'Solid outlook' reported by Royal Caribbean

'Solid outlook' reported by Royal Caribbean

Royal Caribbean Cruises has reported bookings for 2017 being ahead of last year in both rate and volume.

New ships including Harmony of the Seas and Ovation of the Seas are seeing strong trends, supporting a “solid outlook” for next year.

The parent company of Royal Caribbean International. Celebrity Cruises and Azamara Club Cruises said it was confident of meeting its forecast of doubling its adjusted profit to $6.78 per share in 2017 from $3.39 in 2014 – in a so-called ‘double-double’ strategy.

Chairman and chief executive Richard Fain said: “Our business continues to progress solidly to the double-double, and our recent dividend increase is evidence of our confidence in that trajectory.

"It is gratifying to again be headed towards record earnings for the year, above our initial guidance.

"New hardware, continued strength onboard, along with continued cost discipline and a highly motivated team over 65,000 strong is proving to be a winning combination," he added.

Royal Caribbean's adjusted net income rose to $690.9 million in the peak summer third quarter to September 30 from $628.1 million in the same period last year. Passenger carryings rose to more than 1.5 million in the three months from 1.4 million year-on-year.

The improvement was driven by strong yields and positive movements in currency and fuel during the three months.

“Continued strength in demand for North American products was a key driver of the outperformance while the balance of the portfolio performed in-line with expectations,” the second largest US cruise group said.

“Growth in onboard revenue continued to outpace overall net yield growth, despite an extraordinary outperformance last summer. Favourable trends in both currency and fuel compared to expectations also provided a benefit to the quarter.

“Strong close-in demand for North American itineraries in the third quarter is helping offset an impact from the delayed opening of Empress of the Seas sailings during the fourth quarter.”   

Chief financial officer Jason Liberty said: "Our strong booked position and continued focus on effective cost management is expected to keep full year earnings ahead of initial guidance and positions us well for the double-double in 2017.” 

He added: "Minor operational variations are causing some timing shifts between quarters, but the overall market and our overall results remain unchanged from our last guidance."

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