Cruise bookings for the Royal Caribbean Group are improving, according to a company SEC filing.

“Our bookings for 2021 have continued to improve over the last two months, although still below pre-COVID-19 levels,” the company said. “Pricing for 2021 bookings is relatively flat year-over-year when including the negative yield impact of bookings made with future cruise credits; it is slightly up year-over-year when excluding them. We have implemented various programs to best serve our booked guests providing the choice of future cruise credits (“FCCs”) or the opportunity to “Lift & Shift” their booking to the same sailing the following year in lieu of providing cash refunds.” 

Also announcing a $1 billion capital raise on Tuesday, the company said that as of September 30, 2020, it had liquidity of approximately $3.7 billion, including $3.0 billion in the form of cash and cash equivalents and a $0.7 billion commitment for a 364-day term loan.

“Our cash burn rate for the third quarter was consistent with our previously announced range of approximately $250 million to $290 million per month during a prolonged suspension of operations, when excluding cash refunds of customer deposits, commissions, cash inflows from new and existing bookings and fees and collateral postings related to our financing and hedging activities,” the company announced.

“In response to the financial impacts of COVID-19, we have taken preemptive actions that focus on strengthening liquidity through significant cost and capital expenditure reductions, cash conservation and additional financing sources.”

Reduced Operating Expenses

• significantly reduced ship operating expenses, including crew payroll, food, fuel, insurance and port charges;
• further reduced operating expenses as ships are currently transitioning into various levels of layup with several ships in the fleet transitioning into cold layup;
• eliminated or significantly reduced marketing and selling expenses for the remainder of 2020;
• reduced and furloughed the company’s workforce, with approximately 23% of its U.S. shoreside employee base being impacted; and
• suspended travel for shoreside employees and instituted a hiring freeze across the organization.

“We may seek to further reduce our average monthly expenses under a further prolonged non-revenue scenario,” the company said. “This includes consideration of additional vessels heading to cold layup as well as further assessment of our U.S. shoreside workforce, including those coming back from furlough”.

Reduced Capital Expenditures

Since the start of February 2020, Royal Caribbean said it had identified approximately $4.4 billion of capital expenditure reductions or deferrals in 2020 and 2021.