Carnival Corp (NYSE: CCL) said on Friday its cruises operating in fiscal Q3 were cash flow positive. Shares of the company closed about 3.0% up on confidence that momentum will sustain in the upcoming months.
Net loss increased sequentially to $2.8 billion
Carnival reported $2.8 billion in net loss for the third quarter versus the year-ago figure of $2.9 billion. Sequentially, however, it lost more money than Q2’s $2.1 billion. Carnival is still lagging sharply behind 2019 numbers when it posted $1.8 billion in net income for the third quarter.
On an adjusted basis, the cruise operator lost $2.0 billion – an increase from last year’s $1.7 billion. Carnival did not disclose what it lost in Q3 on a per-share basis.
The Q3 update comes only a day after Carnival said over 50% of its cruise capacity is likely to be operating by the end of October.
Monthly cash burn was lower than expected
On the flip side, Carnival’s monthly cash burn stood at $510 million on average in the third quarter that was better than what it had guided for earlier, as its Q3 voyages were cash flow positive.
The Miami-headquartered company said fear related to the delta variant hurt its booking volumes in the recent quarter that came in lower than Q2. It was, however, still stronger than the levels noted in the first quarter.
On the contrary, cumulative advanced bookings for the second half of 2022 are ahead of a very strong 2019, the company said in its press release.
CEO Arnold Donald’s remarks
Commenting on the financial update, CEO Arnold Donald said:
Carnival Cruise Line resumed operations in July offering Caribbean and Alaska sailings somewhat comparable to prior years and achieved 20% higher revenue per PCD than 2019 peak levels, despite onboard credits from cancelled cruises. Even with the unusually short booking window and capacity limitations, the brand achieved occupancy of approximately 70%, which speaks to the strong underlying demand for our core product.
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