Carnival CEO: Enough cash to endure 12 more cruise-less months

Carnival Corp. has enough cash to survive a cruise-less 2021, CEO Arnold Donald told investors Jan. 11.

The company reported a net loss of $2.2 billion during the final quarter of 2020 but ended the year with $9.5 billion in liquidity, enough to endure at least 12 more months without cruises, Donald said. To tighten supply, the company has divested of 15 ships from its pre-pandemic fleet of 105, and plans to bid farewell to four more in the coming weeks.

“I’m glad to put 2020 behind us,” Donald said. “It proved to be a true testament to the resilience of our company.”

The company has returned 30 of its ships to U.S. waters since the U.S. Centers for Disease Control and Prevention lifted its months-long no-sail order in October, replacing it with requirements cruise companies need to meet in order to resume passenger cruises.

Carnival Corp. had removed all of its ships from U.S. waters — and CDC oversight — in June.

Ships in U.S. waters are required to test crewmembers for COVID-19 weekly and report results to the CDC. Donald said the company is still awaiting guidelines from the public health agency about when and how it will operate test cruises, one of the next requirements.

Last year Carnival Corp. cruise lines Costa Cruises and AIDA resumed passenger operations in Europe; both canceled sailings late last year as COVID-19 cases spiked and countries went back into lockdown. Donald said he hopes all of Carnival Corp.’s ships will be operating by the end of 2021.

While details regarding cruising’s resumption are still unknown, Donald said demand from past cruisers remains strong. Cumulative advanced bookings for the second half of 2021 are within the historical range, according to the company, and the cumulative advanced bookings for the first half of 2022 are ahead of 2019.

“Whether we start sailing in April or March or June or whenever, the real value in this business extends for many years,” Donald said. “Eventually we will all be back to the great days of growth in our industry, earnings growth and cash generation. A matter of a couple of months here and there are not determining the future value of the industry.”

01/13/2021 - 10:04am