Lindblad Expeditions (LIND) - 2024 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements for the quarter ended March 31, 2024, providing a comprehensive overview of the company's financial position and performance Notes to the Condensed Consolidated Financial Statements (Unaudited) These notes detail the company's business segments, accounting policies, debt, and significant post-quarter events - The company operates two reportable business segments: - Lindblad Segment: Primarily provides ship-based expeditions on a fleet of ten owned and six chartered vessels - Land Experiences Segment: Includes four land-based brands: Natural Habitat, DuVine, Off the Beaten Path, and Classic Journeys[25][26] Segment Financial Performance (Three Months Ended March 31) | Segment | Tour Revenues 2024 (in thousands) | Tour Revenues 2023 (in thousands) | Operating Income 2024 (in thousands) | Operating Income 2023 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Lindblad | $118,303 | $115,498 | $7,783 | $12,118 | | Land Experiences | $35,311 | $27,897 | $67 | $348 | | Total | $153,614 | $143,395 | $7,850 | $12,466 | - As of March 31, 2024, the company had $290.8 million in unearned passenger revenue, up from $252.2 million at year-end 2023, reflecting strong future bookings[38] - Subsequent to the quarter's end, in April 2024, the company increased its ownership in Natural Habitat to 90.1% for $15.2 million and in DuVine to 75% for $1.5 million, also announcing an agreement to acquire Wineland-Thomson Adventures for approximately $30 million in cash and stock[70][71] Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $177,719 | $156,845 | | Total current assets | $286,564 | $244,502 | | Total assets | $868,038 | $831,297 | | Liabilities & Equity | | | | Unearned passenger revenues | $290,790 | $252,199 | | Total current liabilities | $357,555 | $319,224 | | Long-term debt, less current portion | $622,676 | $621,778 | | Total liabilities | $984,491 | $945,063 | | Total stockholders' deficit | $(227,399) | $(225,064) | Condensed Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended Mar 31, 2024 (in thousands) | Three Months Ended Mar 31, 2023 (in thousands) | | :--- | :--- | :--- | | Tour revenues | $153,614 | $143,395 | | Operating income | $7,850 | $12,466 | | Net (loss) income | $(4,210) | $778 | | Net loss available to stockholders | $(5,115) | $(448) | | Basic & Diluted EPS | $(0.10) | $(0.01) | Condensed Consolidated Statements of Cash Flows (Unaudited) | Cash Flow Activity | Three Months Ended Mar 31, 2024 (in thousands) | Three Months Ended Mar 31, 2023 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $43,916 | $2,058 | | Net cash (used in) provided by investing activities | $(6,468) | $8,738 | | Net cash used in financing activities | $(622) | $(6,096) | | Net increase in cash, cash equivalents and restricted cash | $36,826 | $4,700 | Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2024 financial results, highlighting revenue growth, operating income decline, and liquidity position Business Overview and 2024 Highlights This section provides an overview of the company's adventure travel business, highlighting strategic developments and booking trends - In April 2024, the company increased its ownership of Natural Habitat to 90.1% for $15.2 million and its ownership of DuVine to 75% for $1.5 million[86] - An agreement was announced in April 2024 to acquire Wineland-Thomson Adventures, a Tanzania safari operator, for approximately $30.0 million in cash and stock, pending regulatory approval[87] - Bookings for the full year 2024 are 4% ahead of bookings for 2024 at the same point in 2023[88] Results of Operations — Consolidated Consolidated tour revenues increased in Q1 2024, but rising expenses led to a significant decline in operating income and a net loss Consolidated Results of Operations (Three Months Ended March 31) | Metric (in thousands) | 2024 | 2023 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Tour revenues | $153,614 | $143,395 | $10,219 | 7% | | Cost of tours | $79,302 | $72,050 | $7,252 | 10% | | General and administrative | $32,387 | $26,419 | $5,968 | 23% | | Selling and marketing | $22,758 | $20,652 | $2,106 | 10% | | Operating income | $7,850 | $12,466 | $(4,616) | (37)% | | Net (loss) income | $(4,210) | $778 | $(4,988) | NM | - The 23% increase in General and Administrative expenses was primarily driven by higher personnel costs, increased IT costs following a digital infrastructure launch, and higher credit card commissions from strong bookings[113] Results of Operations — Segments Segment results for Q1 2024 show revenue growth in both segments, but operating income declined due to higher costs and lower Lindblad occupancy Segment Performance Summary (Three Months Ended March 31) | Metric (in thousands) | 2024 | 2023 | % Change | | :--- | :--- | :--- | :--- | | Lindblad Segment | | | | | Tour Revenues | $118,303 | $115,498 | 2% | | Operating Income | $7,783 | $12,118 | (36)% | | Adjusted EBITDA | $20,472 | $26,083 | (22)% | | Land Experiences Segment | | | | | Tour Revenues | $35,311 | $27,897 | 27% | | Operating Income | $67 | $348 | (81)% | | Adjusted EBITDA | $1,134 | $1,103 | 3% | Lindblad Segment Guest Metrics (Q1) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Occupancy | 76% | 81% | | Net Yield per Available Guest Night | $1,219 | $1,205 | | Adjusted Net Cruise Cost per Available Guest Night | $981 | $891 | Liquidity and Capital Resources The company's liquidity position is strong as of March 31, 2024, with operating cash flow significantly increasing from unearned passenger revenue - The company held $177.7 million in unrestricted cash and cash equivalents and $46.5 million in restricted cash as of March 31, 2024[129] - Total long-term debt obligations stood at $635.1 million as of March 31, 2024[130] - Net cash provided by operating activities increased by $41.8 million to $43.9 million in Q1 2024, primarily due to a significant increase in cash received from guests for future travel[131] Quantitative and Qualitative Disclosures about Market Risk The company's market risk exposure, primarily from interest rates on its revolving credit facility, remains materially unchanged from the 2023 Annual Report - There have been no material changes in the company's exposure to market risks since the 2023 Annual Report, with the primary exposure being interest rate risk on the revolving credit facility, which had no balance outstanding[143] Controls and Procedures Management concluded disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal control over financial reporting - The company's principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective as of March 31, 2024[144] - No changes occurred in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[145] PART II. OTHER INFORMATION Legal Proceedings The company is involved in various legal actions arising in the ordinary course of business and maintains insurance coverage for potential damages - The company is involved in various claims and legal actions arising from the ordinary course of business and has insurance coverage for potential damages[146] Risk Factors This section refers investors to the detailed discussion of risks and uncertainties in the 'Risk Factors' section of the 2023 Annual Report on Form 10-K - For a discussion of risks that could materially affect the business, the report refers to the 'Risk Factors' section in the 2023 Annual Report[147] Unregistered Sale of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities in Q1 2024, with $12.0 million remaining under its stock and warrant repurchase plan - There were no unregistered sales of equity securities during the quarter ended March 31, 2024[148] - As of March 31, 2024, the remaining balance for the company's stock and warrant Repurchase Plan was $12.0 million[149] Other Information No director or Section 16 officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during Q1 2024 - No director or Section 16 officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2024[154]