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UPDATE 2-Royal Caribbean's loss narrows as cruise bookings rebound

UPDATE 2-Royal Caribbean's loss narrows as cruise bookings rebound

Reuters · 07/28/2022 08:09
UPDATE 2-Royal Caribbean's loss as cruise bookings rebound

Adds details on booking trends, Europe business, shares

- Royal Caribbean Group RCL on Thursday reported a smaller-than-expected quarterly loss on strong pent-up demand for cruises and as passengers spend more onboard its ships.

Shares in Royal Caribbean climbed 5% to $36.64 in premarket trading as the cruise operator also said it returned its entire fleet back to operations.

The U.S. Centers for Disease Control and Prevention earlier this month stopped reporting coronavirus levels for cruise ships in a move considered the step toward a full return to for embattled cruise operators.

The industry has been steadily cruising toward full occupancy after a 18-month shutdown, with demand from loyal patrons proving a silver lining for cruise operators that are dealing with higher fuel prices and record debt levels.

Affluent guests have also shrugged off the inflation pinch to splurge on watches and at spas as well as casinos on the ships, partly making up for the blow from cruise operators' occupancy constraints.

The cruise operator's revenue was $2.18 billion for the second quarter, compared with estimates of $2.11 billion, according to IBES data from Refinitiv.

Net loss to $521.6 million, or $2.05 per share, from $1.35 billion, or $5.29 per share, a year earlier.

Excluding one-off charges, Royal Caribbean lost $2.08 per share, smaller than estimates of $2.20.

Royal Caribbean still said the spread of COVID-19 in Europe and the Russia-Ukraine war have lowered its occupancy levels on cruises around the continent, which carry higher-than-average ticket prices.

The owner of Celebrity Cruises and Silversea Cruises brands forecast total revenue of around $2.9 billion to $3 billion for the third quarter, compared with estimates of $3.03 billion.

It also forecast per-share earnings to be between 5 cents and 25 cents for the third quarter, compared with estimates of 92 cents, due to higher fuel and food costs.

(Reporting by Praveen Paramasivam in Bengaluru; Editing by Shounak Dasgupta and Maju Samuel)

((Praveen.Paramasivam@thomsonreuters.com; https://twitter.com/PraveenR_P ; +91 867-525-3569))