RCL Stock

[RoyalC]

It expects 80% of its capacity to be in service by 2021 end and turn cash-flow positive in about six months.

 

You are kidding, right? They just canceled their cruises. 80% capacity means 80% of ALL ships will be 80% full on average.  Cash-flow positive in 6 months? 100% false and everyone knows it and this should be investigated. Management is a total disaster! Every day it is something new with them- they will file BK and reorganized. No way they get out of this anymore.  

[John&LaLa]

18 hours ago, Jimbo said:

We need to pipe in some Bird sounds when "Fain" speaks.................just like he is still in his garden at home and never left.

 

Cricket noise from Central Park

[John&LaLa]

17 hours ago, At Sea At Peace said:

It's possibly a bit disingenuous to infer that a # of ships divided by the total # ships in fleet is the real 'back to capacity data.'  It would have been more appropriate to include the % of capacities per ship and for the whole fleet and then report the actual 'back to capacity data.'

 

But the larger ships are going back first

[John&LaLa]

7 hours ago, RoyalC said:

It expects 80% of its capacity to be in service by 2021 end and turn cash-flow positive in about six months.

 

You are kidding, right? They just canceled their cruises. 80% capacity means 80% of ALL ships will be 80% full on average.  Cash-flow positive in 6 months? 100% false and everyone knows it and this should be investigated. Management is a total disaster! Every day it is something new with them- they will file BK and reorganized. No way they get out of this anymore.  

 

In service doesn't mean full berths, just that 80% of its berths will be sailing by end of year.😉

[At Sea At Peace]

32 minutes ago, John&LaLa said:

 

But the larger ships are going back first

 

That could help the % of fleet capacity currently deployed and the schedule ahead by month.  That's the data I believe would be more indicative 'resumption status' than # of ships divided by total ships in the fleet.

[John&LaLa]

23 minutes ago, At Sea At Peace said:

 

That could help the % of fleet capacity currently deployed and the schedule ahead by month.  That's the data I believe would be more indicative 'resumption status' than # of ships divided by total ships in the fleet.

 

3 big girls have more berth capacity than the entire Vision and Radiance class

[Baron Barracuda]

Don't confuse earnings with cash flow.  Assuming covid doesn't worsen don't believe cash flow positive in 6 months is unrealistic.  Cruise lines benefit from a positive float where the bulk of their cash receipts (deposits and final payments) arrive months prior to sailing while some expenses aren't paid until well afterwards.  Once most of RCG's fleet is available for booking (and the 2024 schedule opens up) cash should come rolling in.  They can also temporarily improve their cash flow situation by deferring capital expenditures and modifying debt maturities.

[Biker19]

From the 10Q report released yesterday:

 

Overall booking volumes have improved, and pricing remains strong. During the second quarter of 2021, we received about 50% more new bookings compared to the first quarter of 2021, with trends improving from one month to the next. By June, we were receiving about 90% more bookings each week when compared to the first quarter of 2021, with improvements of a similar magnitude for both 2021 and 2022 sailings.

 

Overall, the booking activity for 2021 sailings is consistent with our expected capacity and occupancy ramp up, at prices that are higher than in 2019. While it’s too early to make any definitive conclusions of the impact of the Delta variant on bookings, we have seen a modest impact on closer-in bookings. However, 2022 continues to remain strong; in particular the spring and summer months are performing well.

[Biker19]

A somewhat interesting table from the 10Q:

 

[Biker19]

Some more debt to retire older debt:

 

On August 11, 2021, Royal Caribbean Cruises Ltd. (the “Company”) issued a press release announcing that it has priced its private offering of $1,000,000,000 aggregate principal amount of 5.500% senior unsecured notes due 2026 (the “Notes”). The Notes are expected to be issued on or around August 19, 2021. 

 

The Company intends to use the proceeds from the sale of the Notes 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.

 

 

[DirtyDawg]

14 minutes ago, Biker19 said:

Some more debt to retire older debt:

 

On August 11, 2021, Royal Caribbean Cruises Ltd. (the “Company”) issued a press release announcing that it has priced its private offering of $1,000,000,000 aggregate principal amount of 5.500% senior unsecured notes due 2026 (the “Notes”). The Notes are expected to be issued on or around August 19, 2021. 

 

The Company intends to use the proceeds from the sale of the Notes 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.

 

 

That will save them some money in interest costs but 5.5% for 5 year notes is pretty steep. I think the debt rating agencies have them rated a B2 - speculative and a high credit risk.

 

 

[At Sea At Peace]

If the current variant continues to play out across the country and globe, followed by the now identified next variant purported to be vaccine-resistant, it really doesn't look like any of the cruise lines can sustain another year.

[Jimbo]

1 hour ago, At Sea At Peace said:

If the current variant continues to play out across the country and globe, followed by the now identified next variant purported to be vaccine-resistant, it really doesn't look like any of the cruise lines can sustain another year.

Don't say that , members on here don't want to hear about stuff like that. Debbie Downer !!

[DirtyDawg]

11 minutes ago, Jimbo said:

Don't say that , members on here don't want to hear about stuff like that. Debbie Downer !!

LOL. Many members on CC prefer their glasses rose coloured. 😉

Edited August 13, 2021 by DirtyDawg

[Ocean Boy]

4 hours ago, At Sea At Peace said:

If the current variant continues to play out across the country and globe, followed by the now identified next variant purported to be vaccine-resistant, it really doesn't look like any of the cruise lines can sustain another year.

 

3 hours ago, Jimbo said:

Don't say that , members on here don't want to hear about stuff like that. Debbie Downer !!

I hate to say it but I've had similar thoughts. It seems like more restrictions aboard the ships keep getting put in place daily. How long are people, other than absolute die hards, going to put up with it?

[Dennis#1]

15 hours ago, Ocean Boy said:

 

I hate to say it but I've had similar thoughts. It seems like more restrictions aboard the ships keep getting put in place daily. How long are people, other than absolute die hards, going to put up with it?

With the added/increased restrictions for cruising getting put in place, we are considering alternate vacation options.

[alexgtp]

If your not swing trading this, your doing it all wrong LOL. (I am not a financial advisor, just an avid cruiser and day trader)

 

Their pattern has become so reliable. This has become my replacement for old reliable MU.

Look at the 1 month 4 hour chart' for confirmation.

 

And yes I still keep a good amount of RCL and NCLH for long term exposure.  Especially when i can get the OBC for just owning the stock.

 

 

 

[alexgtp]

And just like clockwork shares drops and goes way back up. This time with an astonishing $5-$7 per share up because of FDA vaccine approval. Love catalysts. 

 

this is the 5 day 30 min ticker for reference. (not financial advice)

[Biker19]

“The future looks very positive for us and the industry,” commented Richard Fain, CEO and chairman of the Royal Caribbean Group, on Friday's third quarter earnings call.

“Today, we are operating almost normally,” he continued, “and we have restarted in a financially and medically prudent manner. The booking trend for 2022 is very encouraging, especially from the summer onward.”

 

Jason Liberty, CFO and executive vice president, added that 2023 is also seeing a strong booking trend that is stronger this far ahead than in previous years. “We are seeing similar trends across all of our brands,” he said, attributing it partially to pent up demand combined with marketing.

 

The recently announced world cruise for Royal Caribbean International has also been a success, according to Michael Bayley, president and CEO of the brand, who said it was 70 percent booked within seven days at rates that averaged $70,000 for a balcony cabin for the nine-month sailing.

 

“(So far) the (guest) satisfaction level has been very high, and the onboard spending has been unparalleled,” Fain continued. And, having carried some 500,000 passengers so far this year, he said the ships have only had 150 positive (COVID) cases.

 

Liberty added that the onboard spending has also been drive by increased volumes of groups, including gaming groups. He said that the pre-cruise revenue for 2022 was way up from 2019.

 

By spring, the company expects to have all of its ship in service and to be cash positive while returning to profitability for the full year of 2022.

 

Fain also commented on China which is not expected to open up for cruising until after the

(winter) Olympic Games, while Australia is not expected to open until spring. Both are important markets for Royal Caribbean.

 

In terms of other challenges, Fain said that he was not concerned with labor shortages in the hospitality industry, noting that the cruise industry offers more attractive job opportunities in their labor markets, and in terms of supply chain issues, Royal Caribbean is hedged in many areas going forward.

 

Initiatives have also helped the company reshape its cost structure, according to Liberty, including replacing older ships with new and more efficient tonnage.

 

In other developments, Royal Caribbean has also begun to reengage in destination development. Bailey noted the private beach club being developed in Nassau in addition to an extension at Perfect Day, the Hideaway Beach for adults, which will increase that destination’s capacity by another 3,000 passengers per day. The new Galveston terminal is also slated to be open in 2022. It will be able to accommodate Oasis class ships as well as the new Icon class, he said.

 

Royal Caribbean CEO Fain on Earnings Call: Almost Back to Normal - Cruise Industry News | Cruise News

[Biker19]

There may be slim pickings for individual segments for the World Cruise by Dec 1.

[Biker19]

How full are Royal Caribbean Group's cruise ships?

 

The company reported on Friday that ships in its core deployment regions in the third quarter saw a load factor of 44 percent occupancy.

 

Despite the low load factor, the company said that those ships were cash flow accretive excluding start-up costs.

 

Total revenue per passenger cruise day was up 12 percent versus record levels saw in 2019 based on strong onboard revenue performance. 

 

The company said in its third quarter earnings release it hopes to ramp up to load factors of 65 to 70 percent during the fourth quarter, and expects ships in the fourth quarter will be cash flow accretive even when including start-up costs.  

 

By the end of the year, the company expects that 50 out of 61 ships will have returned to service, representing almost 100% of core itinerary capacity and approximately 80% of worldwide capacity. 

The remaining ships are expected to return by the spring of 2022 and return to historical load factors in the third quarter 2022.

 

Royal Caribbean's Ships: 44 Percent Full in Q3 But Cash Flow Accretive - Cruise Industry News | Cruise News

[Biker19]

Royal Caribbean Group today reported financial results for the third quarter of 2021 and provided business updates.

 

The company said has worked aggressively to restart its vessel operations. This process is proceeding at a strong pace with two-thirds of the fleet operating. The Delta-Dip caused a delay in the booking progress but did not alter the strong fundamental trajectory, according to a press release.

 

Key Highlights include:

• Over 500k guests sailed across five brands since the restart of operations; over 1 million guests expected by year end.
• By the end of this year, the Group anticipates that 50 out of 61 ships will have returned to service across its five brands, representing almost 100% of its core itineraries and approximately 80% of worldwide capacity.
• Sailings for 2022 are booked within historical ranges and at higher prices than 2019, even when including future cruise credits (FCCs).
• Guest satisfaction scores and onboard spending per passenger are both at the highest levels in the company's history.
• The Group expects to be cash flow positive by spring and profitable for the full year 2022.
• Constructive dialogue with the CDC leading to the end of the prescriptive CSO in January.

Third Quarter 2021

The company reported US GAAP Net Loss for the third quarter of 2021 of $(1.4) billion or $(5.59) per share compared to US GAAP Net Loss of $(1.3) billion or $(6.29) per share in the prior year. The company also reported Adjusted Net Loss of $(1.2) billion or $(4.91) per share for the third quarter of 2021 compared to Adjusted Net Loss of $(1.2) billion or $(5.62) per share in the prior year. The Net Loss and Adjusted Net Loss for the third quarter of 2021 are the result of the continued impact of the COVID-19 pandemic on the business.

 

Since the last business update, 11 additional ships have returned to service.

As of today, 40 ships from the company's five brands, or approximately 65% of its capacity, have resumed sailing.

 

The company is thoughtfully returning ships into operations at reduced load factors and slowly building to ensure health and safety, a world class guest experience, and financial prudence.

 

Richard Fain, Chairman & CEO said: "We want to show, in a tangible way, the safety and simplicity of cruising. Our strategy continues to focus on getting the flywheel spinning smooth and fast, so that as we turn the year we will enjoy a stable and predictable platform with which to start the WAVE Period."

The ships that operated the Group's core Caribbean, Alaska, and Europe itineraries in the third quarter achieved a load factor of 44%.

 

Core itineraries exclude sailings during the early ramp-up period of up to four weeks and also exclude specialized itineraries implemented during the COVID period (e.g., Singapore, Cyprus). Total revenues per Passenger Cruise Day in the third quarter was up 12% versus record 2019 levels driven mainly by strong onboard revenue performance. Ships in core itineraries in the third quarter were cash flow accretive excluding start-up costs.

 

"On October 25, 2021, the United States CDC issued a temporary extension of the Conditional Sail Order through January 15, 2022. Thereafter, the CDC has expressed its intention to transition to a voluntary program, in coordination with interested cruise ship operators," said Fain. "We are very pleased with the continued and constructive partnership with the CDC and the U.S. government's COVID-19 interagency group. This is a great example of how close collaboration between the cruise industry and the CDC results in health and safety protocols that have demonstrated cruising can be one of the safest forms of vacation," Fain continued.

 

Continued Fleet Ramp-Up

The Group anticipates load factors on core itineraries to ramp to 65-70% during the fourth quarter. 

The company anticipates 6.9 million APCDs for the fourth quarter with overall load factors of 60-65%. 

The Group expects all ships on core itineraries in the fourth quarter will be cash flow accretive even when including start-up costs.  

 

By the end of the year, the Group expects that 50 out of 61 ships will have returned to service, representing almost 100% of core itinerary capacity and approximately 80% of worldwide capacity. 

The remaining ships are expected to return by the spring of 2022 and return to historical load factors in the third quarter 2022.

 

Mainland China is expected to resume in the spring and the the company has assumed lower load factors as this important long term market ramps up.

 

Update on Bookings

Booking volumes have improved significantly since the slowdown this summer due to the Delta variant (the '"Delta Dip").  The company attracted more bookings in the third quarter compared to the second quarter.  September was particularly strong, with new bookings for 2022 sailings more than 60% higher than the monthly average during the second quarter.

 

Sailings for the full year 2022 are booked within historical ranges and at higher prices than 2019. Sailings further out are experiencing more normalized booking trends than sailings closer in. As such, load factors for sailings in the first quarter 2022 are lower than historical levels; are improving but still below average in the second quarter; and are solidly within historical levels in the second half. Pricing remains strong throughout 2022, with or without FCCs.

 

"As cases have come down, demand has come surging back.  Consumers are showing their resilience and desire to vacation, and the growing affinity of Royal Caribbean's leading brands, ships and crew. Although there are many uncertainties going forward regarding COVID-19, as well as cost and supply chain pressures, we continue our pathway forward and anticipate positive cash flow for the Group by spring of 2022 and generating positive earnings for the full year 2022," said Jason T. Liberty, Executive Vice President and CFO.

 

As of September 30, 2021, the company had approximately $2.8 billion in customer deposits.  The comparable figure for the three brands at the same time in 2019 was $3.1 billion. This represents an improvement of about $400 million over the past quarter despite the $300 million of revenue that was recognized during the quarter.   Approximately 35% of the customer deposit balance is related to FCCs compared to 40% in the prior quarter; a positive trend indicating new demand.  Customer deposits for second quarter 2022 forward sailings are higher than at the same time in 2019.

 

Liquidity and Financing Arrangements

As of September 30, 2021, the company's liquidity was approximately $4.1 billion, including $3.3 billion in cash and cash equivalents, $0.1 billion of undrawn revolving credit facility capacity, and a $0.7 billion commitment for a 364-day facility.

 

The Group continues to take steps to improve its balance sheet and reduce its interest costs.  During August we redeemed 40% of the 11.5% senior secured notes and issued senior unsecured notes at 5.5%.  These transactions are expected to result in annual interest savings of $51 million.

 

As of the date of this release, there are no scheduled debt maturities for the remainder of 2021 and $2.2 billion in scheduled debt maturities for 2022.

 

Net interest expense for the fourth quarter of 2021 is expected to be in the range of $250-255 million.

 

Capital Expenditures and Capacity Updates 

Based upon current ship orders and delivery schedules, the projected capital expenditures for the remainder of 2021 are $600 million. The company expects the delivery of Silver Dawn to the Silversea fleet during the fourth quarter, which has committed financing.

 

Depreciation and amortization expenses for the fourth quarter of 2021 are expected to be in the range of $325-330 million. 

 

In 2022, the company has two ship deliveries scheduled, both with committed financing: Wonder of the Seas and Celebrity Beyond. 

 

Fuel Expense

As of September 30, 2021, the company had hedged approximately 51%, 32% and 5% of its total projected metric tons of fuel consumption for the remainder of 2021 and for all of 2022 and 2023, respectively.  For the remainder of 2021 and for all of 2022 and 2023, the annual average cost per metric ton of the fuel swap portfolio is approximately $439, $493, and $580, respectively.  As of the date of this release and following the execution of additional hedges, the company is 53% hedged for all of 2022 at an average cost per metric ton of $502.

 

Royal Caribbean Reports 2021 Q3 Earnings - Cruise Industry News | Cruise News

[Baron Barracuda]

41 ships back at sea for at least part of the quarter operating at 44% loads produced revenue of $500 million vs basically $0 last year.  Yet the bottom line loss for the quarter was greater than 3q '20.  Implies very high re-start costs or maybe ship break-evens are higher than Jason Liberty previously estimated.  

 

Also noted that despite issuing $1.6B in stock this year stockholders equity has dropped to $6.5B from $8.8B a/o year end 2020.  Hopefully Fain is correct in predicting company will be cash flow positive by next spring and will actually earn a profit for the year.

[At Sea At Peace]

22 hours ago, Biker19 said:

 

As of September 30, 2021, the company had approximately $2.8 billion in customer deposits.  

 

Liquidity and Financing Arrangements

As of September 30, 2021, the company's liquidity was approximately $4.1 billion, including $3.3 billion in cash and cash equivalents, $0.1 billion of undrawn revolving credit facility capacity, and a $0.7 billion commitment for a 364-day facility.

 

 

 

Customer deposits are the lifeline of the liquidity.  At $2.8 billion of customer deposits out of the $3.3 billion in cash is 85% of Royals' liquidity.

[DirtyDawg]

RCL stock down 10% this morning in pre-market trading (CCL too). The new South African Covid variant is causing lots of volatility in the global equity markets. 

 

Could be Red Friday in equity markets today.