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Pandemic Surge Due To Omicron Delays Revival Of Cruise Company Royal Caribbean


06/02/2022


Pandemic Surge Due To Omicron Delays Revival Of Cruise Company Royal Caribbean
The lightning spread at which the Covid-19 pandemic is continuing to spread because of the highly infectious Omicron variant of the coronavirus will delay its recovery from the pandemic hit by a few months, Cruise operator Royal Caribbean Group said earlier this week. This also marked yet another hit to the firms that were among the worst hit by the economic slowdown due to the pandemic
 
The stocks of Royal Caribbean went down by as much as 4 per cent following this bleak forecast by the company as well as a quarterly loss that was more than the market was expecting the company to report. The grim forecast by the company also negatively affected the stock price of its rivals such as Carnival Corp and Norwegian Cruise Line Holdings Ltd.
 
Cruise operators have been forced to rejig their trip itineraries and even cancel voyages in recent months because of the very fast spread of the pandemic caused by the Omicron variant. This has halted a recovery in the industry – even while the recovery was at a nascent stage. The ships of the cruise companies have remained docked at ports in the United States for the major time period of the pandemic.
 
"The timing of Omicron was particularly painful as a typical wave booking period begins in early January," Chief Executive Officer Jason Liberty said on an earnings call.
 
The owner of Celebrity Cruises anticipates a deficit in the first half of 2022 before turning profitable in the second half. Refinitiv polled analysts, who predicted a loss in the first quarter and a return to profitability in the second.
 
"(A recovery is) just going to continue to get pushed out and we're going to have delays and starts and stops until we are all clear of the pandemic," said Ivan Feinseth, the chief investment officer of Tigress Financial Partners.
 
The recurrence of Covid-19 infection has prompted the US Food and Drug Administration to issue a travel warning for cruises, which has forced even those passengers who frequently go on cruises to avoid such trips.
 
Total sale revenue for the fourth quarter for the Royal Caribbean was reported at $982.2 million, which was lower than that of analysts' expectations of $1.04 billion. The company also reported an adjusted per-share loss of $4.78 which was more than the $3.92 loss expected by analysts.
 
Royal Caribbean, on the other hand, reported that its bookings had picked up in late January and had recovered to pre-Omicron levels, with there was a decrease in the number of ticket cancellations.
 
(Source:www.skift.com)