Losses continue to pile up for Carnival Corp

Major cruise line company Carnival Corp has reported a record $4.4bn loss for Q2. Excluding one-time charges, Carnival reported a preliminary Q2 net loss of $2.4bn.

The company took major write-downs on the disposal of some of its ships. The Florida-based business said that it had $7.6bn available at the end of May, but confirmed that it was running through $650m a month while its fleet was stuck at anchorage in several ports around the world.

Carnival said that it hoped to resume operations in a phased manner, However it said that it would have to cut back on overall capacity, noting that it had already agreed to sell six of its ships.

The company revealed a roughly $2bn loss due to the difference in the sale price of the ships and their previously booked value.

Carnival has issued $6.6bn in bonds and equity and has drawn down on a $3bn credit line. It said that it was looking for further waivers on debt repayments that are due next year.

“The longer the pause in guest operations continues, the greater the impact on the company’s liquidity and financial position,” it said in its preliminary results for Q2, which ended on May 31st.

The company said that half of the guests affected by cancellations so far had requested full refunds, with the other half prepared to rebook. Although new bookings made in May for cruises in 2021 were down year on year, Carnival said that they were showing signs of improvement, it added.