Norwegian Cruise Line Reports Results for Second Quarter 2010

Norwegian Cruise Line (NCL Corporation Ltd., “Norwegian” or “the Company”) reported results for the second quarter ended June 30, 2010.

“The results for the quarter demonstrate that we are continuing to build momentum”

EBITDA for the second quarter of 2010 improved 12.6% to $94.7 million versus $84.2 million for the same period in 2009 (a 12.1% increase on an adjusted basis, to $95.7 million from $85.4 million). An improvement in Net Yield of 6.6% in the quarter resulted in Net Revenue increasing to $364.7 million from $353.9 million despite a 3.3% decrease in Capacity Days in the quarter due to the departure of Norwegian Majesty from the fleet in October 2009. The increase in Net Yield came from both improved passenger ticket pricing and increased onboard revenue per Capacity Day. Occupancy Percentage for the quarter was 109.2%. Net loss for the quarter was $14.9 million on revenue of $477.9 million compared to net income of $15.4 million on revenue of $478.4 million in 2009. The net loss in 2010 included a non-recurring charge of $33.1 million related to foreign exchange contracts associated with the financing of Norwegian Epic. Excluding this non-recurring charge, net income for the period was $18.2 million.

Net Cruise Cost for the second quarter was essentially flat year over year. On a per Capacity Day basis, Net Cruise Cost increased 3.5% primarily due to higher average fuel costs in the period and fewer capacity days as a result of the departure of Norwegian Majesty. Average fuel cost per metric ton in the period climbed to $508 in 2010 from $356 in 2009. Net Cruise Cost Excluding Fuel per Capacity Day decreased 2.3%.

“The results for the quarter demonstrate that we are continuing to build momentum,” said Kevin Sheehan, chief executive officer of Norwegian Cruise Line. “Our improved results over last year were achieved while absorbing a 43% increase in the price of fuel,” said Sheehan.

Interest expense, net of capitalized interest, increased to $37.0 million in the quarter compared to $26.6 million in 2009 due to higher average interest rates in the period. Other expense increased to $33.8 million in 2010 versus $4.3 million in 2009 primarily due to the aforementioned loss on foreign exchange contracts.

Updates and Outlook

Last month the Company took delivery of Norwegian Epic, its largest, most innovative Freestyle Cruising vessel to date. With 21 dining options, an equal number of bars and lounges, and an entertainment lineup which includes venues housing world-renown acts such as Blue Man Group and Legends in Concert in the Epic Theater, Cirque Dreams and Dinner^TM in the Spiegel Tent, The Second City Comedy Troupe and Howl at the Moon at Headliners and Nickelodeon at Sea entertainment throughout the ship, Norwegian Epic has brought the Company’s Freestyle Cruising offering to a new level. “The depth and breadth of choices and activities on board Norwegian Epic is unparalleled in the industry,” said Sheehan.

After inaugural events in Rotterdam and Southampton, Norwegian Epic took guests on a maiden transatlantic voyage to New York City, where she became the largest vessel ever to dock in Manhattan. In a spectacular ceremony, Norwegian Epic was formally christened by her Godmother, country music icon and Freestyle Cruising fan Reba McEntire. After a successful two-night christening voyage, Norwegian Epic returned to Manhattan to serve as the host site for NBC’s top-rated broadcast of the Macy’s Fourth of July Fireworks Spectacular on the Hudson River. Added Sheehan, “We could not have asked for a better way to introduce Norwegian Epic to the world. From the delighted looks on guests’ faces and the tremendous positive feedback we’ve received from those who sailed on her, we know that all the hard work and dedication by all of Norwegian’s team members has created something truly special.” Regarding her bookings, Sheehan commented, “Norwegian Epic has been booking extremely well, setting records week after week since her introduction in Europe and subsequent inaugural events in New York and Miami.” Norwegian Epic is currently sailing alternating 7-day Eastern and Western Caribbean itineraries on Saturdays from the Port of Miami through April 2011, when she will then reposition to start her summer Mediterranean season out of Barcelona.

The second half of 2010 is showing solid improvements in pricing from 2009 levels with load factors consistent with prior year. Unlike this same time last year, the Company has been successful at holding price while balancing load factor. The booking curve continues to be healthy, but has narrowed from the highest levels achieved in the first quarter of 2010.

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