ONESPAWORLD HOLDINGS Ltd
For the period ended Mar 31, 2025. Filed May 1, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 1, 2025
OSW$31.13+1.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-10-31.
0000950170-24-119539
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-01.
0000950170-25-061930
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 108 previous paragraphs and 89 current paragraphs.
47 unchanged; 32 reworded; 8 added; 26 removed; 3 previous and 2 current paragraphs rearranged.
Tables are not compared: 4 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
Revenue Days. Revenue days are the days on which the health and wellness centers are open onboard a revenue generating cruise with passengers.
Current report
Revenues. Revenues for the three months ended March 31, 2025 and 2024 were $219.6 million and $211.2 million, respectively. The increases in each of service revenues and product revenues were driven by a 2% increase in Revenue Days, which impacted revenue by $5.3 million, and a 2% increase in average guest spend, which positively impacted revenue by $4.7 million. Contributing to the increased volume and spend was $2.3 million in increased pre-booked revenues on health and wellness centers included in our ship count as of March 31, 2025. This was offset by a $1.5 million decrease in our land-based spa business, partially due to the closure of hotels where we had previously operated.
Current report
Service revenues. Service revenues for the three months ended March 31, 2025 were $178.5 million, an increase of $6.3 million, or 4%, compared to $172.2 million for the three months ended March 31, 2024.
Current report
Product revenues. Product revenues for the three months ended March 31, 2025 were $41.1 million, an increase of $2.1 million, or 5%, compared to $39.0 million for the three months ended March 31, 2024.
Current report
Salaries, benefits and payroll taxes. Salaries, benefits and payroll taxes for the three months ended March 31, 2025 were $11.0 million, an increase of $2.5 million, or 29%, compared to $8.5 million for the three months ended March 31, 2024. The increase was primarily attributable to expenses associated with the termination of employment of the Company’s former Chief Commercial Officer, including $1.1 million of severance expense and $1.4 million of expense related to vesting treatment in respect to restricted stock units and performance stock units.
Current report
Income tax expense. Income tax expense for the three months ended March 31, 2025 was $0.4 million, a decrease of $0.2 million, or 28%, compared to an expense of $0.6 million for the three months ended March 31, 2024. The decrease is primarily attributable to a lower effective tax rate, driven by higher earnings in foreign jurisdictions and lower earnings in the U.S.
Current report
Operating activities. Our net cash provided by operating activities for the three months ended March 31, 2025 and 2024 were $10.1 million and $15.0 million, respectively. This decrease of $4.9 million was due to a change in working capital of ($7.8) million offset by an increase in Net income, net of non-cash items of $2.9 million. The increase in Net income, net of non-cash items was primarily attributable to: (i) increased revenues from a higher number of health and wellness center guests on our existing fleet, expansion of our fleet by five ships, and higher guest spend, and (ii) reduced Interest expense, which was attributable to lower debt balances. For further discussion, see “Results of Operations”, above. The $7.8 million change in working capital was attributable to cash outflows of $15.0 million and $7.2 million for the three months ended March 31, 2025 and 2024, respectively. The cash outflows from working capital for the three months ended March 31, 2025, were primarily driven by a $5.1 million net payment of bonuses to employees, a payment of $7.3 million to cruise line partners related to fees accrued, and a $3.4 million increase in Inventories, as a result of increased purchases reflecting the growth in Revenues and anticipation of increased shipments in the second quarter of 2025. The cash outflows from working capital for the three months ended March 31, 2024 were primarily driven by a $22.1 million increase in Other non-current assets reflecting capitalized contract costs incurred to enter into new or to renew long-term contracts, partially offset by an increase in other long-term liabilities of $7.3 million, which relate to fees accrued to cruise line partners and a $7.0 million increase in Accounts payable, primarily related to the timing of vendor payments.
Current report
changes in the market for the products we offer for sale;
Removed paragraphs (26)
Previous report
(1) Refer to Note 2 to the Condensed Consolidated Financial Statements in this report for details underlying OneSpaWorld’s income diluted share calculation.
Previous report
Revenues. Revenues for the three months ended September 30, 2024 and 2023 were $241.7 million and $216.3 million, respectively. The increase primarily was attributable to our Average Ship Count increasing 5% to 195 health and wellness centers onboard ships operating during the quarter, compared with our Average Ship Count of 185 health and wellness centers onboard ships operating during the third quarter of 2023, together with continued productivity gains across our operations. In addition, we benefited from our initiatives to drive revenue growth in each of our on-board health and wellness centers through enhanced guest engagement and experiences, our guest service and product offering innovations, and the disciplined execution of our complex operating protocols by our on-board and corporate teams.
Previous report
Service revenues. Service revenues for the three months ended September 30, 2024 were $194.4 million, an increase of $18.6 million, or 11%, compared to $175.8 million for the three months ended September 30, 2023.
Previous report
Product revenues. Product revenues for the three months ended September 30, 2024 were $47.3 million, an increase of $6.9 million, or 17%, compared to $40.4 million for the three months ended September 30, 2023.
Previous report
Cost of services. Cost of services for the three months ended September 30, 2024 were $159.6 million, an increase of $13.5 million, or 9%, compared to $146.1 million for the three months ended September 30, 2023. The increase primarily was attributable to costs associated with increased Service revenues of $194.4 million in the quarter compared with Service revenues of $175.8 million in the third quarter of 2023.
Previous report
Cost of products. Cost of products for the three months ended September 30, 2024 were $40.1 million, an increase of $5.7 million, or 16%, compared to $34.5 million for the three months ended September 30, 2023. The increase primarily was attributable to costs associated with increased Product revenues of $47.3 million in the quarter compared to Product revenues of $40.4 million in the third quarter of 2023.
Previous report
Administrative. Administrative expenses for the three months ended September 30, 2024 were $4.2 million, a decrease of $0.4 million, or (9%), compared to $4.7 million for the three months ended September 30, 2023. The decrease primarily was attributable to professional fees incurred during the three months ended September 30, 2023 for a secondary offering of common shares by selling shareholders related to the Business Combination.
Previous report
Salary, benefits and payroll taxes. Salary, benefits and payroll taxes for the three months ended September 30, 2024 were $8.6 million, a decrease of $1.3 million, or (13%), compared to $9.8 million for the three months ended September 30, 2023. The decrease primarily was attributable to the timing of higher performance based compensation for the three months ended September 30, 2023.
Previous report
Income tax expense (benefit). Income tax expense (benefit) for the three months ended September 30, 2024 was an expense of $1.0 million, an increase of $3.8 million, or 134%, compared to an income tax benefit of $2.8 million for the three months ended September 30, 2023. The increase was primarily driven by the recognition of a discrete tax benefit of approximately $3.4 million in uncertain tax benefits during the third quarter of 2023 related to foreign tax exposures as a result of our participation in a tax amnesty program in Italy that settled such liability in August 2023.
Previous report
(1) Refer to Note 2 to the Condensed Consolidated Financial Statements in this report for details underlying OneSpaWorld’s income diluted share calculation.
Previous report
Comparison of Results for the nine months ended September 30, 2024 compared to nine months ended September 30, 2023
Previous report
Revenues. Revenues for the nine months ended September 30, 2024 and 2023 were $677.8 million and $599.2 million, respectively. The increase primarily was attributable to our Average Ship Count increasing 7% to 190 health and wellness centers onboard ships operating during the nine months ended September 30, 2024 compared with our Average Ship Count of 178 health and wellness centers onboard ships operating during the nine months ended September 30, 2023, together with continued productivity and pricing gains across our operations. In addition, we benefited from our initiatives to drive revenue growth in each of our on-board health and wellness centers through enhanced guest engagement and experiences, our guest service and product offering innovations, and the disciplined execution of our complex operating protocols by our on-board and corporate teams.
Previous report
Service revenues. Service revenues for the nine months ended September 30, 2024 were $547.5 million, an increase of $58.3 million, or 12%, compared to $489.2 million for the nine months ended September 30, 2023.
Previous report
Product revenues. Product revenues for the nine months ended September 30, 2024 were $130.4 million, an increase of $20.3 million, or 18%, compared to $110.0 million for the nine months ended September 30, 2023.
Previous report
Salary, benefits and payroll taxes. Salary, benefits and payroll taxes for the nine months ended September 30, 2024 were $26.3 million, a decrease of $1.4 million, or (5%), compared to $27.7 million for the nine months ended September 30, 2023. The decrease primarily was attributable to lower stock-based compensation expense in the nine months ended September 30, 2024 offset by annual merit increases for Corporate employees in 2024.
Previous report
Amortization of intangible assets. Amortization of intangible assets for the nine months ended September 30, 2024 and 2023 were $12.4 million and $12.6 million, respectively.
Previous report
Other income (expense). Other income (expense) includes interest expense and change in the fair value of the warrant liabilities. Interest expense, net for the nine months ended September 30, 2024 was $7.7 million, a decrease of $5.0 million, or (40%), compared to $12.7 million for the nine months ended September 30, 2023. The decrease primarily was attributable to lower debt balances. Since the year ended December 31, 2022, we have repaid a total of $115.6 million in debt instruments. The change in fair value of the outstanding warrants during the nine months ended September 30, 2024 was a gain of $7.7 million compared to a loss of ($26.7) million during the nine months ended September 30, 2023. The change in fair value of warrant liabilities was the result of the remeasurement to fair value of the warrants exercised during the nine months ended September 30, 2024 reflecting changes in market prices of our common stock and other observable inputs deriving the value of these financial instruments. The Company has no outstanding warrants as of September 30, 2024; accordingly, there will be no impact on the statement of operations in future periods.
Previous report
Income tax expense (benefit). Income tax expense (benefit) for the nine months ended September 30, 2024 was an expense of $2.4 million, an increase of $4.6 million, or 207%, compared to an income tax benefit of $2.2 million for the nine months ended September 30, 2023. The increase primarily was driven by the recognition of a discrete tax benefit of approximately $3.4 million in uncertain tax benefits during the third quarter of 2023 related to foreign tax exposures as a result of our participation in a tax amnesty program in Italy that settled such liability in August 2023, offset by an increase in the taxable income, the change in valuation allowance and the decrease in availability of net operating losses.
Previous report
Net income. Net income for the nine months ended September 30, 2024 was $58.5 million, an increase of $54.1 million, or 1,250%, compared to a net income of $4.3 million for the nine months ended September 30, 2023. The $54.1 million increase in net income was primarily attributable to: (i) a $34.4 million positive change in fair value of warrant liabilities; (ii) a $5.0 million decrease in interest expense; and (iii) a $19.3 million positive change in income from operations; offset by $4.6 million increase in income tax expense.
Previous report
On September 20, 2024, the Company and its subsidiaries, Dory Acquisition Sub, Inc. and OneSpaWorld (Bahamas) Limited, entered into a credit agreement with Bank of America, N.A., as administrative agent, and certain lenders party thereto, providing for senior secured credit facilities consisting of (x) a term loan facility of $100 million (of which $70 million was borrowed by Dory Acquisition and $30 million was borrowed by OneSpaWorld Bahamas), which was fully drawn on the Closing Date, and (y) a revolving loan facility of up to $50 million, which Revolving Facility remained undrawn upon the closing of the Credit Facilities and as of September 30, 2024. The Revolving Facility includes borrowing capacity available for letters of credit up to $5 million. Any issuance of letters of credit reduces the amount available under the Revolving Facility. The Credit Facilities mature on September 20, 2029.
Previous report
Loans outstanding under the Credit Facilities will accrue interest at a rate per annum equal to Term SOFR plus a margin of 1.90%, with three step ups to a maximum margin of 2.65% depending on the most recent consolidated leverage ratio of the Company and its restricted subsidiaries, and undrawn amounts under the Revolving Facility will accrue a commitment fee at a rate per annum of 0.25% on the average daily undrawn portion of the commitments thereunder, with three step ups to a maximum commitment fee of 0.40% depending on the most recent consolidated leverage ratio of the Company and its restricted subsidiaries.
Previous report
The Term Loan Facility requires the Borrowers to make certain mandatory prepayments, with (i) 100% of net cash proceeds of all non-ordinary course asset sales or other dispositions of property, subject to the ability to reinvest such proceeds and certain other exceptions, and (ii) 100% of the net cash proceeds of any debt incurrence, other than debt permitted under the definitive agreements (but excluding debt incurred to refinance the Credit Facilities). The Borrowers also are required to make quarterly amortization payments equal to 1.25% of the original principal amount of the Term Loan Facility commencing on March 31, 2025 (subject to reductions by optional and mandatory prepayments of the loans). The Borrowers may prepay the Credit Facilities at any time without premium or penalty, subject to payment of customary breakage costs.
Previous report
The proceeds from the Credit Facilities were used, together with cash on hand, to repay in full the remaining principal balance of the First Lien Term Loan Facility and to pay related financing costs of the Credit Facilities. Accordingly, as of September 30, 2024, our First Lien Term Loan Facility has been fully paid and terminated.
Previous report
Comparison of Results for the nine months ended September 30, 2024 and 2023
Previous report
Operating activities. Our net cash provided by operating activities for the nine months ended September 30, 2024 and 2023 were $62.2 million and $46.3 million, respectively. In the nine months ended September 30, 2024, net operating cash flows continued to increase from comparable 2023 periods, as the Company grew total revenue by 13% and income from operations by 46% and reduced interest expense by 40%, which interest expense reduction was attributable to repayment of indebtedness, further enhancing our balance sheet.
Previous report
First Lien Term Loan Facility, paid $5.4 million of deleveraging fee on the First Lien Term Loan Facility, utilized $19.0 million to repurchase 1,351,688 of our common shares and $1.3 million to pay deferred financing cost. For the nine months ended September 30, 2023, the Company repaid $36.0 million on the First Lien Term Loan Facility and $15.0 million on the Second Lien Term Loan Facility and received proceeds from the exercise of warrants of $2.2 million.
Reworded paragraphs (32)
Previous wording
OneSpaWorld Holdings Limited (“OneSpaWorld,” the “Company,” “we,” “our,” “us” and other similar terms refer to OneSpaWorld Holdings Limited and its consolidated subsidiaries) is the pre-eminent global operator of health and wellness centers onboard cruise ships and a leading operator of health and wellness centers at destination resorts worldwide. Our highly trained and experienced staff offer guests a comprehensive suite of premium health, fitness, beauty and wellness services and products onboard cruise ships and at destination resorts globally. We are the market leader at more than 20x the size of our closest maritime competitor. Over the last 50 years, we have built our leading market position on our depth of staff expertise, broad and innovative service and product offerings, expansive global recruitment, training and logistics platform, as well as decades-long relationships with cruise line and destination resort partners. Throughout our history, our mission has been simple: helping guests look and feel their best during and after their stay.
Current wording
OneSpaWorld Holdings Limited (“OneSpaWorld,” the “Company,” “we,” “our, “us” and other similar terms refer to OneSpaWorld Holdings Limited and its consolidated subsidiaries) is the pre-eminent global operator of health and wellness centers onboard cruise ships and a leading operator of health and wellness centers at destination resorts worldwide. Our highly trained and experienced staff offer guests a comprehensive suite of premium health, fitness, beauty and wellness services and products onboard cruise ships and at destination resorts globally. We are the market leader at more than 18x the size of our closest maritime competitor. Over the last 50 years, we have built our leading market position on our depth of staff expertise, broad and innovative service and product offerings, expansive global staff recruitment, training and logistics platform, global operations infrastructure, as well as decades-long relationships with cruise line and destination resort partners. Throughout our history, our mission has been simple: helping guests look and feel their best during and after their stay.
Previous wording
At our core, we are a global services company. We serve a critical role for our cruise line and destination resort partners, operating a complex and increasingly important aspect of our cruise line and destination resort partners’ overall guest experience. Decades of investment and know-how have allowed us to construct an unmatched global infrastructure to manage the complexity of our operations. We have consistently expanded our onboard offerings with innovative and leading-edge service and product introductions, and developed the powerful back-end recruiting, training and logistics platforms to manage our operational complexity, maintain our industry-leading quality standards, and maximize revenue and profitability per center. The combination of our renowned recruiting and training platform, deep proprietary labor pool, global logistics and supply chain infrastructure, and proven health and wellness center and revenue management capabilities represents a significant competitive advantage that we believe is not economically feasible to replicate.
Current wording
At our core, we are a global services company. We serve a critical role for our cruise line and destination resort partners, operating a complex and increasingly important aspect of their overall guest experience. Decades of investment and know-how have allowed us to construct an unmatched global infrastructure to manage the complexity of our operations. We have consistently expanded our onboard offerings with innovative and leading-edge service and product introductions, and developed the powerful recruiting, training and logistics platforms to manage our operational complexity, maintain our industry-leading quality standards, and maximize revenue and profitability per health and wellness center. The combination of our renowned recruiting and training platform, deep proprietary labor pool, global logistics and supply chain infrastructure, and proven health and wellness center and revenue management capabilities represents a significant competitive advantage that we believe is not economically feasible to replicate.
Previous wording
A significant portion of our revenues are generated from our cruise ship operations. Historically, we have been able to renew almost all of our cruise line agreements that expired or were scheduled to expire.
Current wording
A significant portion of our revenues are generated from our cruise ship operations. Historically, we have been able to renew substantially all of our cruise line agreements.
Previous wording
Service revenues. Service revenues consist primarily of sales of health and wellness, aesthetics and fitness services, including a full range of body care, skin care, hair care, cosmetics, medi-spa, acupuncture, nutrition/weight management and mindfulness services, among others, to cruise ship passengers and destination resort guests. We bill our services at rates which inherently include an immaterial charge for products used in the rendering of such services, if applicable.
Current wording
Service revenues. Service revenues consist primarily of sales of health and wellness services, including a full range of massage treatments, facial treatments, nutritional/weight management consultations, teeth whitening, mindfulness and medi-spa services to cruise ship passengers and destination resort guests. We bill our services at rates which inherently include an immaterial charge for products used in the rendering of such services, if applicable.
Previous wording
Product revenues. Product revenues consist primarily of sales of health and wellness products, such as skincare, body care, hair care, orthotics, and nutritional supplements to cruise ship passengers, destination resort guests andtimetospa.comcustomers.
Current wording
Product revenues. Product revenues consist primarily of sales of health and wellness products, such as facial skincare, body care, orthotics, and detox supplements to cruise ship passengers, destination resort guests andtimetospa.com customers.
Previous wording
Cost of services. Cost of services consists primarily of an allocable portion of payments to cruise line partners (which are derived as a percentage of service revenues or a minimum annual rent or a combination of both), an allocable portion of wages paid to shipboard employees, an allocable portion of staff-related shipboard expenses, wages paid directly to destination resort employees, payments to destination resort partners, the allocable cost of products consumed in the rendering of services, and health and wellness center depreciation. Most of the components of cost of services are variable in nature; increases and decreases in cost of services are primarily attributable to corresponding increases or decreases in service revenues. Cost of services has tended to remain materially consistent as a percentage of service revenues.
Current wording
Cost of services. Cost of services consists primarily of an allocable portion of payments to cruise lines (which are derived as a percentage of service revenues or a minimum annual rent or a combination of both), an allocable portion of wages paid to shipboard employees, an allocable portion of staff-related shipboard expenses, costs related to recruitment and training of shipboard employees, wages paid directly to destination resort employees, payments to destination resort venue owners, the allocable cost of products consumed in the rendering of a service, and health and wellness center depreciation. Cost of services has historically been highly variable; increases and decreases in cost of services are primarily attributable to a corresponding increase or decrease in service revenues. Cost of services has improved as a percentage of revenue due to higher revenues and cost efficiencies.
Previous wording
Cost of products. Cost of products consists primarily of the cost of products sold through our various methods of distribution, an allocable portion of wages paid to shipboard employees and an allocable portion of payments to cruise line and destination resort partners (which are derived as a percentage of product revenues or a minimum annual rent or a combination of both). Most of the components of cost of products are variable in nature; increases and decreases in cost of products are primarily attributable to corresponding increases or decreases in product revenues and includes impairment of the carrying value of inventories. Cost of products has tended to remain materially consistent as a percentage of product revenues.
Current wording
Cost of products. Cost of products consists primarily of the cost of products sold through our various methods of distribution, an allocable portion of wages paid to shipboard employees and an allocable portion of payments to cruise lines and destination resort partners (which are derived as a percentage of product revenues or a minimum annual rent or a combination of both). Cost of products has historically been highly variable; increases and decreases in cost of products are primarily attributable to corresponding increases or decreases in product revenues and includes impairment of the carrying value of inventories. Cost of products has improved as a percentage of revenue due to higher revenues and cost efficiencies.
Previous wording
Amortization of intangible assets. Amortization of intangible assets are comprised of the amortization of intangible assets with definite useful lives (e.g. retail concession agreements, destination resort agreements, licensing agreements).
Current wording
Amortization of intangible assets. Amortization of intangible assets are comprised of the amortization of intangible assets with definite useful lives (e.g. retail concession agreements, destination resort agreements, licensing agreements)and amortization expenses associated with the business combination in March 2019.
Previous wording
Other income (expense). Other income (expense) consists of interest income, interest expense and changes in the fair value of warrant liabilities.
Current wording
Other (expense) income. Other (expense) income consists of interest income, interest expense and changes in the fair value of warrant liabilities.
Previous wording
Net income. Net income consists of income from operations less other income (expense) and income tax expense.
Current wording
Net income. Net income consists of income from operations less other (expense) income and income tax expense.
Previous wording
The number of health and wellness centers we operate on cruise ships and in destination resorts. The number of cruise ships on which we operate during each period is primarily impacted by our renewal of existing cruise ship partner agreements, introductions of new ships to service under our existing agreements, agreements with new cruise line partners, ships temporarily out of service for maintenance and repair, and ships prevented from sailing due to outbreaks of illnesses, such as the recent pandemic, among other factors. The number of destination resorts in which we operate during each period is primarily attributable to renewal of existing agreements with destination resort partners and destination resorts prevented from operating due to outbreaks of illnesses, such as the recent pandemic, among other factors.
Current wording
The number of health and wellness centers we operate on cruise ships and in destination resorts. The number of cruise ships on which we operate during each period is primarily impacted by our renewal of existing cruise ship partner agreements, introductions of new ships to service under our existing agreements, agreements with new cruise line partners, ships temporarily out of service for maintenance and repair, and ships prevented from sailing due to outbreaks of illnesses, among other factors. The number of destination resorts in which we operate during each period is primarily attributable to renewal of existing agreements with destination resort partners and destination resorts prevented from operating due to outbreaks of illnesses, among other factors.
Previous wording
Collaboration with cruise line partners, including targeted marketing and promotion initiatives, as well as implementation of proprietary technologies to increase center utilization via pre-booking and pre-payment of health and wellness services. We directly market and promote to onboard passengers as a result of enhanced collaboration with certain of our cruise line partners. We also utilize our proprietary health and wellness services pre-booking and pre-payment technology platforms integrated with certain of our cruise line partners’ pre-cruise planning systems. These areas of increased collaboration with cruise line partners are resulting in higher productivity, revenue generation, and profitability across our health and wellness centers.
Current wording
Collaboration with cruise line partners, including targeted marketing and promotion initiatives, as well as implementation of proprietary technologies to increase center utilization via pre-booking and pre-payment of health and wellness services. We directly market and promote to onboard passengers as a result of increasing collaboration with our cruise line partners. We also utilize our proprietary health and wellness services pre-booking and pre-payment technology platforms integrated with certain of our cruise line partners’ pre-cruise planning systems. These areas of increased collaboration with cruise line partners are resulting in higher productivity, revenue generation, and profitability across our health and wellness centers.
Previous wording
The impact of weather. Our health and wellness centers onboard cruise ships and in select destination resorts may be negatively affected by hurricanes, particularly during the August through October period, which may be increasing in frequency and intensity due to climate change.
Current wording
The impact of weather. Our health and wellness centers onboard cruise ships and in select destination resorts may be negatively affected by the frequency and intensity of hurricanes, which may be impacted by climate change. The negative impact of hurricanes in the Northern Hemisphere is highest during peak season, from August through October.
Previous wording
Comparison of Results for the three months ended September 30, 2024 compared to three months ended September 30, 2023
Current wording
Comparison of Results for the Three Months Ended March 31, 2025 and 2024
Previous wording
Cost of services. Cost of services for the nine months ended September 30, 2024 were $454.4 million, an increase of $44.8 million, or 11%, compared to $409.6 million for the nine months ended September 30, 2023. The increase primarily was attributable to costs associated with increased Service revenues of $547.5 million in the nine months ended September 30, 2024 from our operating health and wellness centers at sea and on land, compared with Service revenues of $489.2 million in the nine months ended September 30, 2023.
Current wording
Cost of services. Cost of services for the three months ended March 31, 2025 were $148.2 million, an increase of $4.1 million, or 3%, compared to $144.0 million for the three months ended March 31, 2024. The increase was primarily attributable to costs associated with increased service revenues of $178.5 million in the quarter from our operating health and wellness centers at sea and on land, compared with service revenues of $172.2 million in the first quarter of 2024.
Previous wording
Cost of products. Cost of products for the nine months ended September 30, 2024 were $110.8 million, an increase of $15.9 million, or 17%, compared to $94.9 million for the nine months ended September 30, 2023. The increase primarily was attributable to costs associated with increased Product revenues of $130.4 million in the nine months ended September 30, 2024 from our operating health and wellness centers at sea and on land, compared to Product revenues of $110.0 million in the nine months ended September 30, 2023.
Current wording
Cost of products. Cost of products for the three months ended March 31, 2025 were $35.3 million, an increase of $1.8 million, or 5%, compared to $33.5 million for the three months ended March 31, 2024. The increase was primarily attributable to costs associated with increased product revenues of $41.1 million in the quarter from our operating health and wellness centers at sea and on land, compared to product revenues of $39.0 million in the first quarter of 2024.
Previous wording
Administrative. Administrative expenses for the nine months ended September 30, 2024 were $13.0 million, an increase of $0.3 million, or 2%, compared to $12.8 million for the nine months ended September 30, 2023. The increase primarily was attributable to timing of professional fees incurred in connection with public company costs.
Current wording
Administrative. Administrative expenses for the three months ended March 31, 2025 were $4.2 million, an increase of $0.1 million, or 4%, compared to $4.1 million for the three months ended March 31, 2024.
Previous wording
Amortization of intangible assets. Amortization of intangible assets for the three months ended September 30, 2024 and September 30, 2023 was $4.1 million and 4.2 million, respectively.
Current wording
Amortization of intangible assets. Amortization of intangible assets for the three months ended March 31, 2025 and 2024 were both $4.1 million, respectively.
Previous wording
Other (expense) income. Other (expense) income includes interest expense and change in the fair value of the warrant liabilities. Interest expense, net for the three months ended September 30, 2024 was $2.5 million, a decrease of $1.2 million, or (33%), compared to $3.7 million for the three months ended September 30, 2023. The decrease primarily was attributable to lower debt balances. Since the year ended December 31, 2022, we have repaid a total of $115.6 million in debt instruments. The change in fair value of the outstanding warrants during the three months ended September 30, 2024 was zero compared to a gain of $7.4 million during the three months ended September 30, 2023. The decrease was attributable to the fact that the Company had no outstanding warrants during the three months ended September 30, 2024. The change in fair value of warrant liabilities during the three months ended September 30, 2023 was the result of the remeasurement to fair value of the warrants reflecting changes in market prices of our common stock and other observable inputs deriving the value of these financial instruments.
Current wording
Other (expense) income. Other (expense) income includes interest expense and change in the fair value of the warrant liabilities. Interest expense, net for the three months ended March 31, 2025 was $1.1 million, a decrease of $1.8 million, or 61%, compared to $3.0 million for the three months ended March 31, 2024. The decrease was primarily attributable to lower debt balances and lower effective interest rates. Since the year ended December 31, 2023, we have repaid a total of $60.9 million in debt instruments. The change in fair value of the outstanding warrants during the three months ended March 31, 2025 was zero compared to a gain of $7.7 million during the three months ended March 31, 2024. The Company had no outstanding warrants during the three months ended March 31, 2025; accordingly, there was no impact on the Condensed Consolidated Statement of Operations during this period.
Previous wording
Net income. Net income for the three months ended September 30, 2024 was $21.5 million, a decrease of $1.9 million, or 8%, compared to a net income of $23.4 million for the three months ended September 30, 2023. The $1.9 million decrease in net income was primarily attributable to a $7.4 million negative change in fair value of warrant liabilities and a $3.8 million increase in income tax expense offset by a $1.2 million decrease in interest expense and an $8.1 million positive change in income from operations.
Current wording
Net income. Net income for the three months ended March 31, 2025 was $15.3 million, a decrease of $5.9 million, or 28%, compared to a net income of $21.2 million for the three months ended March 31, 2024. The change was primarily attributable to a $7.7 million benefit resulting from the change in the fair value of warrant liabilities in the first quarter of 2024. The first quarter of 2025 benefited from a $1.8 million decrease in Interest expense.
Previous wording
We fund our operations principally with cash flow from operations. Our principal uses for our liquidity have been funding our health and wellness centers onboard 196 cruise ships and in 52 destination resorts, including associated working capital investment and capital expenditures; debt service, including $59.6 million repayment of our First Lien Term Loan Facility; purchasing 1,395,432 of our common shares from Steiner Leisure Limited pursuant to a Shares Repurchase Agreement, and purchasing 745,302 of our common shares under a Share Repurchase Program, among other uses of our liquidity.
Current wording
We fund our operations principally with cash flow from operations. Our principal uses for our liquidity have been funding the operations of our health and wellness centers onboard 199 cruise ships and in 50 destination resorts, including associated working capital investment and capital expenditures; capital expenditures in technology and infrastructure assets to enhance our complex global operating platform; debt service, including $1.2 million repayment of our Term Loan Facility; payment of our $4.2 million quarterly dividend; and purchasing 2,094,000 of our common shares under our 2024 Share Repurchase Program, among other uses of our liquidity.
Previous wording
We have concluded that we will have sufficient liquidity to satisfy our existing and planned capital requirements over the next twelve months and thereafter and comply with all debt covenants as required by our debt agreement.
Current wording
We have concluded that we will have sufficient liquidity to satisfy our existing and planned capital requirements over the next twelve months and thereafter and to comply with all debt covenants as required by our debt agreements.
Previous wording
The following table shows summary cash flow information for the nine months ended September 30, 2024 and the nine months ended September 30, 2023.
Current wording
The following table shows summary cash flow information for the three months ended March 31, 2025 and 2024.
Previous wording
Investing activities. Our net cash used in investing activities for the nine months ended September 30, 2024 and 2023 were $3.4 million and $2.9 million, respectively. During the nine months ended September 30, 2024, we continued to make investments in computer hardware and software (including artificial intelligence) and Medi-spa equipment.
Current wording
Investing activities. Our net cash used in investing activities for the three months ended March 31, 2025 and 2024 were $1.7 million and $1.2 million, respectively. During the three months ended March 31, 2025, we continued to make investments in technology hardware and software, including artificial intelligence, and medi-spa equipment.
Previous wording
Financing activities. Our net cash used in financing activities for the nine months ended September 30, 2024 and 2023 were $37.9 million and $48.8 million, respectively. For the nine months ended September 30, 2024, the Company received proceeds from the exercise of public and private warrants of $51.7 million, received proceeds from the Term Loan Facility of $100.0 million, repaid $159.6 million on the
Current wording
Financing activities. Our net cash (used in) provided by financing activities for the three months ended March 31, 2025 and 2024 were ($43.3) million and $24.0 million, respectively. For the three months ended March 31, 2025, the Company utilized $37.9 million to repurchase 2,094,000 of our common shares, repaid $1.2 million on the Term Loan Facility and paid Dividends of $4.2 million. For the three months ended March 31, 2024, the Company received proceeds from the exercise of public and private warrants of $51.7 million, repaid $20.0 million on its prior term loan facility, which was fully paid off and terminated as of December 31, 2024, and utilized $7.7 million to repurchase 606,386 of our common shares.
Previous wording
A significant portion of our revenues are generated onboard cruise ships and are subject to specific individual cruise itineraries, which are dependent on time of year and geographic location, among other factors. As a result, we experience varying degrees of seasonality as the demand for cruises is stronger in the Northern Hemisphere during the summer months and during holidays. Accordingly, the third quarter and holiday periods generally result in higher revenues for us. Further, cruises and destination resorts have been negatively affected by the frequency and intensity of hurricanes, particularly during the August through October period, which may be increasing in frequency and intensity due to climate change.
Current wording
A significant portion of our revenues are generated onboard cruise ships and are subject to specific individual cruise itineraries, as to time of year and geographic location, among other factors. As a result, we experience varying degrees of seasonality as the demand for cruises is stronger in the Northern Hemisphere during the summer months and during holidays. Accordingly, the third quarter and holiday periods generally result in our highest revenue yields. Further, cruises and destination resorts have been negatively affected by the frequency and intensity of hurricanes, which may be impacted by climate change. The negative impact of hurricanes in the Northern Hemisphere is highest during peak season, from August through October.
Previous wording
As of September 30, 2024, our future contractual obligations have not changed significantly from the amounts disclosed in our 2023 Form 10-K.
Current wording
As of March 31, 2025, our net future contractual obligations have not changed significantly from the amounts disclosed in our 2024 Form 10-K.
Previous wording
Our critical accounting policies are included in our 2023 Form 10-K. We believe that there have been no significant changes during the nine months ended September 30, 2024 to the critical accounting policies disclosed in our 2023 Form 10-K.
Current wording
Our critical accounting policies are included in our 2024 Form 10-K. We believe that there have been no significant changes during the three months ended March 31, 2025 to the critical accounting policies disclosed in our 2024 Form 10-K.
Previous wording
We do not believe that inflation has had a material adverse effect on our results of operations, financial condition and cash flows. However, public demand for activities, including cruises, is influenced by general economic conditions, including inflation, global health epidemics/pandemics and customer preferences. Periods of economic softness, increases in inflation rates and interest rates, as well as periods of fuel price increases, could have a material adverse effect on the cruise industry and hospitality industry upon which we are dependent and could have a material adverse effect on our business and our results of operations, financial condition and cash flows.
Current wording
We do not believe that inflation has had a material adverse effect on our revenues or results of operations. However, public demand for activities, including cruises, is influenced by general economic conditions, including inflation, global concerns regarding health, and customer preferences. Periods of economic softness could have a material adverse effect on the cruise industry and hospitality industry upon which we are dependent and could adversely affect our results of operations and financial condition. Severe adverse economic conditions, increases in inflation rates and interest rates, as well as periods of fuel price increases, could have a material adverse effect on our business, results of operations and financial condition.
Previous wording
From time to time, including in this report and other disclosures, we may issue “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements reflect our current views about future events and are subject to known and unknown risks, uncertainties and other factors which may cause our actual results to differ materially from those expressed or implied by such forward-looking statements. We attempt, whenever possible, to identify these statements by using words like “will,” “may,” “could,” “should,” “would,” “believe,” “expect,” “anticipate,” “forecast,” “future,” “intend,” “plan,” “estimate” and similar expressions of future intent or the negative of such terms. Such forward-looking statements include, but are not limited to, statements regarding:
Current wording
From time to time, including in this report and other disclosures, we may issue “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements reflect our current views about future events and are subject to known and unknown risks, uncertainties and other factors which may cause our actual results to differ materially from those expressed or implied by such forward-looking statements. We attempt, whenever possible, to identify these statements by using words like “will,” “may,” “could,” “should,” “would,” “believe,” “expect,” “anticipate,” “forecast,” “future,” “intend,” “plan,” “estimate” and similar expressions of future intent or the negative of such terms.
Previous wording
the potential impact of a global health crisis on the industries in which the Company operates and the Company’s business, results of operations, financial condition and cash flows;
Current wording
the potential impact of outbreaks of illnesses on the industries in which the Company operates and the Company’s business, operations, results of operations and financial condition, including cash flows and liquidity;
Previous wording
the loss of one or more members of the Company’s executive management team;
Current wording
the loss of one or more members of the Company’s management team;
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Comparison of Results for the Three Months Ended March 31, 2025 and 2024
Current report — wording carried from elsewhere
Such forward-looking statements include, but are not limited to, statements regarding:
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
(1) Average Ship Count is calculated by adding the total number of days that each of the ships generated revenue during the period, divided by the number of calendar days during the period.
Previous report — wording carried elsewhere
(2) Average Resort Count is calculated by adding the total number of days that each destination resort health and wellness center generated revenue during the period, divided by the number of calendar days during the period.
Previous report — wording carried elsewhere
The break-down of revenue between service and product revenues was as follows: