(Reuters) -Norwegian Cruise Line Holdings Ltd raised its full-year profit forecast on Monday, betting on higher pricing and pent-up demand from wealthy customers.
Shares in the company rose more than 3% in premarket trade as it also beat first-quarter revenue expectations and posted smaller-than-expected loss.
Easing of on-board COVID-19 protocols after long periods of restrictions has encouraged people, especially from the higher income group, to go on leisure travel while also boosting spending on various on-board facilities from casinos to spas.
Norwegian, which mostly caters to the affluent, has also been raising prices of its tickets to offset the impact from higher costs of fuel and food due to supply chain snags worsened by the Russia-Ukraine crisis.
In February, the company said it expected costs to decrease towards the later half of the year which would boost margins and help it turn profitable as demand for leisure travel remained resilient.
Rival Carnival Corp in March posted a smaller-than-expected quarterly loss and beat estimates for revenue, helped by steady demand for leisure travel, higher ticket prices and strong on-board spending.
Norwegian said occupancy in the first quarter was 101.5%, up from 86.6% reported in the previous quarter.
The company expects full-year adjusted profit of 75 cents per share, compared with its earlier forecast of about 70 cents per share.
The cruise line operator, however, expects second-quarter adjusted earnings per share below Wall Street estimates.
Norwegian Cruise’s total first-quarter revenue rose to $1.82 billion from $521.9 million, beating estimates of $1.75 billion, according to Refinitiv data.
On-board and other revenue during the quarter came in at $613.1 million and made up 33.6% of the total revenue.
Excluding items, the company lost 30 cents per share, compared with estimates for a loss of 41 cents.
(Reporting by Anne Florentyna Gnanaraja Sekar and Ananya Mariam Rajesh in Bengaluru;Editing by Vinay Dwivedi)
