First Quarter 2025 Performance:

• Financials: Royal Caribbean Group reported Q1 EPS of USD 2.70 and Adjusted EPS of USD 2.71, exceeding expectations due to strong pricing on close-in demand and lower costs. Total revenues were USD 4.0 billion, with Net Income and Adjusted Net Income at USD 0.7 billion, and Adjusted EBITDA at USD 1.4 billion.
• Operational Metrics: The load factor was 109%, with 2.2 million guests served (9% year-over-year increase). Gross Margin Yields rose 13.9%, and Net Yields increased 4.7% as-reported (5.6% in Constant Currency). Gross Cruise Costs per Available Passenger Cruise Day (APCD) fell 1.1%, and Net Cruise Costs (NCC), excluding fuel, decreased 0.3% as-reported.
• Bookings: Record bookings were achieved during the WAVE season, with April bookings surpassing the prior year. Booked load factors remained strong at higher rates, and onboard and pre-cruise spending exceeded previous years.

Full Year 2025 Outlook:

• Earnings: Adjusted EPS is projected to grow 28% year-over-year to USD 14.55–USD 15.55.
• Yields and Costs: Net Yields are expected to increase 2.5%–4.5% as-reported (2.6%–4.6% in Constant Currency). NCC, excluding fuel, per APCD, is forecasted to rise 0.1%–1.1% as-reported.
• Capacity: A 5.5% capacity increase is anticipated, driven by new ships like Star of the Seas and Celebrity Xcel, alongside the Royal Beach Club Paradise Island opening.

Second Quarter 2025 Guidance:

• Capacity and Yields: Capacity is expected to grow 6%, with Net Yields rising 4.4%–4.9% as-reported. NCC, excluding fuel, per APCD, is projected to increase 4.1%–4.6%.
• Earnings: Adjusted EPS is forecasted at USD 4.00–USD 4.10.
• Fuel Costs: Fuel expenses are estimated at USD 286 million, with 59% of consumption hedged.

Financial Position and Capital Allocation:

• Liquidity stood at USD 4.5 billion as of 31 March 2025. The company was upgraded to investment grade by S&P Global Ratings, reflecting its strong financial position.
• Debt management included exchanging USD 213 million of 6.00% Convertible Senior Notes for 3.3 million shares and USD 214 million in cash, reducing diluted shares by 1.0 million. Additionally, 1.0 million shares were repurchased.
• Capital expenditures for 2025 are projected at USD 5 billion, primarily for new ships and land-based destinations.

Future Growth:

• The company is focused on delivering exceptional holiday experiences, optimising revenue, and managing costs while investing in new ships and destinations. Capacity is expected to grow 6%, 5%, and 6% in 2026, 2027, and 2028, respectively.

Full report https://www.rclinvestor.com/press-releases/release/?id=1757

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