Viking Holdings Ltd. (Bermuda) Q3 FY2024 earnings call

• Strong third quarter results with consolidated net yield up 11% from prior year. 95% of 2024 capacity and 70% of 2025 capacity sold as of November 3, 2024.
• Viking was rated number one for Oceans, Rivers, and Expeditions by Conde Nast Traveler for the second year in a row. Repeat guest percentage increased from 27% in 2015 to 53% in 2024 to date.
• Updates on Egypt: Two new Nile River vessels delivered, with four more under construction. China operations: Return to China with Viking Yi Dun, expanding Ocean cruises in Asia and continuing River cruises in Europe for Chinese guests.
• Completed a secondary offering of 34.5 million shares on behalf of TPG Capital and CPP Investments at $31 per share.

For the River segment, year-to-date adjusted gross margin grew 12.1% to $1.2 billion, with a net yield of $546, up more than 13% year-over-year. Occupancy for the nine-month period was 95.3%. For the Ocean segment, year-to-date capacity PCDs increased 7.2% year-over-year, driven by the delivery of vessels. Adjusted gross margin grew 11.7% to $1.2 billion, with a net yield of $533, up 4% compared to the previous year. Occupancy for the period was 95%.

• As of November 3, 2024, 95% of 2024 capacity PCDs booked, $4.6 billion in advanced bookings (14% higher than 2023). 2025 capacity up 12%, 70% booked with $4.3 billion in advanced bookings (26% higher than 2024).
• Ocean cruises 2024: $1.9 billion in advance bookings (15% higher than 2023), 94% capacity sold, rates $661 (up from $614 in 2023). 2025: $2 billion in advance bookings (30% higher than 2024), 74% capacity sold, rates $753 (up from $680 in 2024).
• River cruises 2024: Over $2.3 billion in advance bookings (14% higher than 2023), 96% capacity sold, rates $759 (up from $689 in 2023). 2025: $2 billion in advance bookings (22% higher than 2024), 67% capacity sold, rates $856 (up from $819 in 2024).

• Potential last-minute cancellations in 2024 that could slightly affect full-year advance bookings. Impact of Middle East conflict on bookings, though it has recovered well. Egypt represents a small portion of total capacity, but its products are in high demand but small in contribution to overall metrics.

Q: Exercising options for Ocean cruises and opportunities outside core business?

A: Leah Talactac said primary focus is on current ship orders, but see white space in primary markets and expanding in Asia. Connor Cunningham asked about opportunities outside core, Leah replied focus is on current growth and brand's appeal.

Q: Impact of Russia/Ukraine conflict on ships and potential return?

A: Linh Banh said five ships in Russia and one in Ukraine, if able to operate again, could put them back quickly, but they contribute less margin than long ships currently.

Q: Driving force behind Ocean pricing increase for 2025?

A: Linh Banh said deployment decisions, like adding one world cruise in 2025, impact pricing, and they're happy with 74% sold for 2025 at 11% higher pricing.

Q: Excursion trends and partner evolution?

A: Linh Banh said optional shore excursions and pre/post land excursions are growing, guests who purchase them rate higher, and the team is looking to enhance experiences. Meredith Jensen asked about Ocean vs River trip lengths, which are consistent with Ocean at 10-11 nights and River at 7-8 nights.