Norwegian Cruise Line Sees 3.4% Bunker Price Increase in 2017's Q1

NCLH reports a fuel expense of $88.9 million for 2017 Q1. Image: NCL

Norwegian Cruise Line Holdings Ltd. (NCLH), in its financial results covering 2017's Q1, says the fuel price the company paid per metric tonne (pmt), net of hedges, grew 3.4 percent in the period to $453 pmt from $438 pmt in 2016. 

NCLH reports a fuel expense of $88.9 million for Q1, as well as a loss of $0.4 million in other expenses in 2017 related to the ineffective portion of its fuel hedge portfolio, which is attributes to market volatility.

During Q2, NCLH says it expects fuel consumption to reach 185,000 metric tonnes (mt), $450 pmt net of hedges.

For the full year 2017, NCLH expects fuel consumption to reach 780,000 mt, at a price of $440 pmt net of hedges
          
NCLH says that, as of March 31, 2017, it had hedged approximately 78 percent, 66 percent, 49 percent, and 18 percent of its total expected fuel consumption for the remainder of 2017, 2018, 2019 and 2020, respectively.

Overall, NCLH reports a generated GAAP net income of $61.9 million for the Q1 period, compared to $73.2 million during the same quarter of 2016, while adjusted net income in Q1 2017 was $91.2 million, compared to $86.7 million in Q1 of the previous year.

NCLH's total revenue increased 6.8 percent to $1.2 billion in Q1.

"I am pleased to report that the strong performance witnessed in our core markets and reflected in first quarter results also extended to our booked business in future quarters, allowing us to increase our full year Adjusted EPS and Adjusted Net Yield growth guidance," said Wendy Beck, executive VP and CFO of NCLH.

"This positive momentum has been partially offset by recent uncertainties in Norwegian Joy's Chinese source market caused by the South Korea travel restriction. Taking all factors into account, we are on track to deliver another year of solid financial performance and double-digit Adjusted EPS growth."

In February, NCLH announced that it had reached an agreement with Fincantieri S.p.A. (Fincantieri) for the construction of four fuel efficient next generation newbuild ships for its Norwegian Cruise Line (NCL) brand.