Tag Archives: NCLH

Norwegian Cruise Line Ordered to Pay $110 Million in Cuba Court Case

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Norwegian Cruise Line Holdings has been ordered to pay approximately $110 million in damages for use of the Havana port, according to a U.S. judge who ruled in the case Friday.

The case, ongoing for some time, was ruled in favour of the Havana Docks Corp., which essentially argued that the cruise line’s use of the Havana port “constituted trafficking in confiscated property” as the port is a Cold-War asset seizure.

It is still being determined whether NCLH will or can appeal the nine-figure ruling. Havana Docks Corp. has pending cases against Carnival Corporation, Royal Caribbean Group and MSC Cruises.

Havana Docks Corp. was awarded $109,848,747.87 in damages plus Norwegian will pay $3 million in legal fees and costs.

With the Obama administration easing the Cuba embargo in 2016, cruise lines lined up to sail to Havana, including all of Norwegian Cruise Line’s brands.

In 2019, the Trump administration undid some of that with a ban on recreational travel to Cuba which put a stop to any major cruise brands calling on the island.

In 2020 a judge ruled in favour of Carnival Corporation in a similar case.

NCLH: Amendment and Extension of Operating Credit Facility

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Norwegian Cruise Line Holdings today announced it has amended and extended the majority of its operating credit facility consisting of its senior secured revolving credit facility and senior secured term loan A facility on December 6, 2022.

The amendment has resulted in the extension of maturities of approximately $1.4 billion of the Operating Credit Facility by one year to January 2025, according to a press release.

The Company is actively pursuing alternatives to address the remaining debt associated with the Operating Credit Facility that will otherwise mature in January 2024.

“We are pleased to have successfully amended and extended the majority of our Operating Credit Facility by one year to 2025,” said Mark A. Kempa, executive vice president and chief financial officer of Norwegian Cruise Line Holdings Ltd. “As part of this amendment, we were able to modify certain financial covenants and secure additional debt capacity of $1.5 billion, including approximately $0.5 billion of secured debt capacity. While we continue to believe our ongoing and organic cash generation provides a path to restore our balance sheet over time, the increase in debt capacity provides meaningful additional financial flexibility if needed, as we prepare for multiple scenarios in an uncertain macroeconomic environment.”

The Operating Credit Facility consists of the $875.0 million senior secured revolving credit facility and the senior secured term loan A facility with an outstanding principal amount of approximately $1.5 billion as of September 30, 2022. Additional details on the terms of the amendment can be found in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 9, 2022.

Norwegian Cruise Line: Ticket and Onboard Up for Q3, Offset by Costs

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Norwegian Cruise Line Holdings (NCLH) reported a net loss of $295.4 million on revenues of $1.6 billion for the third quarter ended Sept. 30, 2022; compared to a net income of $450.6 million on revenues of $1.9 billion for the third quarter of 2019, the last “normal” year.

Ticket revenue per passenger day was $277.69 in 2022 up from $254.99 in 2019, and onboard revenue per passenger was $127.95 this year, up from $100.24 in 2019.

Increased revenues, however, were offset by increased total operating costs: $311.08 per passenger cruise day in the third quarter of this year compared to $183.89 for the same period in 2019. The biggest cost drivers were fuel, which nearly doubled, and food costs, which were also up, as well as so-called “other” expenses.

Marketing and administrative costs were also up significantly as interest expenses.

Commenting on the cost picture, Mark Kemp, CFO and senior vice president, said the company is taking actions to right-size costs and noted that will settle as the inflation situation will not last. He noted that the cost for certain food categories was already trending down.