Tag Archives: NCLH

NCL Holdings forecasts ‘strong demand so long as it’s safe’

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NCL Holdings forecasts ‘strong demand so long as it’s safe’
Norwegian Cruise Line Holdings chief executive Frank del Rio reported “strong demand for future cruises” as the company recorded a half-year loss of $2.65 billion this week.
Del Rio dismissed a suggestion the Covid crisis could put many cruise-focused travel agencies out of business, but he described the Covid infection of passengers and crew on Hurtigruten’s MS Roald Amundsen as “disappointing”.
He suggested Norwegian Cruise Line Holdings could see a “limited” return of sailing in November and December.
The company’s sailings are currently suspended through to the end of October.
Del Rio insisted: “There continues to be strong demand for future cruises despite our reduced marketing. Consumer demand is evident across markets.”
He forecast: “The last two months of 2020 could see a return of sailing with limited capacity.  We’ve taken important initial steps.
“We’re developing safety protocols with the formation of the Healthy Sail Panel which demonstrates our commitment to combating the spread of Covid and bringing back cruising sooner rather than later.”
The Healthy Sail Panel of experts, set up in collaboration with Royal Caribbean International in July, is working to develop recommendations for a safe resumption of cruising.
Del Rio said: “The panel will submit its initial recommendations to the [US] government and Centers for Disease Control (CDC) for evaluation.”
He acknowledged: “Things will be different, of course. We’ll be mindful of how measures impact on the cruise experience.”
NCL Holdings chief financial officer Mark Kempa said: “We expect to launch with a handful of ships at first with low occupancy.
“Our break-even [on operating ships] is at around 40% of normal revenue. Layer on corporate overheads and it would require 60% of normal revenue.”
Asked whether the crisis could transform cruise distribution, which remains overwhelmingly through travel agencies, del Rio said: “We have seen smaller travel agencies folding and larger ones furloughing employees. We’ve seen an uptick indirect business.”
But he argued: “It might be exaggerated because of the partial closures of agencies. We think travel agencies will survive. Travel agencies have shown their resilience over the long term.
“Not too long ago people were predicting the demise of travel agencies, but they came back stronger. Long term you won’t see much change.”
Del Rio insisted: “We enjoy a very loyal customer base in the cruise industry. Between 15 million and 20 million people have not been allowed to cruise this year – there will be a lot of pent-up demand.
“People are booking. We’ve not seen any major shifts in consumer behaviour. We’ve not changed our itineraries. If people favour cruising closer to home or not going to Asia, we’re not seeing it.
“My instinct is we will be [operating] somewhere in the range of 75% of capacity for the full year 2021. It might start at 50%-60%, with the limitation being concern about the spread of Covid more than about consumer demand.
“So long as we can ascertain cruising is safe we’ll have customers coming back in droves.”
Del Rio added: “We’re hopeful we’ll be able to put together a comprehensive set of health and safety protocols that get us back quickly.”
Asked about the Covid outbreak on the Hurtigruten ship which infected more than 50 passengers and crew, Del Rio said: “It’s disappointing – the re-emergence of Covid aboard vessels.
“But it’s an opportunity to learn something. The cruise companies and ports which suffered these setbacks have handled it well. We’ve not had a repeat of what happened at the start of the crisis.”
Kempa reported the group paid out $725 million in cash refunds to customers in the three months to June, more than the company’s cash burn of $575 million during the quarter.
He said future cruise credits make up 30% of advance bookings and monthly cash burn had fallen to about $160 million.
The company ended June with $2.26 billion in liquidity after raising $2.3 billion during the second quarter.
Norwegian Cruise Line Holdings operates 28 ships like Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises.

Royal Caribbean and Norwegian to Partner on Health Protocols

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RCL and NCL Logos

Royal Caribbean Group and Norwegian Cruise Line Holdings announced a collaboration to “develop enhanced cruise health and safety standards in response to the global COVID-19 pandemic,” according to a press release.

The companies have asked Governor Mike Leavitt and Dr Scott Gottlieb to serve as co-chairs of a newly formed group of experts called the “Healthy Sail Panel.”

The panel is tasked with collaboratively developing recommendations for cruise lines to advance their public health response to COVID-19, improve safety, and achieve readiness for the safe resumption of operations, according to a press release.

The expert panel has been working for nearly a month and will offer its initial recommendations by the end of August.

The cruise lines said its work will be “open source,” and could be freely adopted by any company or industry that would benefit from the group’s scientific and medical insights.

“This unprecedented disease requires us to develop unprecedented standards in health and safety,” said Richard D. Fain, chairman and CEO of Royal Caribbean Group. “Bringing aboard these respected experts to guide us forward demonstrates our commitment to protecting our guests, our crews and the communities we visit.”

“We compete for the vacationing consumer’s business every day, but we never compete on health and safety standards,” said Frank Del Rio, president and CEO of Norwegian Cruise Line Holdings Ltd. “While the cruise industry has always had rigorous health standards, the unique challenges posed by COVID-19 provide an opportunity to raise the bar even higher.”

Fain and Del Rio said they initiated the panel to assure the plans they will submit to the U.S. Centers for Disease Control and Prevention (CDC) and other regulators apply the best available public health, science and engineering insights. The work of the panel will be shared with the entire industry and regulators.

“In convening the Healthy Sail Panel, we sought the participation of a diverse group of leading experts in areas of science and public health that are directly relevant to the considerations listed by the No Sail Order,” said Governor Leavitt. “We view our work as a profoundly important public health effort. The health and safety of passengers, crew, and the communities that cruise ships visit will be the principal focus of this project.”

Dr Gottlieb said, “We know that the public health issues that must be addressed are complex, and in some areas, tackling them will require novel approaches. Our goal in assembling this team of leading experts was to develop best practices that can improve safety and provide a roadmap for reducing the risks of COVID-19.”

The panel is co-chaired by Governor Leavitt, former Secretary of the U.S. Department Health and Human Services (HHS), and Dr Scott Gottlieb, former commissioner of the U.S. Food and Drug Administration (FDA). The panel’s members are globally recognized experts from various disciplines, including public health, infectious disease, biosecurity, hospitality and maritime operations.

 

Norwegian Cruise Line Holdings extends suspension

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The Norwegian Joy in Vancouver last year.
The Norwegian Joy in Vancouver last year. Photo Credit: Tom Stieghorst

Norwegian Cruise Line Holdings has extended its suspension of cruising for nearly all voyages embarking between Aug. 1 and Sept. 30 for all three cruise brands (Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises).

However, Alaska cruises departing from Seattle in September will sail.

NCLH is also cancelling Canada/New England cruises and Pacific Coast cruises in October due to port restrictions in Canada. The Pacific Coast sailings were scheduled to depart from Vancouver.