Carnival posts $2.6 billion first-quarter loss

Melbourne, Australia - February 6th 2019. Carnival Legend, a Spirit class cruise ship operated by Carnival Cruise Line, docked at Station Pier in Port Melbourne.

Carnival Corporation has suffered a US$2.0 billion ($2.6 billion) net loss during the first three months of 2021, but the cruise giant’s cash burn rate was “better than expected”.

The multi-billion-dollar loss is much bigger than the US$781 million ($1.0 billion) loss Carnival recorded in Q1 of 2020, with the company ending the first three months of this year with US$11.5 billion ($15.1 billion) worth of cash and short-term investments.

Carnival noted that its cash burn rate in Q1 was “better than expected, as the company has identified and implemented opportunities to optimise its monthly spend”.

The group’s booking volumes for all future cruises during the first quarter of 2021 were approximately 90 per cent higher than booking volumes during the fourth quarter of 2020.

“Cumulative advanced bookings for full-year 2022 are ahead of a very strong 2019, despite minimal advertising or marketing,” Carnival said.

Six of the company’s nine brands are expected to resume limited guest cruise operations by this winter.

AIDA Cruises resumed guest cruise operations in March, sailing in the Canary Islands, and Costa Cruises expects to resume guest cruise operations in May, sailing to Italian ports.

P&O Cruises (UK), Cunard and Princess Cruises will each offer a series of UK cruises this winter, and Seabourn will operate a series of seven-day round-trip sailings from Athens from 3 July 2021.

Meanwhile, Carnival Cruise Line has notified guests of additional cruise cancellations and the extension of its pause in all operations from US ports through to 30 June 2021.

Carnival president and CEO Arnold Donald said the company was focused on resuming operations “as quickly as practical, while at the same time demonstrating prudent stewardship of capital and doing so in a way that serves the best interests of public health”.

“Our highest responsibility and therefore our top priority is always compliance, environmental protection and the health, safety and wellbeing of everyone,” he said.

“Our portfolio of brands have clearly been an asset, as we resume operations this summer with nine ships across six of our brands.”

During the cruise pause, Donald said he and his team have been positioning Carnival to return to serving guests an “operationally stronger company than we were before”.

“With an exciting roster of six new, more efficient ships by December and with lower capacity from the exit of 19 less efficient ships, we expect to capitalise on pent-up demand and achieve significant cost improvement from the greater efficiency of our fleet, along with ongoing streamlining of shoreside operations,” he said.

Featured image source: iStock/DLMcK

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