OneSpaWorld (OSW) Q4 2023 earnings summary

Executive summary

• Record FY 2023 results: revenue rose 45% to $794.0M, operating income increased to $54.2M, and Adjusted EBITDA grew 77% to $89.2M.

• Q4 revenue grew 15% to $194.8M and Adjusted EBITDA rose 13% to $23.4M, despite Middle East turmoil and an unscheduled large-ship drydock.

• FY 2024 guidance was reaffirmed, with high-single-digit revenue and Adjusted EBITDA growth expected at the midpoints versus FY 2023.

Financial highlights

• FY revenue was $794.0M versus $546.3M in FY 2022; Q4 revenue was $194.8M versus $168.9M.

• FY operating income rose to $54.2M from $15.1M; Q4 operating income was $12.6M versus $10.7M, including a $2.1M impairment charge.

• FY Adjusted EBITDA was $89.2M versus $50.4M; Q4 Adjusted EBITDA was $23.4M versus $20.7M.

• FY GAAP net loss was $3.0M, or $(0.03) per diluted share, versus net income of $53.2M; Q4 net loss was $7.3M, or $(0.07) per diluted share.

• Adjusted FY net income was $61.9M, or $0.63 per diluted share, versus $26.7M and $0.28; Q4 was $12.5M and $0.12 versus $12.8M and $0.14, including the $5.4M deleveraging fee.

Outlook and guidance

• FY 2024 revenue guidance is $850M–$870M and Adjusted EBITDA guidance is $90M–$100M; midpoint outlook implies high-single-digit growth versus FY 2023.

• Q1 2024 guidance is revenue of $204M–$209M and Adjusted EBITDA of $21.5M–$23.5M.

• Positive operating cash flow and after-tax free cash flow are expected throughout FY 2024.