The year 2024 is off to a great start for Royal Caribbean Group's bottom line.
Royal Caribbean Group posted its first quarter financial results, which saw Net Income of $360 million, with total revenues of $3.7 billion.
"Wow, what a great start to the year!" is how Royal Caribbean Group President and CEO Jason Liberty started his statement off in the press release for the earnings report.
"Demand for our leading brands and the incredible experiences they deliver continues to be very robust, resulting in outperformance in the first quarter, a further increase of full year earnings guidance, and 60% expected earnings growth year over year."
That demand he talks about is what drove the company's financials into a better financial position than the company had originally anticipated.
Strong demand and strength in onboard spend pushed first quarter earnings ahead. In fact, there was better demand anticipated during the lucrative WAVE season. This is an industry term for the beginning of the year when the general public books the most cruises of the year.
Read more: Royal Caribbean is making more money than it expected. The good and the bad news for cruisers
High demand persisted across all of the top cruise markets, and on top of that, customers were spending more on cruise extras. That combination lead to higher revenue, as well as Royal Caribbean Group updating its guidance for the rest of the year.
First quarter by the numbers
Here are the key stats from the Royal Caribbean Group's first quarter.
Cruise ships sailed at an average of 107% full during the quarter. That's up 5 percentage points compared to the first quarter of 2023.
Occupancy rates over 100% are a good stat, and it means there were more than two people in a lot of cabins.
Total revenues were $3.7 billion, Net Income was $360 million or $1.35 per share, Adjusted Net Income was $478 million or $1.77 per share, Adjusted EBITDA was $1.2 billion, and operating cash flow was $1.3 billion.
About half of the first quarter yield growth was driven by higher ticket pricing on the fleet of ships, with the remainder driven by a combination of guest spending on extras, ships sailing with more passengers onboard, and new cruise ship demand.
As of March 31, 2024, the Group's customer deposit balance was at $6.0 billion.
Record booked position
Once again, 2024 is another year seeing more people book cruises than ever before.
Royal Caribbean Group is seeing "very strong" demand and prices. Overall, this has been the strongest WAVE season in the company's history from both a demand and pricing standpoint.
Prices for a cruise in 2024 are higher than they were at the beginning of the year in 2023.
Plus, passengers are spending more on add-ons and making purchases before the cruise at a rate higher than prior years. The company said this is due to, "greater participation at higher prices." That essentially means more people are buying add-ons and they cost more than the used to.
Mr. Liberty called out the new Icon of the Seas as being a difference maker, "Our existing fleet along with our new ships continue to perform exceptionally well, highlighted by the market response to the launch of Icon of the Seas, which has exceeded all expectations."
"The momentum continues with Utopia of the Seas and Silver Ray, set to launch this summer. And, just this quarter alone, we announced an order for a seventh Oasis Class ship and the expansion of our Royal Beach Club portfolio in Cozumel; and we officially broke ground on Royal Beach Club Paradise Island. These strategies will further propel our leadership in the cruise industry and push us to new heights in the vacation industry."
