Lindblad Expeditions today reported financial results for the third quarter ended September 30, 2022.

Third Quarter 2022 Highlights:

• Total revenue of $144.8 million increased $80.3 million versus 2021 and $43.8 million compared with the third quarter of 2019
• Net loss available to stockholders improved $15.9 million to a loss of $9.8 million versus the third quarter of 2021
• Adjusted EBITDA of $18.6 million increased $25.2 million versus the third quarter of 2021
• Lindblad segment Net Yield per Available Guest Night increased 24% to $1,014 with Occupancy of 81%
• Strong reservations for future travel with bookings for 2023 23% ahead of bookings for 2020 at the same point in 2019
• Launched the 48 passenger all-suite National Geographic Islander II, replacing the National Geographic Islander in the Galapagos

Dolf Berle, Chief Executive Officer, said: “Lindblad delivered strong financial results this past quarter as we continued to ramp operations and began to harness the expanded earnings power of the Company. With significant demand across both our ship and land-based businesses, our guests are demonstrating their eagerness to return with us to exploring the world’s most remarkable destinations. The growing desire for high quality, immersive and authentic experiences drove the positive earnings contributions during the third quarter, while also positioning us for continued success in 2023 and beyond, when we can further leverage the increased fleet capacity and diversified product offerings we have strategically invested in over the last two years.”

RAMP OF FLEET OPERATIONS

Ramp in Operations

Lindblad resumed operation in June 2021 and, since then, has continually ramped its operations, providing immersive expeditions in 2022 across all ten of its owned vessels.  During the third quarter of 2022, operations included trips to Alaska, the Arctic, the Pacific Northwest, British Columbia, Canada’s Northwest Passage, the Galápagos Islands, Greenland, Iceland, Norway and South America. Travel restrictions related to COVID-19 have diminished dramatically, and the Company will resume operations in additional geographies in the remainder of 2022 and throughout 2023.  Where travel restrictions remain, which primarily includes a limited number of itineraries impacted by the Russia-Ukraine conflict, the Company is adjusting itineraries where possible, and working with guests to reschedule travel plans and refund payments or issue future travel certificates, as applicable.  Previously, due to the spread of the COVID-19 virus and the effects of travel restrictions around the world, the Company had suspended or rescheduled the majority of its expeditions departing between March 16, 2020 through May 31, 2021.

The Company believes there are a variety of strategic advantages that enabled it to deploy its ships safely and quickly as travel restrictions were lifted. Most notably, the size of its owned and operated vessels, which range from 48 to 148 passengers, allows for a highly controlled environment that includes stringent cleaning protocols. The small nature of the Company’s ships also allowed it to efficiently and effectively test its guests and crew prior to boarding, or as otherwise needed. Additionally, the majority of expeditions take place in remote locations where human interactions are limited, so there is less opportunity for external influence. 

Booking Trends

The Company has substantial advance reservations for future travel despite some continued short-term impact from the COVID-19 virus, including elevated cancellations, as well as itinerary changes on a few upcoming voyages due to the Russia-Ukraine conflict. Bookings for 2023 are 23% ahead of the bookings for the full year 2020 at the same point in 2019.

Balance Sheet and Liquidity

As of September 30, 2022, the Company had $116.4 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.

As of September 30, 2022, the Company had a total debt position of $572.4 million and was in compliance with all of its applicable debt covenants. During May 2022, the Company further amended its export credit agreements to extend the waiver of its net leverage coverage ratio from March 2022 through December 31, 2022.

During February 2022, the Company issued $360.0 million of 6.75% senior secured notes, maturing 2027 and entered into a new $45.0 million revolving credit facility. Proceeds from the senior secured notes were used primarily to pay the outstanding borrowings under the Company’s previously existing credit agreement, including the term facility, Main Street Loan and revolving credit facility.

As the Company continues to ramp up operations, it anticipates strong guest cash receipts from final payments for upcoming expeditions and trips, as well as deposits for new reservations for future travel. At the same time, monthly cash usage will increase as the Company incurs costs in operating expeditions and spends to advertise upcoming expeditions and trips. There can be no assurance that cash flows from operations will be available to fund future obligations or that it will not experience delays or cancellations with respect to the ramp of our operations.

THIRD QUARTER RESULTS

Tour Revenues

Third quarter tour revenues of $144.8 million increased $80.3 million as compared to the same period in 2021. The increase was driven by a $50.6 million increase at the Lindblad segment and a $29.6 million increase at the Land Experiences segment, primarily due to the ramp in expeditions and trips compared with the third quarter a year ago and higher pricing. The Land Experiences segment also includes a full quarter of results for Classic Journeys, LLC (“Classic Journeys”), which was acquired during the fourth quarter of 2021.

Net Income

Net loss available to stockholders for the third quarter was $9.8 million, $0.18 per diluted share, as compared with net loss available to stockholders of $25.7 million, $0.50 per diluted share, in the third quarter of 2021. The $15.9 million improvement primarily reflects the ramp in operations, partially offset by $4.0 million decline in other income due primarily to the utilization in the third quarter of 2021 of the CERTS grant for covered expense. The third quarter of 2022 also included a $2.3 million increase in interest expense due to additional borrowings and higher rates and a $1.5 million increase in depreciation and amortization, primarily due to the addition of the National Geographic Resolution to the fleet in September 2021.

Adjusted EBITDA

Third quarter Adjusted EBITDA of $18.6 million increased $25.2 million as compared to the same period in 2021. The increase was driven by a $16.5 million improvement at the Lindblad segment and a $8.7 million increase at the Land Experiences segment.

Lindblad segment Adjusted EBITDA of $4.9 million increased $16.5 million as compared to the same period in 2021, primarily from increased tour revenues, partially offset by higher cost of tours and increased personnel costs from the ramp in operations and from higher commissions related to the revenue and bookings growth.

Land Experiences segment Adjusted EBITDA of $13.7 million increased $8.7 million as compared to 2021, primarily due to additional trips, partially offset by higher cost of tours and increased personnel costs related to the ramp in operations and increased marketing costs to drive future bookings. The Land Experiences segment also includes a full quarter of results for Classic Journeys, which was acquired during the fourth quarter of 2021.