Norwegian Cruise Line Holdings Ltd. · NYSE:NCLH
Norwegian Cruise Line — Q3 2020 Earnings Presentation
19 slides from Norwegian Cruise Line's earnings presentation, Nov 10, 2020
Slide 1: Third Quarter 2020 Earnings Conference Call
THIRD QUARTER 2020 EARNINGS CONFERENCE CALL NOVEMBER 10, 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: Key Events Since Q2 Earnings Call
KEY EVENTS SINCE Q2 EARNINGS CALL Healthy Sail Panel provides 74 detailed recommendations across five key focus areas for safer cruising CLIA and its member lines announce mandatory core elements of health protocols including a travel-industry first with 100% testing September 21 for passengers and
Slide 4: Navigating Through COVID-19
NAVIGATING THROUGH COVID-19 Addressed ▪ Announced voyage suspension through December 31 across all three brands Significant ✓ ▪ Majority of ships are at minimum manning status Operational ▪ Repatriated the majority of crew members. Plan to re-staff a limited number of ships as we prepare to return t
Slide 5: Roadmap to Relaunch and Resumption of Cruise Voyages
ROADMAP TO RELAUNCH AND RESUMPTION OF CRUISE VOYAGES 1 2 3 4 Activate Sales Develop Address and Initiate Enhanced Global Port Marketing Gradual Health and Availability Machine and Phased Safety and Travel Stimulate Relaunch Protocols Restrictions Demand ▪ Re-start of industry ▪ Focus on market-to-fi
Slide 6: Health and Safety
HEALTH AND SAFETY ◼ The Healthy Sail Panel (HSP), a group of globally recognized scientific and medical experts assembled in collaboration with Royal Caribbean Group, has provided 74 detailed health and safety recommendations across five focus areas to reduce the risk of COVID-19 on cruise ships. ◼
Slide 7: Booking Trends Update
BOOKING TRENDS UPDATE ◼ Continued demand for cruise vacations for 2021 and 2022, despite significantly reduced marketing investments. ◼ Cumulative booked position for FY 2021 is below historical ranges driven by 1H 2021 as expected, due to the uncertain environment. However, booked position is in li
Slide 8: COVID-19 Financial Action Plan
COVID-19 FINANCIAL ACTION PLAN Q3 Initiatives 1 ▪ Achieved over 60% reduction in Q3 2020 net cruise costs Further Reduction of ▪ Completed transition of all vessels to expected minimum manning status Operating Expenses & ▪ Extended temporary 20% pay reduction for shoreside team members Capital Expen
Slide 9: Improved Debt Maturity Profile
Action Plan IMPROVED DEBT MATURITY PROFILE Debt Maturity Profile ($ in Billions) Facilities $4.9 typically would be refinanced prior to maturity $2.8 $1.1 $0.8 $0.8 $0.9 $0.0 2020 2021 2022 2023 2024 2025 Thereafter ECA Loans, Capital Leases & Other Norwegian Jewel Term Loan 3.625% Senior Unsecured
Slide 10: Illustrative Liquidity Profile
ILLUSTRATIVE LIQUIDITY PROFILE Illustrative Liquidity ($ in Billions) Liquidity (As of 30-Sept) ~$2.4 (-) Customer refunds payable (As of 30-Sept) ~($0.1) Total Liquidity ~$2.3B Estimated health and safety initiatives and ~($0.3) other Net Liquidity Available ~$2.0B ◼ Q3 2020 average cash burn1 was
Slide 11: Third Quarter Sources and Uses of Cash
THIRD QUARTER SOURCES AND USES OF CASH Cash and cash equivalents increased in Q3 driven by July capital raise *Cash burn includes operating expenses, SG&A, interest expense and capital expenditures. Working capital is net of collections. 11 11
Slide 12: Medium and Long-Term Financial Recovery Plan
MEDIUM AND LONG-TERM FINANCIAL RECOVERY PLAN 1 2 3 Maximize Cash Flow Optimize Rebuild Margins Balance Sheet Generation Upon resumption of voyages, attention will shift to medium and long-term financial recovery plan 12
Slide 13: Key Takeaways
KEY TAKEAWAYS Healthy Sail Panel provided 74 detailed Health & Safety at the recommendations across five key focus areas which will Forefront inform company-specific return to service plan. Cornerstone of protocols is universal COVID-19 testing. Booking trends continue to indicate demand for cruisin
Slide 14: Appendix
APPENDIX NORWEGIAN CRUISE LINE 14 BSS HoLpines LTD.
Slide 15: Healthy Sail Panel Members
HEALTHY SAIL PANEL MEMBERS ◼ The Healthy Sail Panel (HSP), assembled in collaboration with Royal Caribbean Group and led by co-chairs Governor Mike Leavitt and Dr. Scott Gottlieb, consists of a group of globally recognized experts in public health, infectious diseases, medical research and maritime
Slide 16: Fuel Hedge Program
FUEL HEDGE PROGRAM NCLH Fuel Hedge Program as of 9/30/2020 2021 2022 2023 % of HFO Consumption 55% 19% 0% Hedged Average USGC Price / $46.16 $48.36 N/A Barrel % of MGO Consumption 61% 49% 22% Hedged Average Gasoil Price / $80.94 $70.00 $67.45 Barrel Total % of Consumption 59% 37% 13% Hedged 16
Slide 17: Secured Additional Capital
Action Plan SECURED ADDITIONAL CAPITAL Revolver Addition ▪ Secured new short-term $675M revolving credit facility and drew down total amount of new and existing revolving credit facilities, resulting in (March) ~$1.55 billion of cash added to the balance sheet. ▪ $675M of 12.25% senior secured notes
Slide 18: Improved Debt Maturity Profile
Action Plan IMPROVED DEBT MATURITY PROFILE 2021 Debt Repayment Schedule ($ in Billions) $0.4 $0.3 $0.2 $0.1 $0.0 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Debt amortization payments deferred until Q2 2021 Note: Based on debt outstanding as of 9/30/2020 18
Slide 19: Strong Commitment to ESG Initiatives
STRONG COMMITMENT TO ESG INITIATIVES ■ Global sustainability program, Sail & Sustain, is a core focus in everyday operations ■ Created dedicated ESG1 department to enhance overall ESG strategy and coordinate with departments including Health, Medical, Safety and Environmental Operations, Human Resou
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