What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-01 · 349 added, 157 removed, 612 unchanged (45% of the section changed)

4 unchanged sentences

(In thousands, except share and per share data)

As of March 31, 2024

As of June 30, 2024

As of December 31, 2023

31 unchanged sentences

Series A redeemable convertible preferred stock, 165,000 shares authorized;

62,000 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

62,000 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

75,800 73,514

4 unchanged sentences

Preferred stock, $ 0.0001 par value, 1,000,000 shares authorized;

62,000 Series A shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

62,000 Series A shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

Common stock, $ 0.0001 par value, 200,000,000 shares authorized;

53,524,606 and 53,390,082 issued, 53,466,674 and 53,332,150 outstanding as of March 31, 2024 and December 31, 2023, respectively

53,564,680 and 53,390,082 issued, 53,506,748 and 53,332,150 outstanding as of June 30, 2024 and December 31, 2023, respectively

Additional paid-in capital

11 unchanged sentences

(In thousands, except share and per share data)

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

Tour revenues

$ 136,499 $ 124,798 $ 290,113 $ 268,194

Operating expenses:

Cost of tours

78,641 77,654 157,943 149,703

General and administrative

34,148 29,155 66,535 55,574

Selling and marketing

18,281 15,158 41,038 35,810

Depreciation and amortization

13,637 11,331 24,954 23,139

Total operating expenses

Operating income

144,707 133,298 290,470 264,226

Operating (loss) income

( 8,208 ) ( 8,500 ) ( 357 ) 3,968

Other (expense) income:

Interest expense, net

( 11,321 ) ( 11,645 ) ( 22,906 ) ( 22,112 )

(Loss) gain on foreign currency

( 12 ) 348 ( 251 ) 500

Other income (expense)

- ( 3,867 ) 8 ( 3,696 )

Total other expense

(Loss) income before income taxes

( 11,333 ) ( 15,164 ) ( 23,149 ) ( 25,308 )

Loss before income taxes

( 19,541 ) ( 23,664 ) ( 23,506 ) ( 21,340 )

Income tax expense

Net (loss) income

Net (loss) income attributable to noncontrolling interest

Net (loss) income attributable to Lindblad Expeditions Holdings, Inc.

4,453 41 4,697 1,584

( 23,994 ) ( 23,705 ) ( 28,203 ) ( 22,924 )

Net income attributable to noncontrolling interest

673 765 442 922

Net loss attributable to Lindblad Expeditions Holdings, Inc.

( 24,667 ) ( 24,470 ) ( 28,645 ) ( 23,846 )

Series A redeemable convertible preferred stock dividend

1,150 1,083 2,287 2,155

Net loss available to stockholders

$ ( 25,817 ) $ ( 25,553 ) $ ( 30,932 ) $ ( 26,001 )

Weighted average shares outstanding

53,500,084 53,245,491 53,436,128 53,186,796

Undistributed loss per share available to stockholders:

$ ( 0.48 ) $ ( 0.48 ) $ ( 0.58 ) $ ( 0.49 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

3 unchanged sentences

(In thousands)

For the three months ended March 31,

Net (loss) income

For the three months ended June 30,

For the six months ended June 30,

$ ( 23,994 ) $ ( 23,705 ) $ ( 28,203 ) $ ( 22,924 )

Other comprehensive income:

Total other comprehensive income

Total comprehensive (loss) income

comprehensive (loss) income attributive to non-controlling interest

Comprehensive (loss) income attributable to stockholders

Total comprehensive loss

( 23,994 ) ( 23,705 ) ( 28,203 ) ( 22,924 )

comprehensive income attributive to non-controlling interest

673 765 442 922

Comprehensive loss attributable to stockholders

$ ( 24,667 ) $ ( 24,470 ) $ ( 28,645 ) $ ( 23,846 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

5 unchanged sentences

Total Stockholders'

Balance as of March 31, 2024

Stock-based compensation

Net activity related to equity compensation plans

Redeemable noncontrolling interest

Series A preferred stock dividend

Net loss attributable to Lindblad Expeditions Holdings, Inc.

Balance as of June 30, 2024

Additional Paid-In

Total Stockholders'

Balance as of December 31, 2023

4 unchanged sentences

Net loss attributable to Lindblad Expeditions Holdings, Inc

Balance as of March 31, 2024

Balance as of June 30, 2024

LINDBLAD EXPEDITIONS HOLDINGS, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders ’ Deficit

(In thousands, except share data)

Additional Paid-In

Total Stockholders'

Balance as of March 31, 2023

53,243,007 $ 5 $ 86,741 $ ( 264,888 ) $ ( 178,142 )

Stock-based compensation

- - 3,390 - 3,390

Net activity related to equity compensation plans

77,539 - ( 530 ) - ( 530 )

Redeemable noncontrolling interest

- - - ( 4,050 ) ( 4,050 )

Series A preferred shares dividend

- - - ( 1,083 ) ( 1,083 )

Net loss attributable to Lindblad Expeditions Holdings, Inc.

- - - ( 24,470 ) ( 24,470 )

Balance as of June 30, 2023

$ 53,320,546 $ 5 $ 89,601 $ ( 294,491 ) $ ( 204,885 )

Common Stock Additional Paid-In Accumulated Total Stockholders'

Shares Amount Capital Deficit Deficit

Balance as of December 31, 2023

53,177,437 $ 5 $ 83,850 $ ( 266,530 ) $ ( 182,675 )

Stock-based compensation

- - 6,292 - 6,292

Net activity related to equity compensation plans

143,109 - ( 541 ) - ( 541 )

Redeemable noncontrolling interest

- - - ( 1,960 ) ( 1,960 )

Series A preferred shares dividend

Net income attributable to Lindblad Expeditions Holdings, Inc.

Balance as of March 31, 2023

- - - ( 2,155 ) ( 2,155 )

Net loss attributable to Lindblad Expeditions Holdings, Inc.

- - - ( 23,846 ) ( 23,846 )

Balance as of June 30, 2023

53,320,546 $ 5 $ 89,601 $ ( 294,491 ) $ ( 204,885 )

The accompanying notes are an integral part of these condensed consolidated financial statements.

3 unchanged sentences

(In thousands)

For the three months ended March 31,

For the six months ended June 30,

Cash Flows From Operating Activities

Net (loss) income

$ ( 28,203 ) $ ( 22,924 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization

24,954 23,139

Amortization of deferred financing costs and other, net

3 unchanged sentences

Loss (gain) on foreign currency

Write-off of unamortized issuance costs related to debt refinancing

Changes in operating assets and liabilities

Prepaid expenses and other current assets

( 8,744 ) ( 7,740 )

Unearned passenger revenues

67,456 27,824

Other long-term assets

120 ( 1,046 )

Other long-term liabilities

Accounts payable and accrued expenses

( 4,088 ) ( 12,395 )

Operating lease liabilities

( 887 ) ( 724 )

Net cash provided by operating activities

62,566 19,504

Cash Flows From Investing Activities

Purchases of property and equipment

( 13,893 ) ( 14,718 )

Sale of securities

Net cash (used in) provided by investing activities

( 13,893 ) 445

Cash Flows From Financing Activities

Additional acquisition of redeemable noncontrolling interest

Proceeds from long-term debt

Repayments of long-term debt

( 24 ) ( 205,693 )

Payment of deferred financing costs

( 17 ) ( 7,043 )

Repurchase under stock-based compensation plans and related tax impacts

Net cash used in financing activities

( 1,596 ) ( 796 )

Net cash (used in) provided by financing activities

( 18,357 ) 61,468

Net increase in cash, cash equivalents and restricted cash

30,316 81,417

Cash, cash equivalents and restricted cash at beginning of period

187,344 116,024

Cash, cash equivalents and restricted cash at end of period

$ 217,660 $ 197,441

Supplemental disclosures of cash flow information:

Cash paid during the period:

$ 24,785 $ 18,232

Non-cash investing and financing activities:

54 unchanged sentences

When a net loss occurs, potential common shares have an anti-dilutive effect on earnings per share and such shares are excluded from the diluted earnings per share calculation.

For the three months ended March 31, 2024 and 2023, the Company incurred net losses available to stockholders, therefore basic and diluted net loss per share are the same in each respective period.

For the three months ended March 31, 2024, 0.8 million unvested restricted shares, 2.2 million shares issuable upon exercise of options and 8.1 million common shares issuable upon the conversion of the Preferred Stock were excluded from the calculation of dilutive potential common shares for the period as they were anti-dilutive.

For the three months ended March 31, 2023, 0.8 million unvested restricted shares, 1.9 million shares issuable upon exercise of options and 7.6 million common shares issuable upon the conversion of the Preferred Stock were excluded from the calculation of dilutive potential common shares for the period as they were anti-dilutive.

Earnings (loss) per share was calculated as follows:

For the three months ended March 31,

For the three and six months ended June 30, 2024 and 2023, the Company incurred net losses available to stockholders, therefore basic and diluted net loss per share are the same in each respective period.

For the three and six months ended June 30, 2024, 0.8 million unvested restricted shares, 2.7 million shares issuable upon exercise of options and 8.2 million common shares issuable upon the conversion of the Preferred Stock were excluded from the calculation of dilutive potential common shares for the period as they were anti-dilutive.

For the three and six months ended June 30, 2023, 0.7 million unvested restricted shares, 1.9 million shares issuable upon exercise of options and 7.7 million common shares issuable upon the conversion of the Preferred Stock were excluded from the calculation of dilutive potential common shares for the period as they were anti-dilutive.

Loss per share was calculated as follows:

For the three months ended June 30,

For the six months ended June 30,

(In thousands, except share and per share data)

Net (loss) income attributable to Lindblad Expeditions Holdings, Inc.

Net loss attributable to Lindblad Expeditions Holdings, Inc.

$ ( 24,667 ) $ ( 24,470 ) $ ( 28,645 ) $ ( 23,846 )

Series A redeemable convertible preferred stock dividend

1,150 1,083 2,287 2,155

Undistributed loss available to stockholders

$ ( 25,817 ) $ ( 25,553 ) $ ( 30,932 ) $ ( 26,001 )

Weighted average shares outstanding:

Total weighted average shares outstanding, basic

53,500,084 53,245,491 53,436,128 53,186,796

Total weighted average shares outstanding, diluted

53,500,084 53,245,491 53,436,128 53,186,796

Undistributed loss per share available to stockholders:

$ ( 0.48 ) $ ( 0.48 ) $ ( 0.58 ) $ ( 0.49 )

NOTE 3 — REVENUES

8 unchanged sentences

Future travel certificates are valued based on the Company’s expectation that a guest will travel again.

As of March 31, 2024 and December 31, 2023, the Company has $ 290.8 million and $ 252.2 million, related to unearned passenger revenue, respectively.

As of June 30, 2024 and December 31, 2023, the Company has $ 319.7 million and $ 252.2 million, related to unearned passenger revenue, respectively.

Contract Liabilities

3 unchanged sentences

Additional contract liabilities in period

Balance as of March 31, 2024

Balance as of June 30, 2024

The following table disaggregates our tour revenues by the sales channel it was derived from:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

Guest ticket revenue:

67 % 64 % 65 % 62 %

19 % 20 % 20 % 22 %

5 % 6 % 5 % 6 %

Guest ticket revenue

91 % 90 % 90 % 90 %

Other tour revenue

9 % 10 % 10 % 10 %

Tour revenues

Under the brand license agreement between the Company and National Geographic, effective January 1, 2024, National Geographic no longer receives commissions on sales bookings through the former National Geographic sales channel as the co-selling arrangement operates as direct sales through the Company’s booking system.

In the three months ended March 31, 2023, the National Geographic sales channel accounted for 14 % of the Company’s consolidated guest ticket revenue.

In the table above, 2023 guest ticket revenues through the National Geographic sales channel have been classified as direct sales for comparison purposes.

100 % 100 % 100 % 100 %

(a) Under the brand license agreement between the Company and National Geographic, effective January 1, 2024, National Geographic no longer receives commissions on sales bookings through the former National Geographic sales channel as the co-selling arrangement operates as direct sales through the Company’s booking system.

In the three and six months ended June 30, 2023, the National Geographic sales channel accounted for 11 % and 13 %, respectively, of the Company’s consolidated guest ticket revenue.

In the table above, 2023 guest ticket revenues derived through the National Geographic sales channel have been classified as direct sales for comparison purposes.

NOTE 4 — FINANCIAL STATEMENT DETAILS

The following is a reconciliation of cash, cash equivalents and restricted cash to the statement of cash flows:

As of March 31,

As of June 30,

(In thousands)

Cash and cash equivalents

$ 168,123 $ 142,950

Restricted cash

49,537 54,491

Total cash, cash equivalents and restricted cash as presented in the statement of cash flows

$ 217,660 $ 197,441

Restricted cash consists of the following:

As of March 31, 2024

As of June 30, 2024

As of December 31, 2023

1 unchanged sentence

Credit card processor reserves

$ 12,750 $ 20,250

Federal Maritime Commission and other escrow

1 unchanged sentence

Total restricted cash

$ 49,537 $ 30,499

Prepaid expenses and other current assets are as follows:

As of March 31, 2024

As of June 30, 2024

As of December 31, 2023

1 unchanged sentence

Prepaid tour expenses

$ 34,739 $ 26,123

31,163 31,035

Total prepaid expenses and other current assets

$ 65,902 $ 57,158

Accounts payable and accrued expenses are as follows:

As of March 31, 2024

As of June 30, 2024

As of December 31, 2023

1 unchanged sentence

Accrued other expense

$ 52,764 $ 48,901

Accounts payable

Total accounts payable and accrued expenses

$ 61,222 $ 65,055

NOTE 5 — LONG-TERM DEBT

As of March 31, 2024

As of June 30, 2024

As of December 31, 2023

2 unchanged sentences

Deferred Financing Costs, net

$ 360,000 $ ( 5,674 ) $ 354,326 $ 360,000 $ ( 6,771 ) $ 353,229

275,000 ( 5,749 ) 269,251 275,000 ( 6,481 ) 268,519

54 - 54 77 - 77

Total long-term debt

635,054 ( 11,423 ) 623,631 635,077 ( 13,252 ) 621,825

Less current portion

( 46 ) - ( 46 ) ( 47 ) - ( 47 )

Total long-term debt, non-current

For the three months ended March 31, 2024 and 2023, $ 0.9 million and $ 0.7 million, respectively, of deferred financing costs were charged to interest expense.

$ 635,008 $ ( 11,423 ) $ 623,585 $ 635,030 $ ( 13,252 ) $ 621,778

For the three and six months ended June 30, 2024, $ 0.9 million and $ 1.9 million, respectively, of deferred financing costs were charged to interest expense, and for the three and six months ended June 30, 2023 , $ 0.8 million and $ 1.5 million, respectively, of deferred financing costs were charged to interest expense.

On February 4, 2022, the Company issued $ 360.0 million aggregate principal amount of 6.75 % senior secured notes due 2027 (the “6.75% Notes”) in a private offering.

7 unchanged sentences

The obligations under the Revolving Credit Facility are guaranteed by the Company, and the Guarantors and are secured by first -priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all the assets of the Company and the Guarantors.

Borrowings under the Revolving Credit Facility, if any, will bear interest at a rate per annum equal to, at the Company’s option, an adjusted Secured Overnight Financing Rate (“SOFR”) rate plus a spread or a base rate plus a spread.

The Company is required to pay a 0.5 % quarterly commitment fee on undrawn amounts under the Revolving Credit Facility.

As of March 31, 2024, the Company had no borrowings under the Revolving Credit Facility.

As of June 30, 2024, the Company had no borrowings under the Revolving Credit Facility.

On May 2, 2023, the Company issued $ 275.0 million aggregate principal amount of 9.00 % senior secured notes due 2028 (the “9.00% Notes”) in a private offering.

1 unchanged sentence

The 9.00% Notes will mature on May 15, 2028, subject to earlier repurchase or redemption.

The Company used the net proceeds from the offering to prepay in full all outstanding borrowings under its prior senior secured credit agreements, to pay any related premiums and to terminate in full its prior senior secured credit agreements and

the commitments thereunder.

The 9.00% Notes are senior unsecured obligations of the Company and are guaranteed (i) on a senior secured basis by certain of the Company’s subsidiaries (collectively, the “Secured Guarantors”) and secured by a first -priority lien, subject to permitted liens and certain exceptions, on the equity and substantially all the assets of the Secured Guarantors, and (ii) on a senior unsecured basis by certain other subsidiaries of the Company.

The 9.00% Notes may be redeemed by the Company, at set redemption prices and premiums, plus accrued and unpaid interest, if any.

The Company’s 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 interest rate of 0.53 % annually.

The Company’s 6.75% Notes, Revolving Credit Facility and 9.00% Notes contain covenants that include, among others, limits on additional indebtedness and make certain dividend payments, distributions, investments and other restricted payments.

These covenants are subject to a number of important exceptions and qualifications set forth in the 6.75% Notes, Revolving Credit Facility and 9.00% Notes.

The Company was in compliance with its covenants in effect as of March 31, 2024.

The Company was in compliance with its covenants in effect as of June 30, 2024.

NOTE 6 — FAIR VALUE MEASUREMENTS

The carrying amounts of cash and cash equivalents, accounts payable and accrued expenses, approximate fair value due to the short-term nature of these instruments.

The Company estimates the approximate fair value of its long-term debt as of March 31, 2024 to be $ 644.2 million based on the terms of the agreements and comparable market data as of March 31, 2024.

As of March 31, 2024 and December 31, 2023, the Company had no other significant liabilities that were measured at fair value on a recurring basis.

The Company estimates the approximate fair value of its long-term debt as of June 30, 2024 to be $ 642.8 million based on the terms of the agreements and comparable market data as of June 30, 2024.

As of June 30, 2024 and December 31, 2023, the Company had no other significant liabilities that were measured at fair value on a recurring basis.

NOTE 7 — STOCKHOLDERS ’ EQUITY

5 unchanged sentences

These repurchases exclude shares repurchased to settle statutory employee tax withholding related to the exercise of stock options and vesting of stock awards.

No shares were repurchased during the six months ended June 30, 2024.

The Company has cumulatively repurchased 875,218 shares of common stock for $ 8.3 million and 6,011,926 warrants for $ 14.7 million, since plan inception.

The remaining balance for the Repurchase Plan was $ 12.0 million as of March 31, 2024.

The remaining balance for the Repurchase Plan was $ 12.0 million as of June 30, 2024.

Preferred Stock

6 unchanged sentences

The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of common stock of the Company equal to the quotient obtained by dividing the then-current accrued value by the conversion price of $ 9.50 .

The Preferred Stock deferred issuance costs were $ 2.1 million as of March 31, 2024, recorded as reduction to preferred stock.

The Company recorded accrued dividends for Preferred Stock of $ 1.1 million for each of the three months ended March 31, 2024 and 2023.

As of March 31, 2024, the 62,000 shares of Preferred Stock outstanding and accumulated dividends could be converted at the option of the holders into 8.1 million shares of the Company’s common stock.

The Preferred Stock deferred issuance costs were $ 2.1 million as of June 30, 2024, recorded as reduction to preferred stock.

The Company recorded accrued dividends for Preferred Stock of $ 1.2 million and $ 2.3 million for the three and six months ended June 30, 2024, respectively, and $ 1.1 million and $ 2.2 million for the three and six months ended June 30, 2023, respectively.

As of June 30, 2024, the 62,000 shares of Preferred Stock outstanding and accumulated dividends could be converted at the option of the holders into 8.2 million shares of the Company’s common stock.

NOTE 8 — STOCK BASED COMPENSATION

The Company is authorized to issue up to 4.7 million shares of common stock under the 2021 Long-Term Incentive Plan (“the Plan”) which was approved by shareholders in September 2021.

As of March 31, 2024, 2.1 million shares were available to be granted under the Plan.

The Company recorded stock-based compensation expense of $ 2.1 million and $ 2.8 million for the three months ended March 31, 2024 and 2023, respectively.

As of June 30, 2024, 1.7 million shares were available to be granted under the Plan.

The Company recorded stock-based compensation expense of $ 2.7 million and $ 4.8 million for the three and six months ended June 30, 2024, respectively, and $ 3.4 million and $ 6.3 million during the three and six months ended June 30, 2023, respectively.

Long-Term Incentive Compensation

During the three months ended March 31, 2024, the Company awarded 159,660 restricted stock units (“RSUs”) with a weighted average grant price of $ 9.33 .

During the six months ended June 30, 2024, the Company awarded 371,333 restricted stock units (“RSUs”) with a weighted average grant price of $ 8.76 .

The RSUs will primarily vest equally over three years on the anniversary of the grant date, subject to the recipient’s continued employment or service with the Company on the applicable vesting date.

The number of shares were determined based upon the closing price of our common stock on the date of the award.

During the three months ended March 31, 2024, the Company awarded 159,564 performance-based restricted share units (“PSUs”) with a weighted average grant price of $ 9.33 .

During the six months ended June 30, 2024, the Company awarded 70,378 performance-based restricted share units (“PSUs”) with a weighted average grant price of $ 9.33 .

The PSUs generally vest three years following the date of grant based on the attainment of performance- or market-based goals, all of which are subject to a service condition.

The Company does not deliver the shares associated with the PSUs to the employee, non-employee director or other service providers until the performance and vesting conditions are met.

Stock option information for the three months ended March 31, 2024 is below.

Stock option information for the six months ended June 30, 2024 is below.

Stock Option Grants

Number of options awarded 1,944,319

$ 7.40 - 8.44

Exercise price

$ 7.40 - 8.44

Dividend yield

Expected Volatility

64.6 - 77.8 %

Risk-free interest rate

3.63 - 4.48 %

Expected term (in years)

As of March 31, 2024 and December 31, 2023, options to purchase an aggregate of 2.2 million and 0.9 million shares of the Company’s common stock, respectively, with a weighted average exercise price of $ 9.28 and $ 10.55 , respectively, were outstanding.

As of March 31, 2024, 1,697,434 options were exercisable.

As of June 30, 2024 and December 31, 2023, options to purchase an aggregate of 2.7 million and 0.9 million shares of the Company’s common stock, respectively, with a weighted average exercise price of $ 8.84 and $ 10.55 , respectively, were outstanding.

As of June 30, 2024, 1.8 million options were exercisable.

In connection with the 2016 acquisition of Natural Habitat, Mr.

Bressler’s employment agreement, as amended, provides Mr.

Bressler, President of Natural Habitat, with an equity incentive opportunity to earn an award of options based on the future financial performance of Natural Habitat, where if the final year equity value of Natural Habitat, as defined in Mr.

Bressler, Founder and Chief Executive Officer of Natural Habitat, with an equity incentive opportunity to earn an award of options based on the future financial performance of Natural Habitat, where if the final year equity value of Natural Habitat, as defined in Mr.

Bressler's employment agreement, as amended, exceeds $ 25.0 million, effective as of December 31, 2025, Mr.

5 unchanged sentences

The options vested on the grant date and have a term of ten years.

During 2023, the Company determined it was probable the performance condition would be met related to this award and recorded all expense related to it.

The expense related to the remaining equity incentive opportunity through December 31, 2025 was also deemed probable in 2023 and is being expensed over Mr.

In 2023, the Company determined it was probable the performance condition would be met related to this award and recorded all expense related to it.

The performance condition related to the remaining equity incentive opportunity through December 31, 2025 was also deemed probable in 2023 and is being expensed over Mr.

Bressler’s service period.

For the three months ended March 31, 2024, stock-based compensation expense related to this award was $ 0.6 million.

For the three and six months ended June 30, 2024, stock-based compensation expense related to this award was $ 0.8 million and $ 1.5 million, respectively.

NOTE 9 — INCOME TAXES

As of March 31, 2024 and December 31, 2023, the Company had no unrecognized tax benefits recorded.

The Company's effective tax rate for the three months ended March 31, 2024 was an expense of 6.2 %, versus an expense of 66.5 % for the three months ended March 31, 2023.

In 2024, the effective income tax expense differs from the statutory rate primarily due to temporary timing differences related to interest expense, depreciation and stock-based compensation expense.

In 2023, the effective income tax expense was impacted by a $ 1.5 million discrete tax expense.

As of June 30, 2024 and December 31, 2023, the Company had no unrecognized tax benefits recorded.

The Company's effective tax rate for the three and six months ended June 30, 2024 was an expense of 22.8 % and 20.0 %, respectively, versus an expense of 0.2 % and 7.4 %, for the three and six months ended June 30, 2023, respectively.

In 2024, the effective income tax expense differs from the statutory rate primarily due to the timing of losses and the valuation allowance against such losses;

temporary timing differences related to interest expense, depreciation and stock-based compensation expense.

NOTE 10 — COMMITMENTS AND CONTINGENCIES

3 unchanged sentences

The put options enable the minority holders, but do not obligate them, to sell the remaining interests to the Company.

The Company has call options which enable it, but does not obligate it, to acquire the remaining interests in the subsidiaries, subject to certain dates, expirations and similar redemption value purchase measurements as the put options.

See “Subsequent Events” for additional information.

The Company has call options which enable it, but do not obligate it, to acquire the remaining interests in the subsidiaries, subject to certain dates, expirations and similar redemption value purchase measurements as the put options.

Since the redemption of the noncontrolling interests are not solely in the Company’s control, the Company is required to record the redeemable noncontrolling interest outside of stockholders’ equity but after its total liabilities.

4 unchanged sentences

Adjustments in excess of the redemption value of the noncontrolling interest are treated as a decrease to net income available to common stockholders.

During April 2024, Mr.

Bressler exercised a portion of the put option on Natural Habitat, allowing the Company to acquire an additional 9.95 % of Natural Habitat for $ 15.2 million, increasing its ownership to 90.1 %.

Additionally, during April 2024, the Company exercised a portion of its call option on DuVine, acquiring an additional 5 % of the business and increasing its total ownership of DuVine to 75 %, for $ 1.5 million.

The redemption value of the put options were determined using a discounted cash flow model.

1 unchanged sentence

The following is a rollforward of redeemable non-controlling interest:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

Beginning balance

Net (loss) income attributable to noncontrolling interest

$ 36,297 $ 25,698 $ 37,784 $ 27,886

Net income attributable to noncontrolling interest

673 765 442 922

Redemption value adjustment of put option

2,564 4,050 1,704 1,960

Redemption of put and/or call options

( 14,797 ) - ( 14,797 ) -

( 504 ) - ( 900 ) ( 255 )

Ending balance

$ 24,233 $ 30,513 $ 24,233 $ 30,513

Brand License Agreement – National Geographic

2 unchanged sentences

The fee is calculated based upon a percentage of substantially all ticket revenues, less travel agent commission, including the revenues received from cancellation fees and any revenues received from the sale of pre- and post-expedition extensions.

Beginning in 2026, the agreement has minimum royalties that increase annually through the end of the agreement term, which based on current performance are expected to be exceeded.

Beginning in 2026, the agreement has minimum royalties that increase annually through the end of the agreement term, which based on current performance are

expected to be exceeded.

During 2023, the Company operated under its former alliance and license agreement with National Geographic, where National Geographic sold the Company’s expeditions through its internal travel division in return for a commission fee and also allowed the Company to use the National Geographic name and logo in return for a royalty fee.

2 unchanged sentences

From time to time, the Company enters into agreements to charter vessels onto which it holds its tours and expeditions.

Future minimum payments on its charter agreements as of March 31, 2024 are as follows:

Future minimum payments on its charter agreements as of June 30, 2024 are as follows:

For the years ended December 31,

(In thousands)

2024 (nine months)

2024 (six months)

The Company had an agreement for the acquisition of Wineland-Thomson Adventures, Inc., (“Wineland-Thomson Adventures”) an adventure travel group that primarily operates Tanzania safaris, camp and tours and the acquisition was completed July 31, 2024.

The aggregate purchase price for Wineland-Thomson Adventures, which includes a U.S.-based company and multiple Tanzanian-based companies, is $ 30.0 million, consisting of $ 24.0 million in cash and $ 6.0 million of Lindblad common stock.

The purchase price for the Tanzanian-based companies is $ 11.2 million.

The Company has 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 is expected to close January 2025.

NOTE 11 — SEGMENT INFORMATION

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Operating results for the Company’s reportable segments were as follows:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

Tour revenues:

$ 93,053 $ 87,412 $ 211,356 $ 202,910

Land Experiences

43,446 37,386 78,757 65,284

Total tour revenues

Operating income:

$ 136,499 $ 124,798 $ 290,113 $ 268,194

Operating (loss) income:

$ ( 9,372 ) $ ( 11,043 ) $ ( 1,589 ) $ 1,076

Land Experiences

Total operating income

For the three months ended March 31, 2024 and 2023, there was $ 2.8 million and $ 2.5 million, respectively, of intercompany tour revenues between the Lindblad and Land Experiences reportable segments, which were eliminated in consolidation.

1,164 2,543 1,232 2,892

Operating (loss) income

$ ( 8,208 ) $ ( 8,500 ) $ ( 357 ) $ 3,968

For the three and six months ended June 30, 2024, there was $ 1.0 million and $ 3.8 million, respectively, of intercompany tour revenues between the Lindblad and Land Experiences reportable segments, which were eliminated in consolidation.

For the three and six months ended June 30, 2023, there was $ 1.6 million and $ 4.0 million, respectively, of intercompany tour revenues between the Lindblad and Land Experiences reportable segments, which were eliminated in consolidation.

Depreciation and amortization are included in segment operating income as shown below:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

Depreciation and amortization:

$ 12,749 $ 10,338 $ 23,231 $ 21,490

Land Experiences

888 993 1,723 1,649

Total depreciation and amortization

$ 13,637 $ 11,331 $ 24,954 $ 23,139

The following table presents our total assets, intangibles, net and goodwill by segment:

As of March 31, 2024

As of December 31, 2023

As of June 30, 2024 As of December 31, 2023

(In thousands)

Total Assets:

$ 648,425 $ 675,432

Land Experiences

209,912 155,865

$ 858,337 $ 831,297

Intangibles, net:

$ 1,549 $ 1,592

Land Experiences

Total intangibles, net

$ 8,508 $ 9,412

Land Experiences

42,017 42,017

Total goodwill

$ 42,017 $ 42,017

NOTE 12 — SUBSEQUENT EVENTS

During April 2024, Mr.

Bressler exercised a portion of the put option on Natural Habitat, allowing the Company to acquire an additional 9.95 % of Natural Habitat for $ 15.2 million, increasing its ownership to 90.1 %.

During April 2024, the Company exercised a portion of its call option on DuVine, acquiring an additional 5 % of the business and increasing its total ownership of DuVine to 75 %, for $ 1.5 million.

During April 2024, the Company announced an agreement for the acquisition of Wineland-Thomson Adventures, Inc, an adventure travel group that primarily operates Tanzania safaris, camp and tours.

The aggregate purchase price for Wineland-Thompson Adventures, which includes one U.S.-based company and four Tanzanian-based companies, will be approximately $ 30 million and will be financed through at least $ 24 million in cash and Lindblad stock of up to $ 6 million, with the final cash and stock amounts to be determined prior to the close of the transaction.

The purchase price for the Tanzanian-based companies is approximately $ 11.2 million.

The Company expects to complete the acquisition following required Tanzanian regulatory review and approval.

On July 31, 2024, Lindblad, through its land-based subsidiary Natural Habitat, closed the previously announced acquisition contemplated by that Purchase and Sale Agreement dated April 29, 2024 with WTA Holding Corp.

to acquire Wineland-Thomson Adventures, Inc.

and other related entities (“WTA”) to further expand our land-based experiential travel offerings and increase our addressable market.

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.

Thomson Safaris was founded on the principles of quality and integrity, with the goal of leading socially responsible and positively impactful light-treading safari tours.

Today, the brand’s name has earned its place as one of the top safari outfitters in the world, being recognized with consecutive accolades from trusted publications, like Condé Nast Traveler Best Travel Specialists in the World and Travel + Leisure World’s Best Awards.

In addition to its adventure travel brands, the WTA acquisition includes three leading Tanzania safari tour operators (collectively, the “Tanzanian Companies”)—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.

Pursuant to the agreement, the Company has the option to acquire Tanzania Conservation Limited.

The aggregate purchase price for WTA and the Tanzanian Companies was $ 24.0 million and $ 6.0 million in Lindblad common stock, representing 682,593 shares.

MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION

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Potential risks and uncertainties include, but are not limited to:

adverse general economic factors, such as fluctuating or increasing levels of interest rates, inflation, unemployment and perceptions of these and similar conditions that decrease the level of disposable income of consumers or consumer confidence that negatively impact the ability or desire of people to travel;

suspended operations, cancelling or rescheduling of voyages and other potential disruptions to our business and operations related to the COVID-19 virus or other health pandemic, the civil unrest in Ecuador, the Israel-Hamas war, the Russia-Ukraine conflict, political unrest, terrorism, war or another unexpected event in destinations we visit;

adverse general economic factors, such as fluctuating or increasing levels of interest rates, taxes, inflation, unemployment and perceptions of these and similar conditions that decrease the level of disposable income of consumers or consumer confidence that negatively impact the ability or desire of people to travel;

Presidential election, the denial and/or unavailability of ports of call, or another unexpected event in destinations we visit;

events and conditions around the world, including war and other military actions, such as the civil unrest in Ecuador, the Israel-Hamas war, the current conflict between Russia and Ukraine, inflation, higher fuel prices, higher interest rates and other general concerns about the state of the economy or other events impacting the ability or desire of people to travel;

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changes adversely affecting the business in which we are engaged;

management of our growth and our ability to execute on our planned growth, including our ability to successfully integrate acquisitions;

management of our growth and our ability to execute on our planned growth, including our ability to successfully close merger and acquisition transactions and integrate acquisitions;

our business strategy and plans;

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our common stock ranks junior to our Series A Convertible Preferred Stock with respect to dividends and amounts payable in the event of our liquidation, dissolution or winding-up of our affairs;

those risks discussed herein and in Item 1A.

those risks discussed in Item 1A.

Risk Factors in our 2023 Annual Report.

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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.

Guests are able to interact with these experts through lectures, excursions, dining and other experiences throughout their voyage.

We operate land-based nature adventure travel expeditions around the globe, with unique itineraries designed to offer intimate encounters with nature and the planet’s wild destinations and the animals and people who live there.

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2024 Highlights

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.

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.

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.

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.

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.

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.

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.

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.

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Adjusted EBITDA is 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.

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.

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.

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Results of Operations — Consolidated

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.

For the three months ended March 31,

Our consolidated results for the three and six months ended June 30, 2024 and 2023 are set forth below.

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

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Depreciation and amortization

Operating income

Net (loss) income

Operating (loss) income

Undistributed loss per share available to stockholders:

Comparison of the Three Months Ended March 31, 2024 and 2023 — Consolidated

Comparison of the Three and Six Months Ended June 30, 2024 and 2023 — Consolidated

Tour Revenues

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.

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.

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.

Cost of Tours

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.

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.

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.

General and Administrative

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.

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.

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.

Selling and Marketing

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%.

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.

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.

Depreciation and Amortization

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.

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.

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.

Other Income (Expense)

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.

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.

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.

Results of Operations — Segments

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The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

2 unchanged sentences

Total tour revenues

Operating income:

Operating (loss) income:

Land Experiences

Total operating income

Operating (loss) income

Adjusted EBITDA:

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The following table sets forth our Available Guest Nights, Guest Nights Sold, Occupancy, Maximum Guests, Number of Guests and Voyages:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

Available Guest Nights

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Calculation of Gross and Net Yield per Available Guest Night

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands, except for Available Guest Nights, Gross and Net Yield per Available Guest Night)

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The following table reconciles operating income to our Net Yield Guest Metric for the Lindblad Segment:

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

Operating income

Operating (loss) income

Cost of tours

5 unchanged sentences

Calculation of Gross and Net Cruise Cost

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands, except for Available Guest Nights, Gross and Net Cruise Cost per Avail.

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Stock-based compensation

Transaction-related costs

Reorganization costs

Adjusted Net Cruise Cost Excluding Fuel

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Adjusted Net Cruise Cost per Available Guest Night

Comparison of the Three Months Ended March 31, 2024 and 2023 at the Lindblad Segment

Comparison of the Three and Six Months Ended June 30, 2024 and 2023 at the Lindblad Segment

Tour Revenues

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.

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 as occupancy increased to 78% in the quarter compared to 74% in 2023, and n et yield per available guest night increased 6% from 2023 to $1,094.

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 to increased pricing and a 2% increase in guest nights sold.

Net yield per available guest night increased 3% to $1,160 as compared with 2023.

Operating Income

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.

Comparison of Three Months Ended March 31, 2024 and 2023 at the Land Experiences Segment

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.

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.

Comparison of Three and Six Months Ended June 30, 2024 and 2023 at the Land Experiences Segment

Tour Revenues

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.

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.

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.

Operating Income

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.

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.

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.

Adjusted EBITDA — Consolidated

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Reconciliation of Net (Loss) Income to Adjusted EBITDA Consolidated

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

Net (loss) income

Interest expense, net

1 unchanged sentence

Depreciation and amortization

(Gain) loss on foreign currency

Loss (gain) on foreign currency

Other expense (income)

Stock-based compensation

Transaction-related costs

Reorganization costs

Adjusted EBITDA

2 unchanged sentences

Lindblad Segment

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

Operating income

Operating (loss) income

Depreciation and amortization

Stock-based compensation

Transaction-related costs

Reorganization costs

Adjusted EBITDA

Land Experiences Segment

For the three months ended March 31,

For the three months ended June 30,

For the six months ended June 30,

(In thousands)

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Stock-based compensation

Transaction-related costs

Adjusted EBITDA

Liquidity and Capital Resources

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.

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.

As of March 31, 2024, we had $635.1 million in long-term debt obligations, including the current portion of long-term debt.

As of June 30, 2024, we had $635.1 million in long-term debt obligations, including the current portion of long-term debt.

We believe that our cash on hand and expected future operating cash inflows will be sufficient to fund operations, debt service requirements, and necessary capital expenditures for at least the next 12 months.

Sources and Uses of Cash for the Three Months Ended March 31, 2024 and 2023

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.

Sources and Uses of Cash for the Six Months Ended June 30, 2024 and 2023

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.

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.

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 .

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.

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 .

Funding Sources

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The 6.75% Notes will mature on February 15, 2027, subject to earlier repurchase or redemption.

We used the net proceeds from the offering to prepay in full all outstanding borrowings under our prior credit agreement, including the term facility, Main Street Loan, and revolving credit facility, to pay any related premiums and to terminate in full our prior credit agreement and the commitments thereunder.

We used the net proceeds from the offering to prepay in full all outstanding borrowings under our prior credit

agreement, including the term facility, Main Street Loan, and revolving credit facility, to pay any related premiums and to terminate in full our prior credit agreement and the commitments thereunder.

The 6.75% Notes are senior secured obligations and are guaranteed on a senior secured basis by us and certain of our subsidiaries (collectively, the “Guarantors”) and secured by first-priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all of our and the Guarantors’ assets.

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Borrowings under the Revolving Credit Facility, if any, will bear interest at a rate per annum equal to, at our option, an adjusted SOFR rate plus a spread or a base rate plus a spread.

As of March 31, 2024, we had no borrowings under the Revolving Credit Facility.

As of June 30, 2024, we had no borrowings under the Revolving Credit Facility.

On May 2, 2023, we issued $275.0 million aggregate principal amount of 9.00% senior secured notes due 2028 (the “9.00% Notes”) in a private offering.

2 unchanged sentences

The net proceeds from the offering were used to prepay in full all outstanding borrowings under our prior senior secured credit agreements, to pay any related premiums and to terminate in full the prior senior secured credit agreements and the commitments thereunder.

The 9.00% Notes are senior unsecured obligations and are guaranteed (i) on a senior secured basis by certain of our subsidiaries (collectively, the “Secured Guarantors”) and secured by a first-priority lien, subject to permitted liens and certain exceptions, on the equity and substantially all the assets of the Secured Guarantors, and (ii) on a senior unsecured basis by certain

of our other subsidiaries.

We may redeem the 9.00% Notes at set redemption prices and premiums, plus accrued and unpaid interest, if any.

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%.

The 6.75% Notes, Revolving Credit Facility and 9.00% Notes contain covenants that, among other things, restrict our ability and the ability of our restricted subsidiaries to incur certain additional indebtedness and make certain dividend payments, distributions, investments and other restricted payments.

These covenants are subject to a number of important exceptions and qualifications set forth in the 6.75% Notes, Revolving Credit Facility and 9.00% Notes.

As of March 31, 2024, we were in compliance with the covenants currently in effect.

As of June 30, 2024, we were in compliance with the covenants currently in effect.

Preferred Stock

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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.

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.

Funding Needs

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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.

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.

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.

Critical Accounting Policies

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements