Royal Caribbean Group experienced a notable surge in profit on Thursday, attributing it to the upward revision of its full-year profit forecast. The new projection exceeded expectations, prompting investors to view the company optimistically.
Their confidence in Royal Caribbean is underpinned by the belief that the growing demand for its cruises could be indicative of a potential recovery for the cruise industry, which has been heavily impacted since the 2020 COVID-19 pandemic.
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According to MarketWatch, Royal Caribbean’s stock shot up 8.3% in premarket trading on Thursday. This puts the company on track to open at its highest price seen during regular-session hours since Feb. 20, 2020.
“Our brands continue to fire on all cylinders, resulting in record yields and second-quarter earnings significantly exceeding our expectations,” said Royal Caribbean Chief Executive Officer Jason Liberty.
Two other cruise companies’ – Carnival Corp. and Norwegian Cruise Line – holdings also experienced a turnaround, jumping as much as 6.6% and 6.3% respectively.
“Demand for cruising and our brands is exceptionally strong and we have seen another step change in booking volumes and pricing, leading us to now expect double-digit net yield growth for the full year,” Liberty added.
When comparing last year to this year, the company swung to a net income of $458.8 million, ($1.70 a share) from a loss of $521.6 million, ($2.05 a share).
Excluding nonrecurring items:
- Adjusted earnings per share ($1.82) beat the FactSet consensus of $1.57.
- Total revenue grew 61.3% to $3.52 billion above FactSet consensus of $3.41 billion.
- Revenue jumped 40.9% to $1.08 billion.
- Passenger ticket revenue increased 72.3% to $2.44 billion.
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