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Festival Joint Stock Company (NYSE:CCL) shares rallied at the market open on Monday after beating Q1 expectations and fueling optimism about a continued recovery in 2023.
Miami-based travel operator recorded a loss of $0.55 per share on $4.43 billion on revenue for the first fiscal quarter. Analysts had predicted a loss of $0.6 per share on revenue of $4.3 billion. Adjusted EBITDA for the first quarter was $382 million, well above previous guidance and analyst consensus of $304.4 million.
The occupancy rate for the first quarter of 2023 was 91% of pre-pandemic levels while total customer deposits hit a record in the first quarter of $5.7 billion. The company recorded “strong demand, bundled offers and pre-cruise sales” for record performance.
“We are enjoying a phenomenal wave season, achieving our highest quarterly pre-orders ever and breaking records in both North America and Europe. Our strong performance extended into March and we expect this favorable trend to continue based on the success of our demand drive efforts,” said CEO Josh Weinstein. review. “With year-on-year adjusted free cash flow expected to be positive, our turnaround innovation is behind, more committed export credit grants on hand, capital profile future investments and more than $8 billion in liquidity, we believe we are well positioned to pay off short-term liabilities due to excess liquidity and therefore have no intention of selling equity shares (except in connection with our beneficial and undiluted stock swap program).”
For the full year, the company expects adjusted EBITDA from $3.9 billion to $4.1 billion, with sequential improvement expected throughout the year based on expectations from $600 million. dollars to $700 million in Q2. Occupancy is expected to return to normal in the summer after hitting around 98% in the spring in Q2.
Management also expects operating cash flow to continue to grow through 2023 after operating cash turns positive in the first quarter of 2023. This is expected to be the key driver. to reduce debt during the year.
“We believe our debt balance has peaked this quarter and will decline over time based on an ample liquidity position of $8.1 billion,” said Chief Financial Officer David Bernstein. and the expected cash flow strength of our business.”
Shares of Carnival Corp. (CCL) rose 4.4% right after the market opened on Monday.
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