Genting Hong Kong's NCL pops the champagne on 11.6% profit rise

EBITDA hits US$149m for 2Q13.

According to UOB Kayhian, Genting Hong Kong’s (GENHK) 43.4%-owned NCL Holdings reported EBITDA of US$149m (+11.6% yoy) for 2Q13 and US$229m (+1.5% yoy) for 1H13. 

The result is broadly in line with full-year forecast of US$639m, after taking into consideration the seasonally strong 3Q13 and additional contribution from its newest vessel, the 4,000 berth Norwegian Breakaway, which commenced deployment in May 13.

Here's more from UOB Kayhian:

Net yield rose 3.5% yoy in 2Q13 to US$188. Revenue rose 10.5% yoy to US$644m in 2Q13, driven by an 8.2% yoy increase in capacity days. The improved passenger ticket and on-board & other revenues, along with a slower 6.3% growth in commissions, transportation and on-board expenses lifted net yields.

But contribution to GENHK will fall short due to exceptional charges. NCL again booked a US$70.1m exceptional charge in 2Q13 in write-offs and expenses related to two refinancing transactions. While the transactions will strengthen NCL’s balance sheet and reduce interest expense going forward, the exceptional charge dragged bottom line to a net loss of US$8.8m for 2Q13 (Recall in 1Q13, NCL recognised US$110.4m in expenses related to prepayments, debt redemptions and related expenses.)

This brings NCL’s net loss o US$105m in 1H13, which will weigh down contributions to GENHK (we had forecast a full-year net profit contribution of US$107m).