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RCCL reiterates full year guidance, forex and fuel negative impact raised sixfold

Royal Caribbean Cruises Ltd. (RCCL), the world’s second largest cruise shipping company, reiterated its earlier view expects its full year adjusted EPS to be in the range of $8.70 to $8.90 per share. 

“This range includes a negative impact of $0.35 from currency (forex) and fuel versus our previous quarterly guidance and $0.06 in additional interest expense related to the purchase price for Silversea,” RCCL said in a statement. 

“Thus, excluding the impact of currency, fuel and additional interest related to the Silversea investment, the company is effectively raising its guidance by $0.40 per share,” RCCL said

It expects a Net yield increase in the range of 2.75% to 3.75% in constant currency. As reported yields are expected to be up 3.25% to 4.0%.

Net cruise costs, excluding fuel are expected to be up approximately 2.5% in constant currency - in line with previous guidance; and up approximately 3.0% as reported.

Taking into account current fuel pricing, interest and currency exchange rates, and the factors detailed above, the company estimates 2018 Adjusted EPS to be in the range of $8.70 to $8.90 per share.

The company said it does not forecast fuel prices and its fuel cost calculations are based on current at-the-pump prices, net of hedging impacts. Based on today's fuel prices, the company has included $184 million and $693 million of fuel expense in its third quarter and full year 2018 guidance, respectively.

"2018 is shaping up to be another year of record earnings, which is being driven by a strong demand environment and effective cost and capital management," said Jason T. Liberty, executive vice president and CFO. "While it is too early to guide on 2019, it is very encouraging to see these positive trends further supporting a strong book of business for next year."

CBM 2018/2019 Winter