Royal Caribbean Cruises (RCL) 25 Apr 242024 Q1 Earnings call transcript

Good morning. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Royal Caribbean Group First Quarter 2024 Earnings Call. [Operator Instructions] I would now like to introduce Michael McCarthy, Vice President of Investor Relations. Mr. yours. is floor the McCarthy,

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

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

number statements issued discussing Before started, constant circumstances results Relations are release. as and a reconciliation and a state business. metrics outlook expectations. on adjusted on quarter, first to and based filings and differ will are Please factors. update a adjusted on like refer materially call as change. Also, current expectations for I factors financial begin found otherwise, morning Unless forward-looking booking we'll our not are from to of of will description non-GAAP risks be our be that measures, our which all XXXX. to earnings defined, current and can and we in of the for on statements our we making Naftali all call. recap with our certain of as update do we earnings non-GAAP follow a forward-looking actual this A the SEC strategic a current These subject basis. Jason by providing updated the environment currency overview items to cause get We will are website our Investor our as uncertainties. to be well these with the statements undertake release any would note during could this management's

pleased call to call the Jason. then I'm will open your the for over questions. With turn We to that,

we to with share first numerous position good a that the consumers' XXXX the desire I'm another turn to record with tailwinds proud results us, our When would booked page vacation of trajectory you, Michael, expect and morning, our an from this related XXXX, year. be everyone. business. the Thank incredible robust and continued upward for quarter we to and great

in the this the expectations. saw our months Well, over already press as was what transpired morning, X release you even better elevated than past

Our demand for continues and accelerate. experiences to than brands are our stronger ever vacation

way our with growing of take a leading our very portfolio lifetime commercial exceptional leading in guests $X.X ships, exclusive and from delivering exciting innovative of seek and vacations capabilities. trillion to for destination is the leading and incredible we as the are Opportunity We exciting and market. rapidly large and experiences differentiated share vacation brands,

remains robust growth success controls growth, and and lead yield value. long-term cost unchanged. capacity Our Moderate moderate formula strong to for financial performance shareholder

exceptional getting are driving Before working to want the while in best guests I and vacation and details, our out doing that teams so our recognize day incredible delivering day to together into experiences the results.

they people, is grateful business and and so propelled I'm Our strategic success. our force passion. driving are for commitment the behind for our by vision their

Now to moving our results. on

back. points yield contributed first to months earnings continued balance initial the As the onboard Seas share almost further million XXXX. This significantly pricing few and of and to grew X memorable key above delivered the XXX% than year highlighted in improvement onboard prices led was and XXX per XXXX, first season, of demand well we that quarter compared at the environment first first record-breaking higher resulted guidance. Adjusted robust factor exceptional tremendous, is strength booking our and in guidance. coupled path we the us with vacations of across performance. revolutionary expenses the quarter, achieved much quarter first revenue introduction on consistently in for at basis a our in combined a strong acceleration our than itineraries, is expected WAVE just expectations quarter a XX.X% full load bookings also all Slide spend with a higher Icon the than to The revenue setting of in Yields and into revenue better favorable on X, guest higher the year the satisfaction earnings translating the quarter expectations. In ticket scores. to higher better-than-expected earnings Strong year. considerably timing was of and of a

now increased X Page our expect yield is year increasing As XX% initial you the to February, goals to to year in guidance for and as X, full expected. earnings achieve can towards trajectory see X year-over-year. earlier Trifecta than share we The XXXX, in per outlook to initially compared expectations grow all by we goals on to are our continue expect our growth expected further year adjusted early XX% we accelerate

Now April, America see Day I'll year-over-year the robust strength approximately into and insight extremely the provide combination consistently incredible robust have been are our at our the sourced. with first key our resulted throughout though been performing across bookings fewer and of where strength to industry-leading incredible at products through higher strong even existing as with to all for environment has has season. Bookings XX% as pricing for leading demand our this in higher year both quarter outpaced significantly on well ships. We in growth. WAVE products. some staterooms year's strong prices, CocoCay, has and are well on demand left Perfect entire last Alaska Caribbean This and sailings. European continues our sell, outpacing last prevalent yield new markets. the North particularly levels all hardware guests we Booking of yield year's be growth to

to of our demand the to XXXX are of with to are from return our global Seas enables key With quality, now to in consumer of remains high labor finally source markets, business. on resilient sentiment month to which Seas bolstered spend land-based positive very all us XX spend the that bases. Customer continue vacations market this value cruising China stabilizing goods. Despite as to China, and record on exceptional narrow capture and the as worth. Consumer we proposition. and preferences evident Tianjin net of towards new to spend travel. This shift months, for to last pleased Spectrum ability our particularly rebuild in inflation priority to return an by Ovation China add our the markets, high-yielding and experience We experiences, on still the in growth, we remains also household gap double is wage the year-over-year growth back is

than We book meaningfully onboard us these booking and into continue APDs, of our see buying continue spend. products. Guests dream excellent vacations more last booking with year, higher from the first earlier are to XX% across customers at to quarter who activities per onboard they their onboard in and experiences translating all are engagement higher

strong with and Looking earnings XXXX, the rest up growth. of to year to be is shaping the yield exceptional,

achieve long-term targets expect XXXX, to allowing shareholder us of to all We to in drive new returns. focus on Trifecta a growth era

what Trifecta pathway back to base internally but it. creates previously, go mentioned as I the camp, As ambitions we our beyond describe well

we As deliver highlighted to on X% XXXX. now X, are yields XX% than expect that to higher net Slide

yield an mid-single-digit of growth on half to the expectations second revenue XX% deliver with of typical back is yield expect and and a the environment, approximately Our pricing outlook apparatus. In the yield leading we XXXX. from above combined driven in growth commercial new moderate continued strong growth top of by XXXX, our our our accelerating and increase onboard yield performance existing destinations, half private of ships

higher to expect in per earnings the to earnings year-over-year. grow continue also with business share We and adjusted to deliver margins expected XXXX, XX%

that we controls yield ahead, formula to lead look growth cost profitability superior our for we margins, executing capacity growth, As on and remain financial and strong moderate focused proven success, performance. moderate enhanced

and experiences and for life's differentiator ever. is unique while than remains brands moments all We of on Our shareholders. keeping attracting bigger of key delivering within operating our and and long-term intensely platform for value focused remain a stronger our guests portfolio providing

vacation guests Our addressable increasing repeat our expanding higher us, is increasingly XXXX. experiences compared XX% over discovering to see These returning year-over-year. to as continues and to we and are grow, rates XX% are market differentiated new-to-cruise

Our guests gained compared or are points Millennials and today, have younger XX millennials And almost generations XXXX. new younger. X and younger customers. to brands also X in percentage continue share to attract

few hardware financial in both has performance. great and our us, lofty the exceeding a the been already joining New Icon ago. is fleet for satisfaction guest expectations months with of a differentiator Seas It

ship excited later ship positioned ultra-luxury in XXXX. also our quarter, of to for short product, those join Caribbean strong. Also of Silver and the for is Seas, new continues hugely be that an a reimagine year the expedition are our Demand successful order in that pricing ships a segments. Utopia Oasis this and changer incredibly which for We and Ray, for game fleet arrival seventh we the been to will the has announced this class another

take we trillion as of greater to fleet and segments growing generate continue grow very brands Our rapidly lead vacation large continue to quality see vacation and a to experiences. opportunity the and $X.X demand we market, our their share

vacation exciting private is welcome creating is We new portfolio industry which and in set to are the in of the product newest private Beach Mexico, The that to growing Royal include in destinations. destinations our addition Cozumel, Club guests leading XXXX. experiences,

we activities of we beach to next Royal guests this in Nassau, officially type open milestone our is the broke guest Island another also Club giving every of combination Cozumel ultimate experience, on which Royal week, Club Beach for the With day. Earlier will Beach when enhance Paradise vacationer, further celebrated ground important scheduled year.

customer the year. deepen to the journey continues Our with this relationship

new technology our to cost further customer and and are for our experience our distribution lowering We acquire through continue loyalty AI build different commerce platform the channels, the even guests. more enhancing improving to

friction easier a for wallet book ever by while allowing it removing and platform, guests their are than digital unlocking expand in to investing us planning vacations travel dream share. We making travel modern to

experiences delight guests. Our digital

Our to book introduced board adopted the we ability of and is app booking features, we XX% capabilities cruise recently and in continue our capabilities. added mobile to its guests the consistently on by enhance last Among other year flights. app

created track loyalty customers can and quickly also a hub, We their benefits. so and tiers enroll loyalty

in will XXXX We capabilities those and to continue beyond. enhance

released Our report to which outlines annual the deliver vision We sustainability energize our best and we planet, XXth the making Future, SEA ambitions our sustain communities accelerate the responsibly. help experiences recently our on vacation the support innovation. to are progress Seastainability mission

visit. actively making halfway net into like report, generations the our reductions sustainability to entrepreneurs we we we in our zero future communities Impact beyond Kickstarter local the first energize development are and the long-term progress our projects intensity mark. Alongside delves micro grant inspire Royal the that through now double-digit which and towards journey empowering business including are highlights It the and dedication Bahamas. we We to Caribbean how emissions, published Community report, carbon programs

make We'll providers. technology and across we also alone. marine know we zero progress, need full suppliers, can't be done the strong ports operators, collaboration ecosystem, achieving As net including

up us showing each I'm continues teams allowing every more best dream the future to I'm exceptionally that, the business exceptionally the to I perform Group incredibly Naftali. at to for what's day of perform to ahead. And the and proud call create experiences we and for Royal excited about Our Caribbean vacation be and transform. The our Caribbean Royal and with of over to guests, while the well. thankful Group happy Naf? turn bright, couldn't is

XXXX, Thank higher vacation XX% operating of higher than of our the reviewing of a morning, our timing quarter you, with which favorable driven outperformance of guidance Jason, XX.X% with guidance early experiences was driven of XX% good above will the share recent compared $X.XX I better our increase expectations. Adjusted first by earnings February. points the start pricing midpoint quarter significantly or midpoint by first XXX of remainder most in initial to by the yield finished quarter $X.XX, than everyone. were the net basis our per expenses. We of and for $X.XX. the results, were

strength. Net demand most driven the fuel, remainder year $X.X XX% WAVE revenue and to start that discussed their in was costs, XX% our While better-than-expected basis our excluding the was for pricing we initial driven billion. On with load factor onboard timing our to driven EBITDA record-breaking flow last contributed was outpacing have up XX% by were guidance. increased outperformance Favorable weekly by X.X% led ticket XXX board constant amplification despite The contributor, consistent further basis compared cruise our results. Adjusted our pricing the cash was inventory operating expecting. Bookings to XXXX. initial margin remaining last having pricing rates well a wide less by has growth than sale. the a levels for currency, revenue. and our points lower ship and strength in earnings driver the margin in was were by a and call, brands of strength a been of to on we yield by booking, that widespread season recovery beyond was guidance versus

volume. as of Overall, even and largest very nicely call [ with the through As higher Israel entered book ahead product. Europe the diems ships of ] record been ] our now a our book that year. to in [ contributing is around are last capacity be to product in European have they modify were the during the deployment further remain And Despite year Red currently per for XX% to strong sail result, previously XXXX the close and some we had full accounts in strong of than for existing this fact extremely ahead that Caribbean were are year expected products we of booked itineraries position our continue and our a for our group, representing an both just XX% booked volume much year. The XX% to sailings performing or over the new Sea, of in to the our pricing and Eastern position Caribbean rate hardware well. yield growth we on Mediterranean summer. we

revised Regarding be in Red APCDs. for the other morning, a included may fall. in the a these that in Sea, and situation in this impacted contingency the of spring our cruises we repositioning All few handful we have including plans have are also the reduction sailings rerouted guidance

start and X% summer Alaska XX% year This We the product season. the capacity are summer close represents our of of in all to season. full

year upgraded of this have X our We our capacity Alaska for brands.

Alaska Silver will will and Celebrity remains been itineraries Edge-class in also performing vacations one of in Celebrity time, Nova, ship, Edge, sail ship, first booked the this new has incredible Silversea's strongest our record Alaska. Alaska year For offer and on position. a

our winter year. the itineraries to Australia itineraries account and Overall, well, this we and Pacific a for will position upcoming Asia in continues of book for strong capacity XX% our are season. Asia perform

for guidance let's to expectations increased talk Slide turn X XXXX. to Now about our

are expectations, points mid-February. to year a Our revenue. of due The up is basis is for the goals XXX in remain for continued due significantly XX driving exceptional XXXX. results X% guidance year, be of yields ahead rest demand in outlook better our midpoint from quarter of to basis now the Trifecta XX% expect increase results. higher due to business to remainder the first strength to Net prior full we and meet all to the pricing increase and robust onboard of expected point the in our

fuel, the Now includes the Full are basis net year days increased up dry approximately to of and costs. costs, to expected excluding moving X.X%, cruise be and Hideaway Beach. XXX that operations from points impact dock

driven Red basis Our lower due X/X prior sailings skewed cost noncash ] of on metric. up a canceled remainder stock-based metric our is guidance with to that increase to the the XXX Sea The higher APCDs [ predominantly is by points compared compensation.

market our items, at of below initial rates. fuel guidance. We those line hedged and in we our expense Excluding are costs a anticipate with $X.XX are for expectation year, the billion XX% and

exchange on and want share on expense, of little and expect $XX.XX. I color current we per rates provide progress between based So guidance. earnings $XX.XX more interest a fuel adjusted earnings to our prices, the currency

increase year. by to our you outlook we year. are as the headwind timing, benefit rates the X, As can fuel earnings prices the $X.XX business Page first the refinancing quarter $X.XX the in we from the for earnings approximately guidance That outperformance. first That with driven from includes business the excludes on of well for completed see $X.XX and accounting by benefit for rest those $X.XX X/X currency favorable changes, as in exchange increasing better quarter. After X/X is of remainder attributable from

includes increased catch-up, to be the with first XX.X% X.X% to well from like-for-like I Net shifted to by Beach up expected Now Slide as cruise to quarter. to million increase operate X/X the turning the of X, yield to quarter. dry of the X/X related during dock are and load to are APCDs guidance. X.X% remainder operations yields second XX.X% fuel, related and the driven We be expected of timing XX.X and to plan factor costs second up Hideaway days excluding our quarter hardware as pricing. Net new costs, costs discuss will to XXXX. are compared

days all the is X.Xx last the this quarter into year. dock more $X.XX. per second we account, $X.XX dry on During metrics second quarter, have weighing compared this of adjusted the earnings our cost will which we for quarter to quarter. Taking to be expect share to

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

balance sheet reaching goals progress make in our Trifecta We the strengthening of significant metrics. continue investment-grade and to

our points a note save of During in allowed with XXXX. to basis X.XX% interest realizing over that also $X.XX the bonds refinanced unsecured $XX annual expensive we first us new some of million billion while at expense quarter, most or savings XXX

to in to leverage mid-Xx pay continue down and to S&P end will by upgraded to proactively further a the Moody's the BaX and with rating reduce upgraded debt quarter, BB+ pursue company's rating with outlook. expect to stable opportunistic just the refinancing below outlook credit our We credit positive and XXXX. Also a of first

We are business the of of very commitment strengthening to agencies' sheet. pleased with our the strong acknowledgment the trajectory the and balance rating

while Our remain capital focused a remaining committed interest managing sheet. In we address maturities, remain achieving closing, goals. and unchanged, delivering expense and our priorities on removing strategy fully to reducing unsecured restrictions debt and towards our executing on balance allocation debt our Trifecta and mission

strong earnings our the strong yield position growth. With of Our environment us and in open to and I step that, a operator year growth will position a demand ask question-and-answer session. for book for an another change accelerating call

from first [Operator Steven come Stifel. with the will line Our of Wieczynski question Instructions]

the on outlook. and results solid Congratulations

shaping this bookings are for I'm of for a bookings color levels if lot we up interest investor year, So of you are a where go that's next But surely. look, going lot rest to how about sure to pretty year. Jason, obviously gave think of around the

for booking that just pricing wondering seeing you're wondering being the so give strength at So point. of kind what and transferred can you you're is color I'm XXXX us into if XXXX? far this today

question. Steve, thanks for the

the So And around we more point only for that be of for not our XXXX, one, the bookings, 'XX taking commentary all our also getting we're we'll are soon where to relates that seeing XXXX. I we're close mean, than strength bookings but XXXX. to to

And the booking behavior, so extend. continues the one, into when look booking window we to

further making are their out. guests So decisions much

on our really onboard -- ability well also making our demand on the back as also very for all the their And vacation advance. experience, well that. sure -- leading by we're their going rising doing at bookings by repeat experience guests to very, and the strong deposits, the they're way, improving getting of XXXX taking are that again, to dreaming manage get first our that very XXXX. And to they are yield strong look our that's onboard booking trends due we day to are but and is planning to also When guests sure that rates XXXX. that as their helping we're make or only pre-cruise, the customer also ability also it's And behavior into the excursion not vacation want, is activities the that activities in have which seeing

for cruise and propensity of with around, all to experiences our to things what continues So our just survey but but grow. us. just all the booking all, to or that behavior, in cruise, and in the brands not accelerate to also see just propensity also data their you continue And hunger thirst

I obviously, you of kind capacity cost even seems we we always the mean, it But $XX algorithm, to you start in targets Got I dilution today. $XX the And if the back XXXX. think you. think that's think weren't we with if about your share that pandemic, to Are mean, long-term of another remember look, financial set bigger correctly, the on on like was took getting way? crazy are it earnings give and a interest again. I think look, horizon prepared yield probably before you look, that during a question, question. And then Okay. targeting, I cost crazy by that But are probably guys second guys to picture COVID, to to back higher

our And think an you we has into Well, get which of is yield think strong really you the haven't which year. power. we growth, don't I won't that about have yield yield pointed that is year. how formula could I we -- Steve, mean, business, new is destinations, -- out, drive call. But what important have good crazy bring moderate control, the elevated cost because for are, component take as growth operating I talked really very a clearly seen grow see success, that is We balance business earnings which your last I tremendous this seen moderately leverage. on We've growth. Moderate

You this our A cost think half year. in that. is about of in change a X% million is X% our change about yields $XXX

grow great yields costs, than bring your really faster So high-yielding mix. inventory has capacity in strong, your that

takes to more already thing lower in bring course, opportunity that the in balance us destinations in with contemplates profile is haven't one of into team There Club our new be things account, Beach all for which none we Club that profile. we our as is pre-COVID. were capital will return an You very and of to this well that -- bringing done exceptional of it driving the of job sheet. returns, like this Mexico, continue as Nassau, into negative we et on improving earning and margins And are Hideaway, mean, cetera. These year Naf have high the I course, doing in and are the carry, none did bringing Beach

the considering that that So continue shareholders. do return, capital could we think to outlook and those how dilution our look that earnings improve we returning shareholder improve is it's to something also we are things occurred at, as by

goals, we are as in begin address which our describe know, which, this you base once Trifecta we as to get of to will things All we camp.

Ben comes line of Chaiken question the next Your with from Mizuho.

then you And related, to color can would marketing sounds then demand It for perspective I hear like and ship how any the class. from talk to It a about CocoCay, differentiating Paradise great Cozumel demand you're Island. destinations accelerating. be Paradise of is maybe Island, by or guess on

nuances a Like out? Just call person? would different a you returning customer CocoCay any or is this

Ben, experiences, sweet of it's Day, spot demographics really need. Perfect -- and when the in the and fit think when that really developing portfolio we're mean, they Michael. they're I complementary of incredibly on Club along planning the with we Beach of in destination really our looking cruise, satisfying terms of terms park what guests that in out they seeking a our of are for on that knock it they demand, Caribbean the go of

the So of a as imagine, product, Royal the chill, connected vibe, Perfect the and by It's day thrill to the is it's seeking very Club experience. stunning course, different And type which very for and culture. day a similar it's Caribbean, Beach and most incredible full authentically gas of are a you an curated Day is beach, at it's in Caribbean. is, just what

it unbelievable example, For is an Oasis-class market ] they which a was seen of be And and to Perfect incredibly example, short to to driver. When a guests Perfect Port Beach that Utopia, demand and it's to of it going straight demand out success, we'll in which Perfect on brand-new for our was the Last we the People X.X example, wildest want the demand really ship, million. is Bahamas to Day. year, million been extraordinary. on we've we've this on I into the demand driver. think Utopia at proven Day up take dreams or really you for for, product ships, wrap look the year, mean, sailing sail that Canaveral, we've seen go ships, add to to Mexico, you success, beyond they Perfect Day, Icon, hardware they Day has go with And Club. has want sail the a and [ successful. When it the been kind huge X.X introduced, the I which for is

formula So the that out, and got plan evolve and to over our coming years. continue we the formula is figured to think we've develop

it I want my just Ben, I in And -- add remarks. had Yes. to

of it's see think the that the ] Club I millennials. in new-to-cruise is world in of of we're we'll Perfect and and seeing how one Day, incredible like destinations Nassau, Beach out things this and [ drawing

So and in or our my it's of of that X we increase, millennial younger. comment new-to-cruise. an XX-point very are To guests me, X have guests -- of X increase a powerful X statement. The out our

we where attracting bring and that Club, them sail that sail with some when delivers we're experience the experience how because They full And on And think us, more rates I deliver for us again. what for XX-plus enhancing Perfect that's only destinations. with and demand. that we're NPS the crew high want incredible it a And that Day to Xx they're as well level on guests, to our great we're and the so team likely it's Beach -- that are which over incredible we they it's the exceptional. they us is seeking. people there's XX,XXX the walk take from. Bahamas an in ships, going not experience are of -- repeat of guests as a that's seeing what know And lot is probably to to our to delivery bringing scores. innovating a but combination day come into going Michael can and going and really Nassau. dreaming and And his and have drive been experiences And economically those away those is are we're And

huge competitive Port It in a accident, this Day Beach it in right combination Utopia think 'XX, it's ] it fundamentally drawing land amount the will and continue seeing be Day, and product. by you of demand then X-day this sailing huge space and going [ Perfect to Utopia bank Canaveral not beautifully Ben, of Club a in a is it this, [ going the of of we're Canaveral. in but positioned to ] phenomenal out really product new-to-cruise really changer, to is is go that's Utopia Orlando. Perfect add and will and that's -- comments, not Perfect is to about to Day, game Jason's X-, squarely like vacations, to come really in on And for another product

Got quick you. And Paradise. very a just follow-up on

million Am that could not I Jason, that who like guests generated [ be that going think, were this guests, to or Nassau mentioned you I [indiscernible]? but correct just interpreting also cruise people to a for your is XX ] [indiscernible]. revenue kind other a of

brand. No, it's primarily Caribbean for No. the Royal

brands access the access other the not would Club. it, but to broader Our will Beach to [indiscernible] have have

Nassau. is positioned Beach beautiful Royal that the pretty But the Club Paradise Island in much entrance thing the to is at

only on is I a when they on is, cruise guests that cruise different is think going Nassau, XX,XXX course, Beach the that to be Royal there. given they be go will is to brands. of to Club, stunning. sail into day, point Caribbean XX,XXX the unbelievably they knowing absolutely in can't going multiple the thing And And they're coming jealous there's Royal see which

line from comes Boss question next Your Matthew of JPMorgan. with the

And congrats on another nice quarter.

you. Thank

in relative today anything, where as just underlying to So could Jason, from market? you by growing comments if back elaborate are your trillion Naftali, vacation strongest X think think the we coming And we season you and $X.X continued just market pricing, confident WAVE region. history, the this as maybe guidance think in demand months how And strength for opportunity about more half, about off then April, to about earlier, rate, on the global ago? your in both near-term best share maybe to

question, Matt. thanks Sure. Well, for the

though, I previous terms was mid-teens what April better WAVE were seeing. the in we year. it's mean, was demand that than in enough, -- of of -- was almost double I First the kind exceptional. think saw of we absolutely off, just It that level Interesting

when to talk February. we that's at spoke in we we February. accelerating, the early it's is just about only when that It's So the at last end not XX% course, load up what has acceleration speed. build just for when we to updated saw everybody have left picked factors I of year. point, not And this why demand about But of the

year. XXXX for into provide But so And means opportunity the terms in of this I opportunity beyond what to us will and very is think, that, that a appealing. degree

a that's space. the travel of is $X.X think number. trillion. you And frame $XX growing Cruise course, I billion -- when that trillion $X.X of that

talked X% ships fraction. us. very, about worth And Oasis-class think XX before, we've So is very a I is small we're shift a something to

like for to grab further more we share How compete as doing know look Beach look when we least do Orlando? Day, today, what how happening with at share? you look you like at like a getting. and at Royal with we things And like where purposeful, less Nova, take very at at what's Las when other do Perfect do land-based It's we trades when look currently to how that with we're cruise operators. us, Utopia, or Vegas, things with things about compete XX% you do Club, it's at what Edge alternatives compete when we're you the other so we things How on premium XX%

the best world So that value and vacation experiences believe -- a And position win. waking we want share. in us want up being we at gap to to take by vacation, obsessed to puts the close land-based just delivering and in that to we

Naf. Matt, it's

to today, to Just also 'XX been we kind other Jason, one again. look taking we versus add are just at if share thing have of you

we've You X% don't as have Jason that's And But significant said, to rise. ships, make pretty XX much. there. on it focus progress and it's a Oasis-class continued believe to is

strength remarks, very our terms we're coming continues and kind And think our across the I back of but that to well, in Caribbean obviously all as Europe is strength just much prepared China. key course, the in as Alaska, you of of itineraries. be the performing others, to heard

our pretty of standing for the with where position, year. of the book So today are rest is pricing we where the feel good we

Congrats. luck. Best of

Thank you.

with question comes of the Blair. next William Sharon Zackfia from Your line

in North to had unusually America the on as kind about It's China XX% we Europe if about you wondering the ramp-up How base? see impact we of North years, expect you kind call, few of just talked of go? do last And this year, of year. I'm kind the there's American passengers think been if being passenger think on change. that onboard revenue? would next if there's on last about update then any think I or large we any that, where and

well. I thanks you're the Sharon. hope for Well, question, Yes. doing

a to world. by around tools global not we So nationalistic just we brands starting the very have teams need to that just I are commercial brands, these think apparatus supported frame and global yield brands, and leading management off, significant with

really the optimize revenue. to we And so sourcing patterns the is see reflection of ultimate demand a that our

second of it's demand Maybe saw do next of But sourcing of it a little move done year is American-centric. we we're going that probably moves add that going that could And I time. our a be going optimizing More we it's be that but that lot. But it to onboard as shift in China little course, to ticket. we'll we've potentially very, move the patterns. materially to shift on because we're to less can to year. how it relatively revenue. not this follow I this bit, the ship into -- long period very the for don't China, number close mix think bit North a And we'll think focused a

fortunate we've positioned how and think I different our to that's ] the if a more to And long than very be we're bit okay a desirable ago profile brands that sure have And so customer the us. long is for margin as onboard, yield we're that ticket are from answer business [ for with to perfectly time very and globally getting long thought profile higher as we're And higher markets. less time. from many make a little in sourcing on run

kind pre-book across millennials this it pre-booking of of Or X The gamut? Jason, seeing Do follow-up? you inclined -- point. me? is demographic that, ask passengers I at onboard can versus the out customer X success of their elders like are a kind you find more to is being that

a positiveness things it think out et one, used little bit we aged, very but got if younger, can online. a mean, any booking middle consumer, I cetera, pick and to was I Sharon, or buying young the that skews COVID, of

of experience that's the that as booking better well behavior. very ticket steps on commerce we had improved the can we for friction just price as is proper really in of cetera. out of can you websites, what ability In installation is And the lot a twice our et manage, taking to process, pre-COVID. about out the early we shopping yield that of driving quarter, that. And booking innings had a we really what's still really The XXX take visits behavior. experience the system We're also curate. just million XXX We first benefiting our that what think to million. That's for onboard curating, by

able a game, not get also to websites dream want customers to make really so for have to and that help the that they on being our then experiences they have have looking experience but And sure the the we all to of in basis what marketing do on resolve advance our just they upped well that all that making our and onboard ship. helped want they're them -- that about to them and getting

from Your Barclays. next line with question the of Montour Brandt comes

forecasting. That's next Ovation, Alaska expected Australia, can't the take but pricing month, initial I So sort maybe of were you why or is load factors, somewhere initial think obviously And a for why give that year. onboard good Obviously, out the of even was to clearly, us sense Ovation just of of worse than qualitatively a maybe Caribbean there give why decided and a initial ship that Michael, and if China necessarily that not restarted follow-up But comes sign. specifically, or else? you out sort you I ship or this wondering better could of us you spend.

Brandt, yes, good question.

already the think indication the second is the China market. how China ship into well fact a ship in deployed doing an that of first the market I gives we've you

with So we're Spectrum pleased bookings.

years. comparison, the XXXX, last a course, over lot of Our we've in is back used which couple of

rate And both great which indicator of 'XX geographical 'XX, that China from feel rate is second 'XX. have to and kind product. going well volume both the significantly ship, product into in why China and we're for That's higher They seeing market. the volume a be done the is the good about for the Both Overall, of in very in demand we seem got Quantum 'XX, we've Australia pandemic class. before markets of course, onboard in it's terms that positive. market. great well will the its course, be in suited really for of of operated it's only And looking season. couple is for out But us. The both of spend, into market and obviously, One days China and which the the Ovation the in positioning. suited we've really Tianjin, of many years perfectly Shanghai, for Alaska

to going they're think realized. I and be expectations, high have We

business. the a China a that's that in dropped market the pandemic our terms changed lot of thing the terms versus is a There dynamics the direct of the trade during was of other The in quite change traditional retailers business transformation the business. in in lot quite out of

we the we technology, invest Fortunately, continue and pre-pandemic, to and the that pandemic, be in and we people to business, pandemic, when started to resources, us. through of for we've significantly develop very proving productive came direct out accelerated it's

successful. very, strong. is seems to our overall, distribution strategy So very Demand be proving

Korea course, is great. Of which up, opened

feeling we're gives guests. that good to better to how play And offer itinerary our So product out. a us about will this

decade China a we've been course, for before. in Of

it's positive. through ups currently, pretty but looking downs, So the been we've all and

the perhaps higher a little for perhaps The helpful. least credit Okay. at That's closer IG, metrics, in our little a before. had And really one year we Naf. then guidance than for to model, maybe earlier bring helps

And guess, needs help refreshing I Board at it's what on reestablish so see maybe capital you And picture to worth report all. if to maybe you that us returns? think the today's

Yes.

balance the on just So sheet.

of Obviously, year. So we below basically expect to we're we get to with right? you're will right. on leverage the -- We're things, performance, of the X.Xx remarks, I my focused X focused leverage. the acceleration in said by the And on end reducing prepared

EBITDA continue we pay positive. are that's increases So that Obviously, leverage. very with helping down debt. to

feeling about we're pretty good So that.

of basis And cost XXX the capital more continue capital, both you And action and expense. of quarter, opportunistic interest of those then and cash million almost reducing annual lower saw points to cost on opportunities than find X refinancings. us reducing bond take $XX an we'll this use or to

that to the if like much left there's them, we basically do them balance we're more there. And back sheet. pay an collapses, we refinance think and that I back it's unsecured bonds want have and sheet X We get unsecured whole or balance we we to pre-COVID, back had sheet. lastly, capacity structure the to balance just on

continue focus. our We'll on execute that's to So that.

that is agencies, were the We on ratings. but balance got pleased the rating [ from sheet. we upgrades are with ] focus focus the not getting to Our metrics, very our

in was going consideration No, dividend very of -- also to getting pre-COVID, of terms shares to just metrics would buying of I part and getting that just But for much capital returns. we competitive as obviously, that opportunistically. those certainly say, to having and I and camp back well was to was point base formula a our our you're as an line important Board us for as

line Your Robin next with the of will come UBS. Farley from question

really comment One guidance. It that into your that sounded excellent there still I to suggesting your they Red to But were are clarification your factored were on Sea some your if that on that's were like did schedule. understand already cruises you mean fall guidance. change,

I changes just any it sure to your those, So your if wouldn't I see we in part see right? guidance? understood make -- that that commentary, change want of

Robin. That's correct. Yes,

capacity feel think you Okay. And your about future? Others you have changes with some if growth that Great. with I way if on could been have been capacity mentioned been out capacity goal. growth. do would the there -- shipyards? thinking that, And and availability you question in at lately changes what other whether has ordering you on aggressive out capacity future. your just of my or to that more thoughts And into in Or ships the about give us slots any that then is moderate wonder just anything needing

time. talking not those -- XXXX What have we of important We're actually lot that We're are point or that And We're to, first, moderately don't we have potential that brands not brands I at on it's in be believe orders order we right of we our reservations. to segments going Robin, a these this things in on over slot our growth we course, any believe out are XXXX in We ships them. order. about time. is we And so that the talk should talking are subscribe think, to about right about segments. Sure. do talking we are order. options. in are I the growing when about have -- that that book, believe we we we that think

we moderately, we're what to think of And to. book of very only potential period an so good access And but current and over I book our those not time. to order of our grow committed kind also about extended the order about feel that's that build ships

or very in good about So it's investments the the yielding it expand high and we investments showing -- that feel around. for to continuing our our we're at making think we're are we're our brands margins. I very in all shareholders destinations returns I the And think making

I years of years guess that to do is out current in maybe the advance Or to ships [indiscernible]? X in to than X order more need environment? clarify, sort X that you feel you would

Yes.

what We designed type it contracted, that's don't think where the price obviously, we that mean and we kind ordered on of have X- that doesn't fully why But of and comment mean, X-year know and to you the is don't and and X-year that you somewhere have are and [ things those also reservations financing delayed is announce my that range kind slot forth the those they -- -- we so think options in of of typically I I which you don't in could COVID up is place. unless have typically to circumstances. order keep Icon in in range. X- ] I depends being dreamed orders. mind, some was make orders. you We've is, But --

time question. one more have We for

will Ciepiel Cleveland question from Research. final come Our with line Vince the of

across your there was commentary of And And on you're in river thought segment with the see customer customers? that, you of to you seeing the What varying Earlier I loyalty. brands within call, what Great. just And sense for about your of thoughts your get cruising, within there finally, maybe have market? wanted products. in is much some into terms overlap getting base? on that current that overlap ever then and

that off what we brand. with at done on to set on Royal their about versa, thoughtful in and vacation delivering vice Silversea Silversea next of you of Well, is grandkids vacations. and such have and first, kind are sure kids Celebrity of to job and of very a on right month earlier a right been segments. the focused said Yes. an we're going could because of cruise is of Royal have ecosystem. our Caribbean overlap had that we and And grandparents That on having goals all in sure happens up our make guests, a have we ultimate brands our And build set the time. And one just customer keep incredible And the lifetime to ultimate is a our lifetime. our a the making -- Royal here I deliver there we're

through growing could see And core, something further very at in be lot an so technology-wise we And we're that's through core platform experiences, opportunity point on is overlap, do more to the a other we time, whether some flexible. The would awareness at, our in loyalty of future. better whether and that better our where excelling some things or that But we get building comment out cetera. as this we overlap, some also brands, consider we're of do but do that's opportunities. destination And occurring. platform. that's cross-selling, is overlap River whether area we through an travel our et and programs, on especially those are evaluating that at see point focused always our that our have river in not

as to and high profile ROIC a of we're All deliver clearly returns. shareholder very working that, seeing strong is producing

conference remarks. I for turn Holtz, to CFO, back the will Naftali closing now over

participation all follow-up. will day. you your be a all for thank We interest. any you Well, Michael great wish available for and

Ladies call. your participation. and you Thank for today's gentlemen, conference concludes this

disconnect. may You now