Norwegian Cruise Line Furloughs 20 Percent of Shoreside Staff
Norwegian Cruise Line Holdings - the parent company for Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises - said Wednesday that it will furlough 20 percent of its shoreside employees through July, reflecting the temporary cessation of commercial cruising.
Without revenue from current voyage operations, the company is spending $110-150 million from its cash reserves each month (after taking cost-saving measures). As it has about $1.4 billion in cash on hand, it is well-positioned to ride out the shutdown for an extended period.
The line is still taking bookings and deposits for future voyages out through 2022. Its U.S. sailings cannot resume until after the CDC's "No Sail Order" for all cruise line operations is lifted. The earliest expected date for the lifting of the ban is July 24.
"We have . . . taken decisive action to protect the company’s future by shoring up our liquidity position through cost mitigation and cash conservation measures as well as pursuing additional sources of liquidity to help us weather this global pandemic,” said Frank Del Rio, president and chief executive officer of Norwegian Cruise Line Holdings Ltd. “We believe the disruption to the travel industry, while swift and severe, will eventually subside. Our guests continue to demonstrate their desire for cruise vacations as we continue to experience demand for voyages further in the future across our three brands."
According to Norwegian, demand for cruising is soft for the rest of this year but appears relatively healthy for 2021. Advanced bookings for the remainder of 2020 are "meaningfully lower" than the prior year with pricing slightly down; as of the end of March, the firm had about $350 million in bookings for voyages scheduled for the remainder of 2020. Its bookings for 2021 are essentially flat compared to the prior year, at slightly lower prices.