Royal Caribbean reports ‘record’...

Caribbean itineraries accounted for nearly 80% of first quarter capacity

Royal Caribbean Group has reported a “record” customer deposit balance in its quarterly financial results following a strong wave season.

As of 31 March 2023, the group’s customer deposit balance was US$5.3 billion, it said, as it reported a total revenue of US$2.9 billion for the quarter.

The group said stronger than anticipated demand led to a “record-breaking and extended wave season”, which translated to a “robust booking environment driving higher load factors and higher prices”.

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That, plus strong onboard spend, has led to “significant improvement” in the first quarter and the “significant increase” in the company’s full year expectations for ticket and onboard revenue, as well as earnings, it said.

The group reported “significantly higher” booking volumes than in the corresponding period in 2019, particularly for Caribbean itineraries, which accounted for nearly 80% of first quarter capacity, and said it has higher revenue expectations for the three remaining quarters.

Additionally, consumer spending onboard as well as pre-cruise purchases continue to exceed 2019 levels. The company said it expects load factors to reach historical levels by late spring.

President and chief executive Jason Liberty said he was “pleasantly surprised” at the speed in which demand has returned for cruising following the pandemic.

“We knew that demand for our business was strong and strengthening, but we have been pleasantly surprised with how swiftly demand further accelerated well above historical trends and at higher rates,” he said.

“Leisure travel continues to strengthen as consumer spend further shifts towards experiences. Demand for our brands is outpacing broader travel due to a strong rebound and an attractive value proposition.”

Chief financial officer Naftali Holtz added: “First quarter results reflect continued demand for cruising and our teams’ focus on delivering the best vacation experiences that exceed guest expectations. We also benefitted from favourable timing of operating expenses, as well as our continued focus on improving margins.”

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