MIAMI — A “challenging booking environment” didn’t stop Norwegian Cruise Line Holdings from cruising to a 9.3% increase in total revenue for the second quarter of 2016, for a total of US$1.2 billion.
Adjusted net income was $192.6 million, compared to $171.6 million in Q2 2015.
“It was a challenging booking environment where we remained mindful of our go-to market strategy to minimize discounting and maintain our hard-fought pricing gains, resulting in lower occupancy, which in turn lowered onboard revenue and overall net yield growth compared to our expectations earlier in the year,” said Frank Del Rio, President and CEO of Norwegian Cruise Line Holdings.
While successive geopolitical events dampened North American consumer demand “primarily for our Mediterranean itineraries”, the company’s management team found cost-saving opportunities to partially mitigate these impacts, he added.
Second quarter earnings held steady despite “significant booking headwinds”, but NCL is downgrading its earnings expectations further into 2016, the result of four factors: continued weak demand from core North American consumers for European sailings at a time (at a time when half of NCL’s fleet is deployed in the region, including eight of our highest yielding ships); the effect of a weaker British pound post the Brexit vote; an adjustment to earlier pricing expectations for Miami-based Caribbean itineraries, “which continue to outperform prior year despite a doubling of capacity in the low season months”; and the impact from maintaining pricing discipline to minimize discounting.