Why Norwegian Cruise Line (NCLH) Shares Are Falling

Norwegian Cruise Line Holdings Ltd NCLH shares are trading lower by 4.38% to $18.55 Monday morning. The stock is falling in sympathy with peer cruise line operator Carnival Corporation after the company reported second-quarter financial results and issued guidance.

What Happened With Carnival?

Carnival Corporation announced quarterly losses of 31 cents per share, beating the analyst consensus estimate of a loss of 34 cents. The company also reported quarterly sales of $4.91 billion, exceeding the analyst consensus estimate of $4.77 billion by 2.96%. This marks a significant 104.54% increase over sales of $2.40 billion in the same period last year.

Carnival says adjusted FY23 EBITDA is projected to be between $4.10 billion and $4.25 billion, surpassing the previously guided range and representing a midpoint increase of $175 million. However, there is an estimated unfavorable impact of approximately $0.5 billion from fuel price and currency compared to 2019.

See Also: Carnival Stock Is Sliding Monday: What's Going On?

What Else?

The company meanwhile says it has shown consistent improvement in adjusted EBITDA per ALBD (available lower berth day) compared to 2019, with each quarter exhibiting sequential growth. Occupancy levels are expected to reach or exceed 100%, while net per diems are projected to be 5.5% to 6.5% higher (in constant currency) than previously guided, driven by strong demand.

Adjusted cruise costs, excluding fuel per ALBD, are anticipated to be one and a half points higher than the previous guidance due to slower expected decreases in inflationary pressures, increases in incentive compensation reflecting performance improvements and continued investments in advertising.

According to data from Benzinga Pro, NCLH has a 52-week high of $19.77 and a 52-week low of $10.47.