Q1 2025 OneSpaWorld Holdings Ltd Earnings Call

Speaker Change: [music].

Operator: Good day and welcome to the OneSpaWorld First Quarter 2025 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Good day and welcome to the one Spa World first quarter 'twenty 25 earnings Conference call.

All participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero.

Operator: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touchtone phone. To withdraw your question, please press star, then two. Please note this event is being recorded.

Speaker Change: After todays presentation, there will be an opportunity to ask questions to ask a question you May Press Star then one on a touchtone phone to withdraw your question. Please press Star then two please note. This event is being recorded I would now like to turn the conference over to Allison Malkin.

Allison Malkin: I would now like to turn the conference over to Allison Malkin of ICR. Please go ahead. Thank you.

ICR Representative: Of ICR. Please go ahead.

Speaker Change: Thank you good morning, and welcome to one style warehouse first quarter 2025 earnings call and webcast before we begin I'd like to remind you that certain statements and information made available on today's call and webcast may be deemed to constitute forward looking statements. These forward looking statements reflect our Jack.

Allison Malkin: Good morning and welcome to OneSpaWorld's first quarter 2025 earnings column webcast. Before we begin, I'd like to remind you that certain statements and information made available on today's column webcast may be deemed to constitute forward-looking statements. These forward-looking statements reflect our judgment and analysis. Only as of today, actual results may differ materially from current expectations based on a number of factors affecting our business. Accordingly, you should not place undue reliance on these forward-looking statements.

Speaker Change: Men and analysis only as of today and actual results may differ materially from current expectations based on a number of factors affecting our business. Accordingly, you should not place undue reliance on these forward looking statements for a more thorough discussion of the risks and uncertainties associated with the board.

Allison Malkin: For a more thorough discussion of the risks and uncertainties associated with the forward-looking statements to be made in this conference call and webcast, we refer you to the disclaimer regarding forward-looking statements that is included in our first quarter 2025 earnings release, which was furnished to the SEC today on Form 8K. We do not undertake any obligation to update or alter any forward-looking statements, whether as a result of new information, future events, or otherwise.

Looking statements could be made in this conference call and webcast. We refer you to the disclaimer regarding forward looking statements that is included in our first quarter 2025 earnings release, which was furnished to the SEC today on form 8-K, we do not undertake any obligation to update or.

Speaker Change: Walter any forward looking statements, whether as a result of new information future events or otherwise. In addition, the company may refer to certain adjusted non-GAAP metrics on this call and explanation of these metrics can be found in our earnings release issued earlier this morning.

Allison Malkin: In addition, the company may refer to certain adjusted non-GATT metrics on this call. An explanation of these metrics can be found in our earnings release issued earlier this morning.

Speaker Change: Joining me today are Leonard <unk>, Executive Chairman, and Chief Executive Officer, and Stephen Lazarus, President Chief Operating Officer, and Chief Financial Officer, Leonard will begin with a review of our first quarter 2025 performance and provide an update on our key priorities.

Allison Malkin: Joining me today are Leonard Fluxman, Executive Chairman and Chief Executive Officer, and Stephen Lazarus, President, Chief Operating Officer, and Chief Financial Officer.

Leonard Fluxman: Leonard will begin with a review of our first quarter 2025 performance and provide an update on our key priorities.

Stephen Lazarus: Then Steven will provide more detail on the financials and guidance.

Stephen Lazarus: Then Stephen will provide more details on the financials and guidance.

Operator: Following our prepared remarks, we will turn the call over to the operator to begin the question and answer portion of the call.

Stephen Lazarus: Following our prepared remarks, we will turn the call over to the operator to begin the question and answer portion of the call I would now like to turn the call over to Leonard.

Leonard Fluxman: I would now like to turn the call over to Leonard. Thank you. Thank you, Alison.

Speaker Change: Thank you Alison good morning, and welcome to one spot Welds first quarter 2025 earnings conference call.

Leonard Fluxman: Good morning and welcome to OneSpaWorld's first quarter 2025 earnings conference call. It is a pleasure to speak to you today and share a strong start to the year, which continues the sustained positive momentum in our business into 2025. Our team delivered first quarter results at the high end of our guidance, with our performance reflecting the impact of our mission to invest in our cruise line and destination resort partnerships, continuously innovate our guest experiences, and enhance our productivity and profitability across our business. This led to increases across all key operating metrics during the quarter, the addition of new ships to our fold, and new agreements with longstanding partners.

Speaker Change: It is a pleasure to speak to you today and share a strong start to the which continues the sustained positive momentum in our business into 2025.

Speaker Change: Our team delivered first quarter results at the high end of our guidance without performance, reflecting the impact of option to invest in our cruise line and destination resort partnerships continuously innovate our guest experiences and.

Speaker Change: And enhance our productivity and profitability across our business.

Speaker Change: This led to increases across all key operating metrics during the quarter.

Speaker Change: The addition of new ships to a fault and new agreements with long standing partners.

Leonard Fluxman: As outlined in our earnings release issued earlier this morning, based on our performance and with continued positive momentum, we remain confident in our ability to navigate the increasingly dynamic economic environment, which is reflected in our reaffirmation of our annual guidance. In addition to our strategic growth drivers, our cruise line partners continue to experience strong bookings and onboard spend, and consumers continue to prioritize experiences with cruising, a value alternative to other vacation choices. Turning to the highlights of the quarter, total revenues increased 4%. $219.6 million compared to $211.2 million in the first quarter of 2024. Income from operations of $16.8 million included $2.5 million of non-recurring severance expense.

Speaker Change: As outlined in our earnings release issued earlier this morning based on our performance and with continued positive momentum we remain confident in our ability to navigate the increasingly dynamic economic environment, which is reflected on our reaffirmation of our annual guidance.

Speaker Change: In addition to our strategic growth drivers our cruise line partners continued to experience strong bookings and onboard spend.

Speaker Change: Soon as continue to prioritize experiences with cruising a value alternative to other vacation choices.

Turning to the highlights of the quarter total revenues increased 4% to $219 $6 million compared to $211 $2 million in the first quarter of 2024.

Speaker Change: Income from operations of $16 $8 million included $2 5 million of nonrecurring severance expense and compared to $17 million in the first quarter of 2024.

Leonard Fluxman: and compared to $17 million in the first quarter of 2024. and Adjusted EBITDA increased 5% to $26.6 million, which included $1.1 million of non-recurring cash severance expense and compared to $25.3 million in the first quarter of 2024. At quarter end, we operated health and wellness centers on a hundred and ninety nine ships. with an average ship count of 193 for the quarter. This compares with a total of 193 ships. and an average ship count of 188 ships at the end of the first quarter of fiscal 2024. Also at quarter end we had 4,240 cruise ship personnel on vessels compared with 4,082 cruise ship personnel on vessels at the end of first quarter of fiscal 2024.

Speaker Change: And adjusted EBITDA increased 5% to $26 $6 million, which included $1 $1 million of nonrecurring cash severance expense and compared to $25 3 million in the first quarter of 2024.

Speaker Change: At quarter end, we operated health and wellness centers on a 119 nine ships with an average ship count of 193 for the quarter.

Speaker Change: This compares with a total of 193 ships and an average ship count of 188 ships at the end of the first quarter of fiscal 2024.

Speaker Change: Also at quarter end, we had 4240 cruise ship personnel on vessels compared with 4082 cruise ship personnel on vessels at the end of first quarter.

Speaker Change: 2024.

Leonard Fluxman: The quarter marked meaningful progress and our key priorities. Let me share some of those highlights with you. First, we captured highly visible new ship growth with current cruise line partners and added new cruise line partnerships to our fold. In support of this priority, we introduced a new health and wellness center on Norwegian Cruise Lines' first Prima Plus class ship, Norwegian Aqua, in the first quarter and remain on track to introduce health and wellness centers on an additional eight new ships. commencing voyages later this year. In addition, following quarter end, we executed a new agreement to operate health and wellness centers on 11 ships for P&O Cruise Lines and Cunard, which recognizes our strong performance and continues our longstanding partnership.

Speaker Change: The quarter marked meaningful progress on our key priorities, let me share some of those highlights with you first we captured highly visible new ship growth with current cruise line partners and added new cruise line partnerships to uphold in support of this priority, we introduced a new health and wind where all of a center.

Speaker Change: Norwegian cruise lines first prima plus class ships Norwegian aircraft in the first quarter and remain on track to reintroduce health and wellness centers on an additional eight new ships.

Speaker Change: Commencing voyages later this year. In addition, fallen quarter end, we executed a new agreement to operate health and wellness centers on 11 ships for PNR cruise lines, and Cunard, which recognizes our strong performance and continues our long standing partnerships.

Leonard Fluxman: Second, we continue to expand high value services and products. These higher value services, including MediSpa, IV therapy and acupuncture, to name a few, help to grow sales productivity as we introduce these services to more ships and expand offerings with latest innovations. To this end, the quarter saw us elevate the innovation in our MediSpa services with the continued rollout of next-generation technology with Simage, FLX, and CoolSculpting Elite, which offer improved results and reduced treatment time by up to 50%. These new technologies generated over 20% growth for these treatments in Q1 versus last year. In addition, acupuncture remains a sought after service with strong adoption of LED light therapy as a high conversion add-on treatment.

Speaker Change: Second we continue to expand high value services and products. These high value services, including Medi Spa IV therapy, and acupuncture to name a few helped to grill gross sales productivity as we introduce these services to more ships and expand offerings with latest innovations.

Speaker Change: To this end the quarter saw us elevate the innovation in our Medi Spa services with the continued rollout of next generation technology with Cmos.

Speaker Change: F L X and cool sculpting elite, which offer improved results and reduced treatment time by up to 50%.

Speaker Change: These new technologies generated over 20% growth for these treatments in Q1 versus last year.

Speaker Change: In addition, <unk>.

Speaker Change: Puncture remains of sorts all the thoughts after service with strong adoption.

Speaker Change: Leds light therapy as a high conversion add on treatment.

Leonard Fluxman: At quarter end, many spa services were available on 148 ships, up from 142 ships at the end of the 2024 first quarter. We continue to expect to have many spa offerings. 151 ships this year. Third, we focused on enhancing health and wellness center productivity. This is best reflected in the delivery across the board growth in key operating metrics, including revenue per passenger per day, weekly revenue, pre-cruise revenue, and revenue per staff per day, which are driven by, one, staff retention, which remains a key contributor to our consistent gains in operating metrics, as experienced team members are driving incremental revenue through more effective customer recommendation.

Speaker Change: At quarter end Medi Spa services were available on 148 ships up from 142 ships at the end of the 'twenty 'twenty four first quarter.

Speaker Change: We continue to expect to have Medi spa offerings.

Speaker Change: 151 ships this year.

Speaker Change: Third we focused on enhancing health and wellness center productivity.

Speaker Change: This is best reflected in the delivery across the board growth in key operating metrics.

Speaker Change: <unk> revenue per passenger per day weekday revenue pre cruise revenue and revenue the staff today, which are driven by one staff retention, which remains a key contributor to our consistent gains in operating metrics as experienced team members are driving incremental revenue.

Speaker Change: More effective customer recommendations.

Leonard Fluxman: We continue to invest in best-in-class training and have recently redesigned our talent management process to further support productivity and long-term growth in our operating network. Our enhanced sales training continues to feel increases in the number of guests using the spa, service frequency, service spend, and retail and average spend per guest. Additionally, pre-booking revenue as a percentage of revenues remains strong at 23%. During the quarter, we introduced pre-booking on the Virgin Voyagers fleet of three vessels. And fourth, we enhanced our capital structure and strengthened our balance sheet again. In recognition of our strong competitive and financial position and our consistent free cash flow generation, our Board of Directors approved a new $75 million share repurchase program, extending our prior $50 million share repurchase program that we substantially completed in the first quarter.

Speaker Change: We continue to invest in best in class training and have recently redesigned our talent management process to further support productivity and long term growth in our operating metrics.

Speaker Change: Our enhanced sales training continues to appeal increases in the number of guests using this fall service frequency service spend and retail and average spend per guest.

Speaker Change: Additionally, pre booking revenue as a percentage of revenues remained strong at 23%.

Speaker Change: During the quarter, we introduced pre booking on the Virgin voyages fleet of three vessels.

Speaker Change: Fourth we enhanced our capital structure and strengthened our balance sheet again.

Speaker Change: In recognition of our strong competitive and financial position and our consistent free cash flow generation. Our board of directors approved a new 75 million share repurchase program extending our prior 15 million share repurchase program that we substantially completed in the first quarter.

Leonard Fluxman: Together with our quarterly cash dividend, this program demonstrates our commitment to enhance shareholder value through our enterprise growth and capital allocation strategy. As we look ahead, we are experiencing favorable trends at the start of the second quarter and expect our proven operating strategies and strong competitive and financial position further buoyed by decades of long experience and the resilience of our business across economic cycles to have us poised to achieve our annual guidance. Overall, we believe we are well positioned to provide increasingly valuable services to our partners, experiences to our guests, and results for our stakeholders and shareholders in fiscal 2025 and beyond.

Speaker Change: Together with our quarterly cash dividend. This program demonstrates our commitment to enhance shareholder value through our enterprise growth and capital allocation strategies as.

Speaker Change: As we look ahead, we are experiencing favorable trends at the start of the second quarter and expect a proven operating strategies and strong competitive and financial position further buoyed by a decades long experience and the resilience of our business across economic cycles to have us poised to achieve our annual guidance.

Speaker Change: Overall, we believe we are well positioned to provide increasingly valuable services to our partners experienced since two I guess and results for our stakeholders and shareholders in fiscal 2025 and beyond.

Stephen Lazarus: With that, I'll turn the call over to Stephen who will provide more details on our first quarter results and guidance. Thank you, Leonard. Good morning, everyone. We are indeed pleased with our first quarter results, realizing our expected growth in total revenues and adjusted EBITDA, and generating predictably strong free cash flow. Our efficient capital structure and asset-light business model, combined with our strong cash flow generation, funded the return of $42 million to our shareholders in the quarter through our quarterly dividend payment and repurchases of our common shares. I will now share further details on our first quarter results that we reported earlier this morning.

Stephen Lazarus: With that I'll turn the call over to Stephen who will provide more details on our first quarter results and guidance Stephen.

Stephen Lazarus: Thank you Linda good morning, everyone.

Stephen Lazarus: We are indeed pleased with our first quarter results, realizing our expected growth in total revenues and adjusted EBITDA.

Stephen Lazarus: And generating predictably strong free cash flow.

Stephen Lazarus: Our efficient capital structure and asset light business model combined with our strong cash flow generation funded the return of $42 million to shareholders in the quarter through our quarterly dividend payment and repurchases of our common shares.

Stephen Lazarus: I will now share further details on our first quarter results that we report.

Stephen Lazarus: Earlier this morning.

Stephen Lazarus: Total revenues increased 4% to $219.6 million, compared to $211.12 in the first quarter of 2024. The increase in service revenue and product revenues were driven by a 2% increase in revenue days, which impacted revenue by $5.3 million, and a 2% increase in guest spend, which positively impacted revenue by $4.7 million. Contributing to the increased volume and spend was $2.3 million in increased pre-booking revenues at health and wellness centers included in our ship count as of quarter end. This was offset by a $1.5 million decrease in our land-based spa business, partially due to the closure of hotels where we had previously operated.

Stephen Lazarus: Total revenues increased 4% to $219 $6 million compared to $211 12 in the first quarter of 2020 for.

Stephen Lazarus: The increase in service revenue and product revenues were driven by a 2% increase in revenue days, which impacted revenue by $5 $3 million and a 2% increase in guests spend which positively impacted revenue by <unk> $7 billion.

Stephen Lazarus: Contributing to the increased volume and spend was $2 $3 million in increased pre booking revenues at health and wellness centers included in our share count as of quarter end. This was offset by a $1 5 million decrease in our land based small business, partially due to the closure of a hotel.

Stephen Lazarus: We had previously operated.

Stephen Lazarus: Cost of services were $148.2 million, compared to $144 million for the first quarter of 2024, with the increase being primarily attributable to costs associated with increased service revenues of $178.5 million in the quarter from our health and wellness centers at sea and on land, compared with service revenue of $172.2 million in the first quarter of 2024. Similarly, cost of products were $35.3 million compared to $33.5 million in the first quarter of 2024. The increase was primarily attributable to costs associated with increased product revenue of $41.1 million for the quarter from our health and wellness centers at CNN on Land compared to product revenues of $39 million for the first quarter of 2024.

Stephen Lazarus: Cost of services were $148 2 million compared to 144 million for the first quarter of 'twenty 'twenty four with the increase being primarily attributable to costs associated with increased this year have been used over $178 $5 million in the quarter from a health and wellness centers, they see and on land compare.

Stephen Lazarus: Service revenue of $172 2 million in the first quarter of 2024.

Stephen Lazarus: Similarly cost of products with $35 $3 million compared to $33.5 million in the first quarter of 2024.

Stephen Lazarus: The increase was primarily attributable to costs associated with increased product revenues of $41 $1 million for the quarter from a health and wellness centers at sea and on land compared to product revenues of $39 million for the first quarter of 'twenty 'twenty four.

Stephen Lazarus: Salary benefits and payroll taxes were $11 million compared to $8.5 million in the first quarter of 2024. The increase was primarily attributable to expenses associated with the termination of employment of a company's former chief commercial officer, including $1.1 million of severance expense and $1.4 million of expense related to vesting treatment with respect to restricted stock units and performance stock units. Net income was $15.3 million or net income per diluted share of 15 pennies as compared to net income of $21.2 million or net income per diluted share of 21 pennies for the first quarter of 2024.

Stephen Lazarus: Salaries benefits and payroll taxes were $11 million compared to $8 5 million in the first quarter of 'twenty 'twenty four the.

Stephen Lazarus: The increase was primarily attributable to expenses associated with the termination of employment of the company's former chief commercial officer, including $1 $1 million of chevron's expense and $1.4 million of expansion related to vesting treatment with respect to restricted stock units and performance stock units.

Stephen Lazarus: Net income was $15 $3 million or net income per diluted share a 15 pin is.

Stephen Lazarus: As compared to net income of $21 2 million or net income per diluted share of 21 Penny for the first quarter of 2024.

Stephen Lazarus: The change was primarily attributable to a $7.7 million benefit. resulting from the change in the fair value of warrant liabilities in the first quarter of last year. The first quarter of 2025 benefited from a $1.8 billion decrease in interest expenses. As you know, the change in fair value of warrant liabilities was the result of the remeasurement to fair value of the warrants exercise during the first quarter of 2024, reflecting changes in market prices of our common shares and other observable inputs, deriving the value of this financial instrument. The $1.8 million decrease in interest expense was primarily attributable to lower debt balances and a lower effective interest rate.

Stephen Lazarus: The change was primarily attributable to a $7.7 million benefit risk.

Stephen Lazarus: Resulting from the change in the fair value of warrant liabilities in the first quarter of last year.

Stephen Lazarus: The first quarter of 2025 benefited from a $1.8 million decrease in interest expense as.

Stephen Lazarus: As you noted the change in fair value of warrant liabilities was the result of the re measurement to fair value of the warrants exercised during the first quarter of 2024, reflecting changes in market prices of our common shares at all observable inputs deriving the value of financial instruments.

Stephen Lazarus: The $1.8 million decrease in interest expense was primarily attributable to lower debt balances and a lower effective interest rate.

Stephen Lazarus: Adjusted net income was $22.6 million or adjusted net income per diluted share of 22 pennies as compared to adjusted net income of 19.3 million or adjusted net income per diluted share of 19 pennies for the first quarter of 2024. And adjusted EBITDA was $26.6 million, inclusive of that aforementioned $1.1 million cash termination expense compared to adjusted EBITDA of $25.3 million in the first quarter of 2024. If we turn then to the balance sheet, we continue to possess a strong balance sheet at quarter end with total cash of $23.8 million after repurchasing $37.9 million of our common shares and paying a $4.2 million dividend in the quarter.

Stephen Lazarus: Adjusted net income was $22 6 million or adjusted net income per diluted share of 22 pennies as compared to adjusted net income was $19 3 million or adjusted net income per diluted share of <unk> 19 tonnage for the first quarter of 2024 and.

Stephen Lazarus: And adjusted EBITDA.

Stephen Lazarus: Was $26 $6 million inclusive of the aforementioned $1 $1 million cash termination expense compared to adjusted EBITDA of $25 $3 million in the first quarter of 2024.

Stephen Lazarus: If we turn then to the balance sheet, we continue to possess a strong balance sheet at quarter end with total cash of $23 $8 million after repurchasing $37.9 billion of our common shares and paying a $4 2 million dollar dividend in the quarter.

Stephen Lazarus: In addition, we had full availability on our $50 revolving loan facility, giving us total equality of $73.8 million as of March 31, 2025. Total debt, netted deferred financing costs, was $97.4 million at March 2025 compared to $98.6 million at December 2024. As Leonard mentioned, reflecting our strong competitive and financial position and efficient capital structure and asset-like business model that delivers consistent, strong cash flow generation, our Board of Directors approved a new share repurchase program. This program replaces the $50 million share repurchase program that we initiated in the first quarter of 2024, which is substantially complete.

Stephen Lazarus: In addition, we had full availability on our $50 million revolving loan facility, giving us total liquidity of $73 8 million as of March 31st 2025.

Stephen Lazarus: Total debt net of deferred financing cost was 97 $4 million at March 25, compared to $98.6 million at balked at December 2024.

Speaker Change: As Linda mentioned, reflecting our strong competitive and financial position and efficient capital structure and asset like business model that delivers consistent strong cash flow generation.

Speaker Change: Board of directors approved a new share repurchase program. This.

Speaker Change: This program replaces the $50 million share repurchase program that we initiated in the first quarter of 'twenty 'twenty, four which is substantially complete.

Stephen Lazarus: We expect to continue to invest our surplus cash after investing in our growth to support the payment of our quarterly cash dividends, repurchase our common shares, and pay down debt. We expect the continued execution of our strategy and return of capital to shareholders to create long-term value for all of our stakeholders.

Speaker Change: We expect to continue to invest our surplus cash after investing in our growth to support the payment of our quarterly cash dividends repurchase our common shares and pay down debt we.

Speaker Change: We expect the continued execution of our strategy and return of capital to shareholders to create long term value for all of our stakeholders.

Stephen Lazarus: Before moving on to guidance, I would like to briefly comment on tariffs. As you are likely aware, the majority of our operations are not impacted by tariffs, as products for distributions to cruise ships are held in a free trade zone. In addition, products for use in our many spas are purchased from U.S. suppliers. These suppliers have not noted any disruption in the supply chain, nor any increases in current prices.

Speaker Change: Before moving onto guidance I would like to briefly comment on tariffs.

Speaker Change: I assume you are like G O way the majority of our operations are not impacted by tariffs as products for distributions to cruise ships are held in a free trade zone. In addition products for use in our Medi spas approaches from U S suppliers.

Speaker Change: These suppliers have not noted any disruption in the supply chain, nor any increases in current pricing.

Stephen Lazarus: Moving then on to guidance. As we look ahead, we remain confident in our outlook and expect total revenue growth to increase as we move through the year, as we benefit from our strategic initiatives, and as we add health and wellness centers on eight additional cruise ships during the remainder of the year, most of them being back-weighted. As such, we continue to expect to report high single-digit revenue and adjusted EBITDA growth rates at the midpoints of our guidance ranges in fiscal 2025 compared to fiscal 2024. iGardens does not assume a significant deterioration in guest spending on board or a significant slowdown in cruising activity.

Speaker Change: Moving onto guidance.

Speaker Change: As we look ahead, we remain confident in our outlook and expect total revenue growth to increase as we move through the year as we benefit from our strategic initiatives and as we add health and wellness centers on eight additional cruise ships.

Speaker Change: The remainder of the year most of them being back weighted.

Speaker Change: As such we continue to expect to report high single digit revenue and adjusted EBITDA growth rates at the midpoint of our guidance ranges in fiscal 2025 compared to fiscal 2024.

Speaker Change: Our guidance does not assume a significant deterioration in guest spending on board or a significant slowdown in cruising activity.

Stephen Lazarus: As a reminder, for the full year of fiscal 2025, we expect total revenue in the range of $950 million to $970 million, with adjusted EBITDA expected in the range of $115 million to $125 million. We introduce for the second quarter of 2025 total revenue in the range of $235 to $240 million, with adjusted EBITDA expected in a range of $28 to $30 million. In summary, Our business continues to build momentum and we see significant opportunity ahead with a clear growth strategy, a high performing team and strong execution across the board. We expect Fiscal 2025 to deliver meaningful gains and drive substantial value for all of our shareholders.

Speaker Change: As a reminder for the full year of fiscal 2025, we expect total revenue in the range of 952 $970 million with adjusted EBITDA expected in the range of $115 million to $125 million.

Speaker Change: We introduced for the second quarter of 2025 total revenue in the range of $235 million to $240 million with adjusted EBITDA expected in a range of $28 million to $30 million.

Speaker Change: In summary.

Speaker Change: Our business continues to build book to build momentum and we see significant opportunity ahead with a clear growth strategy, a high performing team and strong execution across the board.

Speaker Change: Expect fiscal 2025 to deliver meaningful gains and drive substantial value for all of our shareholders.

Operator: With that, we will open up the call for questions.

Speaker Change: With that we will open up the call for questions. Debbie If you could open the cold place.

Operator: Debbie, if you could open the call, please. We will now begin the question and answer session. To ask a question, you may press star, then 1 on your touchtone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then 2. And please ask one question with one follow-up, and if you have further questions, please rejoin the queue.

Speaker Change: We will now begin the question and answer session.

Speaker Change: To ask a question you May press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys.

Speaker Change: Is it any time your question has been addressed and you would like to withdraw your question. Please press Star then two.

Speaker Change: And please.

Speaker Change: Ask one question with one follow up and if you have further questions. Please rejoin the queue.

Operator: At this time, we will pause momentarily to assemble our roster.

Speaker Change: At this time, we will pause momentarily to assemble our roster.

Speaker Change: Okay.

Steve Wieczynski: The first question is from Steve Wieczynski with Stiefel. Please go ahead. Hey, guys, good morning. So, Leonard, I want to understand spend patterns a little bit more on board. Maybe you could give us some more color around what you're seeing in kind of real time in terms of guest spending. And I think you mentioned in your prepared remarks that April trends were essentially the same as kind of what you guys witnessed in the first quarter. But I want to understand if you guys have seen any changes in whether it's attachment rates, whether there's a difference in terms of spending across what you've seen in your land-based assets versus maritime, any change in demand for higher end services versus traditional treatments.

Speaker Change: The first question is from Steve was in ski with Stifel. Please go ahead.

Steve: Hey, guys good morning.

Speaker Change: So Leonard why don't understand spend patterns, a little a little bit more on board.

Speaker Change: Maybe you could give us some more color around what you're seeing in kind of real time in terms of guest spending and I think you mentioned in your prepared remarks that April trends were essentially the same as it is kind of what you guys witnessed in the first quarter, but want to understand that you guys have seen any changes in.

Speaker Change: Whether its attachment rates.

Speaker Change: Whether there's a difference in terms of spending across what you've seen in your land based assets versus maritime.

Speaker Change: Any change in demand for higher end services versus traditional treatments just trying to dig in a little bit more in terms of your guests are starting to change their behaviors.

Leonard Fluxman: Just trying to dig in a little bit more in terms of if your guests are starting to change their behaviors at all. Yeah. Well, to be honest, we. And we look at the same questions that you just asked because those are all the indicators of pressure from the consumer or consumer competence or sentiments starting to decline. Fortunately, in our first first month here in April, we have not seen a significant increase in discounting. We have seen spend continue to increase. Actually, this last week was a good week too, and spend was up. We are still seeing high-end services, medispa services, and some of the upper-body services in high demand.

Speaker Change: No at all.

Speaker Change: Yeah.

Speaker Change: But to be honest, we and.

Speaker Change: When we look at the same questions that you just asked because those are all the indicators of pressure from the consumer or consumer competence or sentiment starting to decline.

Speaker Change: Finally in the first.

Speaker Change: Last month here in April we.

Speaker Change: We have not seen a significant.

Speaker Change: Increase in discounting we have seen spend.

Speaker Change: To increase actually this last week was a good week, two and spend was up.

Speaker Change: We are still seeing high end services Medi Spa services.

Speaker Change: And some of the upper body services in high demand so.

Leonard Fluxman: So we scraped through every single banner to take a look at where there was any kind of significant pressure, and we have not seen that. So we will keep monitoring that, because for us, the first indicator of A reduction in consumer sentiment or demand would be, do we have to tweak any of our marketing tools that we use on board each and every week? We have not had to do that. So your answer simply is, at this point, We've actually seen no decline. If anything, we've seen a slight improvement in April.

Speaker Change: So we scrape through every single banner to take a look at where there was any kind of significant pressure and we have not seen that so we will keep monitoring that because for us the first indicator of.

Speaker Change: A reduction in consumer sentiment or demand would be do we have to tweak any of our marketing tools that we use onboard each and every week, we have not had to do that so your answer there simply is at this point.

Speaker Change: We've actually seen no decline if anything we've seen a slight improvement in April.

Steve Wieczynski: Okay, that that's interesting. Thanks for that, Leonard.

Speaker Change: Okay. That's interesting thanks for that Leonard and then.

Steve Wieczynski: And then, you know, second question, I guess, you know, if we think about full year guidance, Stephen, I think mentioned that, you know, full year guidance doesn't assume any, you know, any material changes in spending patterns, but, you know, maybe help us think about what would get you guys started. Thank you.

Speaker Change: Second question I guess, you know if we think about full year guidance.

Speaker Change: Steven I think mentioned that full year guidance doesn't assume any any material changes in spending patterns, but maybe.

Speaker Change: Maybe help us think about what would get you guys.

Steve Wieczynski: more towards the low end of that guidance range or even below the low end, you know, I guess what we're trying to figure out here to understand is maybe the sensitivity of, you know, how much of a deterioration or change in demand and spending would, you know, would have to occur in order to get you guys, you know, at the low end of that range, or even below that range.

Speaker Change: More towards the low end of that guidance range or even below the low end.

Speaker Change: I guess, what we're trying to figure out here I understand as maybe the sensitivity of.

Speaker Change: How much of a deterioration or change of demand and spending would you know what would have to occur in order to get you guys.

Speaker Change: At the low end of that range or even below that range.

Stephen Lazarus: Steve, good morning. I think I would answer the question simply as follows. The low end of the range assumes a moderation in spending on board, so some slowdown, but if it's going to be a significant slowdown, then perhaps it goes below that. There is nothing that we are looking at that tells us we should pause and be concerned about a significant deterioration in spend on board. You know, the cruise lines have generally come out and talked about their bookings, which have been very, very strong. They still continue to offer this tremendous value alternative to the guest.

Speaker Change: Hey, good morning, I think I would answer the question simply is as follows.

Speaker Change: The low end of the range assumes a moderation in spending on board, so sudden slowdown, but if it's going to be a significant slowdown.

Speaker Change: Then perhaps it goes below there.

Speaker Change: There is nothing that we are looking at that tells us we should pause and be concerned about a significant deterioration spend onboard.

Speaker Change: Meanwhile, the cruise lines are generally come out and talked about the bookings, which are being very very strong. They still continue to offer this tremendous value alternative to the guest. We then have a sort of a layer of installation, we are canvassing and bringing in on the shift a smaller percentage of those folks that want to spend money.

Leonard Fluxman: We then have a further layer of insulation where we are canvassing and bringing in on the ship a smaller percentage of those folks that want to spend money.

Leonard Fluxman: So we feel at this point in time really comfortable about delivering our numbers.

Speaker Change: So we feel at this point in time really comfortable about delivering out of member.

Steve Wieczynski: Okay, gotcha.

Speaker Change: Okay got you. Thanks, guys. Thanks for the color appreciate it.

Steve Wieczynski: Thanks, guys. Thanks for the call. I appreciate it. Yeah, of course.

Speaker Change: Yeah, Chris.

Sharon Zackfia: The next question is from Sharon Zackfia with William Blair. Please go ahead. Hi, good morning. Thanks for taking the questions. I guess I wanted to kind of follow up with that on the pre-booking trends and whether you're seeing any difference in kind of willingness for consumers to pre-book ahead of time. Or alternatively, if you're seeing the cruise lines use kind of onboard spend credit incrementally to bolster trends, which could actually benefit you. And a corollary to that would just be, you know, I know that you don't control the pre-booking engines that the cruise companies have.

Our next question is from Sharon.

Speaker Change: In fact see a with William Blair. Please go ahead.

Sharon: Hi, good morning, Thanks for taking the questions I guess I wanted to kind of follow up with that on that pre bucking trends and whether youre seeing any difference and kind of willingness for consumers to pre book ahead of time.

Sharon: Or alternatively as you have seen the cruise line is kind of onboard spend too crowded.

Sharon: Incrementally to bolster trends, which could actually benefit you.

Sharon: And a corollary to that would just be I know that you don't control all of the pre booking engines.

Sharon: The cruise companies have just.

Sharon Zackfia: Just given the uncertainty, do you or are you seeing any pullback in the cruise companies kind of willingness to invest to continue to reduce friction in those pre-booking engines?

Speaker Change: Just given the uncertainty do you or are you seeing any pullback.

Speaker Change: Pull back and the cruise companies kind of willingness to invest to continue to reduce friction and that's pre booking engines.

Speaker Change: Okay.

Leonard Fluxman: Hey, Sharon, it's Leonard. Look, we actually saw a slight pickup. I mean, although it's pretty much comparable, 23%. We're very encouraged thus far, we just rolled it out on Virgin for the first time, as I mentioned, we have not seen a decline in the focus and energy, although we're focusing on it much more with the cruise lines, because it's important to keep the focus there and the pressure on the importance of pre-booking. But we have not materially in any way adjusted pricing on pre-booking. It's a very important part of setting the cruise up as 23% of services are pre-booked.

Speaker Change: Hey, Sharon it's Leonard look we actually saw a slight pick up I mean, although it's pretty much comparable 23%.

Speaker Change: We are very encouraged thus far we're just rolled it out on on Biogen for the first time as I mentioned.

Speaker Change: We have not seen a decline in the focus and energy, although we're focusing on it much more with the cruise lines because it's important to keep.

Speaker Change: The focus there and the pressure on the importance of pre booking, but we have not materially in any way adjusted pricing on pre booking it's a very important part upsetting the crews up.

Speaker Change: At 23% of services all pre booked so it continues to remain constant if not slightly up we expected pre booking on Belgian it will improve the other initiatives in place to improve it as well so the cruise lines are being as receptive as they can and they are not pulling back in any significant way Sharon.

Leonard Fluxman: So it continues to remain constant, if not slightly up. We expect with pre-booking on Virgin, it will improve. There are other initiatives in place to improve it as the cruise lines are being as receptive as they can, and they're not pulling back in any significant way, Sharon. So we still focus on that. We still focus on that as a material and important part of setting the table for each cruise and how we yield managed through that.

Speaker Change: No.

Speaker Change: We still focus on that we still focus on that isn't materially unimportant part.

Speaker Change: Setting the table for each crews and how we yield manage through that cruise.

Leonard Fluxman: And Leonard, on the bundling, are you seeing the cruise companies use onboard credits more aggressively at all? Not yet, Sharon. I mean, they only really use that lever when they see a significant decline in booking trends. And I don't think we've seen that reported yet whilst, I mean, Royal Caribbean's commentary yesterday was very positive about 2025. I mean, the visibility to 2026 is comparable with historical trends. NCLH continues to say it's decent, although they said there's some softening. So clearly, each cruise line is going to have a slightly different view of bookings. But look, we focus always on the top, top suites first.

Leonard: And Leonard.

Speaker Change: Are you seeing the cruise companies. He is onboard credits more aggressively at all.

Speaker Change: Not yet Sharon it's you know I mean, the only really use that lever.

Speaker Change: When they see a significant decline.

Speaker Change: And booking trends and I don't think we've seen that reported yet whilst I mean royal Caribbean commentary yesterday was very positive about.

Speaker Change: 2025.

Speaker Change: I mean, the visibility to 2026 is comparable with historical trends.

Speaker Change: And C. L. H continues to say, it's decent although they said there's some softening. So clearly each cruise lines are going to have a slightly different view.

Speaker Change: Are you of bookings, but look.

We focus always on the top top suites first in order to get our 11% penetration we focus on the best guests and then we go we go.

Leonard Fluxman: In order to get our 11% penetration, we focus on the best guests and then we go everywhere else, obviously, to fill the columns. So we're not seeing the use of that magic onboard credit yet. I think when you see them start doing that, clearly, then there are signs of some softening, but we haven't seen it yet in any material shape. Okay, great.

Speaker Change: Everywhere else, obviously to fill the column. So we're not seeing the use of that magic onboard credits, yet I think when you see them starting that clear.

Speaker Change: Clearly there are signs of some softening, but we haven't seen it yet in any material shape.

Speaker Change: Okay, great. Thank you.

Speaker Change: Uh huh.

Maks Rakhlenko: The next question is from Maks Rakhlenko with TD Cowan. Please go ahead. Great, thanks a lot and congrats on on a very nice quarter. So first question, did you guys mention what the what comps were for the MediSpas? I've missed that. I think you've provided that the past couple of quarters. And then just how should we think about the potential slowdown in usage for MediSpas if the backdrop were to soften a little bit just given the significantly higher ticket ManySpa continues to grow as a percentage of service. It's still max under 10%. It's still 8% or 9%.

Speaker Change: The next question is from Max right, Rick Glencoe with T. D. Cowen. Please go ahead.

Rick Glencoe: Great. Thanks, a lot and congrats on a very nice quarter. So first question did you guys mention what the comps were for the Medi spas I've missed that I think you've provided that in the past couple of quarters and then just how should we think about the potential slowdown in usage for all our medi spa.

Rick Glencoe: The backdrop, where it has softened a little bit just given the significantly higher ticket.

Rick Glencoe: The Medi Spa continues to grow.

Rick Glencoe: So as a percentage of service, it's still a max under 10%, it's still eight or 9%, but if we do see as we rollout more onto some of the newer ships as they continue to improve the offering on existing ships, where maybe the full platform is not rolled out and they all ships that will.

Leonard Fluxman: But we do see, as we roll out more onto some of the newer ships, as we continue to improve the operating on existing ships where maybe the full platform is not rolled out, and there are ships that will still get some of the new services that are not there. We've not seen a reduction in demand thus far. So, yeah, it's a high-end ticket, but clearly the demand for it right now continues through April from what we've seen, and it was very decent in the first quarter. So we're not seeing the early signs of deterioration even in the high-end Medispa service.

Rick Glencoe: They'll get some of the new services that are not there.

Rick Glencoe: We've not seen a reduction in demand thus far.

Rick Glencoe: So yeah, it's a high end ticket.

Rick Glencoe: But clearly the demand for it right now continues through April from what we've seen and it was very decent in the first quarter. So we're not seeing the early signs of deterioration even in the high end Medi Spa services.

Maks Rakhlenko: Got it. That's, that's great. Appreciate it.

Speaker Change: Got it.

Speaker Change: Great I appreciate it and then if you can just take us back a little bit going to G. F. C. Can you remind us how the business held in both on top line as well as margin says we are obviously starting to get more and more questions around what what the downside could look like so if you could just take us back and remind her.

Leonard Fluxman: And then if you can just take us back a little bit, going to GFC, can you remind us how the business held in both on top line as well as margins is, you know, we are obviously starting to get more and more questions around what the downside can look like. So if you could just take us back and remind how the business held in at the time. Yeah, so the GFC was obviously the worst time, but it was a very small protracted period of time in which there was you know, major. emotional and stress to the financial systems and so people pretty much shut down but that didn't last.

Speaker Change: How the business held in time.

Speaker Change: Yeah. So the GSC was obviously the worst time, but it was a very.

Speaker Change: Small protracted period of time in which there was.

Speaker Change: You know major [laughter].

Speaker Change: Notional and stress to the financial systems, and so people pretty much shut down but that didn't last for a very long period of time that they pretty much kicked in at the end of a wait and then lasted for about four months into one nine and then started to improve.

Leonard Fluxman: for a very long period of time. It pretty much kicked in at the end of 08 and then lost it for about four months into 09 and then started to improve. We We do not expect that type of contraction, and our business actually fared better than most, as you can imagine. We were able to adjust marketing, maybe some discounting. The only thing that was impacted in any significant way was their retail attachment, which thus far continues. In fact, if anything, it's improved in the first quarter. So we've not seen that. And where we did have contraction or less demand for the retail attachment, We wanted to get the people in for services or two services, which is normal, but on the retail side, we maybe had to discount or bundle slightly differently.

Speaker Change: We.

Speaker Change: We do not expect that type of contraction and I business actually fared better than most as you can imagine we were able to adjust marketing maybe some discounting the only thing that was impacted.

Speaker Change: In any significant way was the retail attachment with Jasper continues in fact, if anything it's improved in the first quarter. So we've not seen that and where we did have contraction or less demand for the retail attachment.

Speaker Change: We wanted to get the people info services with two services, which is normal but on the retail side, we may be had to discount or bundle slightly differently, we've not done that thus far.

Leonard Fluxman: We've not done that thus far. Exactly, perfect.

Speaker Change: Exactly perfect. Thanks, a lot guys and best regards.

Maks Rakhlenko: Thanks a lot guys and best regards.

Operator: Thanks.

Speaker Change: Thanks, Mike.

Laura Champine: The next question is from Laura Champine with Loop Capital. Please go ahead. Thanks for taking my question. I note that you were pretty heavy in the in the market to buy your own stock in Q1 and that you've re-upped the authorization this quarter. How sensitive is your buyback to any potential sign of softening in your business? Meaning, should we expect those buybacks to be contingent upon growth staying as strong as it is today? Not necessarily, Laura.

Speaker Change: The next question is from Laura Champagne with loop capital. Please go ahead.

Laura Champagne: Thanks for taking my question I know that you were pretty heavy in the in the market to buy your own stock in Q1 and that you've re upped the authorization. This quarter how sensitive is your buyback to any potential sign of softening in your business.

Speaker Change: Meaning should.

Speaker Change: Should we expect buybacks to be contingent upon growth staying as strong as it is today.

Speaker Change: Not necessarily Laura.

Leonard Fluxman: Even if you go back to, we were just talking about the last significant downturn in the economy, the company still continued to generate nice free cash flow. Thank you.

Speaker Change: Even if you go back to.

Speaker Change: We were just talking about the last significant downturn in the economy. The company still continue to generate nice free cash flow.

Speaker Change: So.

Speaker Change: Did we see a softening in the business, which which again I'll stress and emphasize we have not so far and I'm not saying, so far I'm not implying that we're going to we.

Speaker Change: We would like you still continue to buy back shares.

Speaker Change: To buyback shares is more around the value where is the stock instead of dislocation between the value of the stock, but look we think it should be so I would expect us to continue to be in the market buying back shares that's a lot of opportunities.

Speaker Change: Understood. Thank you.

Speaker Change: Yeah.

Gregory Miller: The next question is from Gregory Miller with Truist Security.

Gregory Miller: The next question is from Gregory Miller with Truth Security. Please go ahead.

Gregory Miller: Please go ahead. Thank you. Good morning. I'd like to ask a question similar to some of my peers as it relates to how you're seeing trends in the second quarter of the day. Did you see any weaknesses in spend immediately or the couple of days after the tariffs were formally announced or where there were more material stock market declines immediately following the tariffs? Now we can Pleading Devil's Advocate, are you surprised that you did not see any changes in spend activity or behavior? You know, immediately after the tariffs were announced, I mean, people are out there cruising, they had probably set in their minds what their budget was for spend or additional experiences.

Gregory Miller: Thank you good morning, I like to ask a question somewhere just some of my peers as it relates to how you're seeing trends in second quarter, you are quarter to date.

Gregory Miller: Did you see any weaknesses in spend.

Gregory Miller: Lee or the couple of days after the tariffs were formally announced or where there were more material stock market declines.

Gregory Miller: Immediately following the tariffs.

Gregory Miller: Yeah.

Gregory Miller: No we didn't.

ICR Representative: Playing Devil's advocate are you surprised that you did not see any changes in spend activity or behavior.

Gregory Miller: Hmm.

Gregory Miller: You know immediately after the tariffs were announced I mean people are out there cruising they had public setting their minds, what their budget was for spend or additional experiences.

Leonard Fluxman: Did they get back home and start re-evaluating with that incremental or discretionary spend needs to be? Probably, but we didn't see it whilst they were cruising during the tariff announcement.

Gregory Miller: Did they get back home and start reevaluating with that incremental discretionary spend needs to be probably but we didn't see it whilst ever cruising during the tariff announcement.

Stephen Lazarus: Okay, I appreciate it. Yeah, Greg, I would echo that. You know, what Leonard says is not dissimilar to what we've seen before in these short-term blips in the economy or incidents that affect the cruise lines, where you're on vacation, you're going to spend money, but certainly, potentially, the minute you get home, the wallet's jammed shut. But while you're on board, you're there, you've spent the money, you might as well have a good time. And that's how we see people behaving in our business.

Gregory Miller: Okay, I forget Gregg I would echo that.

Gregory Miller: What limits this is not dissimilar to what we've seen before in the short term blip in the economy or incidents that affect the cruise lines, where you are on vacation and youre going to spend money, but certainly potentially the minute you get home the wallet share I'm shocked, but while youre onboard USA you spent the money you're Muslim have a.

Gregory Miller: Good time, and that's how we see people behaving in that business.

Gregory Miller: Terrific. Thanks, Stephen. I appreciate it.

Speaker Change: Terrific. Thanks, Stephen I appreciate it.

Gregory Miller: Yep.

Yeah.

Operator: Is there anything else, Debbie, or are we done? I'm sorry, I was mute.

Gregory Miller: Is.

Gregory Miller: Is there anything else Debbie I'll be done.

Gregory Miller: I'm, sorry, I was mute.

Assia Georgieva: Our next questioner is Assia Georgieva with Infinity Research, and she can please go ahead. Good morning, guys. Congratulations on a very strong quarter. I had a couple of questions. In terms of the pre-booked revenue, the increase was $2.3 million, so about a quarter of the overall increase. How would you characterize what you have pre-booked for Q2 and Q3? I imagine you have some pretty nice visibility at this point.

Speaker Change: Our next questioner is S C Georgie Zhong with Infiniti research and she can please go ahead.

Speaker Change: Good morning, guys, congratulations on a very strong quarter.

Speaker Change: I had a couple of questions in terms of the pre booked revenue.

Speaker Change: The increase was 2.3 million so about a quarter of the overall increase how would you characterize it.

Speaker Change: What do you have pre booked for kitchen, QC I imagine you have some pretty.

Speaker Change: Pretty nice visibility at this point.

Speaker Change: Yeah sure that shift right.

Leonard Fluxman: It's not something that we would provide a forward-looking metric on that. It's still in development. We only have one quarter underway. As we mentioned, at least we have one month into the quarter. We've not seen any change to that number. So as Stephen said, yeah, it's too early for us to comment.

Speaker Change: It's not something that we would provide a forward looking metrics on that.

Speaker Change: It's still in development, we only have one quarter underway.

Speaker Change: As we mentioned that at least we have one month into the quarter.

Speaker Change: We've not seen any change to that number so as Stephen said, yeah. It's too early for us to comment than historically, we wouldn't comment on a forward looking pre booking number.

Stephen Lazarus: And historically, we wouldn't comment on a forward pre-booking number. Unfortunately, but I understand. And Steven, you had mentioned that the provider of your Medispa products has not seen any price increases yet. Is that the keyword? Not necessarily. So there are many providers of those items. And to be completely clear, They may have seen certain input prices go up, but they have, at this point in time, indicated to us that they did not expect any increases from them to OneSpaWorld. So our anticipation at this point in time is, irrespective of what's going up in the tariff world, we would not see Medispa price increases.

Speaker Change: Unfortunately, but I understand and.

Speaker Change: You mentioned that Oh.

Speaker Change: The provider of Europe, everybody spot products. He has not seen any price increases yet is that the keyword.

Speaker Change: Not necessarily so there are many providers of those items.

Speaker Change: Items.

Speaker Change: And.

Speaker Change: To be completely clear.

They may have seen certain input prices go up but they have at this point in time indicated to us that they did not expect any increases problem then.

Speaker Change: One small will so.

Speaker Change: Our anticipation at this point in time is irrespective of what's going on.

Speaker Change: In the tariff World, we would not see maybe small price increases.

Leonard Fluxman: So does it make sense to build inventory to possibly for that to carry you through, let's say, a few month long period of tariff impact? But it's difficult. Some of the medis have expirations. It has expiration dates. You've got to be really careful. Yeah, I didn't know how all those explorations, yeah. It's refrigerated and there's obviously limitations on the size of the refrigeration capabilities on board, but at the same time, we keep sufficient inventory, even for high demand or busy ships with MedSpa demand. But to keep an excess of that beyond what we can store safely, we don't do.

Speaker Change: Sometimes it makes sense to build inventory to possibly.

Speaker Change: So that's carrying you through let's say a few month long period does.

Speaker Change: Paris impact.

Speaker Change: Well it's difficult.

Speaker Change: Paul.

Speaker Change: So is exploration.

Speaker Change: This exploration day, yeah, so you've got to be really careful.

Speaker Change: Yeah, it's a great team a lot of those explorations that yeah.

Speaker Change: Its refrigerated and Theres, obviously limitations on the size of the refrigeration capabilities on board, but at the same time, we keep sufficient inventory even for high demand all busy ships with med spot demand.

Speaker Change: To keep in excess of that beyond what we can still have safely we don't do that.

Speaker Change: That makes it makes perfect sense.

Assia Georgieva: And just two very quick housekeeping questions, in terms of land-based closings, should we anticipate anything significant going forward the rest of the year? Can you repeat the question? the end of the relationship with some hotels and closing of some of those spas, do you anticipate any significant changes in the number of spas to be operated going forward? I imagine not. And this is purely LAMPing. Yeah, that's correct.

Speaker Change: And just very quick housekeeping I get the questions in terms of land based closings should we anticipate anything significant going forward the rest of the year.

Speaker Change: So I ask you to repeat temporary what do you mean you repeat the question can you.

Speaker Change: Because you had mentioned.

Speaker Change: In your press release definitely have its revenues were slightly down because of the closings. What do you have the relationship with some hotels have closing up some of those pause do you anticipate any significant changes in the number of supposed to be upgraded going forward I imagine not.

Speaker Change: And then clearly.

Okay got it.

Leonard Fluxman: Okay. Thank you. I mean, the only thing we will say, yeah, yeah, go ahead. No, no, no. I don't want to hear it. Thank you. No. Yeah, look, I mean, look, I think every type of vacation option out there competing with cruise lines. potentially might not do as well as the cruise industry itself because it's still an incredibly differentiated experience, but also great value. And the delta between land and sea is still pretty significant. I imagine that that's still going to be your first call if you want to take a family and we're moving into the second quarter.

Speaker Change:

Speaker Change: I mean, the only the other thing we will yeah. Yeah go ahead.

Speaker Change: No no.

Speaker Change: I get now.

Speaker Change: Yeah look I mean look I think every type of vacation option out there competing with cruise lines.

Speaker Change: Potentially might not do as well as the cruise industry itself, because it's still an incredibly.

Speaker Change: Differentiated experience, but also great value and the Delta between land and sea is still pretty significant.

Speaker Change: I imagine that that's still going to be a first call. If you want to take a family and we're moving into the second quarter.

Speaker Change: Patients clue school kids coming out. So this is a quarter, where a lot of people do go on to the ships and go to Alaska go to Mediterranean. So you know, it's going to be an interesting second quota, but I think pretty much every itinerary out there the load factors are going to be consistently good and comparable with last.

Leonard Fluxman: This is a quarter where a lot of people do go onto the ships and go to Alaska, go to Mediterranean. So, you know, it's going to be an interesting second quarter, but I think pretty much every itinerary out there, the load factors are going to be consistently good and comparable with last year, if not better.

Speaker Change: Terry if not better.

Assia Georgieva: Perfect. And again, my very, very last question, the EBITDA number, if I were to exclude the cash severance amount, it would have actually come above guidance and would have been $27.7 million. Is that correct, Steve? Yep. Okay, perfect. Thank you guys. Good luck. I look forward to the next call. Thank you.

Speaker Change: Perfect.

Speaker Change: Again, my very very last question D. EBITDAR number if I would exclude the cash severance around it would've actually come above guidance and would've been 27.7 million is that correct.

Speaker Change: Yep.

Speaker Change: Okay.

Speaker Change: Good luck and look forward to the next call.

Speaker Change: Thank you.

Speaker Change: Yeah.

Leonard Fluxman: All right. Thank you, everybody. And thanks for joining us today. We look forward to speaking with many of you as upcoming investor meetings and when we report our second quarter results in July. Thank you for joining us today. Bye-bye.

Speaker Change: Alright, Thank you everybody and thanks for joining US today, we look forward to speaking with many of you as the upcoming investor meetings and when we report our second quarter results in July.

Speaker Change: Thank you for joining us today bye bye.

Operator: The conference is now concluded. Thank you for attending today's presentation.

Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

Operator: You may now disconnect.

Speaker Change: Yeah.