Carnival expects fourth-quarter loss of $2 billion, but cash burn improves

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cruise operator Carnival (NYSE: CCL)(NYSE: CUK) said it expects to post a massive $2 billion loss in its fourth fiscal quarter as it prepares to resume shipping this year.

But in a hopeful note, Carnival also said its cash burn rate was a bit better than expected, though that was mostly due to the timing of its capital spending.

Carnival princess. Image source: Carnival.

Carnival said it expects a net loss of $2.2 billion for the quarter ended Nov. 30, worse than analysts’ forecast of a $1.6 billion loss. But excluding one-time items, the cruise line said adjusted losses would be $1.9 billion.

The company said it had sufficient cash to survive the current crisis, although it had no upcoming revenue, as it ended the quarter with $9.5 billion in cash from opportunistic events. Fund raising.

Carnival said since March it had raised $19 billion, including borrowing $3 billion under its export credit facilities in September, October and December; the issuance of $2 billion of senior unsecured notes in November; and the completion of a $1 billion equity offering in the market in September and a similar $1.5 billion program in November.

This added substantial debt to its balance sheet, and by the end of August Carnival had already amassed nearly $19 billion.

Still, it also noted that its monthly cash burn rate was $500 million, “a little better than expected,” and said its monthly cash burn in the first quarter is expected to be $600 million.

With its Costa Cruises and AIDA Cruises divisions having resumed operations, Carnival is looking to roll out more cruises around the world in 2021. Consumers still want cruise, as indicated by the fact that Carnival says its cumulative advance bookings for the first half of 2022 are ahead of 2019.

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