CCL High Debt /what is Your Opinion

[Guest ldtr]

1 hour ago, BermudaBound2014 said:

 

Sorry, I just now saw this request. The early conference calls were chalk full of predictions that the company would reach 2019 occupancy levels in 2022. Over and over again. So much brag about having historic booking levels when compared to 2019. It really was laughable.

 

1) Here's one (there are many more if you read thru the conference call transcripts from 2021) where Mr. Donald states they are optimistic they will be sailing at capacity by the spring of 2022. As we know, the real numbers fell significantly short of the prediction as the company only managed to get to 91% occupancy during the first quarter of 2023. 

https://www.fool.com/earnings/call-transcripts/2021/06/24/carnival-corp-plc-ccl-q2-2021-earnings-call-transc/

 

 

 

2) Here's another example of misleading information. This was written in June of 2022. As you know, Carnival wasn't anywhere near 110% occupancy in Q322. Instead of 110% occupancy as predicted, I believe the actual numbers were 54% occupancy for Q322.

https://www.cruisehive.com/carnival-cruise-line-aims-for-110-percent-occupancy/75138

 

 

3) Please respond. I am not saying you are wrong, but I can't find anywhere that states Carnival was over 100% occupancy in Q422.

 

 

 

I'd like to see where Carnival reached occupancy of over 100% in Q422. I can't find Carnival segregated data at over 100%. What I see is CCL corporation at 91% occupancy in Q422. Certainly a few ships made 100% over the holiday period, but I do not believe that Carnival (as a brand) averaged over 100% ocupancy in Q422. Please link if possible. 

 

Have to find it, was in a q&a period for the period that covered it.  It actually was around the time of the Q1 financial release and was talking about the holiday period.

 

You notice that it was comments about the fleet being back in full operation, which did happen. That they were optimistic that they would be at full capacity which they were not

Edited June 19, 2023 by ldtr

[BermudaBound2014]

3 minutes ago, ldtr said:

Have to find it, was in a q&a period for the period that covered it.

Please do. 
 

4 minutes ago, ldtr said:

You notice that it was comments about the fleet being back in full operation, which did happen. That they were optimistic that they would be at full capacity which they were not and for that matter could not be due to Covid restrictions. Full capacity would have been below 85%% due to the number of open cabins that were kept for Covid isolation.

I will never believe that in June of 2022 Mr Donald did not know they had zero hope of sailing at capacity in the very next quarter.
 

Yet there he was, with all the bs about record breaking bookings exceeding 2019- expecting to sail at capacity. His claims defied basic logic. The reality is that CCL only sailed with 54% occupancy, no where near predictions. 

 

As I said, quite laughable.  
 

[HappyInVan]

On 6/14/2023 at 9:51 AM, BermudaBound2014 said:

I just did a random check for a longer European cruise departing in July. This is a 19 day med cruise on the Oosterdam. It's past final payment and you can see that these prices continue to drop in each category. Cruise ships that are selling well do not need to reduce pricing closer to sailing date.

 

 

+1. Exactly what I have been saying all along. The last minute booking is your best friend.

[ExpatBride]

10 hours ago, HappyInVan said:

 

+1. Exactly what I have been saying all along. The last minute booking is your best friend.

 

Yes! I generally pick a few sailings and plan to be on one of them, then I watch prices. As a rule, the best deals I've found are right after final payment date because rates generally fall and there are still decent perks available. I booked in late April for a Norway sailing next month and got pre-paid gratuities, discounted HIA, and a generous OBC. Base fares are a bit lower now (about $100) but I'm still ahead with the incentives.

Fortunately, I'm within driving distance of the port and I'm not picky about cabin location.

Edited June 19, 2023 by ExpatBride

[rodndonna]

34 minutes ago, ExpatBride said:

 

Yes! I generally pick a few sailings and plan to be on one of them, then I watch prices. As a rule, the best deals I've found are right after final payment date because rates generally fall and there are still decent perks available. I booked in late April for a Norway sailing next month and got pre-paid gratuities, discounted HIA, and a generous OBC. Base fares are a bit lower now (about $100) but I'm still ahead with the incentives.

Fortunately, I'm within driving distance of the port and I'm not picky about cabin location.

 

From where we are getting to the port.. any port... is typically the long pole requiring flights and really limits making any last minute deals ever work. 😢

 

You European's have it made in that regard, or at least it would seem that way. Maybe just a grass is greener scenario. 

[Mary229]

4 hours ago, ExpatBride said:

 

Yes! I generally pick a few sailings and plan to be on one of them, then I watch prices. As a rule, the best deals I've found are right after final payment date because rates generally fall and there are still decent perks available. I booked in late April for a Norway sailing next month and got pre-paid gratuities, discounted HIA, and a generous OBC. Base fares are a bit lower now (about $100) but I'm still ahead with the incentives.

Fortunately, I'm within driving distance of the port and I'm not picky about cabin location.

This has been my experience as well.  My TA has negotiated more perks if there is a considerable price drop.  I have, in the past year, received a very nice upgrade, very reduced HIA and free meals in lieu of the discount.  It just depends on their mood, I guess 

[dockman]

I think AI will eventually take over most all of the reservations process eliminating most travel agents commissions as well as cruise line res agents.  With HD videos of every inch of every ship available at the click of a mouse and a virtual AI agent that can answer any and all questions as well or better than a human and provide virtual guided tours of the ships , recommendations as to best choices for rooms/dining/shore excursions etc it will eventually replace a lot of the humans that now provide this type of info....bean counters keep looking for places to cut expenses and agent commissions as well as cost of res agents is a huge expense.  Of course it will require a big investment by the cruise lines but done right it will change the way people book cruises.  And of course the cruise lines have email address of just about everyone who has ever cruised and can do massive promotions with the click of a mouse mailing.

[Guest ldtr]

20 hours ago, BermudaBound2014 said:

Please do. 
 

I will never believe that in June of 2022 Mr Donald did not know they had zero hope of sailing at capacity in the very next quarter.
 

Yet there he was, with all the bs about record breaking bookings exceeding 2019- expecting to sail at capacity. His claims defied basic logic. The reality is that CCL only sailed with 54% occupancy, no where near predictions. 

 

As I said, quite laughable.  
 

Have not been able to find it.  It was an article from CNBC (along with the video) that was an Q&A type interview  in the middle of the 1st quarter.  One of the questions was how occupancy was going and the response was that Carnival cruise line as a whole reached 100% during the holiday period.

 

Still hunting for it, but it does not appear to still be on the CNBC site.

 

If I recall correctly the Covid restrictions did not fully come off until Q3 and ships had about 15%  capacity being held open for quarantine, so there is always the question about how full  occupancy is defined during that period.

Edited June 19, 2023 by ldtr

[BermudaBound2014]

On 6/14/2023 at 2:54 PM, ldtr said:

There was comments about record rate of new bookings and there were comments that Carnival cruise line was expected to be over 100% in q4 if 2022 for that cruise line. Which they were.  

 

 

45 minutes ago, ldtr said:

Have not been able to find it…..Carnival cruise line as a whole reached 100% during the holiday period.

 

Don’t bother hunting. 
 

We all know that Carnival reached 100% during the Christmas and New years sailings (for 2 weeks).  
 

That’s entirely different than your first claim that Carnival reached 100% for Q4. If you can find documentation that Carnival reached 100% occupancy for Q4 I’ll be shocked.

 

Here are the numbers: Ccl reached 84% occupancy in q4 and averaged only 54% for all of 2022. The rooms reserved for covid don’t come into play- totally irrelevant. 

 

CCL had 91% occupancy in Q123 and predict 98% in Q2. They also predict 100% for all of 2023. I call BS on that too but time will tell.  Let’s revisit this thread at the beginning of next year. I won’t mind being wrong. 

 

 

“As Carnival CFO David Bernstein put it, "Full-year 2023 occupancy is expected to be 100% or higher”…..

 

 

 

 

Edited June 19, 2023 by BermudaBound2014

[Guest ldtr]

51 minutes ago, BermudaBound2014 said:

 

 

 

Don’t bother hunting. 
 

We all know that Carnival reached 100% during the Christmas and New years sailings (for 2 weeks).  
 

That’s entirely different than your first claim that Carnival reached 100% for Q4. If you can find documentation that Carnival reached 100% occupancy for Q4 I’ll be shocked.

 

Here are the numbers: Ccl reached 84% occupancy in q4 and averaged only 54% for all of 2022. The rooms reserved for covid don’t come into play- totally irrelevant. 

 

CCL had 91% occupancy in Q123 and predict 98% in Q2. They also predict 100% for all of 2023. I call BS on that too but time will tell.  Let’s revisit this thread at the beginning of next year. I won’t mind being wrong. 

 

 

“As Carnival CFO David Bernstein put it, "Full-year 2023 occupancy is expected to be 100% or higher”…..

 

 

 

 

Note the language   reach 100% IN Q4  I did not say reach 100% FOR Q4.  Which they did.

 

Just as in Q2 when they say optimistically   which in business terms can be translated to we hope or a stretch goal.

 

All depends was the denominator the total ship capacity or the available ship capacity.  The 10Q really did not say for all of the quarters during the restart.  

 

Edited June 19, 2023 by ldtr

[BermudaBound2014]

55 minutes ago, ldtr said:

Note the language   reach 100% IN Q4  I did not say reach 100% FOR Q4.  Which they did.

 

Now that deflection is actually funny- show me reach in your first claim 😉 

 

Edited June 19, 2023 by BermudaBound2014

[mowogo]

4 hours ago, dockman said:

I think AI will eventually take over most all of the reservations process eliminating most travel agents commissions as well as cruise line res agents.  With HD videos of every inch of every ship available at the click of a mouse and a virtual AI agent that can answer any and all questions as well or better than a human and provide virtual guided tours of the ships , recommendations as to best choices for rooms/dining/shore excursions etc it will eventually replace a lot of the humans that now provide this type of info....bean counters keep looking for places to cut expenses and agent commissions as well as cost of res agents is a huge expense.  Of course it will require a big investment by the cruise lines but done right it will change the way people book cruises.  And of course the cruise lines have email address of just about everyone who has ever cruised and can do massive promotions with the click of a mouse mailing.

The cruise reservation process is ripe for streamlining however they aren’t going to like the customer incentives they are going to have to offer to peel people away from the current system. New cruisers will easily shift to booking direct, but experienced cruisers are going to need incentives other than the lowest fare actually being able to be booked direct.  

 

[Guest ldtr]

1 hour ago, BermudaBound2014 said:

Now that deflection is actually funny- show me reach in your first claim 😉 

 

Yes they expected to reach occupancy for Carnival cruise line in the 4th quarter.  Which they did reach,  The projection occurred during 2022.  I did not say for the forth quarter.  As you admit they did reach 100% for the holiday season in the 4th quarter.

 

You also asked for proof that they reached 100% in the 4th quarter and that was the interview that I was hunting for.

 

I do not know how Carnival Cruise Line (not all the lines under Carnival Corp) did during the most recent quarter since I have not seen that mentioned. Only that they did reach 100% on their ships during the holiday period in Q4.

 

you seem to be repeating exactly what I said but seem to be assigning a different meaning.

 

 

Edited June 20, 2023 by ldtr

[BermudaBound2014]

7 minutes ago, ldtr said:

Yes they expected to reach occupancy for Carnival cruise line in the 4th quarter.  Which they did reach,  The projection occurred during 2022.  I did not say for the forth quarter.  As you admit they did reach 100% for the holiday season in the 4th quarter.

 

You also asked for proof that they reached 100% in the 4th quarter and that was the interview that I was hunting for.

 

you also asked

 

 

 

You just keep on doubling down my friend 😉 

 

If you want even more giggles, go back and read thru the conference calls to see how many other predictions fell short. And by short I mean "not even close". 

 

Entertainment purposes only.

Edited June 20, 2023 by BermudaBound2014

[dockman]

1 hour ago, mowogo said:

The cruise reservation process is ripe for streamlining however they aren’t going to like the customer incentives they are going to have to offer to peel people away from the current system. New cruisers will easily shift to booking direct, but experienced cruisers are going to need incentives other than the lowest fare actually being able to be booked direct.  

 

The experienced cruisers ultimately down the road will likely have no choice or if they want to book with a human they will pay a fee like many airlines now charge for human service...or maybe the cruise lines will initially offer a small discount or perk for booking direct as they save the agent cost.  And of course every year there are fewer and fewer older non tech cruisers and more and more tech savvy cruisers. 

 

Not same of course but just look at the growth of the self serve checkouts at places like costco/walmart etc...when they first opened them few seemed to use them as they preferred the human check out...now human checkouts are on a steady decline as more people have moved to self serve and down the road human checkouts will likely be few and far between.

[ontheweb]

12 hours ago, dockman said:

The experienced cruisers ultimately down the road will likely have no choice or if they want to book with a human they will pay a fee like many airlines now charge for human service...or maybe the cruise lines will initially offer a small discount or perk for booking direct as they save the agent cost.  And of course every year there are fewer and fewer older non tech cruisers and more and more tech savvy cruisers. 

 

Not same of course but just look at the growth of the self serve checkouts at places like costco/walmart etc...when they first opened them few seemed to use them as they preferred the human check out...now human checkouts are on a steady decline as more people have moved to self serve and down the road human checkouts will likely be few and far between.

It is extremely hard to use the non-self service check in when they are the only lines open for checkout!

 

And at least there is someone supervising that can help if a problem arises such as you accidentally scanned something more than once or you decided you did not want something as the price was much higher than you expected or to use coupons, etc.

Edited June 20, 2023 by ontheweb

[SJSULIBRARIAN]

Occupancy may be near 100%, bookings may be high, but are the cruise lines making any profit? Does Carnival mention that anywhere in its various reports, conversations,?

[BermudaBound2014]

57 minutes ago, SJSULIBRARIAN said:

Occupancy may be near 100%, bookings may be high, but are the cruise lines making any profit? Does Carnival mention that anywhere in its various reports, conversations,?

 

No cruise line has been able to turn a profit since Covid.

 

The only good news is that they are losing less money the first quarter of 2023 than they were in 2022 ;-). 

 

[Guest ldtr]

16 hours ago, BermudaBound2014 said:

 

You just keep on doubling down my friend 😉 

 

If you want even more giggles, go back and read thru the conference calls to see how many other predictions fell short. And by short I mean "not even close". 

 

Entertainment purposes only.

Of course prediction feel short, just as most of the companies listed in the S&P 500 had portions of their forecasts fell short at one time or another during Covid.  It was certainly as they put it an optimistic view.  

 

Keep focusing on conference calls, I never paid much attention to them, even when I was involved in some a few years ago.

 

Just to be clear  CCL did not average 54% occupancy for all of 2022 as you stated above.  The occupancy numbers were

 

FY

Q1 PCD 7.229  ALBD  13.322    54%

Q2 PCD  11,434  ALBD  16,666  69%

Q3  PCD 17,706  ALBD  21,015  84%

Q4  PCD 18.23   ALBD   21.497   85%

 

FY 2022  PCD 54.6    ALBD 72.5   75%

 

Note the amount of increase in the ALBD from Q1 to Q2 to Q3.  Covid restrictions ended in Q3  and the capacity remained pretty stable from Q3 to Q4.  

 

For comparison NCLH was at 72.8% for their FY 22

RCL was at 85.1%

 

Now CCL as a whole certainly has lagged occupancy compared to RCL but one should look at that in comparison with the structure of the two businesses.

 

It is pretty well known that the North American (NA) cruise market recovered the fastest, the EU a little bit slower, Asia, Australia and New Zealand (AANZ) quite a bit slower

 

It also seems that family focused brands recovered faster than Adult focused brands

 

If one looks at CCL and all of its brands and categorize them

 

Carnival   NA  Family   30%

Princess  NA  Adult   18%

HAL  NA Adult      9%

Seabourn NA Adult   1%

 

P&O Australia   AANZ   Mixed    3%

Costa  Europe  Family         16%

AIDA  Europe   Family     13%

P&O UK   Mixed     7%

Cunard  UK  Adult    3%

 

 So CCL has only 30% of its capacity  in the NA focused family market  28% is in the NA Adult focused   and  42% of its capacity is focused on sales in other regions.

 

If you look at RCL and its brands

 

Royal Caribbean  NA Family  61%

Celebrity  NA  Adult                23%

Silver Sea NA Adult               3%

 

TUI  Europe                     11%

Hapag Lloyd  Europe         1%

 

It has 61% of its Capacity in the NA family business,  26% in the NA Adult business  and only 12% in Europe and none in  Asia, Australia and New Zealand

 

Not surprising when looking at where the business focus is that RCL is recovering capacity a bit faster.

 

NCLH is even more concentrated on the NA family market with all of its brands NA focused.

 

 

Edited June 20, 2023 by ldtr

[Guest ldtr]

2 hours ago, SJSULIBRARIAN said:

Occupancy may be near 100%, bookings may be high, but are the cruise lines making any profit? Does Carnival mention that anywhere in its various reports, conversations,?

All of the major holding companies are still showing a loss.  However all of them were cash flow positive on operations in their last filings.  CCL was about 150 million from being cash flow positive in total in the last filing.  I look at cash flow positive as the milestone because it means that they are generating cash after paying on the debt.  Approximately 500 million of their loss last quarter was depreciation which is paper write downs on money spent in the past on capital acquisitions.

[QuestionEverything]

Assume a downgraded ship board experience for many years. 

 

[Roz]

4 minutes ago, QuestionEverything said:

Assume a downgraded ship board experience for many years. 

 

 

As a paying customer I refuse to accept this. 

[Guest ldtr]

11 minutes ago, QuestionEverything said:

Assume a downgraded ship board experience for many years. 

 

I have found during the past few months  have been pretty much the same as pre covid on the 3 lines i have been on. Occupancy back up, ships fully staffed, entertainment back. A few changes from 2019 but really about the same as one saw during any 3 year period pre covid.

 

Considerably better than earlier in the restart.

[OlsSalt]

Two days ago, 6/18/23, The Motley Fool explains why they are bullish about CLL:

https://www.fool.com/investing/2023/06/18/up-over-90-year-to-date-why-carnival-stock-remains/

[HappyInVan]

59 minutes ago, ldtr said:

CCL was about 150 million from being cash flow positive in total in the last filing.  I look at cash flow positive as the milestone because it means that they are generating cash after paying on the debt.  Approximately 500 million of their loss last quarter was depreciation which is paper write downs on money spent in the past on capital acquisitions.

 

Strictly speaking, positive cash flow occurs only after all expenses have been paid, and repayment made on maturing loans.

 

The first quarter tends to be a strong period because of the holiday season. So, a big reduction in net loss is encouraging. But, CCL has to brace for the shoulder seasons. 

 

In any case, the first quarter was profit and cash positive at the operating level, but not sufficient at the corporate level.

 

You don't need to look at the accounts to understand the perilous state of the industry. Everyone is offering discounts and promotions. The industry has expanded capacity in anticipation of years of high growth. After the pandemic, that growth has not met expectations. 

 

The good news is that the industry has not gone into an all-out price war. That would be mutually assured destruction. Instead, the industry has replied on higher onboard spending, and discrete gifts of OBC. 

 

So expect high excursion prices, and drink prices will be raised above drink packages cut-off limits.

 

HAL's problem is that despite $1 deposits and HIA promotions, prices are still at or BELOW pre-pandemic levels. HAL is struggling to hold on to its customer base. This is a branding problem.

 

That is why I am in favor of CCL selling HAL to a white knight who can re-brand HAL and rebuild the quality that HAL was known for.

 

Hope this helps.