Carnival Records Significantly Higher Bookings As Cruise Ships Make a Comeback

Carnival records significant higher bookings as its brands begin to restart cruise operations around the world.

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Although Carnival Corporation’s stock prices did not reflect it and closed almost 80 cents down, its second-quarter results did allow for some positivity. The Miami-based cruise company, home of nine different cruise lines, recorded record booking numbers for both the second half of 2021 and the entire of 2022.

Not only that, the company is looking to have a majority of its ships, over 50%, operational before the end of the fiscal year. While this might not make investors excited, they would have wanted a significantly higher number of ships in operation; given the difficulties the cruise lines are experiencing with crewing ships and bringing those ships back into operation, it is still a valiant effort.

Bookings for 2022 Up from Record-Breaking 2019

As expected at the end of the 2020 fiscal year, bookings for the first half of 2021 were not as strong as previous years. The uncertainty regarding when ships might startup, the CDC’s stalling tactics earlier this year, and a vaccination drive going slower than expected outside the US and the UK have seen guests hesitant to book a cruise in the first half of 2021. Nonetheless, bookings for the remainder of the year are up significantly.

Carnival Corporation has yielded 45% higher bookings for the second half of the year than the first half of the year. Showing that the demand for cruises is excellent, and many guests want to spend at least some time onboard a cruise ship this year.

For 2022 the numbers are looking even better still. Some might remember the record-breaking year of 2019 when the cruise lines experienced their best year ever. As of 31 May, the numbers for 2022 looked even better.

Arnold Donald, CEO of Carnival Corporation:

“Despite our minimal advertising spend, we continue to experience an acceleration in booking trends globally, including capturing significant latent demand for our new sailings this summer. This strong demand affirms confidence in our future. In addition, customer deposits grew this past quarter, a significant milestone on our path to resumption.”

Carnival Horizon Arrives in Miami
Photo By: Carnival Cruise Line

Restart Efforts Include 50% of Ships This Year

Carnival Corporation is taking a significantly slower approach than other companies for the start of operations. Given the size of Carnival as a company and how it operates, this is entirely understandable.

Carnival Cruise Line operates in a much more demographic-based modus. Meaning its nine brands are focused much more on either nationality (Carnival Cruise Line, AIDA, P&O Cruises Australia, P&O UK, and Costa being prime examples), age groups (Holland America, Cunard), or level of luxury (Princess Cruises vs. Seabourn).

The company has been hesitant to operate these brands outside of these demographics, as was shown earlier this year when Carnival Cruise Line Christine Duffy flat out refused to start up her ships outside the US. The company has therefore been waiting for each area to be ready for operations.

So far, Carnival Corporation has started operations or is scheduled to start 27 ships by the end of the third quarter, approximately 35% of its total capacity. By the end of the 3rd quarter of 2021, another 15 ships will resume. Together these 42 ships represent over 50% of capacity. You read more about Carnival Corporations restart plans here.

Carnival-owned Cruise Ships
Photo Credit: JJava Designs / Shutterstock.com

The Finances

As can be expected from a company that runs the most ships globally, its financial position is not the strongest it has ever been. Financial losses account for US GAAP net loss of $(2.1) billion and adjusted net loss of $(2.0) billion.

Also Read: 10 Carnival Cruise Line Stock Benefits and Tips

The company’s cash burn, which accounts for vessel maintenance, fuel costs, food allowances, salaries, and more, amounted to $500 million per month. This cash burn is expected to remain on the same level of slightly elevated as the company restarts more and more ships over the coming months.

Overall, despite the rocky stock price, the future looks good for Carnival Corporation. While it is not the all-out start like Royal Caribbean, Carnival is methodical in its resumption plans. Something that will likely benefit them in the end.

Carnival-Owned Cruise Ships

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