Norwegian Cruise Line Shows Growth, Forecasts Strong 2024

Norwegian Cruise Line Holdings unveiled its fourth-quarter earnings for the close of 2023, revealing results that exceeded expectations and forecasting significant operational growth for 2024.

The corporation expanded its fleet with three new vessels across its trio of cruise lines, achieved record-high bookings for 2024 at increased prices compared to 2023, and saw occupancy rates soar above 100% in 2023, surpassing initial projections. At the same time, the company succeeded in repaying almost $2 billion in debt.

Norwegian Cruise Line Showing Promising Results

Following the disclosure of its fourth-quarter and end-of-year results for 2023, along with its forecasts for the first quarter and the entire year of 2024, Norwegian Cruise Line Holdings saw its stock price surge by nearly 20% in the first few hours of trading.

While NCLH still posted a loss per share of 12 cents for the end of 2023, the outlook for 2024 looks extremely promising for the fourth-biggest cruise company worldwide. Not only did all three cruise lines owned by Norwegian Cruise Line Holdings release a new cruise ship, but bookings for the entire company will surpass those of 2023 in 2024.

“Norwegian Cruise Line Holding experienced a momentous year of growth and achievement in 2023. We successfully took delivery of three new ships, one for each of our brands, representing the most deliveries in a single year in our Company’s 57-year history,” said NCLH President and CEO Harry Sommer.

The optimism around Norwegian Cruise Line Holdings is largely fueled by the robust booking performance the cruise company has reported, beginning with the record number of bookings observed during Black Friday and Cyber Monday. By the end of the year 2023, Norwegian Cruise Line had a record advance ticket sales balance of $3.2 billion.

Sommer: “Looking ahead, we are determined to capitalize on our recent achievements and take advantage of the positive momentum and strong demand for cruise which resulted in turning the year at all-time highs in both our booked position and pricing.”

Some of the highlights for Norwegian Cruise Line Holdings include opening bookings for Norwegian Aqua and the christening of Norwegian Viva. Regent Seven Seas Cruises welcomed the Seven Seas Grandeur, and Oceania Cruises opened a new line of cruises to Africa and Asia. 

The only downturn for Norwegian Cruise Line Holdings comes due to the unrest in the Middle East, which forced cancellations for all calls to Israel, and the Red Sea, for the entire of 2024, which resulted in a slight downturn in occupancy levels. 

Unrest In the Middle East Affects Luxury Brands

The ongoing conflict in Israel and the Red Sea has significantly impacted the operations of the two luxury cruise brands under Norwegian Cruise Line Holdings: Regent Seven Seas and Oceania Cruises. 

The company made strategic adjustments by cancelling and redirecting all its calls to Israel during the fourth quarter of 2023. These cancellations had a significant impact on occupancy levels for the fourth quarter, ending at 99.2% occupancy. However, the rest of the year made up for it with a remarkable full-year occupancy of 102.9%, 0.3% above expectations.

Looking ahead, the unrest has led to the cancellation and redirection of all calls to Israel and the Red Sea for the entirety of 2024. 

Before the conflict escalated, about 7% of the company’s capacity in the fourth quarter of 2023 and 4% for the full year of 2024 were expected to visit the Middle East onboard Oceania and Regent cruise ships. Additionally, approximately 1% of the 2024 capacity was anticipated to sail through the Red Sea. 

Read Also: The Impact of Red Sea Tensions on Cruising

While the cancellations have been disappointing for guests booked on these cruises, Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises are all experiencing strong demand. Overall booking levels for 2024 are significantly above those for 2023, at higher pricing. 

While the overall results of 2023 still include a slight loss of 12 cents per share, for 2024, NCLH expects to post a profit of $1.23 per share. Together with paying off $1.9 billion of its net debt, and adding 16.000 berths across five new ships over the next couple of years, NCLH is looking an ever-increasingly interesting investment.