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Royal Caribbean Group Hopes to Be Profitable By Late 2022

CEO Jason Liberty expects 2022 will be a strong transitional year, as we bring the rest of our fleet back into operations and well-nigh historical occupancy levels.

Royal Caribbean Group (NYSE: RCL) today reported financial results for the 2021 fiscal year and provided business updates.

"2021 marked the beginning of our return to our mission of delivering the very best vacation experiences," said Jason Liberty, president and chief executive officer of the Royal Caribbean Group. "During 2021, we made significant progress toward our recovery with over 85% of our capacity returning to operations and delivering safe and memorable experiences to approximately 1.3 million guests at record guest satisfaction scores. Our team has worked tirelessly to execute our successful and healthy return, and we are grateful for their extraordinary efforts."

"We expect 2022 will be a strong transitional year, as we bring the rest of our fleet back into operations and well-nigh historical occupancy levels," Liberty said. "Omicron created short-term operational challenges that have unfortunately weighed on close-in bookings. While the timing of Omicron was particularly unfortunate for the first half of 2022 bookings and will likely delay our return to profitability by a few months, we do not expect it to impact our overall recovery trajectory and the strong demand for cruising."

Resumption of Sailing and Business Highlights

  • By the end of 2021, the Group had returned 50 out of 61 ships to operations across its five brands, representing over 85% of its worldwide capacity. During the year, the Group carried approximately 1.3 million guests across the five brands, achieving record guest satisfaction scores and onboard spend per passenger.

  • Due to the impact of the Omicron variant, the company experienced some service disruptions and cancelled several sailings in Q1, although it still expects to operate approximately 95% of its planned capacity in Q1.

  • Bookings in the fourth quarter were sequentially higher than the third quarter. Due to the impact of the Omicron variant, bookings decreased in December and remained lower over the holiday period, but have started to increase with each consecutive week since the beginning of 2022 and are now back to pre-Omicron levels.

  • Cumulative advance bookings for the second half of 2022 are within historical ranges and at higher prices, with and without future cruise credits (FCCs).

  • The Group expects to return the full fleet before the summer season of 2022 and load factors approaching historical levels in the third quarter of 2022. The company is thoughtfully ramping up the fleet and load factors while emphasizing industry-leading health and safety standards, world-class guest experiences and financial prudence.

  • Notwithstanding the impact from Omicron, the Group expects to be operating cash flow positive in late spring. The Group also expects a Net Loss for the first half of 2022 and a return to profitability in the second half of 2022.

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