LINDBLAD EXPEDITIONS HOLDINGS INC
For the period ended Jun 30, 2024. Filed Aug 8, 2024.
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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.
Jun 30, 2024 · Filed Aug 8, 2024
LIND$33.98+7.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-01.
0001437749-24-014073
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-08.
0001437749-24-025584
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 111 previous paragraphs and 120 current paragraphs.
82 unchanged; 23 reworded; 15 added; 6 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 18 previous and 18 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 (15)
Current report
During June 2024, we announced an agreement for the acquisition of Torcatt Enterprises Limitada, a holding company that operates two vessels in the Galápagos Islands, for $17.0 million. The acquisition will expand our vessels and guest capacity in one of our core markets. We expect the acquisition to close January 2025.
Current report
Following the end of the quarter, on July 31, 2024, we acquired Wineland-Thomson Adventures, Inc., and other related entities, (“WTA”) to further expand our land-based experiential travel offerings and increase our addressable market, for $24.0 million in cash and $6.0 million in Lindblad common stock, representing 682,593 shares. WTA consists of four adventure travel brands, including the respected Tanzania safari specialists Thomson Safaris, with more than 40 years of experience in the country, was founded on the principles of quality and integrity, with the goal of leading socially responsible and positively impactful light-treading safari tours. In addition to its adventure travel brands, the acquisition includes three leading Tanzania tour operators, the historic award-winning Gibb’s Farm lodge, an 80-acre sanctuary for the senses located near the Ngorongoro Crate, the industry-leading operator of Kilimanjaro treks Nature Discovery, Limited, which has more than 30 years of experience and is the recommended Tanzanian partner for over 20 specialist trekking and safari travel agents around the world, and Thomson Safaris Limited.
Current report
Tour revenues for the three months ended June 30, 2024 increased $11.7 million, or 9%, to $136.5 million, compared to $124.8 million for the three months ended June 30, 2023. The Lindblad segment tour revenues increased by $5.6 million, or 6%, and the Land Experiences segment increased $6.1 million, or 16%, primarily due to operating additional trips, increased guest counts and higher pricing.
Current report
Total cost of tours for the three months ended June 30, 2024 increased $1.0 million, or 1%, to $78.6 million, compared to $77.7 million for the three months ended June 30, 2023. The Lindblad segment cost of tours decreased by $2.1 million, or 4%, partially due to lower port costs, resulting from cancelled voyages, and lower fuel expense. The Land Experiences segment increased $3.1 million, or 14%, primarily due to operating additional trips and higher operating costs.
Current report
Total cost of tours for the six months ended June 30, 2024 increased $8.2 million, or 6%, to $157.9 million, compared to $149.7 million for the six months ended June 30, 2023. The Lindblad segment cost of tours decreased by $0.5 million. The Land Experiences segment increased $8.7 million, or 23%, primarily due to operating additional trips, higher costs and impact of foreign currency on operating expenses.
Current report
General and administrative expenses for the three months ended June 30, 2024 increased $4.9 million, or 17%, to $34.1 million, compared to $29.2 million for the three months ended June 30, 2023. At the Lindblad segment, general and administrative expenses increased $1.6 million, or 8%, from the prior year period, primarily due to higher personnel costs, increased information technology costs and transaction-related costs. At the Land Experiences segment, general and administrative expenses increased $3.3 million, or 40%, primarily due to increased personnel costs related to operating additional trips, higher credit card commissions due to the strong booking environment, and transaction-related costs.
Current report
Selling and marketing expenses for the six months ended June 30, 2024 increased $5.2 million, or 15%, to $41.0 million, compared to $35.8 million for the six months ended June 30, 2023. At the Lindblad segment, selling and marketing expenses increased $4.3 million, or 15%, primarily due to higher royalties associated with the new National Geographic agreement and increased marketing spend to support future growth. At the Land Experiences segment, selling and marketing expenses increased $0.9 million, or 12%, primarily due to primarily due to increased marketing spend to drive future bookings.
Current report
Depreciation and amortization expenses for the six months ended June 30, 2024 increased $1.8 million, or 8%, to $24.9 million, compared to $23.1 million for the six months ended June 30, 2023.
Current report
Other expense for the three months ended June 30, 2024, decreased $3.8 million to $11.3 million from $15.2 million for the three months ended June 30, 2023, due primarily to the May 2023 write-off of $3.9 million of deferred financing costs, fees and other expenses related to the repayment of our prior Export Credit Agreements.
Current report
Other expense for the six months ended June 30, 2024, decreased $2.2 million to $23.1 million from $25.3 million for the six months ended June 30, 2023, due primarily to the May 2023 write-off of $3.9 million of deferred financing costs, fees and other expenses related to the repayment of our prior Export Credit Agreements, partially offset by a $0.8 million increase in interest expense and a $0.8 million increased loss on foreign exchange.
Current report
Tour revenues for the three months ended June 30, 2024 increased $5.6 million, or 6%, to $93.1 million, compared to $87.4 million for the three months ended June 30, 2023. The increase was primarily driven by higher guest ticket revenue due to increased occupancy, with a 9% increase in guest nights sold asoccupancy increased to 78% in the quarter compared to 74% in 2023, andnet yield per available guest night increased 6% from 2023 to $1,094.
Current report
Tour revenues for the six months ended June 30, 2024 increased $8.4 million, or 4%, to $211.4 million, compared to $202.9 million for the six months ended June 30, 2023. The increase was primarily driven by higher guest ticket revenue due toincreased pricing and a 2% increase in guest nights sold. Netyield per available guest night increased 3% to $1,160 as compared with 2023.
Current report
Operating loss of $9.4 million for the three months ended June 30, 2024 decreased $1.6 million compared to a loss of $11.0 million for the three months ended June 30, 2023, as the increase in tour revenues was partially offset by higher operating expenses. Operating expenses included a decrease in cost of tours, offset by expenses associated with the increased revenue, including higher sales and marketing costs, primarily due to increased royalties associated with the new National Geographic agreement and increased marketing spend to support future growth, and higher general and administrative costs, primarily due to increased personnel costs, increased information technology costs and transaction-related costs.
Current report
Tour revenues for the three months ended June 30, 2024 increased $6.1 million, or 16%, to $43.4 million compared to $37.4 million for the three months ended June 30, 2023 primarily as a result of an increase in guests traveled during the second quarter 2024 and higher pricing.
Current report
Operating income of $1.2 million for the three months ended June 30, 2024 decreased $1.3 million compared to $2.5 million for the three months ended June 30, 2023, as the increase in tour revenue was more than offset by higher operating and personnel costs, higher marketing spend to drive future growth, and transaction-related costs.
Removed paragraphs (6)
Previous report
During April 2024, we announced an agreement for the acquisition of Wineland-Thomson Adventures, Inc, an adventure travel company that primarily operates Tanzania safaris, camp and tours, for approximately $30.0 million in cash and Lindblad stock. We expect to complete the acquisition following required Tanzanian regulatory review and approval, which is expected to take at least three months.
Previous report
Total cost of tours for the three months ended March 31, 2024 increased $7.3 million, or 10%, to $79.3 million, compared to $72.0 million for the three months ended March 31, 2023. The Lindblad segment cost of tours increased by $1.6 million, or 3%, and the Land Experiences segment increased $5.7 million, or 38%, primarily due to operating additional trips, higher costs, increased fuel pricing and higher expenses associated with increased other revenue.
Previous report
Other expense for the three months ended March 31, 2024, increased $1.7 million to $11.8 million from $10.1 million for the three months ended March 31, 2023, due primarily to a $1.1 million increase in interest expense, due to increased borrowings and higher interest rates related to our high yield offering in May 2023.
Previous report
Tour revenues for the three months ended March 31, 2024 increased $2.8 million, or 2%, to $118.3 million, compared to $115.5 million for the three months ended March 31, 2023. The increase was primarily driven by other revenue.
Previous report
Other
Previous report
Our DuVine subsidiary has a EUR 0.1 million State Assistance Loan related to the financial consequences of the COVID-19 pandemic, for the purpose of employment preservation. This loan matures August 2025, with monthly payments, and bears an annual interest rate of 0.53%.
Reworded paragraphs (23)
Previous wording
We currently operate a fleet of ten owned expedition ships and operate six seasonal charter vessels under the Lindblad Expeditions, LLC. (“Lindblad”) brand. Each expedition ship is fully equipped with state-of-the-art tools for in-depth exploration and the majority of our expeditions involve travel to remote places, such as voyages to Alaska, the Arctic, Antarctic, the Galápagos Islands, Baja’s Sea of Cortez, the South Pacific, Costa Rica and Panama. We have a longstanding relationship with the National Geographic Society dating back to 2004, which is based on a shared interest in exploration, research, technology and conservation. This relationship, which was recently expanded and extended in November 2023 to the end of 2040 through a Brand License Agreement with National Geographic Partners, LLC (“National Geographic”), includes a co-selling, co-marketing and global branding arrangement whereby National Geographic promotes our offerings in its marketing campaigns across web-based, email, print and other marketing platforms and distributes our expeditions through the Disney Signature Experiences platform and our owned vessels carry the National Geographic name. We collaborate with National Geographic on voyage planning to enhance the guest experience by having National Geographic experts, including photographers, writers, marine biologists, naturalists, field researchers and film crews, join our expeditions. Guests have the ability to interact with these experts through lectures, excursions, dining and other experiences throughout their voyage.
Current wording
We currently operate a fleet of ten owned expedition ships and operate six seasonal charter vessels under the Lindblad Expeditions, LLC. (“Lindblad”) brand. Each expedition ship is fully equipped with state-of-the-art tools for in-depth exploration, and the majority of our expeditions involve travel to remote places, such as voyages to Alaska, the Arctic, Antarctic, the Galápagos Islands, Baja’s Sea of Cortez, the South Pacific, Costa Rica and Panama. We have a longstanding relationship with the National Geographic Society dating back to 2004, which is based on a shared interest in exploration, research, technology and conservation. This relationship, which was recently expanded and extended in November 2023 to the end of 2040 through a Brand License Agreement with National Geographic Partners, LLC (“National Geographic”), includes a co-selling, co-marketing and global branding arrangement whereby National Geographic promotes our offerings in its marketing campaigns across web-based, email, print and other marketing platforms and distributes our expeditions through the Disney Signature Experiences platform and our owned vessels carry the National Geographic name. We collaborate with National Geographic on voyage planning to enhance the guest experience by having National Geographic experts, including photographers, writers, marine biologists, naturalists, field researchers and film crews, join our expeditions. Guests are able to interact with these experts through lectures, excursions, dining and other experiences throughout their voyage.
Previous wording
During the first quarter we provided immersive expeditions to our guests across all of our ships including voyages to Antarctica, Patagonia, South Georgia and the Falkland Islands, Baja California’s Sea of Cortez, the Galápagos Islands, Central America, Australia, New Zealand, the South Pacific and elsewhere.
Current wording
During the six months ended June 30, 2024, we provided immersive expeditions to our guests across all our ships including voyages to Alaska, Antarctica, the Arctic, Baja California’s Sea of Cortez, British Columbia, the Channel Islands, the Galápagos Islands, Greece, Iceland, the Pacific Northwest, Patagonia, Spain, South Georgia and the Falkland Islands, Central America, Australia, New Zealand, the South Pacific and elsewhere. Our Land Experiences guests traveled on adventures to locations such as Costa Rica, the Amazon, Brazil’s Pantanal, Mexico, China, India, Sri Lanka, Borneo, Bhutan, Africa including Kenya, Tanzania, Botswana, South Africa and Madagascar, Portugal, Italy, the Cotswold’s, Croatia, France, Spain, Alaska, Yellowstone National Park and Canyons Southwest USA.
Previous wording
During April 2024, we increased our ownership of Natural Habitat to 90.1% for $15.2 million, as Mr. Bressler exercised a portion of his put option, and we exercised a portion of our call option on DuVine, increasing our ownership to 75% for $1.5 million.
Current wording
During April 2024, we increased our ownership of Natural Habitat to 90.1% for $15.2 million, as Mr. Bressler, President of Natural Habitat, exercised a portion of his put option, and we exercised a portion of our call option on DuVine, increasing our ownership to 75% for $1.5 million.
Previous wording
We have substantial advanced reservations for future travel with bookings for the full year 2024 4% ahead of the bookings for 2024 at the same point in 2023 and over 20% ahead excluding carryover bookings in 2023.
Current wording
We have substantial advanced reservations for future travel with bookings for the full year 2024 6% ahead of the bookings for 2024 at the same point in 2023 and over 29% ahead excluding carryover bookings in 2023.
Previous wording
Adjusted EBITDAis net income (loss) excluding depreciation and amortization, net interest expense, other income (expense), income tax (expense) benefit, (gain) loss on foreign currency, (gain) loss on transfer of assets, reorganization costs, and other supplemental adjustments. Other supplemental adjustments include certain non-operating items such as stock-based compensation, executive severance costs, the National Geographic fee amortization, debt refinancing costs, acquisition-related expenses and other non-recurring charges. We believe Adjusted EBITDA, when considered along with other performance measures, is a useful measure as it reflects certain operating drivers of the business, such as sales growth, operating costs, selling and administrative expense, and other operating income and expense. We believe Adjusted EBITDA helps provide a more complete understanding of the underlying operating results and trends and an enhanced overall understanding of our financial performance and prospects for the future. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income as it does not take into account certain requirements, such as unearned passenger revenues, capital expenditures and related depreciation, principal and interest payments, and tax payments. Our use of Adjusted EBITDA may not be comparable to other companies within the industry.
Current wording
Adjusted EBITDAis net income (loss) excluding depreciation and amortization, net interest expense, other income (expense), income tax (expense) benefit, (gain) loss on foreign currency, (gain) loss on transfer of assets, reorganization costs, and other supplemental adjustments. Other supplemental adjustments include certain non-operating items such as stock-based compensation, executive severance costs, the debt refinancing costs, acquisition-related expenses and other non-recurring charges. We believe Adjusted EBITDA, when considered along with other performance measures, is a useful measure as it reflects certain operating drivers of the business, such as sales growth, operating costs, selling and administrative expense, and other operating income and expense. We believe Adjusted EBITDA helps provide a more complete understanding of the underlying operating results and trends and an enhanced overall understanding of our financial performance and prospects for the future. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income as it does not take into account certain requirements, such as unearned passenger revenues, capital expenditures and related depreciation, principal and interest payments, and tax payments. Our use of Adjusted EBITDA may not be comparable to other companies within the industry.
Previous wording
Our consolidated results for the three months ended March 31, 2024 and 2023 are set forth below. Percentages that are not meaningful to the change are noted as NM in the table.
Current wording
Our consolidated results for the three and six months ended June 30, 2024 and 2023 are set forth below.
Previous wording
Comparison of the Three Months Ended March 31, 2024 and 2023 —** Consolidated**
Current wording
Comparison of the Three and Six Months Ended June 30, 2024 and 2023 —** Consolidated**
Previous wording
Tour revenues for the three months ended March 31, 2024 increased $10.2 million, or 7%, to $153.6 million, compared to $143.4 million for the three months ended March 31, 2023. The Lindblad segment tour revenues increased by $2.8 million, or 2%, and the Land Experiences segment increased $7.4 million, or 27%, primarily due to operating additional trips, higher pricing and increased other revenue.
Current wording
Tour revenues for the six months ended June 30, 2024 increased $21.9 million, or 8%, to $290.1 million, compared to $268.2 million for the six months ended June 30, 2023. The Lindblad segment tour revenues increased by $8.4 million, or 4%, and the Land Experiences segment increased $13.5 million, or 21%, primarily due to operating additional trips, increased guest counts, higher pricing and increased other revenue.
Previous wording
General and administrative expenses for the three months ended March 31, 2024 increased $6.0 million, or 23%, to $32.4 million, compared to $26.4 million for the three months ended March 31, 2023. At the Lindblad segment, general and administrative expenses increased $4.0 million, or 21%, from the prior year period, primarily due to higher personnel costs, increased information technology costs following the launch of our digital infrastructure and higher credit card commissions due to the strong booking environment. At the Land Experiences segment, general and administrative expenses increased $2.0 million, or 26%, primarily due to increased personnel costs related to operating additional trips and higher credit card commissions due to the strong booking environment.
Current wording
General and administrative expenses for the six months ended June 30, 2024 increased $10.9 million, or 20%, to $66.5 million, compared to $55.6 million for the six months ended June 30, 2023. At the Lindblad segment, general and administrative expenses increased $5.5 million, or 14%, from the prior year period, primarily due to higher personnel costs, higher credit card commissions due to the strong booking environment, increased information technology costs and transaction-related costs. At the Land Experiences segment, general and administrative expenses increased $5.4 million, or 33%, primarily due to increased personnel costs related to operating additional trips, higher credit card commissions due to the strong booking environment, and transaction-related costs.
Previous wording
Selling and marketing expenses for the three months ended March 31, 2024 increased $2.1 million, or 10%, to $22.8 million, compared to $20.7 million for the three months ended March 31, 2023. At the Lindblad segment, selling and marketing expenses increased $2.3 million, or 14%, primarily due to higher royalties associated with the new National Geographic agreement. At the Land Experiences segment, selling and marketing expenses decreased $0.2 million, or 5%.
Current wording
Selling and marketing expenses for the three months ended June 30, 2024 increased $3.1 million, or 21%, to $18.3 million, compared to $15.2 million for the three months ended June 30, 2023. At the Lindblad segment, selling and marketing expenses increased $2.0 million, or 17%, primarily due to higher royalties associated with the new National Geographic agreement and increased marketing spend to support future growth. At the Land Experiences segment, selling and marketing expenses increased $1.1 million, or 37%, primarily due to increased marketing spend to drive future bookings and higher commissions related to revenue growth.
Previous wording
Depreciation and amortization expenses for the three months ended March 31, 2024 decreased $0.5 million, or 4%, to $11.3 million, compared to $11.8 million for the three months ended March 31, 2023.
Current wording
Depreciation and amortization expenses for the three months ended June 30, 2024 increased $2.3 million, or 20%, to $13.6 million, compared to $11.3 million for the three months ended June 30, 2023.
Previous wording
Comparison of the Three Months Ended March 31, 2024 and 2023 at the Lindblad Segment
Current wording
Comparison of the Three and Six Months Ended June 30, 2024 and 2023 at the Lindblad Segment
Previous wording
Operating income of $7.8 million for the three months ended March 31, 2024 decreased $4.3 million compared to a $12.1 million for the three months ended March 31, 2023, as the increase in tour revenues was more than offset by higher operating expenses. Operating expenses included higher cost of tours, primarily due to increased fuel pricing and land costs, as well as expenses associated with the other revenue, higher sales and marketing costs, primarily due to increased royalties associated with the new National Geographic agreement and higher general and administrative costs, primarily due to increased personnel costs, increased information technology costs following the launch of our digital infrastructure and higher credit card commissions due to the revenue and bookings growth.
Current wording
During the six months ended June 30, 2024, we incurred an operating loss of $1.6 million compared to operating income of $1.1 million for the six months ended June 30, 2023, as the increase in tour revenues was more than offset by higher operating expenses. Operating expenses included expenses associated with increased revenue, including higher sales and marketing costs, primarily due to increased royalties associated with the new National Geographic agreement and marketing spend to drive future booking growth, and higher general and administrative costs, primarily due to increased personnel costs, higher credit card commissions due to the revenue and bookings growth, increased information technology costs and transaction-related costs.
Previous wording
Comparison of Three Months Ended March 31, 2024 and** 2023** at the Land Experiences Segment
Current wording
Comparison of Three and Six Months Ended June 30, 2024 and** 2023** at the Land Experiences Segment
Previous wording
Tour revenues for the three months ended March 31, 2024 increased $7.4 million, or 27%, to $35.3 million compared to $27.9 million for the three months ended March 31, 2023 primarily as a result of operating additional trips during the first quarter 2024 and higher pricing.
Current wording
Tour revenues for the six months ended June 30, 2024 increased $13.5 million, or 21%, to $78.8 million compared to $65.3 million for the six months ended June 30, 2023 primarily as a result of operating additional trips during 2024 and higher pricing.
Previous wording
Operating income of $0.1 million for the three months ended March 31, 2024 decreased $0.2 million compared to a $0.3 million for the three months ended March 31, 2023, as the increase in tour revenue was more than offset by higher operating and personnel costs related to operating additional departures, higher marketing spend to drive future growth and the impact of foreign currency on operating expenses.
Current wording
Operating income of $1.2 million for the six months ended June 30, 2024 decreased $1.7 million compared to $2.9 million for the six months ended June 30, 2023, as the increase in tour revenue was more than offset by higher operating and personnel costs related to operating additional departures, higher marketing spend to drive future growth, transaction-related costs, and the impact of foreign currency on operating expenses.
Previous wording
As of March 31, 2024, the Company had $177.7 million in unrestricted cash and cash equivalents and $46.5 million in restricted cash primarily related to deposits on future travel originating from U.S. ports and credit card reserves.
Current wording
As of June 30, 2024, the Company had $168.1 million in unrestricted cash and cash equivalents and $49.5 million in restricted cash primarily related to deposits on future travel originating from U.S. ports and credit card reserves.
Previous wording
Sources and Uses of Cash for the Three Months Ended March 31, 2024 and 2023
Current wording
Sources and Uses of Cash for the Six Months Ended June 30, 2024 and 2023
Previous wording
Net cash provided by operating activities was $43.9 million for the three months ended March 31, 2024 compared to $2.1 million for the same period in 2023. The $41.8 million increase is primarily due to increased cash received from guests for future travel.
Current wording
Net cash provided by operating activities was $62.6 million for the six months ended June 30, 2024 compared to $19.5 million for the same period in 2023. The $43.1 million increase is primarily due to increased cash received from guests for future travel.
Previous wording
Net cash used in investing activities was $6.5 million for the three months ended March 31, 2024 compared to $8.7 million in cash provided by investing activities during the same period in 2023. 2024 primarily included capital expenditures on our vessels and our digital transformation initiatives, while 2023 primarily included divesting of marketable securities, partially offset by capital expenditures on our vessels and our digital transformation initiatives.
Current wording
Net cash used in investing activities was $13.9 million for the six months ended June 30, 2024 compared to $0.4 million in cash provided by investing activities during the same period in 2023. 2024 primarily included capital expenditures on our vessels, while 2023 primarily included divesting of marketable securities, partially offset by capital expenditures on our vessels and our digital transformation initiatives.
Previous wording
Net cash used in financing activities was $0.6 million for the three months ended March 31, 2024 compared to $6.1 million for the same period in 2023. 2024 primarily included income tax withholdings for stock-based compensation, while 2023 primarily included principal payments on our prior export credit agreements*.*
Current wording
Net cash used in financing activities was $18.4 million for the six months ended June 30, 2024 compared to $61.5 million provided by financing activities for the same period in 2023. 2024 primarily included expenditures for the acquisition of an additional 9.95% of Natural Habitat and 5% of DuVine related to the respective puts and calls of the redeemable non-controlling interests, and income tax withholdings for stock-based compensation, while 2023 primarily included the issuance of $275.0 million of new senior notes which were used primarily to repay our prior export credit agreements*.*
Previous wording
In August 2020, we issued and sold 85,000 shares of Series A Redeemable Convertible Preferred Stock, par value of $0.0001, (“Preferred Stock”) for $1,000 per share for gross proceeds of $85.0 million. As of March 31, 2024, 62,000 shares of Preferred Stock were outstanding. The Preferred Stock has senior and preferential ranking to our common stock. The Preferred Stock is entitled to cumulative dividends of 6.00% per annum, and for the first two years, the dividends were required to be paid-in-kind. After the second anniversary of the issuance date, the dividends may be paid-in-kind or be paid in cash at our option. During 2024, we thus far have continued to pay Preferred Stock dividends in-kind. At any time after the third anniversary of the issuance, we may, at our option, convert all, but not less than all, of the Preferred Stock into common stock if the closing price of shares of common stock is at least 150% of the conversion price for 20 out of 30 consecutive trading days. The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of our common stock equal to the quotient obtained by dividing the then-current accrued value by the conversion price of $9.50. At the six-year anniversary of the closing date, each investor has the right to request that we repurchase their Preferred Stock, and any Preferred Stock not requested to be repurchased shall be converted into our common shares equal to the quotient obtained by dividing the then-current accrued value by the conversion price. As of March 31, 2024, the outstanding Preferred Stock and accumulated dividends could be converted, at the option of the holders, into approximately 8.1 million shares of our common stock.
Current wording
In August 2020, we issued and sold 85,000 shares of Series A Redeemable Convertible Preferred Stock, par value of $0.0001, (“Preferred Stock”) for $1,000 per share for gross proceeds of $85.0 million. As of March 31, 2024, 62,000 shares of Preferred Stock were outstanding. The Preferred Stock has senior and preferential ranking to our common stock. The Preferred Stock is entitled to cumulative dividends of 6.00% per annum, and for the first two years, the dividends were required to be paid-in-kind. After the second anniversary of the issuance date, the dividends may be paid-in-kind or be paid in cash at our option. During 2024, we thus far have continued to pay Preferred Stock dividends in-kind. At any time after the third anniversary of the issuance, we may, at our option, convert all, but not less than all, of the Preferred Stock into common stock if the closing price of shares of common stock is at least 150% of the conversion price for 20 out of 30 consecutive trading days. The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of our common stock equal to the quotient obtained by dividing the then-current accrued value by the conversion price of $9.50. At the six-year anniversary of the closing date, each investor has the right to request that we repurchase their Preferred Stock, and any Preferred Stock not requested to be repurchased shall be converted into our common shares equal to the quotient obtained by dividing the then-current accrued value by the conversion price. As of June 30, 2024, the outstanding Preferred Stock and accumulated dividends could be converted, at the option of the holders, into approximately 8.2 million shares of our common stock.
Previous wording
We generally rely on a combination of cash flows provided by operations and the incurrence of additional debt to fund obligations. A vast majority of guest ticket receipts are collected in advance of the applicable expedition date. These advance passenger receipts remain a current liability until the expedition date, and the cash generated from these advance receipts is used interchangeably with cash on hand from other cash from operations. The cash received as advanced receipts can be used to fund operating expenses for the applicable future expeditions or otherwise, pay down debt, make long-term investments or any other use of cash. Traditionally we run a working capital deficit due primarily to a large balance of unearned passenger revenues. As of March 31, 2024, we had a working capital deficit of $71.0 million, and as of December 31, 2023, we had a working capital deficit of $74.7 million.
Current wording
We generally rely on a combination of cash flows provided by operations and the incurrence of additional debt to fund obligations. A vast majority of guest ticket receipts are collected in advance of the applicable expedition date. These advance passenger receipts remain a current liability until the expedition date, and the cash generated from these advance receipts is used interchangeably with cash on hand from other cash from operations. The cash received as advanced receipts can be used to fund operating expenses for the applicable future expeditions or otherwise, pay down debt, make long-term investments or any other use of cash. Traditionally we run a working capital deficit due primarily to a large balance of unearned passenger revenues. As of June 30, 2024, we had a working capital deficit of $99.0 million, and as of December 31, 2023, we had a working capital deficit of $74.7 million.