXX said his levels. and quarter, this been as new prepared So, last to our combination in it's quarters. several think significantly exceeded I consistent in remarks, new our

and seeing repeat So, demands same they in that our rates. to This there, we're then people the is attracting quality sure our our also new And at making brands all we ecosystem. pleased strategies. focused with very stay time, increase right, line this with on

the just see of these with looking customer new more and you us, cruise. brands, benefit deposits new some is quarter people So, first to in to in the our

And And year? That's up. about you are first, saw you realize momentum it a you load little the if assume through just was you're the could originally? What that then just I helpful. quarter. did hoping that out? factors how close-in then trend stepping this of the on Okay. unpack played thinking in pricing how And I just bit remainder

But Thank how that just less forward? to about on fill. probably So, you're you. there's thinking going curious

which between at occurred. levels, say close substantial I what Well, realities it was is a was incredible in were the versus would think I of difference expectations our surprise There WAVE the at already Yes. high. record it first, a versus an was differential a 'XX what --

points. built or we three so, load And four another factor

our As load are -- at you factors. out, of expectations Conor, pointed we normal to for year was balance the the be

book positions so those higher, is less were inventory. there So,

we've at the those certainly, expectation that terms will continue volumes opportunity And course, of is and that lot of But a there we in the recognize opportunity. of higher rates.

during I you see the in building continue wouldn't certain always a say which you're of time, those while think us were large also not the delight We is volumes gaps. fill to which as thing pricing that that was what was volume you were looking raise at able but a period -- to volumes. I surprise, times to to great

of and onboard I as ticket revenue. it just yield prepared on I exceptional were remarks, factors. think just remaining pricing, We points said in our just and the more, load X/X both And higher was outperformance Yes. strength my XXX-basis built on in the quarter

up from Matthew is Boss JPMorgan next.

on Maybe nice demand. on follow congrats print. to a Great. Thanks, and, really up

in seen? And finally, relative just laid plan What's to to on recent think to to you've Trifecta we this where about magnitude laid that confidence just to if out upside maybe could most line As we months three you the about could that us Or help help you stood the you you cited and takes the top that rank bookings order then out? today? elaborate the And upside? drivers maybe your initially to guess your you of in November relative and think relative when the puts maybe consider I momentum 'XX. back,

my I'll a take to teammates Well, for it in. add Okay. at here stab and

There's dealing of moderately our kind Obviously, today grow we're look at see costs is goals. biosis manage feel continuing of those of Trifecta. But encouraging ability and very headwinds about our pricing, Trifecta I to think, program. managing kind do our our talking costs as good we allocation, capital what think or like. is the going off and XXXX what the always with. managing believe to continued yields towards very first, our of all acceleration, our about terms We results to through really that you're that look skies clear we on in the starting just higher we

think about, down to and get which That's that there. earnings how for manage to get of negative us. to and carry, we There's we from power back about that levels obviously top in mind when kind also things the think our of

laid relates our remarks, it kind on to think which there just things. -- I As to side, of the we be are in several demand out

area the strong, It's a not one of We It's has touching onboard, spend ships exceptionally strength huge First board. is Day. especially saw strong. been been across that really Perfect a Caribbean has onboard. the very are very, from

encouraging. So -- that's that's really been very

we products booking of global Northeast American play all into European But Europe little the on that year, Alaska, so bit nimble this but and bookings, we a surge model, we a out very Caribbean. because sourcing Europe, have and I concerned saw North been not the in Our we really year. the were feel and have good think in to And seen going forth. our how is level going for to well,

is what's and doubled and we we -- in combination increased broader acceleration our XX%. demand just that while acceleration and so earnings And yield our -- by driving pricing

Yes.

a talk demand, Naftali, Just you think that I around cruise to and think add, out. first about about the little see did if kind it's attractive, being bit, you talking very on and of the we proposition points latest played the been valve of out I zoom we've

that ships itineraries So, designed. with Day goal we do close and the the deliver the we CocoCay, some at we the that our of gap Perfect to is have, we experiences

attractive. the that things are, obviously, you consumer But are very if those it's

Jason comment, headwinds, as want there's and I On make environment, So we it, perfect as takes, is, designing to can it said, just we're for we tailwinds. were we one get which weren't puts designing those designing a the confident we Trifecta, right? as were there. And coordinates, there's

'XX, And When the you just Royal we've coming a to for Utopia online Caribbean the using we've of Beach about We've coming in year. Icon Seas. Matthew, late that Perfect be got this add, China operating International the expectations as will of Club just got got XXXX, when proxy Day online. in in coming 'XX. XXXX think the online and We've got We've got and I Seas and company. Hideaway and up Beach

we've an these of And perspective, lineup just and really the that got exciting do products significant the demand. and generate products. we've incredible Royal seen Brands market new from So, really ignite

So, pretty we optimistic future. the about feel

color. great best luck. of Congrats It's again and

Next up, Politzer, we'll Daniel Wells from hear Fargo.

quarter. the on Congrats everyone. morning, good Hi,

Could you your tracking do product. there? you're this about Just The a prolonged now it talked short-term getting to shift of a me. -- see is itineraries you itineraries, for the shift think the And and as quick more your the one two kind next like and capacity pricing above relates Europe kind some I allocation Caribbean well year of premium lift CocoCay? sounds tracking to to demand from mean expectations. you've pricing probably And about of how or relative it is over

deployment. feel we balance think our I good the of about pretty

so of short experiences We been Perfect having X do and that over millennials and well have product, which are we that and more that like -- the Day, putting have periods assets they shown shorter in time. I for connects forth great very vacation assets Gen great think to volume looking

into like more like I that think a China. look as or 'XX this when clientele. short does our XXXX. kind little majority expect play to more the where I look zones a come course, shift Caribbean bit our a and capacity and here indexing But portfolio light into expectations But up we to kind of bit broader that and China of is to bit we is. And little more of -- into deployment of going and will year in look be our online deployment it little of think continue really to less so we indexing forward as our back Asia/Pac And with in

per versus think given robust the the yields, your to travel any of China a EBITDA little demand on as it. portfolio into customer, we relative account additional like in about onboard, looked from color pre-board of more mix just strong I terms what that the color customer can historically reopening wanted leisure Got there? maybe that and Thanks. bit kind and put cruise take And you bit and the the if more for of follow-up, my rest around maybe of a spend little APCD and color

China a built we cruise business the market. for pre-pandemic, then, So significant in

few subsequently changed. was I China And were Wonder think into in of operating which, the that the had Royal ships planned fact, pandemic, Seas deploy our before of volume, to there. we had by market, the of cruise number in brand and course, a originally one China we the

the very and When net higher. expectation return market an value same was level is how from to revenue customer of it slightly a around The Our will Chinese you typically this consumer. the a is high. Chinese American pre-pandemic. that as at It's look

their So, in of that of The we high. is in differently returning. different spending. spend the somewhat very But skew onboard spend aggregate terms They overall, areas. changes see

we that, that So, 'XX, will see we'll that. believe return, and market hoping in we're

Got Thanks, much. it. so

Your next comes from question Wightman, Fred Wolfe Research.

of European that just on I about Hi, the Is you CocoCay demand talk airfare? seeing -- about the driving that hoping more pushback it if Like morning. guys. a for in-line you're strong Good sort divergence? bit really you could demand, sort was you think and Caribbean just what is hearing the that of is where European difference? Are is biggest attractive?

the European in guests. for of of for And airlift nimble least think part kind global, has year, Europe And but goes I we Europe model. bit that having the Well, earlier in the of for model source sourcing kind that our at forget, concerned of as were our we normalized about to a also, well this don't back business our product. little just

that. think kind think So, I we how of that's about

still there As is a it and land-based between cruise. out, a of Caribbean, as think it's value relates gap to and things the vacation significant Naf pointed combination I

especially gap closed that really to of saw is Perfect kind have the we Orlando gap encouraging. which think Vegas. that I touched and had some we ships Day And of as that a this pre-pandemic year, closed an example land-based,

during back And as stronger starting get is, gap what the are -- got those so that levels the we kind seeing period. doing to 'XX of businesses to is still we what are exists

environment. one the people's for value But that I trends gap, all the with spend and huge buy demand secular less I stuff, gather it's family think demographic the experiences just friends time these and and think to tailwinds don't are think thing. so, I And demand and

And the then called out side, sense. some expense Makes in benefit on you from timing quarter. guys the expense

How get was that some XQ punted think that in all points. and that showing up about at Is think sized XQ the should XQ? we XXX-basis that? of guide to I

it it, I should QX. -- all majority of isn’t It's Yes. almost of in mean, be expected

you. Thank Perfect.

Paul go we'll to Macquarie Capital. And Golding,

and much quarter. so congrats on Thanks the

as here. question context about next know and I a you you protracted And booking load through Just the into manage WAVE so me, the booking change one building the as pandemic, cycle? the in had and in booking just about much. curve. the inventory we go think this what bookings, you and still you curve of was and way longer-term the cycle, next are bit does which QX But Thanks think strength the factor. how close WAVE for you

it, go suites kind the Yes. to be COVID we period Well, our with we there sold actually put of more cabins. then now down the everything of and used how basically revenue of models today. the inventory market and based your all -- shifted to had management inventory. out Well, we we would inside bat, the kind would to much kind have way that hold right release off, back We and the you through we off of sophisticated work

this focused we what the And around percent booked and seeing get sometimes relate period? yield. so, we think optimizing takes why are all of are conversations are that is period that on really into I account you? What it versus that's demand to when we How into environment does

us a yield, in booked previous sell. might with what we're maximizing more And stronger or or on a focused there or be book is less position sometimes we period to what to comes periods want than so in quarter-over-quarter having be inventory were lesser because year-over-year, which where we

Thanks. Appreciate context. the

Okay. thank we Well, everyone.

Go ahead.

company. Michael their Thank McCarthy be interest available will participation thank We for you. in follow-up. everyone and any for the

you So, we day. all you. Thank great a wish

to all Once like We does today's you would participation. thank conference. for conclude again, everyone, that your

may now disconnect. You