Lindblad Expeditions Holdings today reported financial results for the quarter ended June 30, 2020.
Sven-Olof Lindblad, President and Chief Executive Officer, said, “The COVID-19 virus has created unprecedented challenges for the travel industry and while we can’t be certain when we will be able to return to the world’s most remarkable destinations, the steps we are taking today will enable us to return to operations as soon as possible, safely and prosperously.
“I couldn’t be prouder of how hard the Lindblad team has worked to enhance our existing rigorous operating protocols, while coordinating with local authorities that have welcomed us for the last four decades. We continue to hear from our loyal guests how eager they are to resume travelling with us, especially given the smaller size of our ships and the remote geographies we visit, and we look forward to once again providing them the joy of exploration through authentic and immersive experiences.”
Due to the spread of the COVID-19 virus and the effects of travel restrictions around the world, the company has suspended or rescheduled the majority of its expeditions departing March 16, 2020 through September 30, 2020 and has been working with guests to reschedule travel plans and refund payments, as applicable.
The company’s ships are currently being maintained with minimally required crew on-board to ensure they comply with all necessary regulations and can be fully put back into service quickly as needed.
Significantly reduced ship and land-based expedition costs including crew payroll, land costs, fuel and food. All ships have been safely laid up.
Lowered expected annual maintenance capital expenditures by over $10 million, savings of more than 50% from originally planned levels, according to a statement.
Meaningfully reduced general and administrative expenses through employee furloughs, payroll reductions and the elimination of all non-essential travel, office expenses and discretionary spending, the company said, adding it suspended the majority of planned advertising and marketing spend.
The company also noted it was off to a strong start to the year with Lindblad segment bookings at the end of February up 25% for the full year 2020 as compared to the same point a year ago for 2019, and had sold 86% of its originally projected guest ticket revenues for the year, Lindblad said, in a press release.
Since that point, the company has experienced a substantial impact from the COVID-19 virus including elevated cancellations and softness in near-term demand. As of July 28, 2020, Lindblad segment bookings for travel in 2020 are now 62% below the same point a year ago for 2019 due primarily to the cancelled and rescheduled voyages, as well as cancellations for travel later this year.
Lindblad said it has substantial advanced bookings for travel in 2021, including 6% more bookings as compared with bookings for 2020 as of the same date a year ago and 35% higher bookings as of the same date in 2018 for 2019.
As of June 30, 2020, the Company had $80.9 million in unrestricted cash and $21.3 million in restricted cash primarily related to deposits on future travel originating from U.S. ports. During the first quarter of 2020 the Company drew down $45.0 million under its revolving credit facility as a precautionary measure for working capital and general corporate purposes given the uncertainty related to the COVID-19 pandemic and borrowed $107.7 million under its first export credit agreement in conjunction with final payment on delivery of the National Geographic Endurance in March 2020.
The company estimates its monthly cash usage while its vessels are not in operations to be approximately $10-15 million including ship and office operating expenses, necessary capital expenditures and interest and principal payments. This excludes guest payments for future travel and cash refunds requested on previously made guest payments. Based on current liquidity, the actions taken to date and its current forecast, the company believes that its liquidity should be adequate to meet its obligations for the next 12 months.
The company said is currently evaluating several additional strategies to enhance its liquidity position. These strategies may include, but are not limited to, pursuing additional financing from both the public and private markets through the issuance of equity and/or debt. The timing and structure of any transaction, if completed, will depend on market conditions.
SECOND QUARTER RESULTS
Tour Revenues
Second quarter tour revenues decreased $76.9 million, or 100%, as compared to the same period in 2019. The decline was driven by a $65.0 million decrease at the Lindblad segment and a $12.0 million decrease at Natural Habitat as a result of rescheduling all expeditions due to COVID-19.
Net Income
Net loss available to common stockholders for the second quarter was $39.7 million, $0.80 per diluted share, as compared with net income available to common stockholders of $1.0 million, $0.02 per diluted share, in the second quarter of 2019. The $40.7 million decrease primarily reflects the impact of COVID-19 on operations, a $3.9 million loss on foreign currency in the current year versus a $0.5 million foreign currency gain in the second quarter of 2019 and a $2.4 million increase in depreciation and amortization versus the same period a year ago primarily due to the addition of the National Geographic Endurance to the fleet in March 2020.
Adjusted EBITDA
Second quarter Adjusted EBITDA loss of $25.5 million decreased $38.0 million as compared to the same period in 2019. The decrease was driven by a $36.3 million decline at the Lindblad segment and a $1.7 million decrease at Natural Habitat.
Lindblad segment Adjusted EBITDA loss of $23.0 million decreased $36.3 million as compared to the second quarter a year ago due primarily to the revenue impact of rescheduling all expeditions as a result of COVID-19 and costs associated with the National Geographic Endurance following its March 2020 delivery. The current quarter also included lower operating costs for the fleet while laid up, a reduction in commissions from the impact of COVID-19 on revenues and reduced marketing and personnel spend.
Natural Habitat Adjusted EBITDA loss of $2.5 million increased $1.7 million versus the second quarter a year ago primarily due to the lower revenue as a result of COVID-19, partially offset by lower operating costs due to rescheduled departures and a decline in marketing and personnel spend.
