By Dhirendra Tripathi
Investing.com – Norwegian Cruise stock (NYSE:NCLH) fell 5.2% Thursday after the operator’s fourth-quarter revenue came in behind estimates.
The loss was worse than expected as cruise operations remained disrupted due to Omicron while costs stayed elevated. The losses in the stock were aggravated because of the escalating crisis in Europe arising out of Russia’s invasion of Ukraine.
Cruise operators were the worst hit in the pandemic as the fear of the virus and strict Covid-19 protocols kept guests away. Adhering to the guidelines also meant higher operating expenses for the cruise operators. Sporadic cases of infection being found on ships hurt operations further. So did booking cancellations.
As a result of Omicron-related disruptions, the company expects to have 85% of its capacity operating by end-March with its 28-ship fleet expected to be back in operation during the early part of the second quarter. It closed December with around 70% capacity in operation.
Strong ticket pricing and onboard revenue drove positive contribution from the fleet that operated in the quarter. Occupancy in the fourth quarter was just over 51%.
Based on the current booked position and trajectory, the company expects to make a profit on an adjusted basis in the second half of the year.
Revenue in the fourth quarter climbed past $487 million on the resumption of voyages.
The adjusted net loss in the quarter widened to $765 million from $684 million a year ago.
The company expects the monthly cash burn to be around $390 million in the current quarter, higher sequentially. It currently has nine premium yielding vessels on order through 2027, accounting for around 24,000 berths.