NCLH: ‘Right-Size’ Cost Base

Norwegian Joy in Sydney

Norwegian Cruise Line Holdings is working hard to right-size costs, undertaking a broad and ongoing margin enhancement initiative.

That means looking to improve operating efficiencies, reduce costs, and maximize revenue generation opportunities while continuing to provide value to its guests, the company said.

While the company announced layoffs last year and also cut some onboard services, it said that in press release that operating efficiency and cost reduction efforts are expected to result in a decrease of nearly 15 percent in adjusted net cruise costs excluding fuel per capacity day for full year 2023 as compared to the second half of 2022.

“This includes a broad and ongoing initiative we began in the fourth quarter to improve operating efficiencies and to right-size our cost base so that we can rebuild and enhance our margins,” said Frank Del Rio, president and CEO, speaking on the company’s year-end and fourth quarter earnings call on Tuesday.

Del Rio said the company was “exploring further opportunities, first and foremost, to reduce our cost profile and to maximize revenue generation. You’ve likely seen some of the actions we’ve already taken to improve our cost structure, including normalization of marketing spend, corporate overhead reductions, itinerary optimization, supply chain initiatives and thoughtful rationalization of product delivery.”

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