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I know this is the Royal Caribbean blog but this has relevance here. Read between the lines for me because I am bad at that. Does mean they are going under? Its a bit vague I think.

 https://www.cnbc.com/2020/05/05/norwegian-cruise-line-says-theres-substantial-doubt-about-its-ability-to-continue-as-a-going-concern.html?__source=sharebar|twitter&par=sharebar

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I don't think there's much need to read between the lines.  The lines themselves are pretty clear to me !  This cannot be good for their stock or their precipitous position in the industry.  For me....if I had any money in pending reservations, based on this statement, I would be doing everything I could to get my money out NOW.  I don't know if NCL has a version of Cruise With Confidence or not (I haven't followed their saga) but I would expect that there may be increased activity there, if they do.

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I heard yesterday on one of the podcasts that I listen to that they are also asking creditors to defer debt to raise cash. You can ask those creditors only so many times before they say "nope, we can't afford to hold your credit anymore."  It sounds like a bankruptcy (reorganization) filing will be in their future to me.

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Just now, RCIfan1912 said:

Does this mean anything for Royal Caribbean? Does this say something at all about RCI or two totally different situations?

It's the exact same situation, RCL is just bigger.

The longer things continue, the "lifelines" of credit become a noose.

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Interesting tidbit in the article.

They are reporting losses for the 1st quarter that ended March 31st.  IOWS, even before CoVid hit, it was in severe financial problems.  Cruises were sailing into the 2nd week of March.  You can't tell me that 1 month of no sailing would equate into losses for an entire fiscal yr.  Plus, on top of that they took @ 1.3 billion in credit lines in the month of March.  

It just means to me that they were already on the brink and the crisis pushed them off the edge.

Yes, RCL is in danger, but so is every travel industry company, some are more insulated if they have diversified properly.  

 

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2 minutes ago, Pima1988 said:

Interesting tidbit in the article.

They are reporting losses for the 1st quarter that ended March 31st.  IOWS, even before CoVid hit, it was in severe financial problems.  Cruises were sailing into the 2nd week of March.  You can't tell me that 1 month of no sailing would equate into losses for an entire fiscal yr.  Plus, on top of that they took @ 1.3 billion in credit lines in the month of March.  

It just means to me that they were already on the brink and the crisis pushed them off the edge.

Yes, RCL is in danger, but so is every travel industry company, some are more insulated if they have diversified properly.  

 

NCL to me always seemed like was in weird spot, almost in trouble. The way they give away those perks seemed to indicate they were. It always seemed like desperation to gain bookings. No one really does that. We strayed from Royal a few years ago, 2016 and sailed the Breakaway from NY to Bermuda. The ship was huge and beautiful but oddly laid out. It had a TON of bottlenecks and passenger flow was a nightmare. The food was excellent I thought though. We like that they do 7 day Bermuda as apposed to 5 days Royal does from NJ at least. Everything else Royal beats the pants off them. Oh and the crew seemed unhappy with the company. I mean it almost seemed like a "union slowdown" if you know what that means. They seemed unhappy and not as good as other crews on Royal Caribbean cruises we were on. 

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11 minutes ago, RCIfan1912 said:

NCL to me always seemed like was in weird spot, almost in trouble. The way they give away those perks seemed to indicate they were. It always seemed like desperation to gain bookings. No one really does that. We strayed from Royal a few years ago, 2016 and sailed the Breakaway from NY to Bermuda. The ship was huge and beautiful but oddly laid out. It had a TON of bottlenecks and passenger flow was a nightmare. The food was excellent I thought though. We like that they do 7 day Bermuda as apposed to 5 days Royal does from NJ at least. Everything else Royal beats the pants off them. Oh and the crew seemed unhappy with the company. I mean it almost seemed like a "union slowdown" if you know what that means. They seemed unhappy and not as good as other crews on Royal Caribbean cruises we were on. 

I didn’t get that feeling at all onboard the Breakaway class ships. We have overly attentive service, great Suite options and excellent food. Overall a good value. I think bankruptcy protection at this point is fair game for any or all of the big 3 cruise lines. If RC doesn’t get back into operations 8/1 as planned I think they could be headed down the same road. 

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16 minutes ago, tonyfsu21 said:

I didn’t get that feeling at all onboard the Breakaway class ships. We have overly attentive service, great Suite options and excellent food. Overall a good value. I think bankruptcy protection at this point is fair game for any or all of the big 3 cruise lines. If RC doesn’t get back into operations 8/1 as planned I think they could be headed down the same road. 

I was hesitate to say anything definitive because we only did one NCL cruise and that might have been an isolated experience. Overall the cruise was fun, just got a strange vibe from the crew. 

Anyways hopefully cruises restart in August. Hopefully because we are on Oasis in Sept. Selfishly of course I'm being. 🤣

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4 hours ago, bobroo said:

It's the exact same situation, RCL is just bigger.

The longer things continue, the "lifelines" of credit become a noose.

Generally I agree, however bankruptcy doesn't mean the end of cruising.  It usually means debt is restructured and some assets are liquidated.  Perhaps they do some downsizing and eliminate some employees.  However, creditors eventually want to be paid and investors don't want their investments to become worthless.  My guess is that it isn't the end of the rope for the cruise industry just yet because people like to cruise.  

Just trying to think positively and hoping paying now for a cruise in the future isn't throwing money away.  I can't imagine, things being that bleak for the cruise industry as a whole.

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We have sailed with NCL from 2015 thru June of last year out of FL, CA and TX (until they left). We never had a problem with them and always like the ships. There are differences just like every other cruise line. NCL was more of the "open" concept of dining and entertainment which some either love or hate. To us it is no big deal as we do not have to have waiters and formality on our vacations. Would be sorry to see them declare bankruptcy as this may affect their ability to attract some quantity of future clients and could rub off on the the other cruise lines. We moved to Royal from the other cruise lines as the ships and personnel made us feel at home and more relaxed on our trips. Can only hope this (bankruptcy) will not be contagious throughout the cruise industry.

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5 minutes ago, Dad2Cue said:

Generally I agree, however bankruptcy doesn't always mean the end of cruising.  It usually means debt is restructured and some assets are liquidated.  Perhaps they do some downsizing and eliminate some employees.  However, creditors eventually want to be paid and investors don't want their investments to become worthless.  My guess is that it isn't the end of the line for the cruise industry just yet because people like to cruise.  

Just trying to think positively and hoping paying now for a cruise in the future isn't throwing money away.  I can't imagine, things being that bleak for the cruise industry as a whole.

I agree. The future is positive. There are way too many people who enjoy cruising and are itching to spend money on vacation again. This is just a matter of riding out the storm because once operations begin again the cruise lines will be flush with plenty of cash to pay off debt. 

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This whole thing sucks, it just sucks. This type of vacation that is perfect for me. I don't fly, I have a VERY serious fear of flying so I can take the train which I LOVE but is very slow here in the US, no high speed trains or I can cruise and go to incredible destinations on a big beautiful ship. Right now both are restricted. Trains will be back, cruises? Royal Caribbean? Questions abound.

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1 hour ago, RCIfan1912 said:

I know this is the Royal Caribbean blog but this has relevance here. Read between the lines for me because I am bad at that. Does mean they are going under? Its a bit vague I think.

 https://www.cnbc.com/2020/05/05/norwegian-cruise-line-says-theres-substantial-doubt-about-its-ability-to-continue-as-a-going-concern.html?__source=sharebar|twitter&par=sharebar

Not to downplay their situation, but the language about "ability to continue as a going concern" shows up very frequently in financial filings.  I think it is a required statement triggered by certain debt conditions.  It's not good to have to include it but I'm also often surprised to hear about it from companies I'd never expect to be worried about.

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17 minutes ago, tonyfsu21 said:

I agree. The future is positive. There are way too many people who enjoy cruising and are itching to spend money on vacation again. This is just a matter of riding out the storm because once operations begin again the cruise lines will be flush with plenty of cash to pay off debt. 

We love cruising. We had 2 big cruises booked but as I said elsewhere, we are not planning to cruise again until I can be 100% sure that the originating port will allow the ship to dock and I can get off as scheduled... and that we will then be able to go home and my wife (who can not work from home) is not forced to stay home without pay for 2 weeks in self isolation like what happened in March. 

For us, we live for vacations.. but we are planning US based vacations for the next 18 months. Some time before the end of the year, we will likely see CCL and RCL follow NCL. I just do not see how they can avoid it. I hope I am wrong..

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2 hours ago, Dad2Cue said:

Generally I agree, however bankruptcy doesn't always mean the end of cruising.  It usually means debt is restructured and some assets are liquidated.  Perhaps they do some downsizing and eliminate some employees.

This to me also ties in back to the class action lawsuit from employees that are occurring currently.

  I am not an attorney, however,  I wonder if this is also step 1 in protection from these type of lawsuits.  They would be the bottom of the pile for pay outs.  Plus. it might be why in some of  the articles I have read regarding employees wanting to speak on anonymity due to the fear of retaliation.  For NCL, if they have to eliminate some employees, than fewer would want to become part of that class action lawsuit.

2 hours ago, tonyfsu21 said:

I agree. The future is positive. There are way too many people who enjoy cruising and are itching to spend money on vacation again.

My husband is a naysayer, I am the opposite.  He is on the ship that people will be afraid to cruise at the rate they cruised before.  I am on the ship that says they have the FCC, i.e. basically a free vacation if they sail by the end of 2021 and they will travel.  Plus, now add in those passengers that have already booked for 2021.  Back to full ships.

I made my point by saying, look right now at beaches that have opened up, CoVid be darned.  They are packed.  People want out of their homes and to start life again.  If they have the vacay time and they took the FCC than they are going to sail.

 

 

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14 hours ago, RCIfan1912 said:

I know this is the Royal Caribbean blog but this has relevance here. Read between the lines for me because I am bad at that. Does mean they are going under? Its a bit vague I think.

 https://www.cnbc.com/2020/05/05/norwegian-cruise-line-says-theres-substantial-doubt-about-its-ability-to-continue-as-a-going-concern.html?__source=sharebar|twitter&par=sharebar

While there is no doubt the cruise lines will face big challenges in the coming months/years.  Being written by CNBC means that the cruise line will be shown in the most negative light possible.  Frankly,  I'm surprised they didn't lob in a "floating petri dish" grenade somewhere in the piece.

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3 hours ago, Scrumps said:

We love cruising. We had 2 big cruises booked but as I said elsewhere, we are not planning to cruise again until I can be 100% sure that the originating port will allow the ship to dock and I can get off as scheduled... and that we will then be able to go home and my wife (who can not work from home) is not forced to stay home without pay for 2 weeks in self isolation like what happened in March. 

My wife and I are retired so no worries about self isolating without pay for two weeks after the cruise.  I do have some worry about the originating port not allowing us to disembark but that isn't a big concern.  My wife likes the ports in between and doesn't like sea days as much.  I am perfectly content to stay on the ship.  My wife thinks I'm vulnerable but I told her in the worst case she could throw me overboard.  I mostly hate wearing a mask. 😊

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6 hours ago, Pima1988 said:

Interesting tidbit in the article.

They are reporting losses for the 1st quarter that ended March 31st.  IOWS, even before CoVid hit, it was in severe financial problems.  Cruises were sailing into the 2nd week of March.  You can't tell me that 1 month of no sailing would equate into losses for an entire fiscal yr.  Plus, on top of that they took @ 1.3 billion in credit lines in the month of March.  

It just means to me that they were already on the brink and the crisis pushed them off the edge.

Yes, RCL is in danger, but so is every travel industry company, some are more insulated if they have diversified properly.  

 

Mixing and matching things incorrectly.

They are saying they lost money in Q1 ... assuming they are on a calendar Q1 if they lost 2 weeks of march that would be roughly 2/13 of the quarter or about 15% of the revenue gone for the quarter with very limited ability to cut costs ... i could see that making an unprofitable quarter.

They are suggesting they will lose money for the year, not stating that they have ... again mid-march through august/sept shutdown is a lot of lost revenue with a lot of new ships to pay for ... very likely they will lose money for the year.

Taking a loan affects cash ... it doesnt count as income ... so the loan is to keep afloat not "show profit". You can lose cash and still turn a profit and make cash and show a loss ... all in the accounting games.

With that said the language used is the standard language to prep for a bankruptcy. The question is does someone else want to buy a bunch of slightly used cruise ships out of the bankruptcy or do the debt holders want to take a little loss on the restructure in the hopes that the company bounces back and the repays the rest of the debt down the road

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Either way you slice it, NCL & perhaps CCL and RC are going to be in hot water. I can see first hand boots on the ground what the lack of tourism (mainly the cruise industry) is doing to East Fort Lauderdale. Even assuming we open the city back up soon we’re still at a major loss without the heavy influx of cruisers spending money week in and week out. It’s sad to drive down the beach and see it empty. I hope RC and the cruise industry as a whole can make it out of this and get back to normal even if “normal” is a new normal. 

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2 hours ago, Dad2Cue said:

My wife and I are retired so no worries about self isolating without pay for two weeks after the cruise.  I do have some worry about the originating port not allowing us to disembark but that isn't a big concern.  My wife likes the ports in between and doesn't like sea days as much.  I am perfectly content to stay on the ship.  My wife thinks I'm vulnerable but I told her in the worst case she could throw me overboard.  I mostly hate wearing a mask. 😊

I wear a bandanna and I like it. Its kinda fun, its something I would have gotten arrested for 2 months ago if I walked into a store wearing but hey now, its A-OK. 🤣

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8 hours ago, tonyfsu21 said:

 I hope RC and the cruise industry as a whole can make it out of this and get back to normal even if “normal” is a new normal. 

Everyone is in the same boat, waiting to see what the new normal is..

We talk about getting cruises going again asap ( which i also want ) however the way the world is people dont even know if they will have a job as companies outwith the cruise industry may go bust, companies that survive make ask employès to take reduced pay just so they stay afloat.

The Domino effect is that cruise companies, travel agents, airlines, hotels, restaurants etc will probably be the hardest hit simply due to the fact people will have less disposable income for things such as vacations or eating out.

The world as we know it has changed for ever and it will take time to recover. 

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5 hours ago, Ray said:

Everyone is in the same boat, waiting to see what the new normal is..

We talk about getting cruises going again asap ( which i also want ) however the way the world is people dont even know if they will have a job as companies outwith the cruise industry may go bust, companies that survive make ask employès to take reduced pay just so they stay afloat.

The Domino effect is that cruise companies, travel agents, airlines, hotels, restaurants etc will probably be the hardest hit simply due to the fact people will have less disposable income for things such as vacations or eating out.

The world as we know it has changed for ever and it will take time to recover. 

Unfortunately the economic impact is going to take a long time to really realize ... it goes far beyond even what you listed above ... car manufacturers, parts manufacturers, plane manufacturers, heck even hospitals and healthcare organizations are laying off people because they are only allowed to treat COVID ... my brother cleans pools ... or did ... state governments talking about 25-30% layoffs to cover COVID costs, etc.

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21 hours ago, RCIfan1912 said:

This whole thing sucks, it just sucks.

I agree !!!   I find this very sad.    We have sailed on Breakaway and Dawn with no complaints.  I can't say that about RCL.

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