Questions investors are asking ahead of Royal Caribbean Group’s earnings call this week

Royal Caribbean Group’s first quarter 2022 earnings call is slated for this week, and many investors will be eager to hear about the cruise giant’s financial well-being.

Every quarter, each publicly traded company releases its financial results for the previous three months, then discusses in depth what happened in a conference call that everyone listens to online.

Earnings calls are hosted by key executives at Royal Caribbean Group, and are a combination of disclosures, prepared statements and answers to questions from Wall Street analysts.

Royal Caribbean Group will host its call at 10:00 a.m. Eastern Time on Thursday, May 5, 2022.

To get an idea of ​​the top things Wall Street wants to know this quarter, I reached out to Dan Kline, Managing Editor, TheStreet.

Have they seen an increase in average prices?

You don’t have to be an investor to know that cruise fare prices have been trending up lately.

Cruise vacations have always been invaluable, but like so many other things in life, prices tend to rise over time.

People paying more for a cruise might not be what the average cruiser wants to see, but it’s a good indicator for investors who want to see how quickly Royal Caribbean Group can reduce the debt it has accumulated. during the pandemic.

Are people always spending more on board?

Since cruise ships began sailing again in 2021, customers are spending more than ever beyond their cruise fares, and an update on this trend will be important to watch.

Sometimes referred to as “revenge spending,” consumers have demonstrated a strong desire to make up for lost time over the past two years by purchasing beverage packages, gambling at the casino and booking lavish excursions.

It’s not just cruise lines who are seeing this trend. Airline and hotel stocks have surged this year, thanks in part to what some call the “YOLO economy.” United and American Airlines both reported strong earnings last week. Shares of Marriott, Hilton and Wyndham are near all-time highs. The owner of the SeaWorld theme park is also not far from a record.

For Royal Caribbean, the question will be whether cruise ship passengers continue this trend.

What proportion of record bookings use FCCs?

An important indicator of demand for Royal Caribbean is the number of bookings booked with cash or existing future cruise credits (FCCs).

Future cruise credits are something that are granted when cruises are cancelled, and to get a better idea of ​​the company’s financial situation, comparing the amount of cash the company has against FCC is another matter. current.

Are there plans to retire more ships?

With Royal Caribbean taking Odyssey of the Seas and Wonder of the Seas in less than a year, and four more ships on order in the next few years, will existing ships be scrapped?

The cruise line has always said it would be strategic in selling or transferring older ships out of the fleet.

Whether the cruise ship resale market has improved from the depths of the pandemic remains to be seen, and it’s unclear what to expect from aging Vision-class ships.

Do they plan to refinance more debt?

It will be a while before Royal Caribbean Group can get out of all those loans it has had to take out during the pandemic, but they will have to get creative to prevent it from becoming a huge mess.

No one expects the debt to disappear tomorrow, but investors will want to know how Royal Caribbean Group plans to handle it all.

How You Can Listen to the Earnings Call

There will be full coverage of everything coming out of Royal Caribbean Group’s first quarter 2022 earnings call on RoyalCaribbeanBlog, but if you want to listen for yourself, here’s how.

The call will be available online on the Company’s Investor Relations website, www.rcinvestor.com.

You will be able to listen via the link provided near the start of the call.