Carnival Corporation has provided an insight into just how much the cruise giant is struggling amid the COVID-19 pandemic.
In announcing its second-quarter results and preparation measures for the resumption of guest operations, Carnival said it intends to accelerate the removal of ships in the 2020 financial year which the company previously expected to be sold over the ensuing years.
“The company already has preliminary agreements for the disposal of six ships which are expected to leave the fleet in the next 90 days, and is currently working toward additional agreements,” Carnival said in a statement late last week.
While the cruise behemoth said it was unable to definitively predict when it will return to normal operations, its expects to resume guest operations in “a phased manner”, with specific ships and brands returning to service over time.
Carnival anticipates that initial sailings will be from a select number of “easily accessible” homeports, and expects future capacity to be moderated by the phased re-entry of its ships, the removal of capacity from its fleet and delays in new ship deliveries.
The company previously had four ships scheduled to be delivered between May and October of 2020.
Carnival posted a US$2.4 billion ($3.5 billion) loss in the second quarter, with total revenue down US$4.8 billion ($7 billion) to US$700 million ($1 billion) compared to the prior corresponding period.
The company ended the second quarter with US$7.6 billion ($11.1 billion) of available liquidity, and it expects to further enhance future liquidity, including through refinancing scheduled debt maturities.
In addition, Carnival has US$8.8 billion ($12.9 billion) of committed export credit facilities that are available to fund ship deliveries originally planned through to 2023.
Carnival’s total customer deposits balance at 31 May was US$2.9 billion ($4.2 billion), including US$475 million ($694 million) related to cruises during the second half of 2020.
Last week, the company also announced the appointment of Josh Weinstein as its new chief operations officer.
In addition, Weinstein will retain oversight of Carnival UK, the operating company for P&O Cruises and Cunard, which he managed directly for the past three years.
Simon Palethorpe, currently president of Cunard, will assume added responsibilities in the role of president of Carnival UK.
Featured image: iStock/Drake McLemore