Despite reports of plunging revenue due to prolonged periods of not sailing during the COVID-19 pandemic, the CEO of Norwegian Cruise Line (NCL) – which reported a net loss of $715 million in its second quarter on August 6th – is “astonished” at how well bookings continue to pour in.
According to its latest earnings report, NCL’s has revenue dropped by $17 million (USD), down from $1.7 billion USD last year.
The cruise line, alongside others with the Cruise Lines International Association (CLIA), also recently suspended voyages until at least November.
NCL’s monthly cash burn is estimated to be around $160 million amid the pandemic. However, company CEO Frank Del Rio remains optimistic that the cruise industry’s loyal customer base will keep NCL afloat.
In a recent media call, Del Rio was “astonished how well bookings are coming in, given the fact the industry is suspended,” as reported by Forbes.
Despite eye-popping revenue losses, NCL has reportedly secured $1.2 billion USD of advanced ticket sales as of June 30th, 2020. And of those advanced ticket sales, $800,000 USD comes from future cruise credits.
Furthermore, Norwegian raised $1.5 billion USD in July to cover its financial losses, “which we believe positions us to withstand a scenario of prolonged voyage suspensions,” Del Rio said.
“If you had told me that we were going to be facing this set of circumstances, and your question is, ‘Frank, would you be taking any bookings?’ I would have laughed at you. I’ll say, ‘Of course, not, who would book? It’s crazy,’” Del Rio said. “But people are booking. People are confident that we’re going to come back. People do want to cruise. They miss it…And so this is temporary. The question is how temporary is ‘temporary.’”