NCLH hires Goldman Sachs as financing options are explored

Posted on 20 April, 2020 by Spacejunkie2

Goldman Sachs applies for Tokyo banking licence | Financial Times

Norwegian Cruise Line Holdings has reportedly hired experts at investment bank Goldman Sachs to explore financing options on its behalf.

The parent of Norwegian Cruise Line, Regent Seven Seas Cruises and Oceania Cruises has tasked Goldman Sachs will looking into options which could include the sale of a stake in the company, according to a report from Reuters.

It comes amid a global pause on cruise operations due to the coronavirus outbreak.

The report suggests NCLH is considering a stake sale known as private investment in public equity (PIPE), with the company said to be in talks with several private equity firms.

Goldman Sachs declined to comment and the Reuters report said NCLH did not immediately respond to a request for comment.

It comes after Carnival Corporation raised $6.25 billion by issuing new debt and equity to investors. It made a share offering to raise $3 billion and said it would issue $1.75 billion in senior convertible notes. It also commenced an underwritten public offering of $1.25 billion of shares of common stock and underwriters were being given an option purchase of up to $187.5 million additional shares.

NCLH to report first quarter results May 9

Earlier this month it was announced that Saudi Arabia’s sovereign wealth fund had acquired a minority stake in Carnival Corp. The Public Investment Fund based in Riyadh disclosed that it had taken an 8.2% shareholding in the world’s largest cruise company, estimated to be valued at around $370 million.

Royal Caribbean Cruises – parent of Royal Caribbean, Azamara, Celebrity Cruises and Silversea, also announced a $2.2 billion loan last month as it looked to shore up cash flow amid the pandemic.

On April 9, the US Centers for Disease Control and Prevention extended its ‘no sail order’ for all cruise ships for up to 100 days.

Norwegian Strategic on Alaska

Posted on 30 November, 2019 by Spacejunkie2

Norwegian Cruise Line Holdings (NCLH) President and CEO Frank Del Rio underscored his enthusiasm for Alaska on the company’s third-quarter earnings call.

He said the company will continue to make investments and cultivate partnerships in the region, noting the new pier NCLH has agreed to build in Ketchikan, its $20 million purchase of 2.9 acres of waterfront property in Juneau, and the construction of a second pier at Icy Point Strait.

“We are investing in port facilities and guest experiences,” he said. “Alaska is destination-centric and you much have the land capabilities in place. We have almost doubled our capacity in Alaska over the past three years and will be even stronger as we finalize our investments.”

NCLH’s Q3 Alaska capacity was up 17 per cent over the same period last year.

In Ketchikan, NCLH has entered into a 30-year preferential berthing agreement with Ward Cove Dock Group, which allows for the construction of a new double ship pier in Ward Cove.

Meanwhile, current zoning laws are said to prevent a pier from being built on the property in Juneau.

The pier will be built to simultaneously accommodate two of Norwegian Cruise Line’s 4,200-passenger Breakaway-Plus class ships and is expected to be ready for the summer 2020 season.

NCLH partnered with the Port of Seattle in 2015 on the renovation and expansion of the Bell Street Terminal at Pier 66 which was ready for the 2018 season and the 4,000-berth Norwegian Bliss.

NCLH and the port entered into a 15-year lease agreement providing its ships priority berth space in Seattle for the full term of the lease in return for passenger volume guarantees. NCLH manages the cruise operations at Pier 66, while the port operates the facilities outside the cruise season.

Next year, the Norwegian brand will have three ships in Alaska, with the Norwegian Bliss, Joy and Sun will be from Seattle. In 2021, the new Encore will take over for the Joy. Oceania and Regent will each have one ship in the Alaska market, with the Regatta and the Seven Seas Mariner from Seattle, Vancouver and Seward.

Del Rio cited what he called “incredibly strong ticket pricing and onboard spend” in the Alaska market and also noted the lengthening of the season, which now runs all the way from April to October.

“In the coming years, we will further bolster our presence and commitment to the region,” Del Rio noted.

Two cruise lines regroup after Caribbean setbacks

Posted on 14 November, 2019 by Spacejunkie2

The Norwegian Sky in Havana in a 2017 photo.

Norwegian Sky outside Havana Port, Cuba.

Two cruise companies affected by sudden upsets in the Caribbean and Bahamas region are slowly regaining their footing.

For Norwegian Cruise Line Holdings (NCLH), the big blow was the abrupt end to U.S. cruises to Cuba in June. NCLH had bet heavily on Cuba’s reopening, scheduling not only short cruises on its contemporary Norwegian Cruise Line brand but longer visits by its two premium brands, Oceania Cruises and Regent Seven Seas Cruises.

As detailed in a conference call with investors, the U.S. government decision to shutter Cuba with no advance warning hit NCLH third-quarter earnings big-time.

“Given the suddenness of the termination and the lack of lead time we had to make any meaningful fleet redeployment changes, the third quarter bears the largest negative earnings impact from the Cuba travel ban,” said Frank Del Rio, the company’s CEO.

The hit was more than $47 million.

Overnight, high yielding routes to Cuba for the Norwegian brand turned into low-yielding routes to the Bahamas. And several months later came Hurricane Dorian, which made its own dent in NCLH’s earnings through cancelled sailings and reworked itineraries.

Del Rio said Norwegian plans to redeploy half of its Bahamas capacity to higher-yielding areas such as Alaska, the eastern Mediterranean and Asia, and will slowly get out from under the Cuba aftermath.

Even more impacted by Dorian than Norwegian was Bahamas Paradise Cruise Line, whose only destination is the Bahamas.

It suspended its two-day sailings to Grand Bahama for most of September, filling in the time by providing much-need relief and evacuation services.

The silver lining, of sorts, is that Dorian forced Bahamas Paradise into a new market, Nassau, which was not much affected by the storm. It now runs one of its ships from West Palm Beach to Grand Bahama and the other to Nassau.

Bookings for Nassau started slow, said Francis Riley, senior vice president of sales and marketing, but are now on par with those to Grand Bahama. Part of the attraction is the Cruise & Stay program where guest can vacation for two or four nights at one of four Nassau hotels: Atlantis, The Melia, the Comfort Suites Nassau or the SLS Baha Mar.

Bahamas Paradise has a similar program in place on Grand Bahama with the Lucayan, which has reopened, and the Viva Wyndham, which plans to reopen Dec. 10.

Unlike Norwegian, Bahamas Paradise doesn’t have plans to go elsewhere, and it is busy selling the Bahamas to Canadians and New Yorkers, who have just started getting the frosty temperatures they can look forward to until next spring.