Royal Caribbean Group says “demand has come surging back” for its cruise brands despite reporting a net loss of $1.4 billion for the third quarter.
The cruise giant – parent to Royal Caribbean International, Celebrity Cruises and Silversea Cruises – blamed the Delta variant for delaying booking progress, but anticipates being cash-flow positive by spring 2022.
The company ended the last three-month period with $4.1 billion in liquidity, including $3.3 billion in cash.
Since its last quarterly results, 11 more ships have resumed operations. As of today, 40 ships – or 65% of its fleet-wide capacity – have restarted sailing.
Royal anticipates that 50 out of its five brands’ 61 ships will have returned to service by the end of this year. The company is also a 50% owner of joint-venture that operates Tui Cruises and Hapag-Lloyd Cruises.
More than 500,000 passengers have sailed across the five brands since operations restarted and one million passengers are expected to have sailed by the end of 2021.
The ships that operated core Caribbean, Alaska, and Europe itineraries in the third quarter achieved a load factor of 44%.
Core itineraries exclude sailings during the early ramp-up period of up to four weeks, the company explained.
Total passenger revenues per cruise day in the third quarter were up 12% versus record 2019 levels.
The company reported that bookings had improved following a slowdown over the summer due to a surge in Delta Covid-19 cases and levels were higher during the third quarter than in the second.
During September, new bookings for 2022 sailings were more than 60% higher than the monthly average during the second quarter.
As of September 30, 2021, the company had around $2.8 billion in customer deposits across the three main brands versus $3.1 billion at the same time in 2019.
The company reported around 35% of the customer deposit balance related to future cruise credits compared to 40% in the prior quarter.
This, it said, indicates a positive booking trend, adding forward booking for the second quarter of next year were higher than at the same time in 2019.
Jason T. Liberty, chief financial officer and executive vice president, said: “As cases have come down, demand has come surging back.
“Consumers are showing their resilience and desire to vacation, and the growing affinity of Royal Caribbean’s leading brands, ships and crew.
“Although there are many uncertainties going forward regarding Covid-19, as well as cost and supply chain pressures, we continue our pathway forward and anticipate positive cash flow for the Group by spring of 2022 and generating positive earnings for the full year 2022.”
Chairman and chief executive Richard Fain praised the industry’s “constructive partnership” with the US Centers for Disease Control and Prevention (CDC).
He said: “This is a great example of how close collaboration between the cruise industry and the CDC results in health and safety protocols that have demonstrated cruising can be one of the safest forms of vacation.”