“With new leadership not only in my seat but in all three of our award-winning brands and most recently for our vessel operation function, there is a possible feeling of reinvigoration and excitement about the future across the entire company,” said Harry Sommer, president and CEO of Norwegian Cruise Line Holdings (NCLH), speaking on the company’s second-quarter earnings call.
“We are approaching every decision with fresh perspective and new energy, challenging the status quo at every level and encouraging our entire team to think outside of the box and come to the table with new ideas, however big or small,” Sommer said, noting his focus is on the future and how to refine and enhance our strategy to optimize the company’s existing fleet of high-quality assets, further differentiate the business model, build resiliency, advance efforts to drive a positive impact on society in the environment and ultimately drive more value.
“Our executive team has an average of over 20 years in the cruise industry and nearly all have been with NCLH for a decade plus,” he continued.
“I have the unlost confidence that this team is the right one to take the company to even greater heights.”
Norwegian Cruise Line Holdings had an average load factor of 101.5 per cent in the first quarter, according to company executives speaking on the corporation’s first quarter earnings call.
“We reached load factors of 101.5 per cent in the first quarter, exceeding our guidance and breaking triple-digit levels for the first time in three years with some voyages exceeding occupancy above 115 per cent,” said Harry Sommer, incoming president and CEO of Norwegian Cruise Line Holdings.
“With this significant achievement, we have also nearly closed the occupancy gap versus 2019 levels,” he said.
For the second quarter, Sommer said he expects 105 per cent occupancy on average across the fleet.
“This average is slightly below 2019 levels as a result of our strategic shift to longer, more immersive itinerary at the Norwegian Cruise Line brand, naturally resulting in fewer thirds and fourths, which is what historically pushes passenger occupancy above the 100 per cent mark, all while enhancing margin over time,” he explained.
Norwegian Cruise Line Holdings launched an updated climate action strategy with short- and near-term greenhouse gas targets towards achieving net zero by 2050, according to a press release.
“We are proud to further refine and strengthen our climate action strategy and commitments including by setting milestone GHG intensity reduction targets which will guide us on our ambitious pursuit of net zero by 2050,” said Harry Sommer, president and chief executive officer-elect of Norwegian Cruise Line Holdings.
“Every aspect of our business from shoreside to shipboard is responsible for doing their part to design, deliver and demonstrate results for decarbonization and our Board of Directors has reinforced this expectation by establishing shared accountability and tying incentives for our entire management team to this critical effort. We also recently took an important step forward on our pursuit of net zero by announcing the modification of two of our future Prima Class newbuilds to accommodate the use of green methanol in the future.”
The key components of the new targets include reducing greenhouse gas emissions intensity by 10 per cent by 2026 and 25 per cent by 2030. These include emissions from the company’s fleet islands and facilities as well as fuel- and energy-related activities. The new targets serve to support NCLH’s existing strategy for achieving net zero by 2050.
“We are also activating and mobilizing our full network of team members, ports and destinations, suppliers and partners, and guests to act now and join us on this transformative journey, further amplifying the efforts we could achieve on our own,” added Sommer.
The updated climate action strategy is centred around efficiency, innovation and collaboration. The company continues to invest in systems and technologies aimed at optimizing efficiency, such as HVAC system upgrades and waste heat recovery systems. NCLH is also working on long-term solutions including technologies that help support the ability to operate using green fuels.
The company has already completed tests of biofuel on several ships, using a blend of about 30 per cent biofuel and 70 marine gas. Long term, NCLH is also planning on using green methanol which would result in a drastic reduction in emissions and up to 95 per cent reduction in CO2 and has announced Prima ships five and six will be methanol ready.
Achieving net zero will require collaboration across the company’s network of stakeholders.
“We are encouraged to see the significant progress and momentum across sectors to decarbonize, but fundamental challenges continue to exist for the cruise industry to fully decarbonize by 2050,” said Jessica John, vice president of ESG, Investor Relations and Corporate Communications of Norwegian Cruise Line Holdings Ltd.
“Rather than waiting for these challenges to dissolve, our strategy is about acting now to implement solutions for efficiency today, innovate for future solutions and collaborate with our stakeholders along the way. Underpinning this strategy is good governance and effective risk management as we work to advance our climate action efforts and build our Company’s resilience.”
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