Carnival Reports $2.2 Billion Q4 Loss As US Cruises Stay Docked
Cruise ship operator Carnival is looking at a loss of $2.22 billion for the fourth quarter ending Nov. 30 because of the pandemic’s shutdown of its voyages for almost a year now, The Wall Street Journal (WSJ) reported.
The loss is compared to the company’s $423 million profit in the same quarter from a year prior, the report stated.
Carnival paused all its cruises after the pandemic hit U.S. shores last March, and other companies under its banner, like Princess Cruises and Holland America Line, paused some of their cruises as well, WSJ reported.
The ability to set new voyages depends on receiving a permit from the U.S. Centers for Disease Control and Prevention (CDC), which wants operators to put on mock sailings and apply for a certificate at least 60 days before they can offer passenger cruises, according to WSJ.
“With the aggressive actions we have taken, managing the balance sheet and reducing capacity, we are well-positioned to capitalize on pent-up demand and to emerge a leaner, more efficient company,” Carnival CEO Arnold Donald said on a conference call, per WSJ.
Carnival is expected to sell off 19 of its less efficient ships, which would make up around 13 percent of capacity from before the pandemic. Pre-pandemic, Carnival had expected to sell off those ships in the coming years. WSJ reported that 15 of them had already exited the fleet.
Donald told WSJ that Carnival wants to resume cruises by the end of the year, although analysts say the prospect of returning to normal this year isn’t likely because of its slimmer fleet and the need to operate at reduced capacity.
The CDC extended a No Sail Order for cruise ships operating from U.S. ports through Oct. 31, PYMNTS reported, although the organization had been looking to set a ban through February of this year until Vice President Mike Pence overruled that plan.
Instead, the ban through Halloween ended up reflecting what industry professionals had been looking for from the start. But even so, the cruise ship industry took more of a beating from the pandemic in some ways than even the airline industry, as some of the first reported cases of the virus came from cruise ships.