Lindblad Expeditions Holdings has reported financial results for the quarter ended September 30, 2021.
Dolf Berle, Chief Executive Officer, said “We are extremely excited to have nearly all of our ships back exploring the world’s most remarkable destinations, providing high-quality and immersive expeditions to our loyal guests. The pent-up demand for authentic adventure travel is evident in both the overwhelmingly positive guest response as we return to destinations that we have been travelling to for decades, as well as in the sustained booking momentum we are generating across our fleet.
“This momentum also goes beyond our ship-based offerings with our platform of land-based businesses delivering positive earnings in the quarter, capitalizing on the robust demand for experiential travel. As we continue to ramp up existing operations, we have also further expanded our growth opportunities moving forward with the delivery of our fourth polar ship, the National Geographic Resolution, and with the acquisition of leading travel provider Classic Journeys,” he said. “While not yet fully back to where we were prior to the pandemic, Lindblad is emerging from the pandemic as a vibrant company with a strong balance sheet, real operating momentum and a broader set of opportunities that will allow us to deliver additional shareholder value in the years ahead.”
The company resumed ship operations in June 2021 and currently has eight of its ten operating vessels providing expeditions to guests. During June 2021, the company launched three ships in Alaska and another in the Galapagos, and, during the third quarter, the company resumed operations on the majority of its remaining vessels with additional ships operating in Alaska, the Galapagos, Iceland and the Pacific Northwest. The company continues to work with local authorities on plans to operate in additional geographies, including Antarctica, during the remainder of the year and early 2022.
The company said it believes there are a variety of strategic advantages that enable it to deploy its ships safely and quickly, while mitigating the risk of COVID-19, as travel restrictions are lifted. The most notable is the size of its owned and operated vessels which range from 48 to 148 passengers, allowing for a highly controlled environment that includes stringent cleaning protocols.
Lindblad said it had experienced a substantial negative impact from the COVID-19 virus including elevated cancellations and softness in near-term demand. Despite the COVID-19 impact, we continue to see significant new bookings across the fleet and have substantial advanced reservations for future travel. Bookings for the full year 2022 are 51% ahead of the bookings for 2021 as of the same date a year ago and 27% ahead of the bookings for 2020 as of the same date two years ago.
As of September 30, 2021, the company had $155.6 million in unrestricted cash and $29.5 million in restricted cash primarily related to deposits on future travel originating from U.S. ports and credit card reserves. During August 2021, the company received a $21.0 million grant under the Coronavirus Economic Relief for Transportation Services (“CERTS”) Act, which provided grants to eligible motorcoach, school bus, passenger vessel, and pilotage companies. Following the quarter, the company received an additional $6.0 million representing the remainder of the CERTS grant.
As of September 30, 2021, the company had a total debt position of $561.8 million and was in compliance with all of its debt covenants. During September 2021, the company drew down an additional $46.2 million under its second export credit agreement in conjunction with its final payment upon delivery of the National Geographic Resolution. In April 2021, the company drew down $15.5 million under the second export credit agreement in conjunction with its fourth installment payment for the vessel. Throughout 2021 the company has taken further steps to amend its credit agreements to provide additional flexibility including:
During June 2021, the company amended its export credit facilities to, among other things, extend the deferral of scheduled amortization payments of the first export credit facility through December 2021 in the aggregate amount of $15.7 million, extend the effective suspension of the total net leverage ratio covenant through March 2022, increase the interest rate by 50 basis points and annualize EBITDA used in the covenant calculation through December 31, 2022. The deferred principal payments will amortize quarterly over three years starting in March 2022.
During April 2021, the company amended its term loan and revolving credit agreement to, among other things, extend the waiver of its total net leverage ratio covenant through March 31, 2022, annualize EBITDA used in its covenant calculation through December 31, 2022 and increase the interest rate spreads of the Term Facility, excluding the Main Street Loan and the Revolving Facility, by 50 basis points.
As the company continues to ramp up operations, monthly cash usage will increase as it incurs costs in operating expeditions, prepares additional ships for return to service and spends to market and advertise upcoming expeditions and trips. The company also anticipates a significant increase in guest payments as it receives final payments for upcoming expeditions and trips, as well as deposits for new reservations for future travel. Given the dynamic nature of the COVID-19 pandemic, the company cannot reasonably estimate the potential impacts the pandemic will have on its financial condition, results of operations, cash flows, plans and growth for the foreseeable future. It is unknown when travel restrictions and various border closures will be lifted and what the demand for expedition travel will be once restrictions are no longer in place.
Third quarter tour revenues of $64.5 million increased $63.5 million as compared to the same period in 2020. The increase was driven by a $33.1 million increase at the Lindblad segment and a $30.4 million increase at the Land Experiences segment primarily due to the resumption of additional expeditions and trips during the third quarter of 2021. The Land Experiences segment also included the results of Off the Beaten Path LLC (“Off the Beaten Path”) and DuVine Cycling + Adventure Co. (“DuVine”), which were acquired during the first quarter of 2021.
Net loss available to stockholders for the third quarter was $25.7 million, $0.50 per diluted share, as compared with net loss available to stockholders of $27.8 million, $0.56 per diluted share, in the third quarter of 2020. The $2.1 million improvement primarily reflects the resumption of additional expeditions and trips, as well as a $4.4 million increase in other income mainly due to the utilization of the CERTS grant for covered expenses. These increases were partially offset by a $2.5 million tax expense in the current year versus a $2.9 million tax benefit in the third quarter of 2020, $1.4 million foreign currency loss in the current year versus a $1.0 million foreign currency gain in the third quarter of 2020 and a $1.5 million increase in interest expense due to additional borrowings and higher rates.
Third quarter Adjusted EBITDA loss of $6.6 million improved $10.9 million as compared to the same period in 2020. The increase was driven by a $4.5 million improvement at the Lindblad segment and a $6.4 million improvement at the Land Experiences segment.
Lindblad segment Adjusted EBITDA loss of $11.6 million improved $4.5 million versus the third quarter a year ago, primarily due to the resumption of expeditions, partially offset by higher cost of tours, increased personnel costs and higher marketing spend related to ramping up operations as well as increased credit card commissions related to final payments for upcoming trips and deposits for future travel.
Land Experiences segment Adjusted EBITDA of $5.0 million improved $6.4 million versus the third quarter a year ago, primarily due to additional trips, partially offset by higher cost of tours and increased personnel costs related to the additional departures and increased marketing costs to drive long-term growth initiatives. The Land Experiences segment also included the results of Off the Beaten Path and DuVine, which were acquired during the first quarter of 2021.