Brandt Montour: And then maybe just a follow-up to Ben’s question on looking at EBITDA per ALBD ex-fuel and FX, I noticed that, Josh, your commentary about exiting the year, rivaling 4Q ’19 was — that commentary was essentially unchanged from three months ago. But again, three months ago was before this record wave season. I guess the question is, do you feel any better about that comment three months later?
Josh Weinstein : Yes. You bet I do. So we’re working hard. We outperformed in the first quarter. We’re expecting 50 and we got to 60. We’re about 2/3 forecasted for the second quarter on that basis. And we’re just working — everybody is working incredibly hard to make that come to fruition as quickly as we can.
Operator: Next question from the line of Assia Georgieva with Infinity Research.
Assia Georgieva : Congratulations on the very good results for Q1. Josh, I had a question kind of longer term question again, in terms of new builds. Given the fact that it usually takes three to four years from the point when we put in the order, are you thinking of — and again with the treasury background being more conservative, are you thinking of continuing to sort of reduce the rate of new build growth, the capacity growth, or can we see acceleration once we get to investment grade?
Josh Weinstein: We tried to, I think, give that philosophy by using our one to two ships a year once we start ordering again. And so, by its very nature that will be a lower capacity rate of increase than we have experienced for a very, very long time. I feel, with four ships on order, plus a small expedition ship and that’s it through 2025, we know we’re not getting anything for ’26, ’27 to push, we’ll see. It sets us up incredibly well to be able to generate free cash flow, pay down debt. As David mentioned, our EBITDA increases, get back to 3.5x debt to EBITDA, and be much better positioned to be making new build decisions frankly for the future.
Assia Georgieva : Okay, that makes perfect sense. I believe that in the past we were looking to maybe one or two ships per year per brand as opposed to per the corporate entity?
Josh Weinstein : No, no, no, no. That would have been a much higher growth rate. We were probably somewhere between three and five ships a year depending on the brand. Remember, we have nine brands. So we’ve got plenty to diversify our newbuild growth strategy over time.
Operator: Next question from the line of Stephen Grambling with Morgan Stanley.
Stephen Grambling : Just thinking about the ship pipeline. You talked about the gross adds, but the other side of the equation is any attrition. Are we now in the normal retirement cycle for the fleet where we should more or less expect maybe one to two per year? Or did you pull forward some retirements that could actually be lower going forward?
Josh Weinstein : Yes, we definitely pulled forward some ships that could have been done at a later time. So not anticipating anything of significance over the next couple of years, and then we’ll probably pick back up the cadence that you’re talking about over time, but nothing imminent.
Stephen Grambling : That’s helpful. And then you talked about a few of the non-ship related projects, Grand Bahama, private islands, et cetera. Can you talk a bit more about how those could potentially impact yields and how the investments may compare to what you’ve done in the past?
Josh Weinstein : Yes. Well, I mean, as a starting point, we have a phenomenal footprint in the Caribbean. I think I mentioned in my prepared remarks, Half Moon Cay being pretty much a jewel of the Caribbean in the Bahamas. With the ability for us to generate more differentiated experiences through Grand port, that will absolutely help the Carnival Cruise Line brand, not only on the yield side, but also on the cost side. We’re talking about being able to put another incredibly attractive destination in a very short distance from South Florida, the East Coast of the United States, which helps us tremendously on the cost side, on the carbon footprint side. And with what we’re doing on Half Moon Cay, by adding a pier, that will open up a lot more opportunity for us to bring bigger ships to that island, more guests, a better guest experience and more opportunity to generate not only enhanced ticket pricing because of that, but also onboard spend in the form of spending on board our destinations.
Operator: Next question from the line of Chris Stathoulopoulos with Susquehanna.
Chris Stathoulopoulos : Josh, you spent a lot of time going through these various revenue and marketing initiatives in your prepared remarks. Could you help frame or give some color, as we think about the guide here for EBITDA for the full year, how we should perhaps we could put those in buckets, how we should think about incremental revenue for these initiatives here versus any cost and efficiency related efforts net of what’s, as you said, likely to be elevated marketing costs for the midterm?
Josh Weinstein : So I’m going to try to answer your question. Some of the things that the brands have been working on, what we’ve seen is a fairly immediate in-year benefit, right? The ability for us to be better at our search engine optimization, driving more people to be looking for us to begin with. We can measure those things, and we can see results. There are other things that we’re doing specifically with respect to introducing fare types that brands have never had before, some brands doing non-refundable deposit fares, that have never done that. We can weigh that up in here pretty quickly. There are other things that are going to be having impacts not just for this year, but frankly, on a much longer-term basis as well, primarily around how we’re managing our booking curve and being able to extend that out further, being able to be better differentiated in the market, driving more demand over time.
So candidly, I’m not sure I’m answering your question, but I don’t think it’s so easy to try to fit into particular buckets of particularly for this year, if that’s what you were looking for.
