Impairment charge contributes to deep first quarter loss for RCCL

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Written by Kari Reinikainen Kari Reinikainen

Category: Top Headlines Top Headlines

Published: 20 May 2020 20 May 2020

Royal Caribbean Cruises Ltd. (RCCL) the world’s second largest cruise shipping group, has reported a deep first quarter loss on an impairment charge and says bookings for 2021 are in historical ranges at this early stage of cycle.

RCCL’s net loss amounted to $1.4 billion, deepened by a $1.1 billion impairment charge, compared to a net income of $249.7 million in the first quarter of last year.

“Given the impact of COVID-19, booking volumes for the remainder of 2020 are meaningfully lower than the same time last year at prices that are down low-single digits.  Although still early in the booking cycle, the booked position for 2021 is within historical ranges when compared to same time last year with 2021 prices up mid-single digits compared to 2020,” the company said in a statement.

At the end of April, approximately 45% of the guests booked on cancelled sailings have requested cash refunds. Additionally, as of March 31, 2020, RCCL had $2.4 billion in customer deposits, it said.

"Responding to the dramatic change in business conditions caused by COVID-19 has required focus, dedication, ingenuity and improvisation from all our people, and their efforts have been nonstop," said Richard D. Fain, Chairman and CEO. 

"We understand that when our ships return to service, they will be sailing in a changed world.  How well we anticipate and solve for this new environment will play a critical role in keeping our guests and crew safe and healthy, as well as position our business and that of our travel agent partners to return to growth."

RCCL closes $3.32 billion private note offerings

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Written by Kari Reinikainen Kari Reinikainen

Category: Top Headlines Top Headlines

Published: 20 May 2020 20 May 2020

Royal Caribbean Cruises Ltd. (RCCL), the world’s second largest cruise shipping group, said it has closed two private offerings of senior secured notes totalling at $3.23 billion.

The first offering was of $1.0 billion aggregate principal amount of 10.875% Senior Secured Notes due 2023 and the second one of $2.32 billion aggregate principal amount of 11.500% Senior Secured Notes due 2025.

The 2023 Notes will mature on June 1, 2023. The 2025 Notes will mature on June 1, 2025 and are redeemable at the Company's option beginning June 1, 2022.

“The Notes and the related guarantees will be secured by 28 of the Company's vessels and material intellectual property of the Company.  The obligations under the Notes and the related guarantees will be secured by the collateral in an amount not to exceed permitted capacity under the Company's existing indebtedness,” the company said in a statement.

RCCL said it had used the net proceeds from the offering of the Notes to repay its $2.35 billion 364-day senior secured term loan agreement with Morgan Stanley Senior Funding, Inc., as the administrative agent and collateral agent and the other lenders party thereto, entered into on March 23, 2020. It expects to use the remainder of the net proceeds for general corporate purposes, which may include repayment of additional indebtedness.