Carnival Corp. & plc's fourth quarter loss widened but cash from operations turned positive in November and revenue per passenger cruise day topped Q4 2019.
The Omicron variant is affecting bookings for near-term sailings but not return-to-service plans.
Some 61% of the company's capacity is operating and Carnival continues to expect its full fleet will be back in service by spring.
US GAAP net loss was $2.6bn, up from the $2.2bn loss a year ago, while adjusted net loss was $1.96bn, compared to $1.86bn.
Cumulative advance bookings for the second half of 2022 and first half of 2023 are at the higher end of historical ranges and at higher prices, with or without future cruise credits.
Customer deposits increased $360m, to $3.5bn, in Q4, the third consecutive quarter of growing deposits.
Carnival has refinanced more than $9bn, reducing its future annual interest expense by approximately $400m per year and extending maturities.
'Since resuming guest cruise operations, we have established effective protocols for COVID-19 and its variants and have returned 65,000 team members and 50 ships, all while delivering an exceptional guest experience to over 1.2 million guests and counting,' Carnival Corp. & plc President and CEO Arnold Donald said.
Positive cash flow
Cash from operations turned positive November, earlier than expected, and Carnival projects consistently positive cash flow beginning in Q2 2022 as additional ships resume operations.
'We enter the year with $9.4 billion of liquidity, essentially the same liquidity level as last year but with significantly improved cash flow generation ahead, as ship operating cash flow and customer deposits continue to build,' Donald said. 'During 2021, we believe we have clearly maximized our return to service and strengthened our financial position to withstand potential volatility on our path to profitability.'
Revenue PCD up
Revenue per passenger cruise day increased approximately 4% in Q4, compared to a strong 2019. The increase was driven in part by exceptionally strong on-board and other revenue.
Occupancy was 58%, better than the 54% in Q3 this year.
Available lower berth days were 10.2m, or 47% of total fleet capacity. ALBDs are expected to be 14.1m for Q1 2022, or 63% of total fleet capacity.
Carnival Cruise Line nearing 90% occupancy
Donald noted Carnival Cruise Line experienced another quarter of double-digit revenue growth per passenger day compared to 2019, operating at nearly 60% of its capacity while also improving occupancy, and is now approaching 90% occupancy levels in December.
Cash burn lower than expected
The company's monthly average cash burn rate in Q4 was $510m, better than expected. Incremental costs are expected as more of the fleet resumes operating and dry dock expense goes up.
28 ships to undergo dry dock in first half
Some 28 of Carnival's 94 ships are planned to undergo dry docking in the company's fiscal first half.
Second half profit still forecast
Carnival expects a net loss for the first half of 2022 and a profit for the second half of 2022 on both a US GAAP and adjusted basis for both periods.
Jim Hepple is an Assistant Professor at the University of Aruba and is Managing Director of Tourism Analytics.