Cruise company Royal Caribbean has published a loss of $1.6 billion and reported monthly losses of $250 million – $290 million However, the company announced liquidity of approximately $4.1 billion and quarterly earnings more than three times more than expected the majority of analysts. At the same time, Royal Caribbean saw a growth in demand for cruises in 2021.
Shares of the cruise company Royal Caribbean (RCL: NYSE), decreasing by 57% year to date, has grown over the last quarter and closed with a growth of 10% to $57,31 per share on Monday after the publication of financial results for the second quarter.
Optimism of investors is based on the statements of management Royal Caribbean about a strong financial position and encouraging news on the demand for booking cruises for 2021.
Part of the reservations is postponed due to the pandemic tours, but the majority – over 60% – new orders received since mid-may.
CEO of Royal Caribbean Richard Fain (Richard Fain) in an interview with CNBC said that the company obtained these results without any marketing efforts, due to the fact that people tend to go back to rest, after a long period of isolation.
“I think we are seeing pent-up demand. People are disappointed that we are at home and isolated,” said FEIN.
In terms of quarantine measures since March cruise companies had no time to carry their plans for the resumption of flights. Currently, most cruise operators say they do not expect to resume flights until at least 31 October.
Answering the question of the journalist, FEIN reiterated that in the current environment, “you can never be sure of anything”, but the company hopes to resume its activities in China or Australia until the end of October.
In the second fiscal quarter, Royal Caribbean reported a loss per share of $6,13, which was worse than analysts ‘ expectations of $4.82 loss per share. The total quarterly loss was $1.6 billion.
At the same time, quarterly income was $of 175.6 million, which is more than three times more analytical forecast of $43.5 million
In the current environment, “freeze the industry” and basing all vessels in the ports, Royal Caribbean reported that its monthly cash flow averages $250 million to $290 million, but this does not include reimbursement of customer deposits, the scheduled fee for repayment of debt and expected revenue from new orders.
The company has announced approximately $4.1 billion in cash and equivalents, which means that Royal Caribbean has sufficient liquidity to withstand a potentially prolonged situation of low income or lack of it.
Finance Director Royal Caribbean Jason liberty said that the company is looking for ways to reduce the flow of funds and evaluates the possibility of selling the vessels to improve their financial situation.
Gene. Director Richard FEIN added: “We are very clear idea of what our monthly losses, and we are taking steps to continually improve our liquidity”.
Growth stocks in tourism, airlines and cruise companies
Shares of Royal Caribbean are not the only sectors that rose on Monday. Investors ‘ optimism is also reflected in the increase in the shares of other major cruise companies, and airlines and travel.
The shares of rivals Caribbean: companies Carnival (NYSE: CCL) and Norwegian Cruise Line Holdings (NASDAQ: NCLH) on Monday grew by 8.6% and 8.15%, respectively.
On the same day, the airline showed the following growth: shares of United Airlines Holdings (NASDAQ: UAL) was the leader with growth of 9.35%, Delta Air Lines (NYSE: DAL) showed an increase of 7.95%, while American Airlines Group (NASDAQ: AAL) and Southwest Airlines (YSE: LUV) rose by 7.44% and 5.14%, respectively.
Smaller carriers showed similar growth, while shares of JetBlue Airways (NASDAQ: JBLU) was up by a significant 8.6 per cent.
Shares of the two largest American companies in the online tourism Booking Holdings (BKNG) and Tripadvisor (TRIP) also rose over the last week. Read more in the article Marketinfo.pro “Booking and TripAdvisor Holdings survived the worst quarterly loss, but shares rise, waiting for improvements”.
