CCL offers another 1 Billion in common stock :(

[Gail & Marty sailing away]

3 hours ago, ldtr said:

Just to do some comparisons from the last 10Q filed by each company in millions

 

CCL

Revenue   4305

Operating Income  (279)

Occupancy   84%

 

Current Liabilities    12,954   of which 4470 are passenger deposits 

Long term debt   28,518

Total Current Assets   8432

 

RCL

Revenue   2184

Operating Income  (219)

Occupancy   82%

 

Current Liabilities   11,719

Long Term Debt  17,746

Total Current Assets  3,560

 

If you compare CCL to RCL's last 10Q filing RCL actually appears to be in worse shape

 

Current liabilities/current assets    CCL  1.53     RCL 3.28

Occupancy      CCL   84%    RCL  82%

Operating income/Quarterly Revenue    CCL  -.065     RCL   -.1

ratio long term debt/quarterly revenue   CCL 6.62    RCL 8.125

 

So when one looks at the relative sizes of the company by looking at revenue  RCL actually looks in worse shape than CCL.  Both have heavy debt loads compared to revenue, both are running in the low 80% range.

 

Now considering that most of cruise line expenses are the same if the ship is 80% filled as it is with 100% occupancy (an increase in food in beverage, which to a large degree would be a rounding error.  So if one looks at current revenue and one can estimate what the revenue numbers would look like if they were to reach 100% occupancy.  In that case

 

Estimated quarterly revenue 100% percent occupancy   CCL  5125   RCL  2663.  At which time one would expect both to be cash flow positive with operating income to be   CCL   540, and RCL 260.  

 

Long term debt/estimated operating income at 100% occupancy  CCL  52.8   RCL   68.25

 

 

So basically CCL is in better shape than RCL based upon their last filings, both really need to get to 100% occupancy.  However, as high as their debt load is there are paths forward as long as occupancy continues to grow.  Quite a ways from BK.  Even a restructuring one that would leave passengers intact.

Thanks for the info 

[Gail & Marty sailing away]

3 hours ago, ldtr said:

Depends upon the type of BK, if restructuring most likely not impacted.  If a liquidation they might be dropped at the next port.

Which has happened in the past. 

[mcrcruiser]

3 hours ago, Gail & Marty sailing away said:

Which has happened in the past. 

There was the Renissance cruise line back some time ago when the creditors closed down on the line operators    ,the pax had to vacate all ships the same day . Many of those smaller ships were sold off to Azamara & one to Princess 

 

The point I am making here is that it has become rather uncomfortable    to have to check financials of these cruise lines just to take one of their vacation cruises .  The question then begs how will this uncomfortable feeling spread among  the pax considering cruises as a vacation option  or do they look more toward other vacations ?  

 

 Word of mouth  can bear a good or a bad    impact on any business . 

 

 We have 6 future cruises booked ,starting  Dec 10th on Kpningsdam  for a B3B  ,12 night total  Mexican Riviera   . then 2 B2B  7 night cruises on Celebrity   March 2023  & finally ,RCL  2 cruises B2B in October   2023 

 

 We are hoping to see HAL open up a R/T Hawaii from San  Diego   around October 21st for the 2024 season  ;which I would book immediately    if I feel comfortable  about the future of the cruise industry  . Yes we now have doubts  & maybe just maybe we should have given more thought to the finacial future of these cruise lines  . Thus ,there are alternative all inclusive land vacations  & even other privately held cruise lines   .Just saying 

 

 So if these thoughts are in my mind could they also be in the minds of other propspective   customers ?  We won;'t know that answer for awhile yet 

 

 

 

 

 

[Guest ldtr]

1 hour ago, mcrcruiser said:

There was the Renissance cruise line back some time ago when the creditors closed down on the line operators    ,the pax had to vacate all ships the same day . Many of those smaller ships were sold off to Azamara & one to Princess 

 

The point I am making here is that it has become rather uncomfortable    to have to check financials of these cruise lines just to take one of their vacation cruises .  The question then begs how will this uncomfortable feeling spread among  the pax considering cruises as a vacation option  or do they look more toward other vacations ?  

 

 Word of mouth  can bear a good or a bad    impact on any business . 

 

 We have 6 future cruises booked ,starting  Dec 10th on Kpningsdam  for a B3B  ,12 night total  Mexican Riviera   . then 2 B2B  7 night cruises on Celebrity   March 2023  & finally ,RCL  2 cruises B2B in October   2023 

 

 We are hoping to see HAL open up a R/T Hawaii from San  Diego   around October 21st for the 2024 season  ;which I would book immediately    if I feel comfortable  about the future of the cruise industry  . Yes we now have doubts  & maybe just maybe we should have given more thought to the finacial future of these cruise lines  . Thus ,there are alternative all inclusive land vacations  & even other privately held cruise lines   .Just saying 

 

 So if these thoughts are in my mind could they also be in the minds of other propspective   customers ?  We won;'t know that answer for awhile yet 

 

 

 

 

 

In most cases, not really.

 

These companies are not close to BK based upon their Financials. There is a possibility that they might get there someday if they cannot get back to pre covid capacity levels, but there well be lots of warning before a liquidation BK would occur. Once they show that they can rrun with a positive operating income, the odds of a liquidation BK pretty much go away, though a restructuring BK, that would not impact customers might take place at some point, since it will take the companies 10 to 15 years to work out from under current debt levels.

 

Most customers do not look at Financials, and do not care  Here on CC you a some working themselves up into a frenzy in kind of a Don Quixote moment.

 

CC is not representative of most cruise customers.

Edited October 20, 2022 by ldtr

[Guest ldtr]

4 hours ago, Gail & Marty sailing away said:

Which has happened in the past. 

With much smaller companies.

[mcrcruiser]

7 minutes ago, ldtr said:

In most cases, not really.

 

These companies are not close to BK based upon their Financials. There is a possibility that they might get there someday if they cannot get back to pre covid capacity levels, but there well be lots of warning before a liquidation BK would occur. Once they show that they can rrun with a positive operating income, the odds of a liquidation BK pretty much go away, though a restructuring BK, that would not impact customers might take place at some point, since it will take the companies 10 to 15 years to work out from under current debt levels.

 

Most customers do not look at Financials, and do not care  Here on CC you a some working themselves up into a frenzy in kind of a Don Quixote moment.

 

CC is not representative of most cruise customers.

What you say may  be true   ;but ,if the economy  turns into a stagflation   yupe economy ( inflation  with no growth) then where do you see the   cruise lines   balance  sheets   ? 

[Guest ldtr]

23 minutes ago, mcrcruiser said:

What you say may  be true   ;but ,if the economy  turns into a stagflation   yupe economy ( inflation  with no growth) then where do you see the   cruise lines   balance  sheets   ? 

Certainly there may be things that negatively impact the industry. If they do there will be warnings showing up. 

[Mary229]

@mcrcruiser  I am not sure your ultimate conclusion.  Businesses go bankrupt often and it is not unheard of in travel.  I had the great fortune of having a Braniff flight the day they went belly up.  The transition to my new flight was a blip.  This is always a possibility and certainly with a publicly held company it is much more transparent than going with a privately held company .

 

My two conclusions are 1. Figure out how to pay the smallest deposit possible, usually this is accomplished when onboard and don’t pay until finally payment date.  I don’t cruise on some well known lines who require payment as much as one year ahead.

2. though I do pay attention to financials my travel agency does this for their customers.  A good travel agency can help you prevent these issues and help you when the outlier occurs.  
 

The probability of a bankruptcy and seizure happening while in transit is likely less than being struck by lightning.  There is always something to worry about……

[mcrcruiser]

1 hour ago, Mary229 said:

@mcrcruiser  I am not sure your ultimate conclusion.  Businesses go bankrupt often and it is not unheard of in travel.  I had the great fortune of having a Braniff flight the day they went belly up.  The transition to my new flight was a blip.  This is always a possibility and certainly with a publicly held company it is much more transparent than going with a privately held company .

 

My two conclusions are 1. Figure out how to pay the smallest deposit possible, usually this is accomplished when onboard and don’t pay until finally payment date.  I don’t cruise on some well known lines who require payment as much as one year ahead.

2. though I do pay attention to financials my travel agency does this for their customers.  A good travel agency can help you prevent these issues and help you when the outlier occurs.  
 

The probability of a bankruptcy and seizure happening while in transit is likely less than being struck by lightning.  There is always something to worry about……

Agree   . The TA  that I used  for our Dec  Cruises on koningsdam is a good  YA but  do they  keep checking a cruise line balance sheet ,I doubt it  .i say this is because their business is to sell travel  .  

 

 Like all of us on this thread we all wish things were pre  pandemic  normal  ,not this craziness .  but ,who said that life would always be clear sailing with no storms 

 

 It is what it is & we will all deal with it .  

 

 FWIW right now CCL is up .34 cents  in a down market ,so p maybe there is hope  

 

 

 

c

 

 

[BermudaBound2014]

On 10/20/2022 at 9:05 AM, ldtr said:

In most cases, not really.

 

These companies are not close to BK based upon their Financials. There is a possibility that they might get there someday if they cannot get back to pre covid capacity levels, but there well be lots of warning before a liquidation BK would occur. Once they show that they can rrun with a positive operating income, the odds of a liquidation BK pretty much go away, though a restructuring BK, that would not impact customers might take place at some point, since it will take the companies 10 to 15 years to work out from under current debt levels.

 

Most customers do not look at Financials, and do not care  Here on CC you a some working themselves up into a frenzy in kind of a Don Quixote moment.

 

CC is not representative of most cruise customers.

 

I agree with the gist of what you have said. However caution that getting back to pre-covid capacity levels does not necessarily yield enough money to make the interest payments on debt, let alone anything else. This chart is a few months old. CCL has more debt now. As you can see, the entire 2019 operating income is very close to interest only payments.

 

 

I still see restructuring as the only way out from under the debt. 

[gilboman]

22 hours ago, Mary229 said:

@mcrcruiser  I am not sure your ultimate conclusion.  Businesses go bankrupt often and it is not unheard of in travel.  I had the great fortune of having a Braniff flight the day they went belly up.  The transition to my new flight was a blip.  This is always a possibility and certainly with a publicly held company it is much more transparent than going with a privately held company .

 

My two conclusions are 1. Figure out how to pay the smallest deposit possible, usually this is accomplished when onboard and don’t pay until finally payment date.  I don’t cruise on some well known lines who require payment as much as one year ahead.

2. though I do pay attention to financials my travel agency does this for their customers.  A good travel agency can help you prevent these issues and help you when the outlier occurs.  
 

The probability of a bankruptcy and seizure happening while in transit is likely less than being struck by lightning.  There is always something to worry about……

or just pay with a credit card and you're protected if the provider does go belly up.  

 

it's happened many times before in the past where travel providers go out of business and those who paid with cc are made whole and those who didn't aren't.   

 

Also depending on where you live, there maybe additional protection as well..eg i live in ontario, canada. if you use a TA, you are also protected by TICO compensation fund 

[BermudaBound2014]

24 minutes ago, gilboman said:

or just pay with a credit card and you're protected if the provider does go belly up.  

 

it's happened many times before in the past where travel providers go out of business and those who paid with cc are made whole and those who didn't aren't.   

 

Also depending on where you live, there maybe additional protection as well..eg i live in ontario, canada. if you use a TA, you are also protected by TICO compensation fund 

 

Not necessarily.

 

Since the pandemic, credit cards have introducted specific wording to NOT cover in the event of insolvency of travel companies.

 

Also, this is another reason to not purchase insurance directly from the cruise line, as most insurance policies connected with the cruise line specifically exclude financial insolvency. 

 

Best to check and double check. 

 

 

https://thepointsguy.com/news/travel-insurance-bankruptcy-guide/

 

 

 

 

 

Edited October 21, 2022 by BermudaBound2014

[Mary229]

3 hours ago, BermudaBound2014 said:

 

Not necessarily.

 

Since the pandemic, credit cards have introducted specific wording to NOT cover in the event of insolvency of travel companies.

 

Also, this is another reason to not purchase insurance directly from the cruise line, as most insurance policies connected with the cruise line specifically exclude financial insolvency. 

 

Best to check and double check. 

 

 

https://thepointsguy.com/news/travel-insurance-bankruptcy-guide/

 

 

 

 

 

Adding:  That has always been the case and is also the case with travel insurance.  Certainly there are some credit card issuers who do cover insolvency for certain tiers of customers and for certain levels of payment but don’t count on it. 

[Guest ldtr]

49 minutes ago, Mary229 said:

Adding:  That has always been the case and is also the case with travel insurance.  Certainly there are some credit card issuers who do cover insolvency for certain tiers of customers and for certain levels of payment but don’t count on it. 

Of course there is a difference between travel insurance coverage provided by some credit cards, and the protections provided by cards for non-delivery of services.  Even though the insurance offered by cards do not provide travel insurance coverage in case of a BK in many cases, the credit cards in the US still provide protections for payments made through the card for travel services not provided.

[Mary229]

6 minutes ago, ldtr said:

Of course there is a difference between travel insurance coverage provided by some credit cards, and the protections provided by cards for non-delivery of services.  Even though the insurance offered by cards do not provide travel insurance coverage in case of a BK in many cases, the credit cards in the US still provide protections for payments made through the card for travel services not provided.

As @BermudaBound2014mentioned insolvency is and always has been a separate case.  Visit the Crystal cruise boards to see what happened in modern situation.  I wasn’t speaking of credit card travel insurance, I was speaking of credit card protections.  Most protections are not mandated by law and are in fact at the discretion of the credit card issuer.  I would not rely on a credit card issuer to cover my costs in the case of insolvency, it is not a reliable position 

[Guest ldtr]

19 minutes ago, Mary229 said:

As @BermudaBound2014mentioned insolvency is and always has been a separate case.  Visit the Crystal cruise boards to see what happened in modern situation.  I wasn’t speaking of credit card travel insurance, I was speaking of credit card protections.  Most protections are not mandated by law and are in fact at the discretion of the credit card issuer.  I would not rely on a credit card issuer to cover my costs in the case of insolvency, it is not a reliable position 

The article they referenced in their post was specific to the travel insurance offered by the CC.

 

Even in the case of insolvency the people that had paid for their cruise by credit card received their money back.  So the protection for failure to provide services still applied.

 

The people that did not recover their payments were for 2 reasons.

 

1. They had cruises canceled during Covid and chose to take FCCs.  Once someone takes that approach the original credit card protections may no longer apply.

 

2. They made their credit card purchase too far in advance  and as such was outside of the window for recovery.

 

Even with reason 1, the primary reason was that the initial purchase that was eventually converted to an FCC was outside of the window for reimbursement for services not provided. 

 

So as long as someone is under US law, and has a credit card issued by a US bank, then if a card was used to pay for a trip and the provider goes BK before the trip occurs they should be able to recover their payments.  Some cards have different windows for the look back period.   The law states 60 days so technically some might try to argue that limit though I have not seen any of the major Visa or Master card providers push that.  Most tend to use 6 or 12 months from actually use of card, though they might stick to 60 days for actually awareness of  actual failure to provide services.

 

No card can unilaterally void the protections for failure to deliver services without Congress changing the Fair Credit Protections Act., even in the case of a bankruptcy.

[Damcruiser]

I bought 100 shares last week and Carnival is giving me $750 OBC in three B2B cruises, more than the cost of the stock.  At what  POINT WILL THEY CANCEL THIS PERK?  Sorry for the caps..

[Guest ldtr]

7 minutes ago, Damcruiser said:

I bought 100 shares last week and Carnival is giving me $750 OBC in three B2B cruises, more than the cost of the stock.  At what  POINT WILL THEY CANCEL THIS PERK?  Sorry for the caps..

They have renewed each year for quite a while now, as long as I have been sailing on one of the CCL lines.

[BermudaBound2014]

8 minutes ago, Damcruiser said:

I bought 100 shares last week and Carnival is giving me $750 OBC in three B2B cruises, more than the cost of the stock.  At what  POINT WILL THEY CANCEL THIS PERK?  Sorry for the caps..

 

Currently the perk is good thru July 2023. If history repeats itself, they will vote whether or not to continue the perk past July 2023 sometime around February.

Edited October 21, 2022 by BermudaBound2014

[BermudaBound2014]

28 minutes ago, ldtr said:

... The law states 60 days so technically some might try to argue that limit though I have not seen any of the major Visa or Master card providers push that.  Most tend to use 6 or 12 months from actually use of card, though they might stick to 60 days for actually awareness of  actual failure to provide services.

 

No card can unilaterally void the protections for failure to deliver services without Congress changing the Fair Credit Protections Act., even in the case of a bankruptcy.

 

Exactly my point. We can't automatically count on credit cards for protection. There are lots of little niggles involved. I would suspect that if one of the giants actually goes BK that credit cards will be clamoring for ways not to repay consumers.

 

Just for the record, I don't see BK happening anytime soon. IMO; A less drastic restructuring is more likely.

 

 

[Mary229]

51 minutes ago, ldtr said:

2. They made their credit card purchase too far in advance  and as such was outside of the window for recovery.

Yes, this is the fine detail that needs be mentioned.  Don’t expect to pay for a cruise well in advance then have it refunded due to insolvency.  US law has a very narrow time frame.  In another post I also mentioned avoiding cruise lines who require full payment many, many months in advance.  To me that is a tell.   This is what happened to Crystal passengers. There are other lines who require full payment up to a year in advance.

 

I totally agree with many people betting on that FCC and losing their consumer rights.   the fine details on those provisions had the passenger sign away their rights in order to get as little as a 10% bonus.   Discounts are powerful

 

😉smiling as I sit here and write a promotional email offering serious discounts to my wholesale customers 

Edited October 21, 2022 by Mary229

[JesseLivermore]

If CCL goes BK can't they spin off HAL etc. Are any of the lines independently profitable?

[rkacruiser]

18 minutes ago, JesseLivermore said:

Are any of the lines independently profitable?

 

None of us know this.  That data is not available for us shareholders.  Such data has never been available.  it is--and has been--a source of frustration for us long time owners of CCL.  

[BermudaBound2014]

20 minutes ago, JesseLivermore said:

If CCL goes BK can't they spin off HAL etc. Are any of the lines independently profitable?

 

Sure, they could with a buyer.

 

Right now, so much is up in the air. At one time, I thought that the most likely fate for CCL was to spin off brands because they are so behemoth compared to RCL and NCLH. There were rumors months ago that the Saudi Sovereignty was interested in purchasing Seabourn. So far, just rumors. CCL just 'spun off' 12 of their newer ships to a brand new company called Carnival Bermuda for the purpose of borrowing enough money to make immediate payments due. At this point, anything is possible.

Edited October 21, 2022 by BermudaBound2014

[gilboman]

9 hours ago, BermudaBound2014 said:

 

Not necessarily.

 

Since the pandemic, credit cards have introducted specific wording to NOT cover in the event of insolvency of travel companies.

 

Also, this is another reason to not purchase insurance directly from the cruise line, as most insurance policies connected with the cruise line specifically exclude financial insolvency. 

 

Best to check and double check. 

 

 

https://thepointsguy.com/news/travel-insurance-bankruptcy-guide/

 

 

 

 

 

I'm in Canada and none of my 6+ credit cards have that .. guess very different in the US and as I said...TICO covers me as well as the travel insurance included on my cc that specifically states insolvency is included as covered item