OSW - Earnings call 2 2021 | OneSpaWorld Holdings Limited

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Operator

Greetings, and welcome to the OneSpa Second Quarter 2021 Earnings Call.

[Operator Instructions] As a reminder, this conference is being recorded, Thursday, August 5, 2021. I would now like to turn the conference over to Allison Malkin, Investor Relations. Please go ahead.

Allison Malkin

Thank you. to Quarter welcome and Earnings and Webcast. morning, OneSpaWorld' XXXX Second Call Good

I'd you our judgment webcast to and could we a and The of current current The like number only differ Before statements begin, conditions materially impact uncertain to alter business. continues remind flow to our forward-looking nature available have and ongoing forward-looking today's COVID-XX position. pandemic deemed impact information on may that our cash call factors dynamic of today, and reflect expectations be of its and on our analysis as may significant results constitute a and These statements. operations, outlook. and made affecting based actual statements certain on from financial materially

reliance not on forward-looking should statements. you place these Accordingly, undue

discussion we SEC forward-looking with conference For included earnings Form was quarter XXXX the a the statements call furnished you release, in forward-looking X-K. which our on more second that refer and regarding to made to thorough uncertainties risks disclaimer statements this to and associated today webcast, in of be is the

or result We new any forward-looking a or do information, obligation alter undertake whether as future not update statements, any to otherwise. events of

morning. certain In can explanation this on of release addition, be earnings adjusted these found refer the company this may earlier to issued metrics metrics non-GAAP call. An in our

financials over Then and liquidity. COO. XXXX begin Stephen priorities. an details today Executive I to quarter and operations on provide and now call Leonard. will Fluxman, Chairman Lazarus, our Leonard the Leonard more like Joining provide update turn our CFO would are a CEO; our and the on me review and to with will and performance second of key our Stephen

Leonard Fluxman

Conference Allison. Good Call. Results Second welcome you, XXXX OneSpaWorld's morning Thank Quarter to and all,

represented positive that and quarter destination of a have reopened. at across OneSpaWorld's resumption momentum to spas terrific continued service second start our The sea resort

from the revenue first a in environment, quarter to continue we significant. fluid While was improvement sequential operate

our XX total, in second said, focus reflect quarter intense XX end the implementation successful Of our safety, to June. staff execution a service mainly protocols dedicated in the performance at wellness and ships quarter, led results health to the and of of of spas. operations our the ready and In service resumed That our by destination to resort our our often our and flawless centers members. staff new of actions outstanding highly

spa to support hours among I enduring would to service. staff crews return for like training and resorts our corporate of outstanding thank to hardships other endless our teams destination and many

more We our build service momentum expect the upon favorable half as to year. the during ships second return of to

spa of to resort revenues EBITDA staff higher-than-expected highlights at Adjusted almost liquidity $X.X destination meet the reflected million. was destination million and Of positive with we has and spa quarter locations are the EBITDA in $X.X note, all demand, of generated ended were Total the quarter, our resorts a $XX.X total million. quarter. revenues. to of mainly loss we and Turning increasing

estimated when XX operated reported quarter total more we May. we in ships, yesterday, on we of of X As first than a results cruise

levels, are services. our to see demand stopping we spend historical for customer and occupancy While strong below are and continuing

that of levels customers promotional July cruise accomplished spent in the activity. lower onboard This July, historical month end, this exceeded than ships was To the XXXX sailed. despite we

service returned tradition already are ships encouraged has team generate our versus up staff, that with the our We In supporting maintaining we possible highest also XX of ensure are statistics to of OneSpaWorld's XXXX. the while onboard that standards. have keeping the recent highest to prebooking visited XX corporate revenue,

COVID challenges personnel successfully sea. back quarter placed the voyages, ecstatic other members securing for of the on top travel anticipated team be actual XXX cruise hurdles, Despite the our our are visas, is at at service second these to end and to and restrictions. return vessels We ship testing the overcoming Flawless pandemic, priority. of

plans on so return end to are to the adjusting basis have of service. September, are X,XXX By to We immediately we a additional that position daily our any we unplanned to are in September. react expect staff to to reembarked on operations continue back vessels. additional staff we an by on execution We the ships as believe flawless and well end we positioned welcome prepare our resume XX of a

model of growth confirms which to delighted that We spa our operating business metrics. team, in we on also cruise operating fully an profitable government to operations us, to Alaska, positioned were generating We U.S. market and performance service are represents powerfully return platform long-term sailings our believe resorts the initial resume. some approved ships our for to as the and of drive important strength see capitalize destination best

Overall, value and increase offering continue in efforts return execute financial ongoing our will OneSpaWorld implementing the that service our while expand elevate only stakeholders. peak to but of to sales profitability strategies discipline, for with company levels not further our brand enable we and our intense all to to also

that, call liquidity who results turn Stephen, over With to position. comment quarter our on I'll XXXX and second the will

Stephen?

Stephen Lazarus

good ladies Leonard, and gentlemen. you, and morning, Thank

sales of and XXXX mentioned, performance to I Leonard will the quarter and to staff the experts first and a extraordinary of team's As highlights. second return share reflecting year, the from the prepare the quarter few ability now service just second operating accelerated our quarter saw conditions.

million those $X second majority in health resort destination our revenues to centers service $X.X Cost our the spas. operations XX the second in to million had costs quarter. million The related onboard from coming costs personnel service compared was year. quarter, were in the and For our and wellness XX, into with resumed generated June million were of Revenues as quarter second of total ships towards the quarter. of of quarter. of primarily repatriation of the decrease last XXXX, COVID-related incurred wellness due $XX.X closure were all the onboard to XXXX attributable the $X.X significant to of compared XXXX health the to centers the of second and end

quarter. million cost quarter while second in of XXXX second reserve. compared Cost $XXX,XXX increased of of product the of establishment freight product to the for inventory to resumption Cost the related year in $X.X XXXX this included a the second expense quarter service, of of reflected $X.X products the were million

$XXX,XXX warrants. value in income is million our loss prices, the to the of positive was XXXX. from instruments. these The second a a $XX quarter change in of result million operations, in of value financial the the $XX.X improvement of result in the million market plus warrants of of the deriving value XXXX changes loss change the in primarily the of quarter in $X.X fair fair The $XX.X of million compared second improvement Net a fiscal was

liquidity was compared the $XX.X $XX.X a XXXX. of second as million Adjusted quarter loss loss a $X.X the of EBITDA of with total quarter to ended million. million of We in

Additionally, $XX.X the at quarter end. under million million end, Availability remained at program. under our ATM $XX quarter was line credit available of

was rate of $XX.X million our $X.X driven increased the for of cash below The quarter expectations, burn timing approximately by and million revenue. payments

between $XX in burn as of cash quarter in $XX and third we anticipation activity expect the million increased increase million We sailings.

leading from thereafter, in in cruise generate We flow flow expect our accelerate resumption cash and improved operations the and ultimately December. positive cash to third quarter, of operations, ship to

to business quarter guidance. and expect Notwithstanding due not the a we surrounding GAAP a impact relates for will the it the fiscal third foregoing, XXXX, our disruption to continue loss COVID-XX and As the for continued from our provide adjusted ongoing XXXX we and the to outlook to on year, business incur pandemic, uncertainty to basis. net

we please take that, the with Operator, over. And if will open for call questions. up you could

Operator

Stifel. Wieczynski from question line first comes of Steve Instructions] Our the of [Operator

Steven Wieczynski

point. So totally all, specialized labor if look at pressure I you pretty are give there first has of obviously, better or that's understand at out companies is your guys fact part, you big commissioned. any a fleet, much the most for point positioned given versus like this most pressure labor point guys? and employers the us for of can most that, land-based what you you if looked a labor But for they're idea availability operations, your

Leonard Fluxman

Yes. us so certainly necessary different But there by we up models, Steve, extended competition We tougher Certain labor far, are in. to staff. little on that the and a hours correct. land is demand get, so complete increased resorts being are different you're pool Look, it's proving mean to given positions starting for I good. where with operate X and

the as it's fluid point, not managing necessary when stay up And that start far, Probably a staff and tighter so but to But at we're definitely recruit yes, this with It's model tight it. able to demand. abreast as so get we we're question definitely a different about from. no good. countries XX market, from

Steven Wieczynski

if services But are is Meaning then kind onboard complex levels services? of this. know more more expensive Okay. help or guys Or paying in of from credits? us Or you can passengers are it can Got wanting there's are spending is mentioned on? you any makes And just on XXXX. customer? don't that think from through spending talk Hopefully, what about board been And you. way coming these it sense. us that after I all the spend you And strong products cash then on is very about spend folks the complete? most have

Leonard Fluxman

Yes.

at. at been positive got all occupancy being July And you We've encouraging, metric on XX% only which I we've a every at July XXXX, has overall good tell we with look can ships and is where look, we're that right had it. under very now, So wraps. the single were above ship about

than ship total now extent don't spent more shorter before. I first that And while the we system getting to our first a I itineraries. very times able that is the up despite are the into spend changing day our what mind-blowing the a on while seen basis up, to on us spend. enough mean and credits. occupancies can down, data spend prebook to we've have is encouraging, the with we've testament be So ever are which tell up some up, amounts is on is you seen pull to frequency of people implication day factoring onboard spending that's is of right on lead prebook

frequency summary seeing snapshot total, versus 'XX. single it's of I what if So July up a average look and ticket overall, for a every in we're at category, spend,

good thus So that indication far services. for it's And pent-up obviously, retail with legacy of demand just some attachment. a comes

So our been really about the so execution seeing we're team has and we're from excited incredible. far, what

Steven Wieczynski

if sounds That Okay. more great. in. could I sneak And one

you do cancel if operators obviously, position guess, the just having XX, liquidity there include what themselves, like that mid-XXs a to hovering the of that itineraries in eventually stuff to there's whether I component. and or that. around ATM it's variance fear cruises Your to out kind could and

today do you are guys where position still is you cash your guys with so some if liquidity pretty slight well even is pretty comfortable feel burn, disruption and there your that to of So speak, kind positioned?

Stephen Lazarus

Clearly, border okay. vaccination increased the with to in in lines yes, short now The I are day Carnival, testing for right think in a we taking cruise be last requiring vessel status just outdoor order required. example, on that to the now or answer disruption, be is despite will so, slight fact, would with initiatives

So while have in it we And doing the they're terms are place lines does, and very exposure quickly good potential it will of increases identifying with also the certainly mitigating any taking are and containing the board. seen exposure. potential actions protocols think where great cruise job that We've that they on a very in happen. that

much we see today, upon feel a But that us. pretty it's wait-and-see for comfortable. we everything So situation based and

Operator

comes of Wissink of question next Instructions] Our [Operator Jefferies. line Stephanie the from

Unknown Analyst

the It's Steph. Chris line for [indiscernible] on

as about levels framework quick of percentage modeling per is there for should be to for thinking about ramp that Or a up be here? there volume should thinking you couple of prepandemic from a a of Is Just ship general me. ones revenue XX ship? we kind per How XX? really we

Leonard Fluxman

depending in too honestly, itineraries, of the different get come starting lines occupancy a It's the those will type levels, different generation. with on occupancy little levels depending when probably because depending on ships quarter soon, general out revenue into cruise service, onboard that influence to are all our on

honestly, this generation to overarching too about there's or so for talked revenue with soon So at stage, assumptions just regards that to fluid be it's many changes so us.

Unknown Analyst

given cash early need bring also around to I do the dig then then variants? do uncertainty How And dynamics. enough. balance really you burn deeper you how specifically COVID Fair staffing pre-voyage? around on staffing staffing want that And back to

Stephen Lazarus

still done to the Wellness bringing quarantine crews we're an all Yes, some going requirements to that around cetera. or job, both go revenue world. question. the it's incredible and our a give and have ahead quarantine, terms them certain we're those just actual serve vaccination, staff a adequate has in of XX that in there us test it's of vaccination are countries, great the days cases, mean of voyage countries. team time I our London something different protocols. their going banner et Academy, to red recruiting through in obviously, for are we that crews Each And has an And actual for the of staff in not either

So the recruiting of Clearly, it lot puts have and water that something many and this so is have training, very on ships pressure put never but well. what a staff. is, that with does the all historically stress back done we in we

of bench that end yes, So task, very enough back somebody some but the all where at Herculean you days cope into through it's well. same the the projecting we we've demand quarantine, year. obviously have date, managing now right blips to the on the There we're but a are is time, to with or been staff put have

Operator

of the of Infinity Assia Our next comes question Georgieva Research. from line

Assia Georgieva

in a really I job these have think particular, the in under done guys, industry, general, great circumstances. you

So keeping go everything fingers smoothly. that crossed ahead my to continues

spend are first of coming attribute am you back it of cruisers these that more In first-time the cruisers board. may you're I In passengers better on a seeing? that correct? terms experienced for have are seeing, seems of the good spend past, that the I you, imagine quality you're some offered that would that to

Leonard Fluxman

cruises. experienced there's percentage not think now. say total first-timers something That's crews dig right experienced higher between it's of and I to to into we're just able terms the But delineate I a of that spend that Yes, will definitely hard in onboard.

experienced the But more by don't given cruises seeing. the we're spend as as simply pent-up first-timers demand typically as that encouraged we're much that

like the spend prebook now. all demand seems it the on well So out again, the into exuberance our there sea getting services that's and the and of for playing right

Assia Georgieva

portion? to cruise spend help? difficult by And do delineate it is Or directly how coming SECs much companies is that issued the from

Leonard Fluxman

a going we necessarily more sort it having set they're spending portfolio. service, say or of having fourth think on recap visibility. in not quarter of to that POSs we've than above and of one off cruise. get the I on quarter. of not when get tough you will one try something that service, state helping. It's as the It's back we're you It's we're third the something visibility in single every track individual to try and we'll the encouraging expensive breakout better stand I it's and But is services. the definitely only because SECs the the beyond are But more they're more people and on any

the good So of pent-up that's indication, the guest services. of demand a type the not these but of for legacy only quality of

Assia Georgieva

That Delta see it's of inherent this anything If we of risks a has X there moment, concerned Is [indiscernible]. you or the We the that surrounding you to say, sounds potential are uncertainties next, else all for point? the are what that possibly aware variant at over let's months? that whether the XX great. some exclude

Leonard Fluxman

to that there board. spreading that in encouraging banners delta couple with a few say been surge weeks increased I in so the our ability ships have onto sort protocols our The putting level as obviously, the outbreaks team, from everything our little amazing of being it's many about a an the at me to to August, think that are of up will seen a even quickly operation, the returning bit execute. that job done where from the last the September the of months with well. see increase thing big on we've concerned only I contain on that not we've to variant of keeps variant, ability I'm continued night, of is ship. in out this I lot mean, the

a I to definitely the of awareness forward protocols So ships what keep need do they there's their working, are and think to heightened going sea. in

Assia Georgieva

the industry sort for people and think faster get indirect for some a vaccinated I Well, of vaccination rate. advocates at credit deserve getting should to being

great a up. are guys you think I again, so So keep it doing job,

Leonard Fluxman

Thank you.

Operator

And the further panelists. to I'll Please at turn time. there call you, back this are no continue. questions

Leonard Fluxman

you you everyone, in and joining speaking report again for our look right. us quarter Thanks All today. our third to progress early forward updating We again, for with November. on Thanks results us joining today. and

Operator

thank rest conclude your please do great Have presentation. And for We your today's day, that you disconnect lines. ask participation that of you everyone. does a and the

OneSpaWorld Holdings Limited (OSW) 5 Aug 212021 Q2 Earnings call transcript