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Financial updates unveil strong demand, positive signs

Details: Written by Kari Reinikainen Kari Reinikainen; Category: More News More News; Published: 07 May 2021 07 May 2021

Updates regarding the financial outlook for three cruise shipping companies suggests that strong demand is giving reason for optimism despite deep losses two of these companies reported for the first quarter.

Norwegian Cruise Line Holdings Ltd (NCLH) said that bookings have been strong for future periods resulting in an elongated booking window as guests book further into the future, despite reduced sales and marketing investments and a travel agency industry that has not been at full strength for months.

“During the first quarter 2021, overall bookings, net of cancellations, were more than double the volumes during the prior quarter,” the company said in a statement.

Strong demand for 2022 cruises

Booking and pricing trends for next year are very positive driven by strong pent up demand. “The Company is experiencing robust future demand across all brands with the overall cumulative booked position for the first half of 2022 meaningfully ahead of 2019’s record levels with pricing higher when excluding the dilutive impact of future cruise credits (“FCCs”),” NCLH said.

NCLH had $1.3 billion of advance ticket sales, including the long-term portion of advance ticket sales, which includes approximately $0.85 billion of FCCs as per 31 March.

However, the company reported a net loss of $1.4 billion for the first three months of the year, a reduction from a $1.9 billion loss in the same period last year.

Royal Caribbean Cruises Ltd (RCCL) said a few weeks earlier that booking activity for the second half of 2021 is aligned with its anticipated resumption of cruising. “Pricing on these bookings is higher than 2019 both including and excluding the dilutive impact of future cruise credits (FCCs),” RCCL said.

RCCL’s bookings for next year at higher prices vs 2019

“Cumulative advance bookings for the first half of 2022 are within historical ranges and at higher prices when compared to 2019. This was achieved with minimal sales and marketing spend which the Company believes highlights a strong long-term demand for cruising,” the company said in a statement.

Since the last business update, approximately 75% of bookings made for 2021 are new and 25% are due to the redemption of FCCs and the "Lift & Shift" program.

RCCL had approximately $1.8 billion in customer deposits at the end of March, in line with its December 31, 2020 balance. Approximately 45% of the customer deposit balance is related to FCCs. “Since the suspension of guest operations on March 13, 2020, approximately 50% of the guests booked on cancelled sailings have requested cash refunds,” RCCL stated.

RCCL was also able to reduce its first quarter net loss, which narrowed to $1.1 billion from $1.4 billion in the same period last year.

TUI Cruises bond issued could lift credit rating

Meanwhile, the credit rating agency Fitch Ratings has nassigned TUI Cruises GmbH a first-time expected Issuer Default Rating (IDR) of 'B-(EXP)' with a Positive Outlook.

The Hamburg based company owns TUI Cruises and Hapag-Lloyd Cruises and it is jointly owned by RCCLv and TUI AG.

“Fitch has also assigned TUI Cruises' proposed EUR300 million senior unsecured notes an expected long-term rating of 'CCC(EXP)' with a Recovery Rating of 'RR6', reflecting significant higher- ranking debt ahead of the planned bonds resulting in no recoveries of the bonds under Fitch's waterfall analysis,” the agency said in a statement.

The assignment of final ratings is contingent on completion of the debt issue and receipt of information conforming to bond documentation already reviewed. However, the rating is constrained by high leverage due to the impact of the disruption to the cruise industry caused by pandemic-related restrictions and also because of the Hapag Lloyd Cruises (HLC) acquisition in 2020.

"TUI Cruises' business profile benefits from a strong market position in the European cruise market with a focus on Germany as well as the company's premium product offering and high repeat customer base. Successful execution of the currently ramp-up phase is expected to result in an improved financial profile in 2022, which is reflected in the Positive Outlook,” Fitch said.

Two cruise lines unveil more European summer 2021 cruises

Details: Written by Kari Reinikainen Kari Reinikainen; Category: More News More News; Published: 07 May 2021 07 May 2021

AIDA Cruises and Viking have unveiled more cruises in Europe for the summer of 2021.

Viking said that it will restart operations in the Mediterranean with new voyages for vaccinated guests beginning this summer.

"Offered as part of Viking’s Welcome Back collection, Viking Venus and Viking Sea will homeport in the Maltese capital city of Valletta—a cultural UNESCO World Heritage Site—and sail two different 11-day roundtrip itineraries in the Mediterranean,’ the company said in a statement.

Viking also said it is adding more sailing dates this summer for its Welcome Back voyages around Iceland and Bermuda due to strong demand.

Guests on the Malta & Adriatic Jewels itinerary will overnight in Valletta and then sail to Montenegro and Croatia, calling in Kotor, Dubrovnik, Split, Zadar and Šibenik, before returning to the Maltese archipelago, with a stop in Gozo and finally back to Valletta.

Guests on the Malta & Greek Isles Discovery itinerary will also overnight in Valletta and then sail to Greece, calling in Kalamata, Athens, Santorini, Rhodes and Souda Bay, before returning to Valletta.

Viking Venus and Viking Sea will sail the itineraries between July and early October 2021.

Meanwhile AIDA Cruises in Germany said it will start short cruises from the German port of Kiel on 22 May. The company said it would publish more details about its plans in the near future. TUI Cruises is also reported to be planning resumption of cruises from German ports in the near future.

Holland America Line to restart operations with Greek programme in August

Details: Written by Kari Reinikainen Kari Reinikainen; Category: More News More News; Published: 06 May 2021 06 May 2021

Holland America Line, which is part of Carnival Corporation & plc group, said it had received approval from the Greek government to restart cruising from Piraeus (Athens) in August with four departures aboard Eurodam.

“Departing Aug. 15 and 29, the "Idyllic Greek Isles" itinerary features Kotor, Montenegro, plus the Greek isles of Kékira (Corfu), Thíra (Santorini) and Mykonos. "Ancient Wonders" departs Aug. 22 to explore Haifa, Israel, as well as Náfplion, Mykonos and Rhodes in Greece. Both options can be combined to form a longer, back-to-back 14-day Collectors' Voyage,” the company said in a statement.

A seven-day "Adriatic Allure" itinerary departing Sept. 5 would sail from Piraeus to Venice, Italy, with calls at Mykonos, Katakolon (Olympia) and Crete (Chania), Greece, and Sarandë, Albania, the company said.

“Additional Mediterranean cruises aboard Eurodam through the fall will be announced in the coming weeks and include ports in Italy and Greece. Eurodam returns to the United States to begin sailing its published Caribbean cruises in mid-November,” Holland America Line said.

CDC publishes demands to be met before cruising in US waters can resume

Details: Written by Kari Reinikainen Kari Reinikainen; Category: More News More News; Published: 06 May 2021 06 May 2021

Centers for Disease Control and Prevention (CDC) in Washington has published the next two phases of the Framework for Conditional Sailing Order (CSO) for cruise ships operating or seeking to operate in U.S. waters.

CDC published an 11 page technical instructions for cruise ship operators preparing to conduct simulated trial voyages in advance of restricted passenger voyages under a Covid-19 Conditional Sailing Certificate.

“With the issuance of these next two phases, cruise ship operators now have all the necessary requirements and recommendations they need to start simulated voyages before resuming restricted passenger voyages and apply for a Covid-19 conditional sailing certificate to begin sailing with restricted passenger voyages,: it said in a statement.

CDC said it may adjust these requirements and recommendations based on public health considerations and other factors.

MSC Seaside joins MSC Grandiosa in Western Mediterranean

Details: Written by Kari Reinikainen Kari Reinikainen; Category: More News More News; Published: 05 May 2021 05 May 2021

MSC Seaside has joined MSC Grandiosa back at sea this past Saturday, welcoming guests back on board for weekly 7-night cruises in the Western Mediterranean as the company ramps up its resumption operations, MSC Cruises said in a statement.

The itinerary features destinations in Siracusa in Sicily and Taranto in Puglia, Italy. “The ship is now two days into her voyage, having departed from Genoa, Italy on 1 May, followed by a relaxing day at sea on Sunday and is now in the stunning port of Valetta, Malta today. As part of her itinerary, the ship will also call in Civitavecchia for Rome,” the company said.

MSC Seaside becomes the second ship back at sea for the 2021 summer season, with further ships, including sister ship and future flagship MSC Seashore to join them in the Mediterranean from August. All ships will implement the Company’s rigorous health and safety protocol, which has been developed with a Blue Ribbon Panel.