Royal Caribbean share price slips despite earnings boost
Royal Caribbean’s share price slipped yesterday even though the cruise company’s second-quarter earnings beat expectations.
The stock dipped after the company warned that it’s earnings for the full year would be lower than initially thought.
However, CEO Richard Fain said he was pleased with the second quarter earnings of $2.81 billion, which was $20 million higher than expected, and with forward bookings to the end of the year.
Earnings per share were $2.54, higher than the $2.43 expected by analysts, but the company warned that it expects full year earnings will be $9.55 to $9.65, down from a previous range of $9.65 to $9.85.
Fain acknowledged that the US government’s sudden ban on cruises to Cuba had hurt the company, which had to reposition the ships and compensate passengers.
"We wanted to be generous to those guests whose vacations were disrupted, and that comes with a cost, but I think most of them say we handled it well, which will auger well for us in the future," he said.
He said that looking at bookings for the rest of the year and for 2020, Royal Caribbean ‘is looking at one of the most positive scenarios we’ve seen in a long time’.
He said that even with ‘softer UK demand surrounding Brexit’, Europe is putting up strong numbers. "We’re really very encouraged at how well the forward pattern is looking," added Fain.
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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