Royal Caribbean, Norwegian Extend Cruise Suspensions

Royal Caribbean Cruises Ltd and Norwegian Cruise Line Holdings Ltd on Wednesday extended the suspension of voyages by another month until July 31 amid sailing curbs imposed to check the spread of the coronavirus.

The cruise industry has faced the brunt of the health crisis as major outbreaks in ships were blamed for spreading the disease, resulting in government-mandated “no-sail” orders and trip cancellations.

Royal Caribbean, which warned of a second-quarter loss in the face of a mounting debt, said it would have to pay between $590 million and $610 million in interest for the rest of the year on borrowings to the tune of more than $5 billion.

The company, in the past few months, has had to borrow money by pledging some its ships. While its China operations would continue, the company said booking volumes for the rest of the year were slowly improving, driven by demand for cruises later this year and in 2021.

“Our current booking trends indicate that there is demand for cruising,” Chief Financial Officer Jason Liberty told analysts.

Rivals Carnival Corp and Norwegian Cruise Line have also signaled a similar return in demand.

Royal Caribbean said net loss attributable to the company was $1.44 billion, or $6.91 per share, in the first quarter ended March 31.

Excluding one-time items, it lost $1.48 per share, much more than Wall Street expectations of 63 cents loss, according Refinitiv data.

Shares of the cruise operator were down 4% at $40.7 in noon trading.

(Reporting by Nivedita Balu; Editing by Bernard Orr, Anil D’Silva and Arun Koyyur)

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