The cruise ship industry has been in full swing since Royal Caribbean on Thursday raised its full-year profit outlook and said it expects 60% year-over-year growth following record first-quarter bookings.
Royal Caribbean says that despite a recent spate of fatalities and reports of missing passengers on the high seas, including a 20-year-old Florida youth who jumped off a Royal Caribbean cruise this month, travelers They say they are paying “record ticket prices.”
A surge in demand for vacations at sea has given cruise lines plenty of room to increase ticket prices. The industry aims to close the price gap with more expensive land-based holidays and boost profits.
Royal Caribbean, which operates Celebrity Cruises, now expects full-year earnings of $10.70 to $10.90 per share, compared with previous expectations of $9.90 to $10.10.
Chief Executive Officer Jason Liberty said: “Our existing fleet and newbuilds continue to perform very well, as evidenced by the market response to the launch of Icon of the Seas. ” he said.
Royal Caribbean stock, which has soared 126% over the past year, rose 2% to $139.32 Thursday morning.
“I remember owning this stock in 2022,” said Peter Ahluwalia, chief investment officer at Swiss Partners Group and manager of the Belevest Global Equity Fund, which owns Royal Caribbean stock. But every customer was sad about it.” “Right now our return on equity is almost 45%, which is pretty impressive.”
Overall, the industry, which was hit hardest by the pandemic, is expected to see passenger numbers rise to 39.4 million in 2027 from 31.7 million last year, according to Statista.
This spike in demand comes after highly publicized incidents at sea involving missing passengers, including a Florida man who jumped into the ocean in front of his brother and father after drinking alcohol on April 4th. It’s happening in the middle of the day.
Last December, a 41-year-old Royal Caribbean passenger fell overboard during a cruise to the Bahamas. This followed an incident in August last year in which a 64-year-old woman was presumed to have jumped to her death while sailing from Singapore to Malaysia on Royal Caribbean.
A 2020 study commissioned by the Cruise Lines International Association, an industry group, found that an average of 19 people fall overboard on cruise ships each year, and only about four of those people are rescued.
