Viking Holdings today reported financial results for the first quarter ended March 31, 2024, according to a press release.

Key Highlights

• Adjusted Gross Margin for the first quarter of 2024 increased 19.1% compared to the same period in 2023, resulting in a Net Yield of $508.
• Adjusted EBITDA increased by $46.1 million compared to the first quarter of 2023.
• Net Leverage declined from 3.8x as of December 31, 2023 to 3.4x as of March 31, 2024.
• As of May 19, 2024, for the 2024 and 2025 seasons, Viking had sold 91% and 39%, respectively, of its Capacity Passenger Cruise Days for its Core Products.

“We are pleased with our performance in the first quarter, during which we reported a Net Yield of $508, and our strong Advanced Bookings for 2024 and 2025 are equally encouraging,” said Torstein Hagen, Chairman and CEO of Viking. “At Viking, we remain committed to prioritizing our guests and treating our employees as integral members of our family. We embrace a contrarian approach and steadfastly maintain a long-term perspective when managing our business. Leveraging our momentum, we are dedicated to shaping Viking’s next era to deliver value for all of our stakeholders.”

First Quarter 2024 Consolidated Results

During the first quarter of 2024, Capacity PCDs increased by 14.5% over the same period in 2023 and Occupancy was 94.0%, compared to 92.8% for the same period in 2023.

Total revenue for the first quarter of 2024 was $718.2 million, an increase of $89.2 million, or 14.2%, over the same period in 2023 mainly due to an increase in the size of the Company’s fleet and higher Occupancy in 2024 compared to 2023.

Gross margin for the first quarter of 2024 was $160.1 million, an increase of $62.0 million, or 63.2%, over the same period in 2023 and Adjusted Gross Margin for the first quarter of 2024 was $495.3 million, an increase of $79.6 million, or 19.1%, over the first quarter of 2023. Net Yield was $508 for the first quarter.

Vessel operating expenses and vessel operating expenses excluding fuel for the first quarter of 2024 were $281.1 million and $239.0 million, respectively. Compared to the same period in 2023, vessel operating expenses increased $17.9 million, or 6.8%, and vessel operating expenses excluding fuel increased $17.2 million, or 7.8%.

Net loss was $493.9 million compared to $214.4 million for the same period in the prior year. The 2024 first quarter net loss includes a loss of $330.5 million and the 2023 first quarter includes a gain of $15.5 million related to the net impact of the Private Placement derivative (loss) gain and interest expense related to the Company’s Series C Preference Shares. The Company’s Series C Preference Shares converted into ordinary shares immediately prior to the consummation of the Company’s initial public offering (“IPO”), which was subsequent to the first quarter of 2024.

Adjusted EBITDA increased by $46.1 million over the first quarter of 2023. The increase in Adjusted EBITDA was mainly due to higher Capacity PCDs and higher Net Yield.

“Our first quarter results reflect the seasonality of our business. While our ocean, expedition and Mississippi products operate year-round, the primary cruising season for our river product is from April to October, although some of our river cruises run longer seasons. Additionally, our highest Occupancy occurs during the Northern Hemisphere’s summer months. We recognize cruise-related revenue over the duration of the cruise and expense our marketing and employee costs when the related costs are incurred. As a result, the majority of our revenue and profits have historically been earned in the second and third quarters of each year,” the company said.

Update on Operating Capacity and Bookings

For the company’s Core Products, operating capacity is 5% higher for the 2024 season in comparison to the 2023 season and 12% higher for the 2025 season in comparison to the 2024 season.

For Core Products, as of May 19, 2024, for the 2024 and 2025 seasons, the company said it had sold 91% and 39%, respectively, of Capacity PCDs and had $4,573 million and $2,481 million, respectively, of Advance Bookings. Advance Bookings were 15% and 27% higher in comparison to the 2023 and 2024 seasons, respectively, at the same point in time. Advance Bookings per PCD for the 2024 season was $742, 9% higher than the 2023 season at the same point in time, and Advance Bookings per PCD for the 2025 season was $852, 12% higher than the 2024 season at the same point in time.

Balance Sheet and Liquidity

On May 3, 2024, Viking closed its $1.8 billion initial public offering, with net proceeds of approximately $245.5 million to Viking and approximately $1.4 billion to certain selling shareholders.

As of March 31, 2024:

• The Company had $1.7 billion in cash and cash equivalents, which does not include the proceeds of the IPO.
• The scheduled principal payments for the remainder of 2024 and 2025 were $196.4 million and $489.0 million, respectively.
• Deferred revenue was $4.1 billion.

In May 2024, S&P upgraded Viking Cruises Ltd’s corporate rating to BB- from B+.

“We are excited to share strong first-quarter financial results, which are a testament to the great demand for our products and brand,” said Leah Talactac, CFO of Viking. “Also, strengthening our balance sheet continues to be a priority as evidenced by our cash balance and reduction in Net Leverage. We are also very pleased by the S&P credit rating upgrade. These achievements underscore our dedication to financial prudence and our pursuit of sustainable growth.”