Royal Caribbean Cruises Ltd. shares hit a record price after the cruise operator raised its earnings outlook for the fourth time this year and said it sees no diminishing of demand or pricing.
Royal Caribbean Group CEO Jason Liberty. (Photo Credit: Brian Major)
“We do not in any way see anything in the ingredients that say that we’re hitting some type of ceiling. If anything, we see continued acceleration in demand for our business,” Chief Executive Officer Jason Liberty said during a conference call with financial analysts.
Royal Caribbean is riding high, with its shares rising at a rate more than double its competitors. The company boosted its adjusted earnings outlook to $11.57 to $11.62 per share this year, according to a statement Tuesday, above the average analyst projection of $11.51. Liberty said earnings per share next year will be at least $14.
Following the conference call on third quarter results, shares jumped by over 5% to a record.
In more good news for the company, balance sheet actions taken during the third quarter resulted in lower interest expense and a return to the company’s pre-COVID unsecured balance sheet.
“Our exceptional third quarter results and increased full year expectations reflect the robust demand for our differentiated vacation experiences,” said Liberty.
“We see elevated demand patterns continuing as we build the business for 2025, and although the yield comparable will be a high bar, our proven formula of moderate capacity growth, moderate yield growth and strong cost discipline is expected to continue to deliver strong financial results.”
This year saw thelaunch of two new Royal Caribbean International ships, including Icon of the Seas, which holds the current title as world’s largest cruise ship. The innovative new ship and the hype over its debut has led to record pricing levels.
A rendering of Perfect Day Mexico (Photo Credit: Royal Caribbean International)
But some of the excitement around the company is happening on land, as Royal Caribbean focuses on its private destinations. This quarter, the company announced its plans to expand its private destinations portfolio with Perfect Day Mexico, expected to open in 2027.
The company also announced Silversea’s plans for a new 150-room hotel in Puerto Williams, Chile, designed to provide an elevated and seamless guest experience for its Antarctica expeditions. These new experiences are in addition to the Royal Beach Club Paradise Island, expected to open in 2025, and Royal Beach Club Cozumel, expected to open in 2026.
“We wake up every day obsessively focused on our mission of delivering a lifetime of the very best vacation experiences to our guests. In pursuit of that mission, we are very excited to further broaden our Perfect Day Collection with Perfect Day Mexico and to develop the Southernmost hotel on Earth,” said Liberty.
“Together with the expansion of our Icon Class, we look to continue to change the game and position ourselves to win a greater share of the $1.9 trillion vacation industry.”