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Lindblad Expeditions Holdings, Inc. Reports 2022 First Quarter Financial Results

Cision

First Quarter 2022 Highlights:

  • Operated nine of ten owned and operated ships providing expeditions across Antarctica, Baja California's Sea of Cortez, Bahamas, Belize, Costa Rica and Panama, and the Galápagos

  • Strong reservations for future travel with bookings for the second half of 2022 50% ahead of bookings for the second half of 2019 and bookings for 2023 32% ahead of bookings for 2020 at the same point in 2019

  • Further increased financial flexibility with refinancing of existing term loan and revolving credit facilities through issuance of new senior secured notes

  • Solidified operating rights in the Galapagos Islands with extension of existing cupos for an additional 20-year period

NEW YORK, May 3, 2022 /PRNewswire/ -- Lindblad Expeditions Holdings, Inc. (NASDAQ: LIND; the "Company" or "Lindblad"), a global provider of expedition cruises and adventure travel experiences, today reported financial results for the first quarter ended March 31, 2022.

Dolf Berle, Chief Executive Officer, said "Lindblad is well on its way to returning to full operations, having already provided unforgettable experiences to our guests across nine of our ten owned ships in some of the world's most amazing geographies. As our guests return with us to destinations we have been operating in for decades, the desire to get out and explore has never been more evident from both returning guests, and new travelers who are searching for unique and authentic experiences after being limited in that opportunity over the last several years. There will continue to be some short-term headwinds as we emerge from the pandemic and as we reschedule several upcoming itineraries due to the Russia-Ukraine conflict. However, with guest demand accelerating and expanded earnings power from a growing fleet that includes our two new polar ships, already receiving rave reviews from our guests, and a diverse product portfolio that has expanded our addressable market, we are very well situated to deliver results well ahead of pre-pandemic levels in the years ahead."

RAMP OF FLEET OPERATIONS AND COVID-19 BUSINESS UPDATE

Ramp in Operations

Lindblad continued to ramp its operations during the first quarter of 2022, providing expeditions to guests on nine of its ten owned vessels including trips to Antarctica, Baja California's Sea of Cortez, Bahamas, Belize, Costa Rica and Panama, and the Galápagos. Due to the spread of the COVID-19 virus and the effects of travel restrictions around the world, the Company had previously suspended or rescheduled the majority of its expeditions departing between March 16, 2020 through May 31, 2021. Travel restrictions related to COVID-19 have diminished dramatically, and the Company continues to work with local authorities on plans to operate itineraries in additional geographies during 2022 and 2023. Where travel restrictions remain, which now also includes a limited number of itineraries impacted by the Russia-Ukraine conflict, the Company is working with guests to reschedule travel plans and refund payments or issue future travel certificates, as appropriate.

The Company believes there are a variety of strategic advantages that enable it to deploy its ships safely and quickly, while mitigating the risk of COVID-19 as travel restrictions are lifted. The most notable is the size of its owned and operated vessels which range from 48 to 148 passengers, allowing for a highly controlled environment that includes stringent cleaning protocols. The small nature of the Company's ships also allows it to efficiently and effectively test its guests and crew prior to boarding, or as otherwise needed. Additionally, all guests are required to be fully vaccinated. and the majority of expeditions take place in remote locations where human interactions are limited, so there is less opportunity for external influence.

Booking Trends

The Company has substantial advance reservations for future travel despite some continued short-term impact from the COVID-19 virus, including elevated cancellations and softness in near-term demand, as well as itinerary changes on a few upcoming voyages due to the Russia-Ukraine conflict. Bookings for the second half of 2022 are 50% ahead of the bookings for the second half of 2019, and bookings for 2023 are 32% ahead of the bookings for the full year 2020 at the same point in 2019, which was prior to the pandemic.

Balance Sheet and Liquidity

On February 4, 2022, the Company issued $360.0 million of 6.75% senior secured notes, maturing 2027 and entered into a new $45.0 million revolving credit facility, including a letter of credit sub-facility in an aggregate principal amount of up to $5.0 million. Proceeds from the senior secured notes were used primarily to pay the outstanding borrowings under the Company's previously existing credit agreement, including the term facility, Main Street Loan and revolving credit facility. The senior secured notes are guaranteed on a senior secured basis by the Company and certain of the Company's subsidiaries and are collateralized by certain of the Company's assets.

As of March 31, 2022, the Company had $154.8 million in unrestricted cash and $30.0 million in restricted cash primarily related to deposits on future travel originating from U.S. ports and credit card reserves. As of March 31, 2022, the Company had a total debt position of $584.1 million and was in compliance with all of its debt covenants.

As the Company continues to ramp up operations, its monthly cash usage will increase as the Company incurs costs in operating expeditions, prepares additional ships for return to service and spends to advertise upcoming expeditions and trips. The Company also anticipates a significant increase in guest payments as it receives final payments for upcoming expeditions and trips as well as deposits for new reservations for future travel. However, there can be no assurance that cash flows from operations will be available to fund future obligations or that it will not experience delays or cancellations with respect to the resumption of our operations.

FIRST QUARTER RESULTS

Tour Revenues

First quarter tour revenues of $67.8 million increased $66.0 million as compared to the same period in 2021. The increase was driven by a $49.8 million increase at the Lindblad segment and a $16.3 million increase at the Land Experiences segment primarily due to the ramp in expeditions and trips compared with rescheduling nearly all expeditions and trips in the first quarter a year ago due to COVID-19. The Land Experiences segment also includes a full quarter of results for Off the Beaten Path LLC ("Off the Beaten Path") and DuVine Cycling + Adventure Co. ("DuVine"), which were acquired during the first quarter of 2021, and Classic Journeys, LLC ("Classic Journeys") which was acquired during the fourth quarter of 2021.

Net Income

Net loss available to stockholders for the first quarter was $43.0 million, $0.85 per diluted share, as compared with net loss available to stockholders of $34.6 million, $0.66 per diluted share, in the first quarter of 2021. The $8.5 million decrease primarily reflects the ramp in operations, which was more than offset by investments in future growth, a $3.0 million increase in interest expense due to additional borrowings and higher rates and a $3.0 million increase in depreciation and amortization primarily due to the addition of the National Geographic Resolution to the fleet in September 2021. The quarter also included an $11.6 million increase in other income mainly due to the utilization of the CERTS grant for covered expenses, mostly offset by $10.9 million of costs related to refinancing the Company's term loan and revolving credit facilities.

Adjusted EBITDA

First quarter Adjusted EBITDA loss of $21.2 million decreased $0.4 million as compared to the same period in 2021 as a $3.0 million decline at the Lindblad segment was mostly offset by a $2.6 million increase at the Land Experiences segment.

Lindblad segment Adjusted EBITDA loss of $21.0 million was $3.0 million greater than 2021, as increased tour revenues were more than offset by higher cost of tours and increased personnel costs related to the ramp in operations, increased commissions related to the revenue and bookings growth and higher marketing spend to drive future growth.

Land Experiences segment Adjusted EBITDA loss of $0.2 million improved $2.6 million as compared to 2021, primarily due to additional trips, partially offset by higher cost of tours and increased personnel costs related to the ramp in operations and increased marketing costs to drive future bookings. The Land Experiences segment also includes a full quarter of results for Off the Beaten Path and DuVine, which were acquired during the first quarter of 2021, and Classic Journeys which was acquired during the fourth quarter of 2021.



For the three months ended
March 31,


(In thousands)


2022



2021



Change



%


Tour revenues:

















Lindblad


$

50,274



$

484



$

49,790




NM


Land Experiences



17,572




1,296




16,276




NM


Total tour revenues


$

67,846



$

1,780



$

66,066




NM


Operating loss:

















Lindblad


$

(33,569)



$

(27,296)



$

(6,273)




(23)

%

Land Experiences



(676)




(3,770)




3,094




82

%

Total operating (loss) income


$

(34,245)



$

(31,066)



$

(3,179)




(10)

%

Adjusted EBITDA:

















Lindblad


$

(20,981)



$

(17,952)



$

(3,029)




17

%

Land Experiences



(239)




(2,868)




2,629




92

%

Total adjusted EBITDA


$

(21,220)



$

(20,820)



$

(400)




(2)

%

LINDBLAD FLEET ACTIVITIES

In November 2021, the Company acquired a ship which is currently undergoing renovations and will replace the National Geographic Islander in the Galápagos Islands during the third quarter of 2022. The renovated ship has been named the National Geographic Islander II and will provide immersive and authentic expeditions to 48 guests who will enjoy all suite accommodations, indoor-outdoor dining options and diverse expedition tools and amenities.

In February 2022, the Company further solidified its ability to operate in the Galapagos Islands through an extension of its existing cupos for an additional 20-year period.

STOCK REPURCHASE PLAN

The Company currently has a $35.0 million stock repurchase plan in place. As of April 25, 2022, the Company had repurchased 875,218 shares and 6.0 million warrants under the plan for a total of $23.0 million and had $12.0 million remaining under the plan. As of April 25, 2022, there were 50.9 million shares of common stock outstanding. Beginning in March 2020, the Company suspended all stock repurchases given the uncertainty surrounding COVID-19, and it remains suspended due to restrictions related to the Main Street Expanded Loan Facility program.

FINANCIAL OUTLOOK

The COVID-19 pandemic has had, and will continue to have, a significant impact on the Company's financial position and results of operation. Given the continued uncertainty around the COVID-19 pandemic, the Company is not providing a full year outlook regarding results of operations at this time and will update its expectations when it has more clarity around the timing and extent of future operations.

NON-GAAP FINANCIAL MEASURES

The Company uses a variety of operational and financial metrics, including non-GAAP financial measures such as Adjusted EBITDA, Occupancy, Net Yields and Net Cruise Costs, to enable it to analyze its performance and financial condition. The Company utilizes these financial measures to manage its business on a day-to-day basis and believes that they are the most relevant measures of performance. Some of these measures are commonly used in the cruise and tourism industry to evaluate performance. The Company believes these non-GAAP measures provide expanded insight to assess revenue and cost performance, in addition to the standard GAAP-based financial measures. There are no specific rules or regulations for determining non-GAAP measures, and as such, they may not be comparable to measures used by other companies within the industry.

The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The definitions of non-GAAP financial measures along with a reconciliation of non-GAAP financial information to GAAP are included in the supplemental financial schedules.

Conference Call Information

The Company has scheduled a conference call at 8:30 a.m. Eastern Time on May 3, 2022, to discuss the earnings of the Company. The conference call can be accessed by dialing (844) 378-6487 (United States), (855) 669-9657 (Canada) or (412) 542-4182 (outside the U.S.). A replay of the call will be available at the Company's investor relations website, investors.expeditions.com.

About Lindblad Expeditions Holdings, Inc.

Lindblad Expeditions Holdings, Inc. is an expedition travel company that focuses on ship-based voyages through its Lindblad Expeditions brand and on land-based travel through its subsidiaries, Natural Habitat Adventures, Off the Beaten Path, DuVine and Classic Journeys.

Lindblad Expeditions works in partnership with National Geographic to inspire people to explore and care about the planet. The organizations work in tandem to produce innovative marine expedition programs and promote conservation and sustainable tourism around the world. The partnership's educationally oriented voyages allow guests to interact with and learn from leading scientists, naturalists and researchers while discovering stunning natural environments, above and below the sea, through state-of-the-art exploration tools.

Natural Habitat partners with the World Wildlife Fund to offer and promote conservation and sustainable travel that directly protects nature. Natural Habitat's adventures include polar bear tours in Churchill, Canada, Alaskan grizzly bear adventures and African safaris.

Classic Journeys is a luxury cultural walking tour company that operates a portfolio of curated tours centered around cinematic walks led by expert local guides. Classic Journeys offers active small-group and private custom journeys in over 50 countries around the world.

DuVine designs and leads luxury bike tours in the world's most amazing destinations, from Italy's sun-bleached villages and the medieval towns of Provence to Portugal's Douro Valley and the vineyards of Napa, California. Guests bike, eat, drink, and sleep their way through these regions and many more while sampling the finest cuisine, hotels, and wine.

Off the Beaten Path is an outdoor, active travel company offering guided small group adventures and private custom journeys that connect travelers with the wild nature and authentic culture of their destinations. Off the Beaten Path's trips extend across the globe, with a focus on exceptional national park experiences in the Rocky Mountains, Desert Southwest, and Alaska.

Forward Looking Statements

Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the Company's financial projections and may also generally be identified as such because the context of such statements will include words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "will," "would" or words of similar import. Similarly, statements that describe the Company's financial guidance or future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties that could cause results to differ materially from those expected. Many of these risks and uncertainties are currently amplified by, and will continue to be amplified by, or in the future may be amplified by, the COVID-19 outbreak. It is not possible to predict or identify all such risks. There may be additional risks that we consider immaterial or which are unknown. These factors include, but are not limited to, the following: (i) suspended operations and disruptions to our business and operations related to COVID-19; (ii) the impacts of COVID-19 and/or the Russia-Ukraine conflict on our financial condition, liquidity, results of operations, cash flows, employees, plans and growth; (iii) the impacts of COVID-19 on future travel and the cruise and airline industries in general; (iv) unscheduled disruptions in our business due to travel restrictions, weather events, mechanical failures, pandemics or other events; (v) changes adversely affecting the business in which we are engaged; (vi) management of our growth and our ability to execute on our planned growth; (vii) our business strategy and plans; (viii) our ability to maintain our relationship with National Geographic; (ix) compliance with new and existing laws and regulations, including environmental regulations and travel advisories and restrictions; (x) compliance with the financial and/or operating covenants in our debt arrangements; (xi) adverse publicity regarding the cruise industry in general; (xii) loss of business due to competition; (xiii) the result of future financing efforts; (xiv) delays and costs overruns with respect to the construction and delivery of newly constructed vessels; (xv) the inability to meet revenue and Adjusted EBITDA projections; and (xvi) those risks described in the Company's filings with the SEC. Stockholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this press release, and the Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. More detailed information about factors that may affect the Company's performance may be found in its filings with the SEC, which are available at http://www.sec.gov or at http://www.expeditions.com in the Investor Relations section of the Company's website.

LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)



As of
March 31,

2022



As of
December 31,
2021




(unaudited)






ASSETS









Current Assets:









Cash and cash equivalents


$

154,816



$

150,753


Restricted cash



30,046




21,940


Marine operating supplies



8,037




8,275


Inventories



2,034




2,278


Prepaid expenses and other current assets



32,114




27,094


Total current assets



227,047




210,340











Property and equipment, net



539,177




542,418


Goodwill



42,017




42,017


Intangibles, net



12,830




13,235


Deferred tax asset



7,758




7,609


Right-to-use lease assets



4,085




4,402


Other long-term assets



7,721




7,470


Total assets


$

840,635



$

827,491











LIABILITIES









Current Liabilities:









Unearned passenger revenues


$

242,161



$

212,598


Accounts payable and accrued expenses



48,344




49,252


Lease liabilities - current



1,563




1,553


Long-term debt - current



24,072




26,061


Total current liabilities



316,140




289,464











Long-term debt, less current portion



545,099




518,658


Lease liabilities



2,842




3,178


Other long-term liabilities



300




247


Total liabilities



864,381




811,547











COMMITMENTS AND CONTINGENCIES



-




-











Series A redeemable convertible preferred stock, 165,000 shares authorized; 80,000 shares issued and
outstanding as of March 31, 2022 and December 31, 2021, respectively



85,201




83,901


Redeemable noncontrolling interests



14,458




10,626





99,659




94,527


STOCKHOLDERS' (DEFICIT) EQUITY









Preferred stock, $0.0001 par value, 1,000,000 shares authorized; 80,000 Series A shares issued and outstanding as of
March 31, 2022 and December 31, 2021, respectively



-




-


Common stock, $0.0001 par value, 200,000,000 shares authorized; 50,933,471 and 50,800,786 issued, 50,888,231 and
50,755,546 outstanding as of March 31, 2022 and December 31, 2021, respectively



5




5


Additional paid-in capital



60,307




58,485


Accumulated deficit



(183,717)




(136,439)


Accumulated other comprehensive loss



-




(634)


Total stockholders' deficit



(123,405)




(78,583)


Total liabilities, mezzanine equity and stockholders' deficit


$

840,635



$

827,491


LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except share and per share data)

(unaudited)



For the three months ended
March 31,




2022



2021











Tour revenues


$

67,846



$

1,780











Operating expenses:









Cost of tours



57,947




8,279


General and administrative



20,637




13,812


Selling and marketing



12,329




2,506


Depreciation and amortization



11,178




8,249


Total operating expenses



102,091




32,846











Operating loss



(34,245)




(31,066)











Other (expense) income:









Interest expense, net



(8,715)




(5,669)


Gain on foreign currency



130




70


Other income



533




1


Total other expense



(8,052)




(5,598)











Loss before income taxes



(42,297)




(36,664)


Income tax benefit



(149)




(2,801)











Net loss



(42,148)




(33,863)


Net loss attributable to noncontrolling interest



(427)




(619)


Net loss attributable to Lindblad Expeditions Holdings, Inc.



(41,721)




(33,244)


Series A redeemable convertible preferred stock dividend



1,298




1,301











Net loss available to stockholders


$

(43,019)



$

(34,545)











Weighted average shares outstanding









Basic



50,757,126




49,865,234


Diluted



50,757,126




49,865,234











Undistributed loss per share available to stockholders:









Basic


$

(0.85)



$

(0.66)


Diluted


$

(0.85)



$

(0.66)


LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In thousands)

(unaudited)