Norwegian Cruise Line Holdings Ltd. · NYSE:NCLH
Norwegian Cruise Line — Q1 2020 Earnings Presentation
20 slides from Norwegian Cruise Line's earnings presentation, May 14, 2020
Slide 1: First Quarter 2020 Earnings Conference Call
FIRST QUARTER 2020 EARNINGS CONFERENCE CALL MAY 14, 2020
Slide 2: Forward Looking Statement
FORWARD LOOKING STATEMENT Some of the statements, estimates or projections contained in this presentation are “forward-looking statements” within the meaning of the U.S. federal securities laws intended to qualify for the safe harbor from liability established by the Private Securities Litigation Re
Slide 3: Definitions and Non-GAAP Financial Measures
DEFINITIONS AND NON-GAAP FINANCIAL MEASURES This presentation includes the following defined terms and non-GAAP financial measures: Adjusted EPS. Adjusted Net Income divided by the number of diluted weighted-average shares outstanding. Adjusted Net Income (Loss). Net income (loss) adjusted for suppl
Slide 4: Cruise Bookings Update
CRUISE BOOKINGS UPDATE ◼ Prior to the outbreak of COVID-19, 2020 was off to a strong start and entered the year in a record booked position and at higher prices on a comparable basis ◼ For the first two months of the year, ships sailed full at prices that were higher than prior year despite meaningf
Slide 5: Weathering COVID-19 Impact & Preparing for the Future
WEATHERING COVID-19 IMPACT & PREPARING FOR THE FUTURE Addressed ▪ Cancelled Asia sailings, launched enhanced health and safety embarkation protocols and introduced new cancellation policies Significant ✓ Operational Challenges ▪ Announced voyage suspension and debarked all guests at earliest availab
Slide 6: Safety, Security & Well-Being of Guests, Crew and Communities
SAFETY, SECURITY & WELL-BEING OF GUESTS, CREW AND THE COMMUNITIES WE VISIT IS OUR NUMBER ONE PRIORITY COVID-19 Protocols Implemented Prior to Voyage Suspension ◼ Developed jointly with government agencies, global public health authorities and industry associations ◼ Denied boarding to guests who hav
Slide 7: COVID-19 Action Plan – Cost Reduction & Cash Conservation
COVID-19 ACTION PLAN – COST REDUCTION & CASH CONSERVATION 1 2 3 4 Reduced Reduced Improved Secured Operating Capital Debt Maturity Additional Expenses Expenditures Profile Capital 7
Slide 8: Reduced Operating Expenses - Shoreside
Action Plan REDUCED OPERATING EXPENSES - SHORESIDE ◼ Significantly reduced near-term marketing expense in the first half of the year ◼ Implemented a furlough of ~20% of shoreside employees through July 31, 2020. Team Members will maintain certain benefits during this period and the Company is fundin
Slide 9: Reduced Operating Expenses - Shipboard
Action Plan REDUCED OPERATING EXPENSES - SHIPBOARD ◼ Meaningfully reducing cruise operating expenses such as crew payroll, food, fuel and port charges with the majority of ships transitioning to cold layup ◼ Crew payroll generally represents roughly 40% of total ship operating expenses on an average
Slide 10: Reduced Operating Expenses - Warm and Cold Layup
Action Plan REDUCED OPERATING EXPENSES - WARM AND COLD LAYUP ($ in millions) Cold Layup Warm Layup Monthly ongoing ship and administrative operating costs1 ~$ 70 ~$ 110 Total Ships in Fleet 28 28 Cash Burn / Ship1 ~$2.5 ~$3.9 ◼ Warm Layup: Reduced level of crew staffing while ship awaits resumption
Slide 11: Reduced Capital Expenditures
Action Plan REDUCED CAPITAL EXPENDITURES ◼ Identified ~$515M of capex reductions including: — ~$345 million, or an approximately 65% reduction of non-newbuild capital expenditures for the remainder of 2020. This includes the deferral of Pride of America refurbishment projects, which resulted in $55M
Slide 12: Improved Debt Maturity Profile
Action Plan IMPROVED DEBT MATURITY PROFILE ◼ Export Credit Agencies (“ECA”) and NCLH’s ECA Lenders have finalized an industrywide initiative to grant a 12-month debt holiday — ~$540M1 deferred in aggregate over the next twelve months — All postponed amortization to be repaid evenly over the followin
Slide 13: Secured Additional Capital
Action Plan SECURED ADDITIONAL CAPITAL Revolving Credit ▪ Secured new $675M revolving credit facility and drew down total amount of new and existing revolving credit facilities, resulting in ~$1.55 billion of Facilities cash added to the balance sheet. ▪ Issued $675M of 12.25% senior secured notes d
Slide 14: Illustrative Liquidity Runway Post COVID-19
Action Plan ILLUSTRATIVE LIQUIDITY RUNWAY POST COVID-19 Summary of Estimated Ship Layup Costs Illustrative Liquidity Runway ($ in Millions) Cold Layup Warm Layup ($ in Billions) Monthly ongoing ship and ~$ 70 ~$ 110 Current Liquidity (As of 31-Mar) ~$1.4 administrative operating costs (+) Incrementa
Slide 15: Roadmap to Recovery and Resumption of Cruise Operations
ROADMAP TO RECOVERY AND RESUMPTION OF CRUISE OPERATIONS 1 2 3 4 Develop Activate Sales Initiate Enhanced Address and Marketing Gradual Health and Global Port Machine and Phased Safety Availability Stimulate Relaunch Protocols Demand ▪ Government and ▪ Movable assets allow ▪ Focus on market-to- ▪ Exp
Slide 16: Key Takeaways
KEY TAKEAWAYS Swift implementation of significant cost reduction and Significantly cash conservation measures, coupled with highly Strengthened Financial successful execution of over $3 billion of capital raises Position which the Company believes will allow it to withstand an unlikely scenario of o
Slide 17: Appendix
APPENDIX NORWEGIAN CRUISE LINE 17 BES HoLpinGs LTD.
Slide 18: Key Events Since COVID-19 Outbreak
KEY EVENTS SINCE COVID-19 OUTBREAK Week of March 30th, 2020 April 9th, 2020 Week of April 27th, 2020 ■ All 28 vessels disembarked all ■ The U.S. CDC extended No Sail Order for all ■ On April 28th, extended $230M passengers and in safe haven cruise ships, in effect until one of the Pride of America t
Slide 19: Highly Experienced Management Team
HIGHLY EXPERIENCED MANAGEMENT TEAM About The Team Accomplishments ■ Over 120 years of combined experience in the ■ Successfully managed through exogenous events including: cruise and hospitality industries — The Great Recession ■ Many in core team have been together since — Hurricanes Maria, Irma an
Slide 20: Fuel Hedge Program
FUEL HEDGE PROGRAM NCLH Fuel Hedge Program as of 3/31/2020 Remainder 2021 2022 2023 of 2020 % of HFO Consumption 64% 53% 19% 0% Hedged Average USGC Price / $41.20 $46.09 $48.36 N/A Barrel % of MGO Consumption 70% 49% 46% 20% Hedged Average Gasoil Price / $84.52(1) $80.61 $70.00 $67.45 Barrel Total %
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