In preparation for RCL's FQ3 2013 earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary.
- "In the second half of the year, we have lowered our revenue forecast by just under one percentage point due to lower expectations in China and some impact from the pricing environment in the Caribbean. In aggregate, our booked load factors and pricing are both up slightly for the full year. Since our last call, bookings have been slightly higher than last year after adjusting for capacity."
- "Europe is developing about as we anticipated and we are expecting net yield increases in the mid-single digits for the year."
- "The Caribbean, which represents about a quarter of our deployment in Q3 and almost half in Q4, is holding up pretty well. We are aware there has been a lot of focus in the investment community on the overall health of the Caribbean in light of some of the competitive pressures. And we would be naive to say that this has not affected us to some degree. But at a macro level, consumers seem to be recognizing the value of our brands and our pricing in the region continues to show improvement for the year."
- "Asia is the only product in our portfolio that we are forecasting to have lower yields for the year."
- "The territorial island dispute between China and Japan has forced us to drop Japanese ports-of-call from our itineraries, and in total we have had to modify 30 sailings. These modifications have resulted in some churn in our book-of-business as well as some volatility in the booking behaviors in the region."
- "Our Pullmantur brand is one exception here (positive growth) and as Richard noticed, the brand will be putting much more emphasis on developing its business in Latin America."
COMPETITIVE PRICING/PROMOTIONAL ACTIVITY
- "In recent weeks competitive pricing has gotten more intense.
- "Throughout recent months, there has been a lot of promotional activity. We've discussed in the past that you can basically expect to see promotional activity throughout the revenue cycle."
- "Bookings for both 2013 and 2014 are ahead of where we were at the same time last year, both in terms of load factor and pricing."
- "Our objective for next year is to at least achieve flat net cruise costs excluding fuel. And while we don't forecast what the price of oil will do, we do work aggressively to reduce our energy consumption."
- "Onboard spending was much stronger. Onboard revenues increased 8.2% for APCD in the quarter and generated about $0.04 per share of favorability to our April's expectations. Overall, we are generally seeing better spending behaviors out of the North American guests, but we are also enjoying very favorable results from our revitalization project. Gaming, beverage, specialty restaurants and shore excursions all out-performed."
- "Current estimates indicate that we will reduce our year-end net debt balance by about $270 million versus prior year, which in combination with improved operating cash flows will help improve our credit measures as we continue to strive for investment-grade metric."
QUANTUM OF THE SEAS
- "Quantum of the Seas will enter the fleet just over 15 months from now. We are very pleased with her initial bookings since we opened for sail at the end of May. Quantum has already reached the projected load factor for her 2014/2015 winter season that we have set as a target for the end of this year. And the demand for her suite and new stateroom types such as the studios are particularly encouraging."
- "We're feeling pretty good about the first quarter. We had very strong load factors; our pricing is up slightly. As we look out beyond Q2 the numbers are really too small to extrapolate, but I will say that in all our quarters in 2014 our load factors and APDs are running ahead of where they were a year ago."
- "I think we anticipated that Alaska had a terrific beginning of the year and it was unlikely to continue at that trajectory."
- "Australia is a very attractive southern summer market for us. We have a strong presence there with both Royal Caribbean and Celebrity. We did expect pressure on yields this year from the capacity increases and we're looking forward to be – playing a prominent role in that market going forward in the future."