Carnival Cruises reports $4.4bn second quarter loss as ships remain in ports

Cruise liner company says it can't predict when normal operations will be resumed

SYDNEY, AUSTRALIA - JUNE 9:  In this handout image provided by Carnival Australia, P&O Cruises 'Pacific Jewel' cruise's out of Sydney with a message of support for the New South Wales State of Origin team emblazoned across her front on June 9, 2012 in Sydney, Australia. The Sydney-based superliner sported a giant banner measuring 24m by 5m above her bow, cheering on the Blues ahead of the all-important second State of Origin match against the Queensland Maroons at ANZ Stadium on June 13. Pacific Jewel's 1900 passengers will be able to watch the second Origin game live on the ship's Big Screen during a call at Vila, Vanuatu, on Wednesday June 13, as part of a 13-night roundtrip Pacific Islands cruise.  The move follows the cruise line securing an international rights deal to show live NRL games at sea, including all three State of Origin matches. (Photo by James Morgan/Carnival Australia via Getty Images)

Cruise titan Carnival Corportation reported a second-quarter loss of $4.4 billion (Dh16.2bn) including $2bn in impairment charges, and warned that it is unable predict when it will be able to resume operations given the lingering coronavirus shutdown.

The world’s largest cruise company said its adjusted net loss for the period ended May 31, excluding the charges, was $3.30 a share. That’s far deeper than analysts’ expectation of a $1.95 loss. Revenue was just $700 million, an 85 per cent plunge from the year-earlier $4.8bn. Carnival’s shares skidded in early trading on Thursday.

While rival Norwegian Cruise Line Holdings this week extended its cruising suspension through to the end of September, Carnival said it couldn’t provide a resumption target at all. Norwegian’s announcement slammed the brakes on what had been a remarkable recovery for cruise stocks, and Carnival’s further downbeat news is likely to extend losses.

Carnival is working to downsize its fleet, expecting a long, phased return to cruising when it eventually comes. The Miami-based company said it has preliminary agreements to dispose of six ships and is the process of concluding more such deals.

Like other cruise operators, Carnival has taken steps to shore up its cash and debt positions in an effort to weather the pause. The company said it has a total of $7.6bn in available liquidity and faces $250m a month in operating and administrative expenses.