Member Info for mattwales

most CEOs would plumb for option 1 and issue as much senior vanilla bonds as they can.

$7bn of vanilla bonds at 5% equates to $350m.

If their CEO was smart he would defer ship payments of a couple of billion and seek to raise less cash (ships which are delayed because production halted anyway)

https://www.bloomberg.com/news/articles/2020-03-27/carnival-seeks-up-to-7-billion-in-debt-amid-global-travel-halt

Carnival is discussing issuing a mix of debt and equity, the people said. Options include issuing $3 billion to $7 billion in senior secured first-lien debt, implying a loan-to-value ratio of about 25%, they said. The company is also weighing issuing $1.5 billion in convertible notes and $1 billion to $2 billion in common equity, one of the people said. The situation remains fluid, they said.

I meant higher lows we didnt just drop down to £6 again.

your big dilution doubtful they can raise $6bn in vanilla bonds (with the rest of their ship fleet as guarantee).

since they have never issued convertible bonds I have no idea why you would mention them.

so far higher highs and lower lows no sub 450p in sight.

They wrote off over $900m of goodwill which is a non cash loss event i.e over $700m loss did not go out of the business iits just a balance sheet restructure.

net income was $150m i.e a cash profit so in the midst of heavy cancellations they booked a profit.

No way it will close down for 6 months.

A lot of their cruises should be rerouted over to Asia now where it is much less affected as they could start operating cruises there right now.

While this was playing out they used hand sanitiser etc on ships so expect it to continue.

The majority of people will want a holiday after this lockdown your assertions are wrong and defy the logic of what is in their recent RNS.

Even in the midst of panic they sold over half a million cruises in early March (with no discounting) so at least income is coming in.

They have access to pretty much free cash and a rights issue which was 100% likely has gone.

They can utilise the cash to ride it out while buying back and redeeming long term underwater debt some of which is trading 46 cents to the dollar.

For every $1 billion of cash they can wipe out approximately $1.5bn of their long term debt out.

Also, Trump gave them a competitive advantage over European and Asian operatons and while these are desperately in need of cash with some maybe being liquidated Carnival can use bailout funds to buy liquidated assets.

2 weeks ago id have said cash was king.

With all the bailouts from every Government including the Uk assets are the place to get into as collectively they have printed trillions.

your not seeing the play.

Carnival CEO could utilise a $5bn loan for example.

Right now $1bn buys at least $1.5bn of debt at par booking them a $500m profit saving on redemption of those bonds while saving them at least $75m a year in debt interest.

They could also utilise bailout cash to buy insolvent European and Asian cruise companies.

They have already signed a $500 billion bailout of airlines and cruise lines and other industries in the USA.

https://www.nbcnews.com/politics/congress/white-house-senate-reach-deal-massive-2-trillion-coronavirus-spending-n1168136

Carnival being American/British has access to these bailout funds.

The barking mad booked over half a million cruises in 2 weeks up to March 15thwhile a virus was in pandemic mode it's in their RNS.

99.99% of people and I not recorded on official figures have this virus.

We're deemed not important enough or our condition isn't serious to be checked.

We're told to self isolate a week so the reality as dictated by Govt is over a million have it already.

I'd have agreed with you but the powers at be Trump wants everyone back at work by Easter sighting economic damage and more deaths from suicides than deaths from the virus.

They booked over half a million cruises in 2 weeks up to March 15th while this virus was in full swing.

Of course it could fall back to the 650 range but they managed to sell without heavy discounting while a virus was around.

The pent up demand will come back sooner than anyone thinks.

Operating Costs and Expenses
Cruise Commissions, transportation and other 2,720= no cash there
Onboard and other 2,101 = no cash there
Payroll and related 2,249 = halved at most
Fuel 1,562 = no costs
Food 1,083 = cancelled costs no more
Other ship operating 2,925 = no costs except probably their debt included in this
Tour and other 268 = no costs
Selling and administrative 2,480 = costs cut
Depreciation and amortization 2,160 = its not a cash expense no money goes out just accounts write down

total: 17,549


15,556


14,701

If I was their CEO id be borrowing $5bn from the bailout purchasing my long term underwater debt saving me important costs which they may well do.

Except debt payments they practically have no costs.

An example is Cineworld they have costs down to 30% with everything closed but they have rents to pay on top.

Carnival it should be lower they pay no rents on ships and as their new ships are delayed money will not be going out the door for these new ships.

Even if it went on for a year they'd lose around $3bn while paying down the debt.

Your assertions that it would go under are incorrect especially when they have access to bailout money.

Your off your head this would go under without bailout cash they would have opted for a rights issue.

Even if they borrowed an extra $3bn profits will be coming out at over $2.5bn 2021.

over half a million booked holidays during the virus outbreak for the 2 weeks up to march 15th tells me quite a lot want to go on cruises.

trump will give it the cash it needs plus as much aid as it can

Trump talking to Micky Arison about using Carnival cruise ships in COVID-19 response

https://www.miamiherald.com/news/business/tourism-cruises/article241336261.html

$500bn bailout for airliners, cruise liners and any business affected by covid 19

https://www.nbcnews.com/politics/congress/white-house-senate-reach-deal-massive-2-trillion-coronavirus-spending-n1168136

Carnival wont need a rights issue it should rise from here.

They need to cut costs of approx. £85m a month fast and I am not sure they can.

One saving grace is their off-trade income is still working even so without cost cutting losses must be around £50m a month while pubs and their hotel side are out of action.

Pretty much every company right now (except supermarkets) are cutting wages hard and sacking the rest.

This company failed to make profits for at least the past 2 years not a chance they will make it in a bust.

At our preliminary results announcement on 3 March we disclosed that Company-managed shop like-for-like sales grew by 7.5 per cent in the nine weeks to 29 February 2020.

For the two weeks that followed Company-managed shop like-for-like sales growth averaged 4.1 per cent and in the most recent week to 21 March 2020 we saw a 9.9 per cent decline.

The rate of decline has been increasing each day as more and more customers heed the Government advice on social distancing, and we would expect this to increase further if we were to continue to trade.

Thats the only reason they closed a drop in sales.