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Everything posted by philipb

  1. From the Wall Street Journal this past week, they had a press release with this headline: “Royal Caribbean Group announces proposed offering of senior unsecured notes” and these highlights: "Royal Caribbean today announced that it has commenced a private offering of $1,000,000,000aggregate principal amount of senior unsecured notes due 2026. The Company intends to use the proceeds from the sale for general corporate purposes, including the replenishment of capital as a result of the up to 40% redemption of its 11.500% Senior Secured Notes Due 2025 and the refinancing of future debt maturities.” Who on earth would subscribe to these 'junk' bonds? It just goes to show that lessons from previous financial disasters have still not been learned. I am thinking of all that sub-prime lending a decade and more ago which resulted in the financial crash of the late 2000s.
  2. It is interesting that the re-fit is now being done in Poland, and I suspect this was a decision made on cost grounds. Well, at least it is being done after two (or is it three?) postponements due to the pandemic. I hope that the refurbishment is up to the standards employed when Silver Cloud was re-fitted. We thoroughly enjoyed our three expedition cruises on her in 2018 and 2019. They were unmissable experiences!
  3. The RCCL share price currently prices in a full recovery to profitable trading. Way too optimistic in my view. The current stockmarket capitalisation of RCCL is $18.5bn. The balance sheet value at 30 June 2021 was $7.9bn according to RCCL's latest press release. If the shares traded at net asset value they would be around $30 - not $71. As an investor I would steer well clear of investing in any of the 3 major cruise operators.
  4. But unlike governments, there is a limit to how much an ailing business can borrow. This is how I think it could play out: The re-start of mainstream cruising will continue to be delayed in 2021 to the point where the 'Big 3' cruise companies no longer have sufficient working capital to remain afloat. The 'cash burn' will continue and we could see the big corporations filing for bankruptcy (in whichever jurisdiction they may reside). In this event, the secured lenders will either convert their debt for equity (wiping out existing shareholders in the process) or sell their secured assets (principally the ships) to the private equity investors who will be circling like vultures. Newer ships will survive under new ownership (possibly using existing trading names to retain passenger loyalty) and older tonnage will go for scrap to the beaches of Turkey, India or wherever. The industry will shrink, as a result. As regards newbuilds, the new investors can either renegotiate existing contracts or walk away depending on how the numbers stack up. To be left with a half-built ship is not an attractive proposition for the shipbuilder and so again the new investors will have bargaining power. In all of these scenarios existing shareholders are likely to end up with little or nothing. Terry - you might like to bookmark this post and come back to it on 31 December 2021 and see how much of my analysis has proven correct!
  5. Well, now we have it. The re-fit is deferred yet again (I imagine because of the cost considerations) and the Wind schedules do not appear to begin until November.
  6. If RCCL does go bust might just Manfredi Lefebvre be standing by ready to re-acquire Silversea? There's a thought. In the meantime, back to the topic of this thread. I think the Spring '21 conversion (or delay thereof) of Silver Wind will be an acid test of just how strained the finances are at RCCL.
  7. A perfect summation of the situation which echo my thoughts exactly. The problem then becomes how long the major cruise companies can survive. Their currently stressed balanced sheets could reach breaking point in the second half of 2021. At which point the vultures will circle.
  8. Silver Moon's formal handover took place yesterday. Such a pity she has nowhere to go (with passengers, that is). https://www.cruisecritic.co.uk/news/5697/
  9. As the months pass I cannot see the Silver Wind refit happening in Q1/Q2 2021, purely on financial considerations.
  10. Australia is rightly being very cautious.
  11. I had forgotten the expression 'Ponzi scheme' but you are absolutely right in your assessment (as Is Mr Jim Walker). "It will all end in tears", as the saying goes. The Wall Street analysts are ignoring the Elephant in the Room!
  12. I think we shall continue to see month-by-month cancellations by SS and the other cruise lines and that mid-2021 is the absolute earliest that cruising might re-commence. Rather a lot hangs on the spread of Covid-19 in the Northern Hemisphere winter, and how long the cruise lines can survive financially. And, of course, whether a vaccine comes on-stream.
  13. It looks like the Red Sea charter cruises may be underway again. Silver Spirit left King Abdullah Port at 19.27 on 17 September since when she has been to somewhere up the coast called Ar Rayis. The ship is now southbound again and due back at King Abdullah at 06.00 Sunday (source: Marine Traffic). It is stinking hot in the Red Sea at this time of year with temperatures relentlessly in the high 30s. I feel so sorry for the poor crew. It must be ghastly.
  14. It's simply to preserve cash for as long as possible, before having to make refunds. No other reason.
  15. The prospect of the three major cruise companies surviving is looking increasingly remote. Their balance sheets are under considerable strain.
  16. I feel so sorry for the poor crew. Are they confined to the ship? I cannot imagine that shore leave will be possible for them. Or am I wrong?
  17. Not a good start. I hope the passengers on these cruises treat the crew with the civility they are used to from Westerners.
  18. Sorry Terry, my ham-fisted typing (and poor eyesight - currently awaiting eye surgery to replace lens in my left eye, next month!)
  19. Sorry mis-typed date which should read 2021 not 2022
  20. Cunard suspends all sailing plans before March 2022: https://www.bbc.co.uk/news/uk-england-hampshire-53904221 I expect other major cruise lines to follow suit.
  21. The UK National Debt stands at £1.8 trillion. The market cap. of Apple is $2.15 trillion (equals £1.64 trillion). So if the UK government owned Apple it could pay off our National Debt. In full. How extraordinary is this?
  22. If you give at least 120 days notice you get a full refund minus £130 (in the UK) administration charge.
  23. Yes, we booked way back in 2019 when money lent to Silversea seemed as good as money in the Bank. How times change!
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