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Cause for cautious optimism?


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10 hours ago, Ravbo said:

If cruising doesn't resume from the US until summer 2021 I don't think ANY of the cruise lines will survive.

 

You might be right specially because cruisers are panicked and asking for refunds instead of rebooking. This is contributing to the difficulties of cruise lines. 
Ivi 

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6 hours ago, travelberlin said:

You might be right specially because cruisers are panicked and asking for refunds instead of rebooking. This is contributing to the difficulties of cruise lines. 
Ivi 

I'm not sure "panicked" is the right definition of us requesting refunds. In my case, I just want my money, and if I pay more when I eventually book, so be it. Having the money in hand gives me options of whom to travel with. As I've mentioned in another post, my $500 admin fee/FCC for cancelling a Crystal cruise is essentially gone, since I can't imagine ever dealing with Crystal again.

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Apparently there are many lines where future bookings are strong.

Crystal is not one of them -- likely because there is a fear that Crystal will not remain in business.

I have future bookings and I am not cancelling but I will rely on my credit card company to make good on my losses if the line goes bankrupt.

 

None of us knows where this is going.

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40 minutes ago, bitob said:

Apparently there are many lines where future bookings are strong.

Crystal is not one of them -- likely because there is a fear that Crystal will not remain in business.

I have future bookings and I am not cancelling but I will rely on my credit card company to make good on my losses if the line goes bankrupt.

 

None of us knows where this is going.

How do you know that “Crystal is not one of them?”

Edited by TRIPACIAN
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There has been a good deal of news from Carnival, RCC and Norwegian about strong future bookings.

Crystal has been remarkably silent on the issue.

Who is going to book a cruise on a line that has publicized it is in financial trouble?

My understanding is that Crystal is not even taking deposits for new bookings unless you have a FCC.

Everyone I know who is a loyal Crystal cruiser -- without exception -- is asking for money back, not putting money in.

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Wish that Crystal would duplicate the Celebrity's "Lift and Shift" program which allows you to switch dates for the same cruise at the price you paid. Pretty sure that my Panama Canal cruise will be cancelled and they offer the same cruise the following year. Would switch in a minute! I'm looking at other alternatives as well. I have confidence that Crystal will survive in one form or another.

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I just posed the question of Crystal's survival to my very well connected TA.  He owns the company -- a huge internet booking company  -- and has been in the cruise business for decades.  

 

His answer was not a happy one.    He is not confident about Crystal's future and is NOT advising clients to make new bookings.   Crystal is not taking money from anyone.  You can book with no deposit at all for 90 days.  I have asked his permission to post the full contents of his email to me without attribution.   Waiting for an answer.

 

 

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2 hours ago, Life Buoy said:

Wish that Crystal would duplicate the Celebrity's "Lift and Shift" program which allows you to switch dates for the same cruise at the price you paid. Pretty sure that my Panama Canal cruise will be cancelled and they offer the same cruise the following year. Would switch in a minute! I'm looking at other alternatives as well. I have confidence that Crystal will survive in one form or another.

 

That's relatively easy for a company that does repetitive "loops" throughout their schedule.

 

Crystal, OTOH, may or may not have the same itinerary in a coming year.  Sure, some of the Med and New England trips may be the same, but a large number aren't.  If Crystal did this, there would be lots of friction with it applying to some cruises and not others.

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Here is a snippet of what my TA told me -- I edited it a bit -- these are the basics

 

As for Crystal, I am not confident about their future. The product is highly desired by clients so I do think it would be smart by the Chinese Government to bail them out. Based on the older ships and just a couple of river ships and yacht – those don’t pay the bills without going full. Too many Chinese run companies have gone foul over the last few years, and I am talking outside the cruise industry.  The challenge with any cruise line is no one is buying ships as an asset. Crystal has damaged the trust factor with their clients, so to be extra cautionary they should put funds in an escrow until the sailing occurs. We are not advising on new bookings, but with Crystal they let you confirm a new booking with $0 deposit for 90 days. So, I guess the next 90 days they either restructure or close down. At least you are safe with a credit card deposit.

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7 hours ago, bitob said:

Here is a snippet of what my TA told me -- I edited it a bit -- these are the basics

 

As for Crystal, I am not confident about their future. The product is highly desired by clients so I do think it would be smart by the Chinese Government to bail them out. Based on the older ships and just a couple of river ships and yacht – those don’t pay the bills without going full. Too many Chinese run companies have gone foul over the last few years, and I am talking outside the cruise industry.  The challenge with any cruise line is no one is buying ships as an asset. Crystal has damaged the trust factor with their clients, so to be extra cautionary they should put funds in an escrow until the sailing occurs. We are not advising on new bookings, but with Crystal they let you confirm a new booking with $0 deposit for 90 days. So, I guess the next 90 days they either restructure or close down. At least you are safe with a credit card deposit.

 

Is Crystal a "Chinese" company? It is my understanding (but I could be wrong), that Genting Hong Kong was established when the British still "owned" Hong Kong. The "owner" of the whole Genting empire is Malaysian, but is ethnically Chinese. Either this person doesn't know what they are talking about or we have been "mislead" about Genting.

 

Patty

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Genting is a corporate entity listed on the Hong Kong stock exchange.  How things might play our with the Chinese government is a really open question.  If there were to be any Chinese government bailout, in my opinion, it would likely would involve either Genting or maybe its Dream cruises and Star cruises subsidiaries as both of those entities are focused on the Asian market.  Two of the Star cruises ships are listed for sale at $150 million each (the Acquaris and the Gemini) so it might be that the Genting folks are focused on saving Dream cruises more than Star.  They sold 35% of Dream in 2019 (see attachment), Dream has newer ships, has a build in the Genting shipyards and likely to get the financing they are seeking from the German government they will have to commit - on some timetable - to continue with that build if not also the Endeavor.  Obviously this is all pure speculation so please take it as such.  With regard to Crystal, it remains a California LLC  (you can see this on the CA Sec of State website) and as best I can tell it also remains an "indirect" subsidiary of Genting. The indirect designation likely means that there are some other intervening corporate entities upstream from Crystal in the corporate structure which are downstream from Genting.  The corporate structure is likely are real maze and I have not been able to fine any chart showing how things are structured.  All of that said there don't appear to be any publicly available financials for Crystal on a standalone basis although I suspect they certainly have internal financials like they shared for Zouk in connection with the sale.  This is a quote from the annoucment of the purchase of Crystal, "As a result of Completion, Crystal Cruises has become an indirect wholly-owned subsidiary of the Company. Accordingly, the financial results of the Crystal Group Companies are to be consolidated
into the consolidated financial statements of the Enlarged Group".

 

Is Crystal as an individual entity solvent?  Who knows.  And of course if it is short of cash one way or the other,  Genting could always downstream money by extending a loan or other means.  That is all within their ability.  However, I kind of suspect that Genting is a bit short of cash all around so they might not be down-streaming it to Crystal.  The last financial report noted about $398 million in cash and $408 million in liquidity which means their remaining credit line at the group level which includes the cruise and shipyard operations at that time was only about $10 million.  Things could have changed and they did raise a bit of cash with the sale of Zouk but not much.

 

I can only say hope springs eternal.  We are booked on the 2022 world cruise out of LA and sure hope Crystal makes it and we are out of the woods on Covid 19 by then.  We will see.

Sale of Dream Cruises Stock.pdf

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21 minutes ago, H2O Polo Willie said:

 

 

I can only say hope springs eternal.  We are booked on the 2022 world cruise out of LA and sure hope Crystal makes it and we are out of the woods on Covid 19 by then.  We will see.

Sale of Dream Cruises Stock.pdf 250.08 kB · 0 downloads

We are also booked on the 2022 world cruise and we WILL SEE YOU then!!  
 

Positive thinking works according to all of the motivation speakers!!

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We are also booked on the 2022 World Cruise, and hope to meet all of you then.  I do hope that Crystal survives.  We applied some FCCs to the 2022 WC, and we also have refunds still pending from other bookings that were cancelled, so we have a significant financial interest in Crystal's well being as well as a desire to enjoy sailing again on a Crystal ship.

 

I understand about Crystal being owned by Genting HK but isolated from it by at least one and possibly several organizational layers.  As I understand it, now that China has said they have complete control over Hong Kong, that Genting HK is indeed a Chinese company.  I don't understand how one could look at it any other way, and I don't think that means that we have been misled by Genting.  We (the entire world) have been misled by the Chinese government, though.  This in itself makes me nervous for the future of Crystal, above and beyond COVID, refunds, etc.

 

I agree with H2O Polo Willie that if the Chinese government steps in in any way it would be to the benefit of Genting HK and/or Dream Cruises, but much less likely to the benefit of Crystal.  On the other hand, Crystal may be the next portion of Genting HK that would be most easily sold off to someone else, almost certainly it is among their cruise lines.  That would undoubtably bring changes.  But changes are coming even without a buy-out, most likely not for the better, at least compared with what it looked like in 2019.  Looking at the big picture, it might be better in the long run for Crystal not to be part of Genting HK.  

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38 minutes ago, SusieQft said:

On the other hand, Crystal may be the next portion of Genting HK that would be most easily sold off to someone else, almost certainly it is among their cruise lines.  That would undoubtably bring changes.  But changes are coming even without a buy-out, most likely not for the better, at least compared with what it looked like in 2019.  Looking at the big picture, it might be better in the long run for Crystal not to be part of Genting HK.  

 

I agree wholeheartedly that having Crystal not being a part of Genting would be a good thing and that changes are on the horizon one way or the other.  Without the financials, it is hard to tell what is really left in Crystal Cruises, LLC.  When they bought Crystal they paid $550 million in 2015.  From the purchase agreement there was a restructuring that put the Symphony and the Serenity into SPVs (Special Purpose Vehicles) which are owned by Crystal (the notice states "Crystal Cruises wholly-owns ICMA and, as a result of completion of the Restructuring and Completion, wholly-owns (i) ICSL; and (ii) Symphony SPV and Serenity SPV, which are the legal and beneficial owner of the vessels, Crystal Symphony and Crystal Serenity, respectively.")  So at that point they had two ships, likely some good will based on Crystal's customer base and reputation and other assets.  As many have noted they think Crystal was not a money maker for NYK and they surmise that it has kind of been in the same situation for Genting.  But not seeing the Crystal financials as opposed to the Genting financials really makes that hard to determine.  My guess is the good will has been devalued a bit to say the least based on board postings about never sailing with them again and the issues around getting refunds.  None of that would be a secret to a buyer who would do significant due diligence.  The ships likely have been further depreciated from the time of the purchase by Genting but there was some book value added anyway when they were refurbished in 2017 (Symphony) and 2018 (Serenity)  But book value and market value are two very different things.  And some cruise lines value the asset based on its capitalized earnings as I understand it.  So what are the ships worth?  Who knows.  Probably lots more as part of an operating cruise line with a brand than being sold off.  But likely not what they were worth in 2015, especially with one being 25 years old and having lots of cabins without balconies which is the kind of ship other lines are dumping.  The river ships appear to be pretty deeply financed (see attached) and who knows about the airplane.  The awaited Endeavor is also heavily financed (see attached).  My hope is that the 800 to 900 passenger ship space stays alive and if someone wants to take a look at that market - as opposed to say Seabourn at 45 and moving to 600 with their new ships or going bigger.  Things in that range are a bit limited - Oceania and Viking might be close.  But as someone who likes the 800 to 900 passenger category I am not real interested in moving on to a 3,000 passenger ship.  So maybe the niche market in luxury might be the saving grace but if someone buys Crystal they will want to make it operate profitably and that seems to have been a challenge.  I am not being a pessimist here but trying to look at the realistic situation.  Fingers crossed for a good outcome!  We will see.

Crystal River Boats.pdf Sale of Endeavor.pdf

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25 minutes ago, H2O Polo Willie said:

My guess is the good will has been devalued a bit to say the least

Absolutely!  However, if Crystal is sold to a new owner, there might be a better opportunity to restore the good will.  Possibly more so than with continued operation by Genting.

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8 hours ago, H2O Polo Willie said:

Genting is a corporate entity listed on the Hong Kong stock exchange.  How things might play our with the Chinese government is a really open question.  If there were to be any Chinese government bailout, in my opinion, it would likely would involve either Genting or maybe its Dream cruises and Star cruises subsidiaries as both of those entities are focused on the Asian market.  Two of the Star cruises ships are listed for sale at $150 million each (the Acquaris and the Gemini) so it might be that the Genting folks are focused on saving Dream cruises more than Star.  They sold 35% of Dream in 2019 (see attachment), Dream has newer ships, has a build in the Genting shipyards and likely to get the financing they are seeking from the German government they will have to commit - on some timetable - to continue with that build if not also the Endeavor.  Obviously this is all pure speculation so please take it as such.  With regard to Crystal, it remains a California LLC  (you can see this on the CA Sec of State website) and as best I can tell it also remains an "indirect" subsidiary of Genting. The indirect designation likely means that there are some other intervening corporate entities upstream from Crystal in the corporate structure which are downstream from Genting.  The corporate structure is likely are real maze and I have not been able to fine any chart showing how things are structured.  All of that said there don't appear to be any publicly available financials for Crystal on a standalone basis although I suspect they certainly have internal financials like they shared for Zouk in connection with the sale.  This is a quote from the annoucment of the purchase of Crystal, "As a result of Completion, Crystal Cruises has become an indirect wholly-owned subsidiary of the Company. Accordingly, the financial results of the Crystal Group Companies are to be consolidated
into the consolidated financial statements of the Enlarged Group".

 

Is Crystal as an individual entity solvent?  Who knows.  And of course if it is short of cash one way or the other,  Genting could always downstream money by extending a loan or other means.  That is all within their ability.  However, I kind of suspect that Genting is a bit short of cash all around so they might not be down-streaming it to Crystal.  The last financial report noted about $398 million in cash and $408 million in liquidity which means their remaining credit line at the group level which includes the cruise and shipyard operations at that time was only about $10 million.  Things could have changed and they did raise a bit of cash with the sale of Zouk but not much.

 

I can only say hope springs eternal.  We are booked on the 2022 world cruise out of LA and sure hope Crystal makes it and we are out of the woods on Covid 19 by then.  We will see.

Sale of Dream Cruises Stock.pdf 250.08 kB · 2 downloads

 

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After the Statement, I queried for Genting Hong Kong. Older articles provide insight:

 

— Genting’s Poster Boy, Forbes, May 9, 2008

 

– Genting Gaming Family Fighting Over the Chips, Forbes, March 7, 2018. Genting’s market cap was $24.8 Billion at the end of 2017 (Genting Group — top level; not GHK)

 

— The Edge Malaysia, September 1, 2020

 

Genting lacks understanding of the importance of substantive Ongoing Communications to Crystal Society members. Public Relations distributes Friday Night at the Galaxy and Cooking with Jon on Sunday emails. A month has passed since Crystal posted it’s Statement — at the bottom of the Alerts and Advisories.

 

I remember the long ago children’s book, The Little Engine That Could. I believe Crystal Cruises will be the cruise line that can.

 

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On 9/19/2020 at 12:42 AM, Texas Tillie said:

 

Is Crystal a "Chinese" company? It is my understanding (but I could be wrong), that Genting Hong Kong was established when the British still "owned" Hong Kong. The "owner" of the whole Genting empire is Malaysian, but is ethnically Chinese. Either this person doesn't know what they are talking about or we have been "mislead" about Genting.

 

Patty

I heard from a senior crew member back in 2015 that 'real' owners are Mainland Chinese, not the superficial Malaysian Chinese.  To me, it doesn't make a difference as long as the product is identical or better than under NYK, which is a subjective subject.

 

Edited by SwankPooch
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24 minutes ago, ryndam said:

Healthy Sail Panel Report just released on behalf of RCCL/NCL joint task force. It is very detailed, 66-page report. Anyone interested in going to sea again should read it.

 

https://www.royalcaribbeangroup.com/wp-content/uploads/2020/09/Healthy-Sail-Panel_Full-Recommendations_9.21.20_FINAL.pdf

 

Rob

Requiring passengers to take ship's tours or stay on the ship would be the biggest deal breaker for me. I can see the rationale for the requirement, but in most ports I simply walk to town for some exercise since I've been to most ports multiple times. Now, cruises with lots of sea days might be interesting to me. I could still read on my balcony and watch the sea go by.

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