SS/RCCL Finances: Improving, Options, Questions??!!

[TLCOhio]

15 hours ago, RetiredandTravel said:

This appears to be a situation that favors the buyer over the seller and we don't know exactly what the structure of the private placement is to induce buyers.  We don't know the structure but somebody does.  Even at 35 1/2 it's above its recent lows.

 

This morning we are learning a little more details on this latest Royal Caribbean cash/re-finance move.  

 

From a company PR press release and Yahoo News late yesterday evening, they had this headline: “Royal Caribbean Group announces pricing and upsizing of $1 billion senior convertible notes offering” with these highlights: “Royal Caribbean today announced that it has priced the offering of $1 billion aggregate principal amount of 6.00% Convertible Senior Notes due 2025. In connection with the offering of the Convertible Notes, the Company granted certain of the initial purchasers of the Convertible Notes a 13-day option to purchase up to an additional $150 million aggregate principal amount of the Convertible Notes.”

 

Here is more: "The Company intends to use the proceeds from the sale of the Convertible Notes to repurchase $350 million aggregate principal amount of its 2.875% convertible senior notes due November 15, 2023 and $800 million aggregate principal amount of its 4.25% convertible senior notes due June 15, 2023 in privately negotiated transactions. The Company intends to retire the Existing Convertible Notes so purchased.  The Convertible Notes are being offered only to persons reasonably believed to be qualified institutional buyers."

 

Mo Money!  Mo Money!  It seems that this will cost Royal Caribbean more as they know the currently higher/rising interest rates are not a "temporary" situation.   Right or wrong?

 

Towards the later parts of this corporate release, RCL lists many of RISKS associated with the cruise industry these days.  This includes items such as the war in the Ukraine, economic changes, government health orders, shipyard construction challenges, cyber security attacks, ship delivery delays, data breaches, etc. SEC rules require such listing of the many danger for those loaning these additional millions of dollars.  Are you reaching for your check book to invest and roll the dice?

 

Full story at:

https://finance.yahoo.com/news/royal-caribbean-group-announces-pricing-020200214.html

 

THANKS!  Enjoy!  Terry in Ohio

 

Athens & Greece: Visuals, details from two visits in a city and nearby with great history, culture and architecture.  Now at 46,174 views.

http://boards.cruisecritic.com/showthread.php?t=1101008

[highplanesdrifters]

19 hours ago, RetiredandTravel said:

 

If its a private placement we may never know right?  I'm guessing the yield on a 3 yr straight bond would probably be low teens (maybe less), of course the convert yield would be much lower.  The idea was to start paying the debt not rolling it out but it does give them time which is very important.

I knew someone smarter than me would have an answer!

And thanks Terry for the follow up article which explains more.

 

[RetiredandTravel]

1 hour ago, TLCOhio said:

 

This morning we are learning a little more details on this latest Royal Caribbean cash/re-finance move.  

 

From a company PR press release and Yahoo News late yesterday evening, they had this headline: “Royal Caribbean Group announces pricing and upsizing of $1 billion senior convertible notes offering” with these highlights: “Royal Caribbean today announced that it has priced the offering of $1 billion aggregate principal amount of 6.00% Convertible Senior Notes due 2025. In connection with the offering of the Convertible Notes, the Company granted certain of the initial purchasers of the Convertible Notes a 13-day option to purchase up to an additional $150 million aggregate principal amount of the Convertible Notes.”

 

Here is more: "The Company intends to use the proceeds from the sale of the Convertible Notes to repurchase $350 million aggregate principal amount of its 2.875% convertible senior notes due November 15, 2023 and $800 million aggregate principal amount of its 4.25% convertible senior notes due June 15, 2023 in privately negotiated transactions. The Company intends to retire the Existing Convertible Notes so purchased.  The Convertible Notes are being offered only to persons reasonably believed to be qualified institutional buyers."

 

Mo Money!  Mo Money!  It seems that this will cost Royal Caribbean more as they know the currently higher/rising interest rates are not a "temporary" situation.   Right or wrong?

 

Towards the later parts of this corporate release, RCL lists many of RISKS associated with the cruise industry these days.  This includes items such as the war in the Ukraine, economic changes, government health orders, shipyard construction challenges, cyber security attacks, ship delivery delays, data breaches, etc. SEC rules require such listing of the many danger for those loaning these additional millions of dollars.  Are you reaching for your check book to invest and roll the dice?

 

Full story at:

https://finance.yahoo.com/news/royal-caribbean-group-announces-pricing-020200214.html

 

THANKS!  Enjoy!  Terry in Ohio

 

Athens & Greece: Visuals, details from two visits in a city and nearby with great history, culture and architecture.  Now at 46,174 views.

http://boards.cruisecritic.com/showthread.php?t=1101008

 

Private Placements can only be bought by qualified institutional buyers.  The fact that the deal was upsized is a positive.  Unfortunately the devil is in the details in these deals, maybe an analyst will have more info.  Its not unusual for hedge funds to short stock prior to a convert.

 

https://www.investopedia.com/terms/c/convertible-hedge.asp

 

 

 

 

[TLCOhio]

2 hours ago, RetiredandTravel said:

Private Placements can only be bought by qualified institutional buyers.  The fact that the deal was upsized is a positive.  Unfortunately the devil is in the details in these deals, maybe an analyst will have more info.  Its not unusual for hedge funds to short stock prior to a convert.

https://www.investopedia.com/terms/c/convertible-hedge.asp

 

Yes, the details do mater much.  See more below.  Appreciate these follow-ups and added insights.  

 

From a financial website this morning, they had this headline: “Royal Caribbean Stock Drops After $1 Billion Convertible Note Offering” with these highlight details: “In connection with this offering, the company stated that it will also give the initial purchases of the notes the option to buy another $135 million in principal. However, just this morning, the company stated that it upsized the offering to $1 billion while it also established the interest rate for the notes at 6%.  The option granted to initial investors was also increased to $150 million and the conversion factor for the notes was established. Note holders can convert their notes into 19.9577 RCL shares for every $1,000 invested resulting in an initial conversion price of $50.11. This represents a 40% premium over yesterday’s closing price.”

 

If I was a RCL stockholder, it seems that this offering tends to dilute down the current stock value.  Maybe?  Maybe not?  Here is another comment from their financial analysis: "For investors, the fact that the company was forced to increase the interest rate paid on its convertible notes to entice investors indicates that Royal Caribbean’s financial expenditures will rise significantly in the future."

 

Full story at:

https://www.business2community.com/stock-news/royal-caribbean-stock-drops-after-1-billion-convertible-note-offering-02530947

 

THANKS!  Enjoy!  Terry in Ohio

 

Lisbon, NWSpain, Bordeaux/Brittany: Live/blog, June 2017 from Portugal to France along scenic Atlantic Coast on the Silver Spirit.  Now at 32,475 views.  Many pictures, details for history, food, culture, etc.:

www.boards.cruisecritic.com/showthread.php?t=2511358

[RetiredandTravel]

1 hour ago, TLCOhio said:

 

Yes, the details do mater much.  See more below.  Appreciate these follow-ups and added insights.  

 

From a financial website this morning, they had this headline: “Royal Caribbean Stock Drops After $1 Billion Convertible Note Offering” with these highlight details: “In connection with this offering, the company stated that it will also give the initial purchases of the notes the option to buy another $135 million in principal. However, just this morning, the company stated that it upsized the offering to $1 billion while it also established the interest rate for the notes at 6%.  The option granted to initial investors was also increased to $150 million and the conversion factor for the notes was established. Note holders can convert their notes into 19.9577 RCL shares for every $1,000 invested resulting in an initial conversion price of $50.11. This represents a 40% premium over yesterday’s closing price.”

 

If I was a RCL stockholder, it seems that this offering tends to dilute down the current stock value.  Maybe?  Maybe not?  Here is another comment from their financial analysis: "For investors, the fact that the company was forced to increase the interest rate paid on its convertible notes to entice investors indicates that Royal Caribbean’s financial expenditures will rise significantly in the future."

 

Full story at:

https://www.business2community.com/stock-news/royal-caribbean-stock-drops-after-1-billion-convertible-note-offering-02530947

 

THANKS!  Enjoy!  Terry in Ohio

 

Lisbon, NWSpain, Bordeaux/Brittany: Live/blog, June 2017 from Portugal to France along scenic Atlantic Coast on the Silver Spirit.  Now at 32,475 views.  Many pictures, details for history, food, culture, etc.:

www.boards.cruisecritic.com/showthread.php?t=2511358

 

I'm far from an expert on these stocks or convertible bonds.

 

 RCL said the deal wasn't dilutive, I guess we have to trust them that EPS estimates won't change because of the deal.  When convertible bonds convert to stock it is dilutive but possibly in this case it was just replaced.

 

 

Quote 

 

 "The purpose of the offering is to replace some of the existing near-term maturities of convertible bonds with new longer-term convertible bonds in a manner which is non-dilutive to shareholders as described below," said Naftali Holtz, Chief Financial Officer of Royal Caribbean Group."

 

https://www.marketwatch.com/story/royal-caribbean-to-offer-900-million-in-convertible-bonds-due-2025-2022-08-01#:~:text=Royal Caribbean Group RCL%2C -7.54,million more in convertible bonds.

 

 

If all or a large portion of the new issue was purchased by a convertible arbitrage investor like I mentioned above they may have shorted a large amount of stock which I don't think is technically dilutive but could have a negative impact on the price of the stock.

 

Other reasons the stock went down yesterday may, like your thread mentions, be people were unhappy with the interest rate or structure of the convert or were anticipating the debt would just be paid off with no new issuance.  Its also possible it went down for no good reason at all.

 

I think that the upsized deal got done and isn't dilutive is a positive as is the fact that it gives them more time.

 

 

[TLCOhio]

From last Thursday's second quarter 2022 report/briefing by the Royal Caribbean CEO, CFO, etc., I had a chance today to listen to the full audio of their various comments.  I made a number of notes as I listened.  

 

In their opening comments, there was a strong emphasis as to needing to refinance debt, up their margins, increase their load factors, continue on recovery, etc..  They stressed  upbeat "spins" (and some truth) about having positive cash-flow, getting the full fleet back in operations, bookings increasing, etc.  Most of the hour was, directly or indirectly, about finances and related issues.

 

As they shifted into the part where questions come from financial experts from major Wall Street firms, there was some concern about the overall market place and economy.  This includes for the $5 billion in 2023 debt coming due that is facing Royal Caribbean and how to re-finance without watering down equity/stock value.  They were trying to answer various questions by citing the increase in demand they have experienced through recent bookings.

 

Overall, they acknowledged there is a challenge in managing liquidity.  They do not plan to issue any new stock.  “We have a plan and path”  was one of the comments from RCL CEO Jason Liberty.  He and his officials strongly stressed the value of a cruise vacation versus the costs in doing land-based travel.  Another key statement was that they "expect 2023 to be a normal operating year.”    

 

From a UBS analyst, there was a question as to how soon Royal Caribbean will remove testing on longer cruises.  But no specific answer came on that complicated question.    There was a question raised as to Europe and the impacts they are expecting for 2023.  RCL indicated that they saw a 9-10% lift in future bookings once the CDC testing requirements was lifted.  

 

As to the "realities" for how the cruise business will fare versus what Wal-Mart now sees for shrinking/shifting consumer spending due to the coming and/or current recession, RCL views it as a shifting of spending priorities by consumers.  RCL sees a much high demand for ‘EXPERIENCES”.  

 

They view and hope consumers will stress focus on “experiences that consumer are seeking versus things”.  

 

On the question of whether cruise lines will need to do elevated discounting, there was some "dancing" but they admitted they are doing more "packaging." That makes it harder to measure and compare how much pricing cutting is or will be need to be done.  

 

Overall, they came back several times to view cruising as still a very good value proposition.  They cited their new-build ships as much more fuel efficient.  There were discussions as to how they are reaching new-to-cruising passengers and this market segment as being back to pre-covid levels. They either ignored and/or do not view the inflation factor as being a major negative impact on their future recovery plans.  

 

They are ramping up marketing costs/efforts and noted how the consumer has changed in recent years.  This includes how customers are doing much more research and bookings on the webf and that RCL has upgraded their technology to accomodate this market shift.  They have shifted a number of their cruise options to reflect a customer desire to travel more regionally, closer to home, within port driving distance, etc. On the coming recession, they stated near the end of the discussion “we don’t see any of this in our day-to-day business."

 

Sorry for the rambling nature of these various notes and comments, but hopefully it offers "flavor and color" for how these top RCL officials last week discussed their future business projections and hopes.

 

If you would like to listen to the full hour-plus presentation, you can use this link: 

https://www.rclinvestor.com/webcasts-presentations/

 

Questions, comments, reactions?

 

THANKS!  Enjoy!  Terry in Ohio   

 

Panama Canal? Early 2017, Fort Lauderdale to San Francisco adventure through Panama Canal.  Our first stops in Colombia, Central America and Mexico, plus added time in the great Golden Gate City. Now at 31,456 views.

http://boards.cruisecritic.com/showthread.php?t=2465580

[rkacruiser]

3 hours ago, TLCOhio said:

On the question of whether cruise lines will need to do elevated discounting

 

A Kiplinger publication that I received to day had some good news for cruise lines, one of which was that bookings remain solid at good pricing.  A negative piece of news is the difficulty of employing adequately trained staff that allows the service experienced by guests to meet their expectations.  When one reads some of the cruise reports, particularly for the luxury cruise lines, this is a comment that is sometimes made.  

 

3 hours ago, TLCOhio said:

Another key statement was that they "expect 2023 to be a normal operating year.”

 

In comparison to what "normal operating year"?  None of the cruise lines have had one since 2019.  

[TLCOhio]

On 8/2/2022 at 1:20 PM, RetiredandTravel said:

 I think that the upsized deal got done and isn't dilutive is a positive as is the fact that it gives them more time.

 

Per the above comment, maybe, as folks look at what Royal Caribbean has done with their latest billion-dollar plus move, these experts do not view it as too dilutive?  Could be?  Or, not?

 

From the Wall Street Journal below you can see that the "rocky: stock value ride for Royal Caribbean has had quite a "roller coaster" ride during the past three days.  Wow!!  

 

After these wild first three days of August, what will happen with RCL stock during the rest of this summer month?  And as the consumer and stock market move into September and October as the potential recession worries/realities become more in focus?   Any guesses or speculation?

 

THANKS!  Enjoy!  Terry in Ohio

 

From late 2018, see “Holy Lands, Egypt, Jordan, Oman, Dubai, Greece, etc.”, with many visuals, details and ideas for the historic and scenic Middle East. Now at 21,103 views.  Connect at:

www.boards.cruisecritic.com/topic/2607054-livenautica-greece-holy-lands-egypt-dubai-terrypix’s/

 

From the Wall Street Journal, this charts reflects how super "rocky" were things were for their stock value in the three days after details were shared on their latest financial move.:

(Open your screen/viewer wider to see this visual larger/better!)

[RetiredandTravel]

6 hours ago, TLCOhio said:

 

Per the above comment, maybe, as folks look at what Royal Caribbean has done with their latest billion-dollar plus move, these experts do not view it as too dilutive?  Could be?  Or, not?

 

From the Wall Street Journal below you can see that the "rocky: stock value ride for Royal Caribbean has had quite a "roller coaster" ride during the past three days.  Wow!!  

 

After these wild first three days of August, what will happen with RCL stock during the rest of this summer month?  And as the consumer and stock market move into September and October as the potential recession worries/realities become more in focus?   Any guesses or speculation?

 

THANKS!  Enjoy!  Terry in Ohio

 

From late 2018, see “Holy Lands, Egypt, Jordan, Oman, Dubai, Greece, etc.”, with many visuals, details and ideas for the historic and scenic Middle East. Now at 21,103 views.  Connect at:

www.boards.cruisecritic.com/topic/2607054-livenautica-greece-holy-lands-egypt-dubai-terrypix’s/

 

From the Wall Street Journal, this charts reflects how super "rocky" were things were for their stock value in the three days after details were shared on their latest financial move.:

(Open your screen/viewer wider to see this visual larger/better!)

 

 

The overall S&P500 looks to me to have major resistance at 4177 (4160 currently).  I'm not very good at cut and paste but if you draw a horizontal line at 4177 and that's the early June high and near the lows in Feb/March, the index just also crossed its 100 day MA.   A decent close above 4177 would also be significant because it would end the 2022 trend of lower highs (Jan/Apr/June).  I see the next resistance point at 4350 which is the 200 day MA, the 200MA also intersects a trend line of the highs from Jan/April this year.  Tomorrow the July unemployment numbers are released.

 

 

[TLCOhio]

16 hours ago, RetiredandTravel said:

The overall S&P500 looks to me to have major resistance at 4177 (4160 currently).  I'm not very good at cut and paste but if you draw a horizontal line at 4177 and that's the early June high and near the lows in Feb/March, the index just also crossed its 100 day MA.   A decent close above 4177 would also be significant because it would end the 2022 trend of lower highs (Jan/Apr/June).  I see the next resistance point at 4350 which is the 200 day MA, the 200MA also intersects a trend line of the highs from Jan/April this year.  Tomorrow the July unemployment numbers are released.

 

Great above sharing and follow-up by R&T about the S&P500.  From my limited experience, that indicator is a good, solid overall indicator.  Below from the Wall Street Journal is their chart for the stock market during the past   Covid had its impact in March 2020 and there has been general recovery since that point.  But, where for the future?  Why the struggles of the market to rise up during the past seven to eight months?  Does Wall Street know what is coming with the looming economic downturn?  Or, what is called a recession?

 

From MSN News and a financial publication earlier this week, they had this headline: “Royal Caribbean Cruise Line Adds Daring New Ship” with these details/specifics about Silversea's acquisition of the former Crystal Endeavour: "Somewhat unexpectedly, Royal Caribbean has added a new ship to the Silversea fleet. CEO Jason Liberty explained why the purchase made sense. 'Financially, it was a unique opportunity to acquire a brand-new, high-quality expedition vessel significantly below the building costs and that is fully financed through an attractive, long-term unsecured financing arrangement,' he explained.  'We expect this transaction to be immediately accretive to earnings, cash flow, and [return on investment capital].' ”

 

Interesting details about how Royal Caribbean has been able to finance this "new" Silversea expedition ship with fairly cheap, unsecured, easy financing.  Reactions?

 

Full story at:

https://www.msn.com/en-us/travel/news/royal-caribbean-cruise-line-adds-daring-new-ship/ar-AA10efFC

 

THANKS!  Enjoy!  Terry in Ohio

 

Summer 2019 Calgary, Jasper/Banff National Parks, Western Canada Rocky Mountaineer rail adventure, Vancouver, sailing up to Alaska on Silver Muse, post-cruise excursion to Denali, etc.  Many visuals and details from our first in these scenic areas!  Live/blog: 

https://boards.cruisecritic.com/topic/2682584-live-terryohio-silver-muse-alaska-canadarockies-pix’s/

 

From the Wall Street Journal, here is their historic chart for the S&P500 movements during the past three years.  Recovery, but, but, things have stalled in the past seven to eight months.  Right?:

(Open your screen/viewer wider to see this visual larger/better!)

 

[TLCOhio]

18 hours ago, RetiredandTravel said:

Tomorrow the July unemployment numbers are released.

 

Yes, those economic numbers came out this morning and most sources, including FOX News and Wall Street Journal, viewed these numbers as positive for a potential more "soft landing" as our economy seeks to avoid too deep of a recession.  .Maybe good news for the cruise industry as they seek to recover in a continued, positive manner???   

 

From the Wall Street Journal this morning, they had this headline: “Strong Hiring in July Added 528,000 Jobs to Economy" with this sub-headline:  "Jobless rate of 3.5% matches half-century low seen just before pandemic.”

 

Here are some reporting highlights: “The unemployment rate also dropped to 3.5%, a half-century low also seen just before the pandemic in early 2020, the Labor Department said Friday. The acceleration follows a first half of the year during which payrolls grew faster than during any other post-World War II period when the economy began contracting. The labor-force participation rate—or the share of adults working or seeking a job—ticked down to 62.1% in July from 62.2% a month earlier.  Industries vulnerable to the Federal Reserve’s interest-rate increases also performed well in July. Construction firms, manufacturers and finance companies all added to payrolls.”

 

Is good news a true positive?  But, the stock market was mildly down this morning with this news.  

 

Full story at:

https://www.wsj.com/articles/july-jobs-report-unemployment-rate-economy-growth-2022-11659646690?mod=hp_lead_pos1

 

THANKS!  Enjoy!  Terry in Ohio

 

Early 2020, many visuals and details from New Zealand/South Pacific in going from Auckland to French Polynesia.  This includes Bora Bora, Fiji, NZ experiences, etc:  Live/blog;

https://boards.cruisecritic.com/topic/2735732-live-terryohio-“new”-regatta-south-pacificnz-pix’s/

[TLCOhio]

From the Wall Street Journal late this afternoon, below are the stock value charts for the three major cruise lines.  All moved in an upward, positive direction this week.  

 

Early on Monday, Royal Caribbean was down to $34.56, but then moved up to $40.81 by mid-morning on Friday.  That is going up $6.25 or a jump of 18% in less than five days.  Nice increase?  But, what will happen next week?  And, as we move into September and October?

 

THANKS!  Enjoy!  Terry in Ohio

 

Barcelona/Med: June 2011, with stops in Villefranche, ports near Pisa and Rome, Naples, Kotor, Venice and Dubrovnik. Great visuals with key highlights, tips, etc. Live/blog now at 255,116 views.

www.boards.cruisecritic.com/showthread.php?t=1426474

 

From the Wall Street Journal, here are the charts for the three major cruise line companies stock performance during the past week.  Mostly positive and upward?.:

(Open your screen/viewer wider to see these visuals larger/better!)

For a little different look at RCL, below is how their stock has moved since Jan. 1, 2022.  The trend?  Most downward?:

[Stumblefoot]

1 hour ago, TLCOhio said:

That is going up $6.25 or a jump of 18% in less than five days.

Cull your profits, Terry.

[turtlemichael]

23 minutes ago, Stumblefoot said:

Cull your profits, Terry.

Main reason for the stock price lift was we paid for our World Cruise. 😨

Edited August 5, 2022 by turtlemichael

[TLCOhio]

15 hours ago, Stumblefoot said:

Cull your profits, Terry.

 

Good news?  Or, bad news?  I do not own any Royal Caribbean stock.  Nor, with Carnival or Norwegian.  

 

Below is the WSJ chart for Royal Caribbean during the past three years.  Their peak during that period was on Jan. 13, 2020 when RCL was up at $135.05.   

 

How would you feel now if you had "invested" in RCL when they were in that $100-135 range?  Clearly, hopefully, Royal Caribbean stock will go back up.  But, when and by how much?  Will it ever be over $100 a share with all of the existing debt and added stock shares floated?  On Nov. 8, 2021, RCL stock did briefly climb to $98.27.  

 

THANKS!  Enjoy!  Terry in Ohio

 

From the Wall Street Journal, below is their chart for the stock values of Royal Caribbean during the past three years.  Quite an interesting ride?:

(Open your screen/viewer wider to see this visual larger/better!)

[rkacruiser]

21 hours ago, turtlemichael said:

Main reason for the stock price lift was we paid for our World Cruise. 😨

 

Thank you very much!  😆

 

6 hours ago, TLCOhio said:

 Their peak during that period was on Jan. 13, 2020 when RCL was up at $135.05.

 

Oh, the Golden Years!  And, not just for cruise line stocks.

6 hours ago, TLCOhio said:

hopefully, Royal Caribbean stock will go back up.  But, when and by how much?

 

What goes down will go up and what goes up will come down.  For most companies.  If I was not a buy and hold investor, I would be concerned.  Patience is required for investing.  How long will it take?  Maybe I will live long enough to answer that question.  I don't expect a return to receiving a dividend from CCL or RCI for a very long time.  

[TLCOhio]

On 8/6/2022 at 4:52 PM, rkacruiser said:

What goes down will go up and what goes up will come down.  For most companies.  If I was not a buy and hold investor, I would be concerned.  Patience is required for investing.  How long will it take?  Maybe I will live long enough to answer that question.  I don't expect a return to receiving a dividend from CCL or RCI for a very long time.  

 

Sorry to hear about those challenges for our SW Ohio neighbor in being a stockholder with CCL and RCL.  Glad to know that I am not an investor in these challenged stocks.  Yes, things will go up, but by how much and when?  

 

From a financial website this morning, they had this headline: “Norwegian Cruise Line (NCLH) Scheduled to Post Quarterly Earnings on Tuesday” with these highlights: “Norwegian Cruise Line is scheduled to issue its quarterly earnings data before the market opens on Tuesday, August 9th. Analysts expect Norwegian Cruise Line to post earnings of ($0.87) per share for the quarter.”

 

We will see how this announcement affects stock values for the three major cruise lines.  This morning at 11:25 am ET, Royal Caribbean was up 4.42% to $41.42.  They other two lines were up by comparable amount at this point this morning.  Good news coming??

 

Full story at:

https://www.defenseworld.net/2022/08/08/norwegian-cruise-line-nclh-scheduled-to-post-quarterly-earnings-on-tuesday.html

 

THANKS!  Enjoy!  Terry in Ohio

 

Norway Coast/Fjords/Arctic Circle cruise from Copenhagen, July 2010, to the top of Europe. Scenic visuals with key tips. Live/blog at 244,710 views.

www.boards.cruisecritic.com/showthread.php?t=1227923

[TLCOhio]

Not a good morning on Wall Street for the cruise stocks!!  Why and how?  This downward move was driven by Norwegian announcing a a half-bill-dollar-plus loss for the second quarter of 2022.  Royal Caribbean at 10:47 am today was down to $37.69 or a drop of -6.31%.  Norwegian stock dropped down ro $11.98 or a negative -11.46% slide.  Carnival was down -6.5% this morning.  Not good?  Will things bounce back later in the week?

 

From a financial news website connected below this morning, they had this headline: “Norwegian Cruise Line Holdings Ltd. Q2 Loss Decreases, but misses estimates” with these highlights: “Norwegian Cruise Line Holdings announced loss for second quarter that decreased from last year but missed the Street estimates.  The company's bottom line totaled minus $509.32 million, or -$1.22 per share. This compares with -$717.78 million, or -$1.94 per share, in last year's second quarter.”

 

Full story at:

https://www.nasdaq.com/articles/norwegian-cruise-line-holdings-ltd.-q2-loss-decreases-but-misses-estimates

 

THANKS!  Enjoy!  Terry in Ohio

 

Sydney to NZ/Auckland Adventure, live/blog 2014 sampling/details with many exciting visuals and key highlights.  On page 23, post #571, see a complete index for all of the pictures, postings.  Now at 238,118 views.

www.boards.cruisecritic.com/showthread.php?t=1974139

[TLCOhio]

Occupancy?  How full are the cruise ships sailing now?  That is a key factor that the financial experts are monitoring as they consider where the values are for the cruise line stocks.

 

From the Reuters newswire and Yahoo News this morning, they had this headline: “Norwegian Cruise says return to 2019 occupancy levels still a year away” with these highlights: “Norwegian reported second-quarter results worse than estimates and forecast a return to pre-pandemic occupancy levels in the same period next year.  The industry looks to cruise towards full occupancy after the pandemic brought it to a near 18-month standstill, but self-imposed constraints as well as onboard COVID-19 cases, labor shortages and volatile demand stand in the way. Norwegian Cruise reported occupancy of 65% in the quarter, compared with 107.3% in 2019.  In contrast, rival Royal Caribbean had recorded 82% occupancy in its estimate-beating results last month and said it would reach triple-digit occupancy by the end of this year.”

 

Here is another important little "detail" from this reporting: "Norwegian also blamed higher labor and fuel costs for a fourfold increase in total cruise operating expenses to $1.07 billion."

 

Full story at:

https://finance.yahoo.com/news/norwegian-cruise-misses-revenue-estimates-114102610.html

 

THANKS!  Enjoy!  Terry in Ohio

 

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http://boards.cruisecritic.com/showthread.php?t=1278226

[Stumblefoot]

2 hours ago, TLCOhio said:

Norwegian Cruise reported occupancy of 65% in the quarter, compared with 107.3% in 2019.

How is an occupancy rate > 100% possible?  Placing passengers in housekeeping closets or in the engine room?

[jpalbny]

Stumblefoot, is it a math quirk related to kids traveling in the same suite as their parents? In other words, if a cabin is for 2 people, does adding a kid make that cabin 150% occupied? 

[Stumblefoot]

4 hours ago, jpalbny said:

Stumblefoot, is it a math quirk related to kids traveling in the same suite as their parents? In other words, if a cabin is for 2 people, does adding a kid make that cabin 150% occupied? 

I don’t know. By that logic, do they count Lois or Jolly’s cabin as 50% occupied when they sail?

[Randyk47]

30 minutes ago, Stumblefoot said:

I don’t know. By that logic, do they count Lois or Jolly’s cabin as 50% occupied when they sail?

By some accounting they might but more likely they just count total passengers against normal occupancy rates and say the cruise is at XX%.   

[taxatty]

7 hours ago, jpalbny said:

Stumblefoot, is it a math quirk related to kids traveling in the same suite as their parents? In other words, if a cabin is for 2 people, does adding a kid make that cabin 150% occupied? 

That's exactly what it is. Cruise lines consider a ship to be 100% occupied when two people are staying in every cabin. Cabins with more than two occupants because of additional bunks, a sofa bed, or a folding bed can and do result in over 100% total ship occupancy.

[TLCOhio]

17 hours ago, jpalbny said:

Stumblefoot, is it a math quirk related to kids traveling in the same suite as their parents? In other words, if a cabin is for 2 people, does adding a kid make that cabin 150% occupied? 

 

Great follow-up from J.P. and others.  Agree that it seems strange to have an occupancy rate above 100%, but there is a legitimate and understandable reason.  

 

From a trade publication linked below this morning, they had this headline: “Norwegian Cruise Says Pre-pandemic Occupancy Still a Year Away” with this key admission and highlights: “ '2022 has been a very lumpy year. It will continue to be a bit lumpy for the second half given where our load factors (occupancy percentage) are expected to be,' Chief Financial Officer Mark Kempa said on an earnings call.”

 

Is "a bit lumpy" being honest?  Yes!!  Seems to explain much as to how and why Wall Street financial types are NOT fully confident that a "complete recovery" is that close given the other challenges currently happening in the consumer spending areas of the world economy.  

 

This story also looked ahead with an optimistic and hopeful statement: "The company forecast slightly positive adjusted core earnings for the second half of 2022 on strong onboard spending by its affluent guests and easing food and fuel costs."  Agree that many affluent guests with their NCLH brands of Regent and Oceania have money are willing to spend.  BUT, for Norwegian, Royal Caribbean and Carnival, they also have other brands that are dependent on the "middle class" who are not as flexible and flush with cash and a willingness to spend right now.  Right or wrong? 

 

Full story at:

https://www.marinelink.com/news/norwegian-cruise-says-prepandemic-498616

 

THANKS!  Enjoy!  Terry in Ohio

 

Amazon River-Caribbean 2015 adventure live/blog starting in Barbados. Many visuals from this amazing river and Caribbean Islands (Dutch ABC's, St. Barts, Dominica, Grenada, San Juan, etc.).  Now at 70,209 views:

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