The Norwegian Cruise Line (NCL), Oceania Cruise and Regent Seven Seas Cruises parent has seen "very strong" demand so far in 2023, according to a recent trading update covering the fourth quarter and full year to 31 December 2022.
The company entered the year with a cumulative booked position of approximately 62% for 2023, in line with previously outlined expectations and within the firm’s optimal 60% to 65% range, and at higher prices than 2019 at a similar point in time.
Booking volumes have accelerated in recent months buoyed by strong wave season demand, NCLH said, with its brands achieving several booking records in recent months.
As a result, full year 2023 cumulative booked position is ahead of 2019 levels inclusive of the company’s 19% increase in capacity.
NCLH expects this positive momentum to continue throughout the year, with occupancy expected to average 100% for the first quarter and is on track to reach "historical levels" for the second quarter.
As of 31 December 2022, the company’s advance ticket sales balance, including the long-term portion, was $2.7 billion, approximately 9% higher than the prior quarter and approximately 30% greater than at year-end 2019.
NCLH said it will undertake a "broad and ongoing" margin enhancement initiative after it took several steps in recent months to improve operating efficiencies, reduce costs, and maximize revenue generation opportunities.
As part of this initiative, operating efficiency and cost reduction efforts are expected to result in a decrease of nearly 15% in net cruise costs – excluding fuel per capacity day for 2023 – compared with the second half of 2022.
However, despite recording $1.5 billion in total revenue for the last quarter of 2022, the company made a loss of $482.5 million.
Frank Del Rio, president and chief executive officer of NCLH, said: "We are now squarely focused on the future and are taking deliberate and strategic actions to best position the company for its next chapter, which includes an industry-leading growth profile representing approximately 50% capacity growth over 2019.
"We continue to pursue all opportunities to capitalize on the healthy demand we are experiencing, especially during this important wave season."
