Carnival Rises as Positive Cash Flow Offsets Drop in Bookings
(Bloomberg) -- Carnival Corp. shares climbed after the company said third-quarter voyages were cash-flow positive, offering investors some hope for a recovery in spite of a Covid-19 resurgence that has reduced bookings.
The cruise operator posted a wider-than-expected net loss for the period, which was the first quarter since the pandemic began in which it resumed U.S. cruising to a significant extent. Carnival reported an adjusted net loss for the quarter of $1.99 billion, surpassing the $1 billion to $1.88 billion loss projected by analysts surveyed by Bloomberg.
“Even at this early stage with intentionally constrained occupancy levels, our voyages are already cash flow positive,” Chief Executive Officer Arnold Donald said in the release.
At the same time, booking volumes for future cruises were “not as robust” as they were in the second quarter, due primarily to “heightened uncertainty” around the delta variant of Covid-19, Carnival said.
Like the rest of the industry, the world’s largest cruise operator had been largely sidelined until the third quarter. It had begun ramping operations back up, helped by pent-up demand, when a dramatic new wave of Covid-19 hit the U.S., hitting particularly hard in Florida, home to the world’s busiest cruise port.
The shares rose 2.3% to $25.25 at 9:41 a.m. in New York trading.
©2021 Bloomberg L.P.