Summary
Royal Caribbean Cruises Ltd. (RCL) has issued an 8-K filing on October 11, 2002, announcing an upward revision to its third-quarter 2002 earnings estimates. The company now expects reported third quarter earnings per share to be between $0.98 and $0.99, exceeding previous analyst consensus of $0.85. This improvement is attributed to stronger bookings and better-than-anticipated cost savings, despite a 1.7% decrease in net yields compared to the prior year's third quarter. The results also include a $20 million charge ($0.10 per share) related to a potential litigation settlement. For the full year 2002, RCL anticipates earnings per share to be in the range of $1.55 to $1.60, with full-year net yields expected to be down approximately 1% to 2%. The company notes that late booking patterns continue to impact the fourth quarter, which is traditionally the weakest and most difficult to forecast. Investors are advised that these figures exclude any impact from the proposed combination with P&O Princess. A more detailed outlook will be provided on October 23, 2002, during the company's earnings release and conference call.
Key Highlights
- 1Royal Caribbean (RCL) significantly raised its Q3 2002 earnings per share (EPS) estimate to $0.98-$0.99, up from analyst consensus of $0.85.
- 2Improved booking patterns and effective cost savings are driving the positive earnings revision.
- 3Q3 2002 net yields are expected to be down approximately 1.7% year-over-year.
- 4Full-year 2002 EPS is now projected to be between $1.55 and $1.60.
- 5Full-year 2002 net yields are anticipated to decrease by about 1% to 2%.
- 6A $20 million charge ($0.10 per share) related to a potential litigation settlement is included in Q3 earnings.
- 7Late booking trends persist, creating forecasting challenges for the fourth quarter.