RCL - Earnings call transcript Q4 2024 | Royal Caribbean Cruises Ltd.

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Operator

Good morning. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Royal Caribbean Group Fourth Quarter and Full Year 2024 Earnings Conference Call. [Operator Instructions]. I would now like to introduce Blake Vanier, Vice President of Investor Relations. Mr. yours. is floor the Vanier,

Blake Vanier

Good morning, for joining today you and fourth quarter thank our for XXXX us everyone, earnings call.

in Holtz, Officer; Joining Executive Royal Caribbean and here Miami Liberty, the Jason me our CEO Officer; of Naftali Michael our and Financial brand. Chief Bayley, President are Chief

A that forward-looking which a earnings metrics can expectations. risks expectations change. Also, for financial to as earnings call. non-GAAP we as measures, of in all and we on non-GAAP release. morning items adjusted on be we all our are Unless and issued state discussing from will to these These our number statements be Before investor website our note differ do of based otherwise, started, and are are any defined, our found certain reconciliation business. quarter, and forward-looking currency will recap and actual will adjusted basis. the call well description a making with on XXXX. materially would Please I the providing be as get current follow current our are refer as statements to strategic the fourth current subject constant circumstances for overview booking We update SEC to of statements our undertake outlook factors. on uncertainties. begin release our a a and a to by Jason management's Naftali environment cause filings of the could like we'll during with factors this not this results update

call open turn questions. With over Jason. will that, the then I'm the your for to We to call pleased

Jason Liberty

and incredible high good at XXXX the for We and year our us, exception. vacations the many things and morning, to quarter results, continuing net and more memorable Group. XX growth than we an support and our while fourth and the year the achieved at I'm allocation, invest sheet ambitions. everyone. you, billion X.X discuss quarter million cash very for our XX.X% no scores thrilled of metrics. schedule full ahead Caribbean months yield trifecta at was business happening goals generated and investment-grade a exceptional was achieved $X customer the delivered all capital satisfaction expanded balance flow exciting to XXXX same time, operating outlook record in Royal We the fourth Thank to of growth return financial to Blake, our

year for share is the brands, a also results We our best private reduction us. ahead and beginning double-digit the on innovative financial for met focused target fleet a remain greater full people, we truly market. $X our schedule. These just foundation industry-leading winning With of vacation carbon destinations which and future, bright trillion set strong most intensity global a the of very the

and proven to continues us to for for cost I capacity vacation this opportunity financial experiences thank to capitalize success, to team plan passion, grounded Group want in best and commitment Our responsibly strong moderate and growth, drive moderate the on the formula control. our Royal dedication be results. Caribbean entire yield that exceptional deliver their enables to growth

and for to best the details, announced to which transformative another even guests mission product. We order Cruises morning, which vacation explore getting the class placed in will provide yet opportunities to experiences. more Beginning leading like as this in River for XX River serve Celebrity ships, opportunity destinations chapter I guests, we the into our for unlock foundation inspired an edge brands. with our shareholders. for will our take our initial XXXX, new our to will Before Cruises new exciting moment an deliver new exciting would Celebrity discuss a this business

sizable vacation by increasing aligns adjacent within beyond cruisers a Cruises offerings travel fragmented substantial River including as more go value natural spend Our is from a with to reach of is a of a well appeals seasoned has and money as loyalty Cruising that growth into lines Cruise ships who into destination-focused that broadening discerning and business has that an premium lifetime us is a of delivers of and APDs us and market ROIC to disproportionate similar It ecosystem a of can opportunity demand scale River attractive as Driven It last and Cruising Expanding over is and profiles. Celebrity time River high-margin, Ocean of of our allow The an turning decade. travelers Celebrity's opportunity their fits deepening market capture all vacation for River amount smaller new brands. the on that customers. while both offering nicely vacations. growth immersive share. Cruising experienced spent far for exciting exciting a high that shorter double-digit we lines of complementary very lifetime market our presents our our build deployment win businesses. a of return of see portfolio. experiences. the that. We river attractive however, our demographic time ambition, customer cruises. extension types family within River strategy faster of on

curious or an of would a half a majority have add to We vacation take existing new reputation River guests Cruise Cruising, additional but remarkable yet attract our a haven't from either that for and taken to are leap. who River experienced Celebrity's have intend who demand a exceptional opportunity. vacation Cruise. Furthermore hospitality guests of Approximately and already unparalleled of will River travelers take experiences

innovate will edge our quality bring in technologies river space. onboard Just that an as and reimagined the design, in cutting-edge sustainable follows to XXXX. also Celebrity agreement Cruises The sailing inaugural is to the its Xcel be standard Ocean Celebrity Edge we've ship and the for we cruising. known this sister year. gearing sophistication be excellence the This exciting order of news to and as set class in ship delivered Edge will brand a the which ships ocean class cruising, experiences and recent river Xcel, bar for is elevate X continue as time this for shore to of Celebrity up our X, will later to set raises sixth

talk and So yield what outlook. I now let's $X.X XXXX. revenue double-digit of in generated growth and am We originally proud delivered have we XXXX expected. billion about XXXX results we accomplished more than in

team, performance propelled execution brands. by was strong Our our the incredible of our flawless demand drove across elevated which

year-over-year our driving adjusted focus margin in We on growth. also EPS expansion continued resulting XX% durable

$X.XX mid We up X.X% our brands, both Mexico, Of Island exceptionally high Royal The including and will a on target and in our the revenue continue of The ROIC. balance Utopia while the launch of Ray, and Icon innovation of note fourth were Paradise to and guidance and another attracted in a a with we earnings a better further loyal several XXXX than strengthening Day leading scores record and Perfect The volume Of portfolio Seas, of that Beach yields differentiate remarkable guest advancing both vacations number with for ended and achieving while Silver our destinations book Seas in strong guests. and year investment-grade metrics ushered future Cozumel. a invest as was quarter, private and reaching new year pricing standpoint. XXXX teen position sheet, our of the Clubs great from that of satisfaction We announcing received era new key

channels to of their our a planning points reducing capabilities XXXX, time in across been expanded reducing create book vacations, digital flywheel. dream invest across to overall continue distribution XXX channels capabilities our all amount we friction experience half. connects and by across a commercial vacation the and spend. consumer the In aspects the booking experience XXXX, of seamlessly have experiences that while over in the to increasing improving We dots launched new digital and We journey. Guests cruise

infused service. efficient and guest a into journey to AI also better, provide We personalized the more experience more

XX% brands, to XX% loyalty all intent to new For relationships increase chat our onboard. reduction guest match customers customer With their long-term in of rewarding our earn new indicating loyal out allows in loyalty example, X in-app repeat, XX that adoption our guests guests portfolio. status across line across fostering to status led a our a and program service the X saw

continues the have call, to in Momentum across earnings Bookings year. continued all in with XXXX last accelerating in history. the this key X company's year the last weeks since to outpace booking resulting best Turning products. bookings

Our optimize pricing further book us position yield business is and for in line allowing with prior continue as to years higher to XXXX. at we book growth APDs, of the build

year continued the premium has widened, As earnings our our optimizing yield have focus bookings last to ramped growth. up for underlining our XXXX call, since last on APD

cylinders apparatus demand are all commercial all XXXX is and on delivering levels. quality Our above channels firing

grow. last across year extremely We well. added channels of digital engagement continues digital direct-to-consumer to preference performing new our consumers' for as platforms Our are capabilities hundreds

meaningfully are partners bookings rates. at higher travel Our also last delivering than more year

year. America particularly We healthy about our will where XX% sourced North continue of to this guests see from demand be

nimble appeal us Our by allows and brands, guests sourcing the highest the ships world. around multiple positioning in global markets our yielding to model attract

across Our at from brand new are and respective demand in lead sectors and quality bases. their very capturing sourcing segments consumer successful

for and customers. interactions we from trends with daily millions beyond, both As we our of XXXX think about consumer to macro and demand points look data

take experiences and to destinations strong their to our travel. continue We consumer year growth Z this sentiment than experiences. American We spending. significant spend levels. and more are spend savings vacations At from more with wage leisure wealthier place surplus see travel and on positive the to to environment sentiment things Consumers more as even very wages, same travel on continued strong guests time, to more macro and bolstered elevated from low prioritize over see that multiple is in markets, plan and important Consumers consumers. unemployment our Gen leisure they customers, high visiting value on in continue the index trips favors a by wealth in driving grow. millennial coming and and to positive households labor over intent customers our continue ever spend

consideration and vacation is to an Something also leads high among that Cruise millennials is remains the positioned compared proposition in Cruise travelers. value uniquely gains younger deliver guest biggest with on. attractive and cruising to other alternatives. satisfaction

expect benefit well to is with be as and brands, the year AI-driven and generation. and commercial from to path full Of these flow accelerated The X% exciting Xcel differentiated benefit experiences positioned as and leading capacity XX% of of The and up another to exceptional growth cash year ships, we capabilities. XXXX trends XXXX, through and earnings Seas and introduction shaping of robust very grow exclusive Celebrity with Ray. Seas are great leading In Utopia and Star Silver by the expected portfolio innovative Of our We towards well destination

draw overall profitability. enhance yield and elevate our but brand, vacation tailwinds not ships provide customers new to and New only experience our also

combined with to focus of to $XX.XX leading continued capital of and our earnings We expect fleet, and fuel with and strategic the share rates to factors, drive and private X.X% call. ships destinations $X.XX of yields our to per our are which includes on Strong allocation earnings FX performance margins apparatus. grow load driven last headwinds expected to by existing commercial entire new strengthening rate compared together X.X%, and adjusted $XX.XX

Our proven growth, yield and formula margins, moderate to leads growth superior control enhanced moderate capacity working, is success performance. profitability cost and for strong financial

Group been Caribbean It's vacation innovation Royal that a through foundation setting experience built what apart the has clear decades, been excellence. can has be. of and our a differentiation, on redefining ourselves success For

best-in-class the in delivering ships We possible. have way that redefine led

ecosystem like into As new expansion of understanding pursue AI digital their of that private destination redefine individuals time we and ambition the experiences River can an lines and to relentlessly valuable we continue vacation vacation develop we the businesses of that continue capabilities. We entry expanding the vacations portfolio, ahead, wildly how our of couples Cruises, so of an and development to exceed families, expectations. their spend industry-leading through exciting Celebrity today's acute to look want

for we new an travel experiences are they are and committed across to a travel it seed our of lead lifetime redefine to not industry, into promise a not position goal is cruises ship a of planet, about to means exciting alongside remain island the private us vision, them river to to lifetime turning from as personalized just for loyalty, energizing relationships was even the by and preferred create innovation. many It's the world With of the is just beyond communities what our journeys year stage this deepen an accelerating vacation. This and but of choice to poised all, our for brighter future era. Through into it's to marked sustaining Our an strategy, broader seamless, inspire a a dreaming for and kind that a meeting of future. we cruise guests. the that vacation them where set portfolio exceptional every vision, vacations. XXXX company, milestones

and means to brands, vacation. Caribbean elevating We have trusted and are is private the from ships people all unparalleled by awe-inspiring what best a people. vacation continuously Royal the it redefining deliver what portfolio best globally expect come Group destination experiences, to propelled

As started. And winning share on turn over we to with we an embark will getting on even focused and it broader Naftali. XXXX, vacation of remain the just we I Naf? are market that, greater

Naftali Holtz

and good Jason, will reviewing results. you, quarter Thank everyone. start fourth morning, I with

midpoint teams that Our a of better to delivered despite $X.XX. and brands X.X%, exceeded compared quarter was exceptional stronger-than-expected APDs points outperformance revenue ships the the and finished of strong compensation hardware. our earnings new across performance like-for-like from in resulting headwind our share is due both guidance our cost by guidance XXX in with yield stock from another to a basis increase driven products quarter We net than expectations, price. our The growth of per adjusted by higher that driven share our and fourth

a We as entirely constant the billion, in XX.X% $X.X driven well costs basis and due point currency. billion. XXX better-than-expected in The also cash stock-based year-over-year to both fuel, compared spend. Net was XX% operating ticket from guidance on impact cruise $X.X excluding growth higher saw Adjusted to costs, onboard price. increased in stock is the by compensation as pricing increase was flow EBITDA rise better

for you our year. start switching taking deployment outlook. and Now will capacity to the XXXX I by through

Xcel Star, of expected capacity year year-over-year. of increase is and full With Utopia a X.X% the Ray, and Silver introduction to

more some fewer have our This restarted for ships program dry about our growth. contributing dock year of dock. to and planned have days XXXX, We dry this each also have biggest to has for modernization dock dry points we percentage compared capacity that X also year, days we

days dock than but dry As XXXX, a less result, XXXX. we days have more than

negatively more In growth terms docks dry cadence, year, points. impacting last by of quarterly XXX than the quarter first basis has capacity

will The third last growth year, benefiting the relatively while to year, by points. XXX fewer dock second basis last dry have quarter to and fourth flat quarter are days compared capacity the

expected quarters. and first grow X% the As quarter third in around the a result, APCDs are in X% and in fourth the XX% to quarter. second

New XXXX in capacity to represents growth of hardware X% XXXX. total compared X% in

happening. and Last said for factors yield quarter, off continue is strong the a with ramp very mentioned, years with for Jason further and is continued is and XXXX line at As to allowing strong year, year last the load start. what in the higher same demand of last we up, X% year. the up XX% exactly Caribbean XXXX bookings pricing rates, book presents prior also capacity call, over growth year. load as The that's our earnings to expanding our last region versus booked APD and is build Since to in we've while time this deployment the factors

introduction the year. second The the of the Celebrity With in Star of Xcel Seas Of half and

of strong capacity. of volume Icon will on Perfect well is X% rate destinations and very itineraries our X% of with with have both versus will market year, destination Day continue the capacity basis. perform Caribbean the with well perform for Over year. increase visit sailing been Utopia in performance. Clubs sailings opening account XX% continuing these incredible brand account and driving Alaska in and strong up XXXX Royal performance expected differentiate top to guests the ships Cozumel XX% Caribbean strong and total will of private Caribbean this that a to above hardware. Europe existing and with on Nassau to on percentage last continue very Island, expectations to Paradise for bookings We and European at Mexico. of Beach the and is to private of XX%

among best We have has some and Quantum of surpass expectations. the Alaska the Edge, strong Celebrity to class harbor X Nova, continues ships in region, including demand been Silver and very our others.

moderate proven growth year. strong to for growth drive capacity XX% discipline and let flow formula expected Now XXXX, our for about is me this our success, moderate yield cash higher growth, guidance cost generation talk earnings and

and balanced hardware. new We X.X% expect existing between growth X.X%, of to yield

expected outlook expect year's of costs up currency be the fourth XX to was costs, top XXXX the fuel of at prices, and anticipate hedged rates I note Our related and growth between XXXX outperformance basis that fuel and ramp-up excluding quarter shared foreign headwind margin than to we growth our yield earnings Maya on $X.XX X% second from focus and growth we enhance on fuel, quarter, and since destinations. year $XX.XX. metric. Full are to put the of in share XX% other that by of earnings The expense this interest exchange fourth the our cruise are this dry the Costa remains the year, as flat We we net boosted XX.X% third is growth for current per point acquisition to $X.XX business. we for adjusted first on expected to preliminary cost a expense, to as expectations docks, exchange higher our varies call of our billion fuel $XX.XX below costs continue throughout and year. quarter with and last by rates. Based timing range grow driven when of would cadence be rates the year headwind includes port market and also

margin. return points us game-changing sheet to We expanding capital which in expect us also continue EBITDA balance adjusted maintaining accelerate and positions growth investing and metrics generation, growth in our in shareholders. XX% allows XXX initiatives, EBITDA to flow strategic gross This basis cash to investment-grade

assets our are to as $X our well as strategic into maintained. key of billion expect capital invest ensuring well We initiatives growth

the and capital in the fourth is quarter with our related with portion Beach Club significant year. and to private in Maya of $X.X that be including the we the the announced the fourth open the in destination portfolio, to quarter to Costa in billion We having is both expected this committed third are Celebrity year, Club deliver that place. Non-ship of port last in Cozumel expected acquisition of to ships financing quarter in Beach Seas Xcel the set Nassau a Star

first Caribbean, to discuss than remaining products. expected Asia of across Pacific up will X.XX% I and existing Net the with X.XX% first hardware from Now capacity quarter, all in are be and X% coming to guidance. be will our year-over-year. the across other spread our up in More In capacity quarter itineraries. XX% growth be capacity will both the several new yields XX%

for First include growth of new quarter impact Utopia X.X% and dry both full the range quarter cruise from per up adjusted quarter X.X% expect XXX share benefits $X.XX first expected quarter and all from compared costs, disproportionately timing be dry hardware, docks Icon yield and we of increased to earnings to to Net Silver Taking into a the the the XXXX. basis in addition are account, $X.XX. of excluding fuel, to be of Ray. in this docks to to points

We $X.X balance the to in sheet. our would Turning billion ended liquidity. quarter

very is Our credit unsecured leverage Xx, position goal low a balance while was consistent and of ambitions expanding our support our with At our growth strong year-end balance to was in sheet sheet XXXX, investment-grade allocation. capital at metrics.

generation expected strong and leverage finish the expect EBITDA, to we flow mid- at to increase high with cash Xx. XXXX in With

experiences reduce we operator our on I of work to a the call to responsibly remain cost to that, our solid best another question-and-answer open ask as We for and to will maturities of committed we opportunities deliver find will year to closing, session. results. With the mission manage capital. In focused and vacation continue deliver

Operator

question take line [Operator Barclays. from Instructions] Brandt the our first with of We'll Montour

Brandt Montour

strong the XXXX results. on Congratulations

The first about yields and is guidance. question your

of had of midpoint comps of sort to per XX X.X% of quarter yield And you you the new you about sort the year last that setting last fourth gap. versus But single-digit What think help us have as now kind takes want tailwind think year you and side, tough of hardware guess I that it at you -- this looking puts basis from help the us how if guide. points to us in reported And we're compares? year. this that upside. trying about Just bridge 'XX, level and the what Kind high diems think the just a about of on the could maybe year versus just

Jason Liberty

we and well. hope Well, all Okay. Brandt, is

I us. did of think demand kind the strong comparable elevate point, saw to for the quarter the the we first base in fourth

And guiding great. We're But be demand, north. or happen coming of that that so we yield had So had a year, XX.X% of XXXX, north very really some we off improvement. Last slightly we comps, and would rise improvement. maybe right? close-in XX.X% saw is incredible we which also

a load is it comp. more also a time ago. factors little course, we So bit our long recovered difficult of of a And

for seen highest week But the something potential that last so us. And booking we've lift wave. ever early And was is up not during an booking factors load activity incredible from in wave obviously our week it is that's wave. opportunity for

improvement And as very that the like-for-like. encouraged are on incredible also I seeing. that seeing not we thing her very new well And as think launched comps have on encouraged well. so what but we as only of Icon is on some course, other we we're we're hardware Utopia when on in we're And very

the from And X.X% considering midpoint guide. FX where confident call. trends all that to very a based as always. our of to since the our the arose is on give $XX.XX, guidance be and we're and headwind the we're encouraged in guide booked I today last off fuel able the So we We're of that feel seeing X.X% of to yield think

Brandt Montour

the market I question be on can think existing place your on where River that in And the done you about is research you announcement a and river market. lot market. Obviously, second the of Great. say congratulations entering My should guys market. exciting on have the also

there luxury, qualifies rates. all competitor charge diems luxury are prominent the as we that that themselves they a so per And is know out there

broader the Your Celebrity commensurate brand below Ocean market. in charges premium with ocean rates that, significantly

the word luxury the slotting it you you used like in the River because Celebrity like, diem that used So product is, below general question the sort per sound do I brand second market again, elevate, to of sort word be It sounds the you cutting-edge. you rate. the area of doesn't foresee guess expect

So could little color a maybe more around you provide that.

Jason Liberty

And Sure. space exceptional one Viking. I want River there's a that to I'll market great today, it's well. very but an when what comparing you today Tor you like on Celebrity might all-inclusive as Celebrity in mean, obviously, I product. first, competitors gets an that versus job example, it's a side, space. don't does think you're what an is It's Well, the Viking also, say in the not important see gets as what important say to note that also fragmented it's

APDs So also adding with that in as of the you we those inclusivity comes start expect River, elevate. some to

which guests really a it far up to At The X over bring in end et draw level an see when space we're and of talk elevating rooms, incredible real improving view to of our and state is that opportunity in beautiful a the about that us point million design, there's at really the I the to superior to for the take us, the is brand, we that's have Edge, year. cetera, well culinary of of least ships in these going high-quality there's entertainment, and demand. what day, you -- other on else thing through anything small to

people a vacationing continually have of database who XX with are We million us.

great vacation program, sure our being able flywheel demand. are generate that's make company. where as up think course, of that's that to going to There And space that's high-quality great lives go And on to we about this trust us obviously out to I And think those in experienced why ecosystem. this what loyalty we're people excel that they a there. And is deliver And think on is we is side. trying platform the the really to to great us I've to to said that really to And is we and experiences. marketing River to being an as this on our ourselves incentivized well us is high really it's so meet stay the our we that a want experience for before do in being for brands our for be a think is here into. to that cruising standpoint. within as the we're use customers there we with deliver past, We're experience focus the where opportunity an opportunity

Brandt Montour

Congrats on quarter. Excellent. the again

Operator

Our line James Hardiman from of comes the next with question Citi.

James Hardiman

to want page with same Cruise the actually on I that River stay announcement.

trying to offering how for first, to going just the versus Just But offering. let's get similar start. a guess, feel be I to Viking it's the different and

XX going to in So life a customers about be Europe? I'm to and I'm start ships ramp? assuming XX And kids going there's XXXX. brand. of going XXXX. be you're just on to look is offering primarily ships, the then U.S. the going what shape big sort night that's won't of like. assuming Are going all that to up allowed that sort component be by the running Celebrity's ships? given it What's Is I of as to think

these on Just bonds. trying to put some meat

Jason Liberty

Okay.

is great. be Okay. to lot be Well, also, there's I also which come, to think a going going to

side, point also initial of about our intentful out of in it's then we it ships is ships. year. put in in was our as a I'd deliver and couple XXXX a order River the to words, XX are front On very was the plan word X

for hobby us. a not is this so And

So going space. into this we are

year company we're We're to ships. have So the XXXX to anyways a have because to come the in a X. to in out. I River going in of just of XXXX. Icon incredibly We're ships Beach Club in these Day And have year full We're going launch for launching exciting wanted because couple going to to in, have be Mexico to Cozumel, we'll that's going when XXXX. have an going it's going Perfect point course, that

great that of there's looking so we're things XXXX. in to a And lot forward

yield things I are that the brands our it's management think I we for highest have guests of guests those a one sort globally the that world -- would and sourced. of us to each which sophisticated thing the in set out and from tools, And say differentiates we One -- more day, world. built that yielding us that decades, allow source we more get all the and every over is

And XX% kind of times from sourcing U.S., so the coming our range when but coming we're this. obviously, from, about today, we're at from XX%

And based off ebb of and those flow we markets. so

so right? on it's are would Ocean sourcing important I of things. But be the our And Seas what They generally seeing would these to to size, similar think of hold remember Icon we we're ships passengers. side XXX not expect about the

to Royal and ability be an market be manage brand, this going to high-quality demand brand from product. our able as wave sell to attract Celebrity Silver Sea incredible title to our well our brand and for us is so for as And demand a

be experience it what the similar side, see Celebrity. to you On on will

And that details from opportunity or as as is are to are to think an you get side ship. how to whether connect culinary ship end-to-end -- on I whether can state real design from elevate kids on that beverage the is experience happen the and with more land that shore that's further what is the to entertainment, But be you and things, there were with the whether able well can on time, Celebrity. said, can of as kind that there time so of intense we ship that so side the and with rooms on and whether the activities, the a aesthetics the there's have of

about build really announced always more the the to interest from design, travel soon tell we more be could as to is is X tease excited down to, our going like our since be. we of guests trust. river which it. we've watching one and I as do, that think, to We'll the comes important up in this, like about we're get then we're is on it, about So -- of of partners it's And most the from exceptional. And boats hours on just amount what and you possible number what I talking our

we're to that Our guests deliver do trust this. us going on

James Hardiman

should looking build those think a we'll assuming pretty and the the of I'm is goes requirements need for CapEx front sort we're forward? billion up. keys. unified Analyst new at opportunities on sort non-new piece the sure. step I with to maybe to up non-new you build free lot outlook. I on moving of build, the secondly, to a to capacity, how That's we great for guys way guided love But color the new $X billion $X.X build, get Day non-new front, billion, wait there's going just until build, XXXX CapEx I'm then more forward assuming about of big $X.X you guess, cash flow think there model any but

about do how it billion number 'XX? $X we that moves into 'XX, how and So think

Naftali Holtz

Naf. It's

of So in priorities. I think kind and our think of what this about if we of terms what laid out you we have year kind

Xcel to ships we year, Celebrity the it Seas the actually Icon compared about what to And we and Star have that of had did think not you 'XX, in So delivered XXXX. year. deliver remember, this in both deliver last last actually year

counted was 'XX. capital that into So

we're we that ships. what deliveries, to terms when layout that. ship order in our follow financing those we have And So you committed you of you the expect remind have should expecting, do that for I and the

financing $X the payment. to the is on that noted well basis, as release, as and installment committed I the so and the have related billion deliveries in And it's we a gross obviously,

we actually And In where should announced to cadence. of Club year, we we of particularly start see what kind and the the first to we terms then year-over-year. between second deliver we're quarter in the acquiring and also that that the not out land, close of the capital, at year, year we we've this non-ship will in the acquisition And capital then quarter. priorities destinations. And you Maya, maintenance did effort, Nassau But And obviously last materially of change construction end have end following up acquisition point. this we at do, are those our expected port as private of some year. our then destination Costa of Beach that ramp terms we the we'll lay and of have things private announced, kind that

capital on there as develop obviously, well. So

is program. We're also our be to that of majority So capital going there. restarting modernization

details around we that. an we X our forward I will see more going but do So share this opportunity program, ship around and have year

$X think about year. delivered size last if the where we billion of said, that we of are, All company of the EBITDA you and

EBITDA. XX% made reducing we're more If around you deliver of kind interest going progress this guidance of sheet, look expense. we've balance to at significant And our our a year, our

it's billion. see below $X You

and the that returns. balance into maintain you that put a invest allow and focus an as significant expand our amount metric flow capital business, key If sheet generating account, is also to in continue cash margin you that flow. to see will do accelerate us priorities, we're our we of cash to grow investment-grade And

flow, of and things. And cash so the really, allowing the to the the achieve of all feel, us those we is generation company size

James Hardiman

Naf. lot sense. Thanks, Jason. a Thanks, Makes of

Operator

Wieczynski the Our Steve with next of Stifel. comes from question line

Steven Wieczynski

going guidance So were if little given us. the the sit going conservative guidance go the about over we think does and for and think year, looked this guide, expecting to here actually I a fact the harp better bit much to to let's yield I'm back fuel the we on headwinds. But FX the not EPS That's than that there.

And handle I now. comment. handle probably, of us, XX wondering could if right anything potentials way of buybacks guys just XX that is, to excludes guess in about Jason, that been that these in easily that there And debt saying another accretion? talked those is without have statement? So embedded terms mean refis fair or you you I kind a a or headwinds

Jason Liberty

north you if you would Obviously, Yes. of that to $X.XX the Yes. $XX.XX the $XX. add get

surprise our been was on think for cost year. a what I where guide may came have the out

within we by similar to continuing the capital worked Our that past, to contemplate in just teams business. scale guide. do our leverage have And hard returns not exceptionally

we would tailwind to to has side. that our repurchase were be we on that share shares, if in a So obviously opportunistically strategy which earnings do -- been the per

Steven Wieczynski

you. Got Okay. And then...

Naftali Holtz

say that significant capacity cost Yes, right? moderate we Our can growth, formula yield you growth, that, control. is those deliver performance. moderate strong see Steve, And always

whatever already are capital so already dividends, other investments our course, the already in, that's paydowns, that's is the but debt that we've announced, included. normal are And of any in things -- not in. And in, any then

Steven Wieczynski

mean, rights you. different the one obviously, I to much key those to is back River's of the versus then Got to certain differences in animal quickly. not And going ports. River get operators real And fact Okay. that river berthing Ocean. need access Jason,

a So is Sea berthing just river to berthing or that wondering enter of bit maybe well already getting rights Celebrity those road an secured of has down kind those as there of And is to if more the opportunity rights? in with higher customer? of the Silver some little capture process then end

Jason Liberty

think people animal. think, space, I your this to an it's animal. an Well, space. the use with I different Sure. with in It it a Steve, first, but different partner we've get just understanding still is grown to how comfort And works, metaphor of to animal,

rivers didn't having think place. orders announcement berthing We Of course, always did make not able in I that are are inside also provide trying the without And to we the Europe, And place. we we sometimes just for. to we're that also this in make this without that experiences announcement looking world. the having think being about of certain our are the sure guests around but rivers there make

this be we sees prepared, expand few our experience of to looking certainly ultra-luxury up. Celebrity, again, great with a hobby for kind river going ways up opportunity. to start us. that's And under guests not opportunity very for build -- consider there under will Sea. said it buttoned gone see fit. as then, of But As Celebrity. I this is going scale we very off provide Silver for to other river it that other into for where engine we'll this And ago, have to We're our a brands a it minutes to if we is We're think course, there's as

seriously we deliver that heavily to So taking doing and a experiences sure make to the best live making are the all doing. responsible the consideration want up we -- and we're this that's what in vacation extremely and can we do in in way, we to sure world we're plan of

Operator

the Matthew Our JPMorgan. next of question Boss comes with from line

Matthew Boss

congrats another quarter. great And on

So X-part Jason, maybe a question.

then any 'XX, And seeing opportunity that globally. to higher we're trillion relative On you level, you areas maybe today market? how global in the say share your market notable on capacity? you're are start And strong $X just the what in specific I would to optimizing the vacation overall inning guess, pricing acceleration

Jason Liberty

Matt. Thanks,

out Icon, I of across demand is the the kind of going think see seen one think incident strong the on X-year -- our -- third coming all here I into side, interesting or XXXX of that year just of trends from all level having really the again, now we've we of obviously, first of of ships mixes And different Caribbean Perfect Day to assets and products. like and cruisers different all demand incredible a generations are brand as loyalists. as Utopia our and quality like drawing the well first-time different

Alaska even really products well the China. and Asia so in all and Zealand as as continued demand And strong in in Southeast and really Caribbean, Australia, elevation New European across in

our the elevation By from. come we're then North everyone's strong. different products. Europe exceptionally the again, -- fighting are guests across guests fighting, exceptionally U.S. in is we're as is demand over terms trends our fighting markets, demand really we ships, And highest high or of obviously, highest-yielding So And those -- mean, all an seeing where from strong. could America -- based well seeing as on are I for good the

a to we innings us. So of of continue that different inning strong tell weakness. across margin. there's front trends. kind generally and or the then, kind just things there is tech, seeing to are in, It's always whether a course, that's in or that in in better think switch of would And guest And and on I using that we the to it's no on the up, why this. outperformance I these we're we different say that's technology think we're that's the but of all on tough on really read heavy, what disruptive on see would GenAI our that the would area innings to or is I really maybe experience describe deployment just Overall, other whether enhance of that's recommending we of There's but early that. the here or of of whether demand it's utilizing I get of pricing kind to what stronger guests, opportunity now can in heavy guest experience, early just AI stronger all getting what the as be we're

Matthew Boss

to Congrats hear. great It's again.

Operator

Our next question the comes Robin line with UBS. from Farley of

Robin Farley

Can given how order as quickly XXXX River as in until what's XXXX sense see back mentioned, orders? ship, XX to circle it the could to you ships you order and your before ambitions about Cruise say wait obviously, to for sort -- as think of of the launch lead more, of to wanted I can is and get river what these time launch. long would should in that is than what's not you initial time length kind for we you've much fair terms for more working, your a of time beyond. working actually ships Ocean you an frame need not you Is of additional are we

squeeze per of cost sense question, the maybe build of a of ships assume And your can Royal the you us Celebrity of is plus and less obviously, fleet Is is we if given which, it yield. board, you and product. of part compares give and of more delivered premium existing sense then to your the what right Ocean now more on on be Celebrity the inclusive you X of think existing than majority all premium yield, brand, kind in be to second But this or a the or your rough pretty pricing like will going a in maybe that of even that then course, of the I your to it part about it's mentioned, includes had yield, and that? a just comparable similarly, yield, the birth to how just some last year. And a

Jason Liberty

Sure.

This to to our frame of initial cost what XXXX what probably a the going time produce berth not a I say more. not is going per Each no, order. the ship. Obviously, on is into to X until cost is, these side, be you're We're can elevated. wait about going get order So yard per year. to would

are cruise ship, a However, relative of to they mean, money. a I very small amount

it we the X ability our bought. largest money into so just less be operator the we be and to than that this, ship And could would scale second significantly probably Xcel

barrier a something the So but of barrier this a on a terms in entry do we making execution it's that sure flawless is high there way. of not cost, and in high has a can

be it at usually expect And tailwind bit expect profile. have then ROIC better boats this scale river year-round. lastly, and be to thing profile the relates As that yield on margin yield to that our or would to different if going a a the business. little similar better only would do it's would we side, is We do not operate I is will say the not that

parts So the there year the model. ships under of of be will the current the where laid are kind up. That's

to as way we see when that studying we back to shorter will off-season them we can productive we'll got as we seasons during the be as the it's can how obviously a So day, cold. in lift make see the just

Operator

Our with Melius of next comes from the question Cunningham Conor Research. line

Conor Cunningham

this it of trying a shape Obviously, to lot Does what from you capacity? that's year not just headwind just But how bit better. understand the for better progresses? You a the the it can assume just little cost little give stock-based not? big a year. the comp. a I'm of then in is I full guide had bit follow And Like year.

that. around Just any thoughts

Naftali Holtz

Hi, Conor. Yes.

be And Costa I of said, is operating this it's year, Maya, going this also buy dry right. time I some impact So yes, my right? remarks mainly And spent through the The really in to remember, towards the the quarter, in does it growth cost we prepared follows quarter-over-quarter cadence you're the as close, port cadence, capacity then of well. end the because as walking an dock first quarter. second the going year cadence to

costs obviously, the we mainly then Island we don't need some to of because Nassau, so operate. some private have Paradise towards the And of And year. in of It ramp have the we end are up destinations, kind our doesn't ADCDs. as do there that cost

the throughout year. obviously, said, as But second significant be And give impact growth. are the And benefiting next guidance higher kind for real the and quarter to of then are year the I going to is third those from mainly quarter. fourth so will the of the be we cost going as the cadence and quarter capacity progresses

Conor Cunningham

talk sorry again. higher-level to Helpful. it's And Maybe just about question. a River then

think after younger. older it I I is an Viking obviously, demographic, that goes think Celebrity

seems fragmented, than talk an So cohort that when the at. it if with younger talk like you're a one. there's like opportunity older you you seems rather it could just about Because just demographic an looking about

belabor just sorry point, but Just any thoughts the there. to

Jason Liberty

something would expand, part The that average of early it's just clientele, we I is questions be mid-XXs. big want celebrity match and sure on many Yes. making always but so will broader beginning small Much part a a they a have of expected of that of it on our business, in obviously, But experience our is their have standpoint. to older have younger guest customers age they a they where clientele. vacation

more this feel isn't first incredible leveraging their in the to segments business incredible market, cruise of it's is, fraction the -- which key flywheel, Viking confident each this that this have, of we customer. incredible ecosystem. going brands inside a all this. another and keep we cruise the one chasing incredible the about them thing just I customers of grab of in think to the of is we're share And or river. $X think about we or mean I whether sure opportunity that is our is think and that more me back it's other I This off, part market leading overall that making very whether to this that mean, trillion us I fraction I for all a of again, space,

trust better that like think accelerating and recognizes day the challenge achieve, changes. course, and we've the at what and our from our get And flywheel of being being think real guests And demand And difference really the things stay inside that highly are that sourced that so there's and there us. And the we're big enterprise we more customer. we're get so a results really reciprocity of is from like But more they're I and royalty of built. where to demographic in it here that they and productive, adding ecosystem. will on don't of more is happy supportive forth, sourced trying our end we to some a be out of because and more here. they're incentivizes lifetime guests value We guests reps the

Operator

comes question line Our of from Mizuho. next Chaiken Ben with the

Benjamin Chaiken

think mistaken, follow-up. related then are benefits all access have or On is Club do the private you destination, touch that to and Nassau in think with I how of to about Nassau pricing ask the the beach, Day is any there drink food, December, the not if annually about different inclusive, opening that I'm comes kind of today? -- volume lot a opportunity? because than is passengers quick way Beach then which quantify to that, And I Perfect one that of

Michael Bayley

call. Hi, Ben. kind was I lonely question. this feeling that asking Thank for you of on

out. a We'll product have we the laid opening for sale in strategy Yes, launching pricing Michael. into it's be April. market So the

about to So we'll time. be in all-inclusive months' talk It's package. pricing our about able X an

it a quite way have of just brand, in the total, We Club. going lot Nassau Beach the exceeds the for capacity volume Royal into of

the we'll year it full first the pricing I the Beach of in really call. guests later Club the Beach going comment is any expectation talk experience. this operation the can't during into on, X with the detail approximately Club, Our about of but for have we'll And on million

Benjamin Chaiken

costs CocoCay. is is late And it net but it do cruise different talking -- for does also anything just opens to highlighting? year, worth then a the this, cruise from or include how similar recognizing basis, alluded Naf Nassau I of maybe obviously, then And think Understood. the how -- kind anecdotally, in on the similar this net cost that's 'XX

On this Coco or than the but obviously, efficient it's just more surface, on smaller, any reason cost would side? less headcount, the so be presumably less

Michael Bayley

the big will mean difference be I volume. really

million I X.X -- CocoCay think on this 'XX will hosting for year guests. be

all get that come the scale of economies operation. we those with So

fully and million it million around For is the $X.X will Nassau, when operational. be $X volume

still So scale it's very operation. efficient opportunities, obviously, there's less a but

major will its It's the be attractive. Nassau. Club, our very And pretty -- is it's be going a margins we that ships. proximity of of product also It's its needed really is to elements to a mean, of course, the I profitable Beach offering business. think one So in

complementary the guest a going that experience. and Day CocoCay it incredibly because be lot to a in product it's It's to the with day we'll goes be Club. have one of next also Beach Perfect day, short So on will

the like history the of cruising. weekend it's in So greatest

Naftali Holtz

open the in to Yes, opening be in costs materially just then a obviously, touch up through different. of to the operation, in add of we shouldn't still -- Obviously, as terms be destination, and some private accretive the brand year. And expect going XXXX very ready investment, fully is cost ramp-up towards end as to towards the the go And it's they're sorry. there's the to the end the of of year. that, kind base XXXX, we'll this

Operator

Cleveland Our the with Research. final Vince Ciepiel question will come of line from

Vince Ciepiel

relating repeat program could -- across loyalty. inclusive wanted it there more brands. was of Maybe between share some to changes I with maybe I on of in crossover year was you behavior, second comment to the wallet, back quarter this be think know brands. circle the booking I that on to

if there's kind now? the in anything you've in seen curious roughly a year last Just quantifiable that the of response

Jason Liberty

successful or for you are were it and they recognize as Celebrity recognize the Royal been house. program. I as I you, our is. it One it Sea believe would Silver Well, be to how think we the many not, muted that guests there in to But of terms generally in not has successful grossly reciprocity Yes. and terms will you of tell think want in same

with I are their their building kids older when might or on on course, to they're not, have kids And and that Silver broader they're grandkids. think Celebrity travel so guests Sea on maybe and that looking or And just Royal we they maybe and of or Celebrity and children traveling it's be awareness when not. they're

wherever Silver they're they be. Sea on their to children, or when might not with want But it go

So bringing that awareness is one thing.

all it reciprocity that our with to coming they Now a that inside get of for them of that. the then benefits it stickier lot there's makes ecosystem stay because

And I -- and continues So I at of our think and getting I program. how taken many significantly get reasons we planned repeat incredibly had that surprised we're I our one been guests think for. faster have have would it's why quickly to guests more mean, than to we flywheel faster

Vince Ciepiel

was And support? Western with XX% number it Perfect really maybe in is Club the I helpful Caribbean could comment the Mexico XX%, Caribbean about of today, I of I Coco, think commenting expansion eventually guests it's you the thought go eventually think your on, of X.X just Beach that Day And kind ramps? then story Perfect million in million the over think Nassau, think Mexico as Day, on passengers Mexico, where Perfect then could X.X think to you like time

Michael Bayley

ultimately, that and It's We've -- much Michael Texas. into We obviously, far thinking Perfect Mexico take the regionally exceed year Texas will that ships again. and CocoCay. some I mean, got pretty the the will every in taking opportunity we we've got we're Day, online what big think big now. coming. we're to Galveston from Class got We've Icon coming volume

Operator

conference the to turn CFO, any back I'll remarks. over Naftali Holtz, for And closing

Naftali Holtz

you for in participation the available wish day. and will We We your interest all any follow-ups. great you thank Blake company. be all for a

Operator

and joining. conference you concludes today's this gentlemen, Thank Ladies call. all for

may disconnect. now You

Royal Caribbean Cruises (RCL) 28 Jan 252024 Q4 Earnings call transcript