Latest news with #CarnivalCorporation
Telegraph
3 days ago
- Business
- Telegraph
The murky reason why cruise ships are registered in obscure countries
It is an established maritime practice dating from ancient times, but the foreign flagging of merchant vessels that carry passengers and cargo has become a contentious issue in recent years that periodically sees the cruise industry put on the defensive. Critics regularly attack cruise companies for registering ships in the likes of Panama, Bermuda and the Bahamas instead of the countries where they are based, slamming these 'flags of convenience' as a tawdry means of sidestepping the onerous tax, employment and legislative regimes of more developed nations. A Trump-led crackdown The issue raised its head in February when the Trump administration turned its attention to foreign-flagged vessels, with Howard Lutnick, the US commerce secretary, pinpointing cruise ships and threatening to tax those that called at US ports. 'You ever see a cruise ship with an American flag on the back? They have flags of Liberia or Panama. None of them pays taxes,' he told Fox News. 'This is going to end under Donald Trump. Those taxes are going to be paid.' His words were enough to send cruise stocks plummeting within minutes of the broadcast, with four of the main players – Carnival Corporation, which owns P&O Cruises and Cunard; Royal Caribbean Group; Norwegian Cruise Line Holdings; and Viking Holdings – collectively down $15.4 billion at their lowest point, though they later recovered. However, this isn't the first time industry observers have heard such threats, and it was pointed out that any policy aimed at the cruise industry would ensnare cargo shipping too, as the industries are so entwined and cruising makes up just a tiny proportion. Steven Wieczynski of Stifel Financial, which provides investment banking analysis, was reported as saying: 'We have seen this story play out before. This is probably the tenth time in the past 15 years we have seen a politician or other [Washington] DC bureaucrat talk about changing the tax structure of the cruise industry. Each time it was presented, it didn't get very far.' Since then, the issue has gone quiet, but Trump's unpredictability and the speed of some of the administration's other decisions means the industry can't afford to be caught napping. Prohibition-era origins The global merchant shipping fleet exceeds 100,000 vessels, with cruise ships accounting for only around 400, yet it is the cruise industry that is invariably in the firing line when this issue rears its head. One of the most damning accusations of flying foreign flags is that it enables cruise and cargo companies to dodge labour regulations and pay lower salaries than would be permitted in the likes of the United States or Britain, though cruise salaries usually compare favourably with average salaries in the home countries of their on-board staff. For passengers, there are few obvious clues as to where their ship is registered, and apart from noticing which port and flag is painted on the hull, they would be hard-pressed to find any other trace. It was during the 1920s Prohibition era that passenger steamship lines started registering ships in Panama to bypass the US's strict alcohol laws. Once they realised the accompanying benefits of cheaper labour and fewer restrictions, some companies stuck with Panama, even when Prohibition ended in 1933. As other lines cottoned on and followed suit, the practice became more prevalent and the term 'flag of convenience' was coined in the 1950s. Under international law, all merchant ships must be registered in a host country and operate within its legal framework, with periodic inspections from the authorities. Not all countries offer ship registry. Those that do are known as flag states and while many have residency or nationality strictures, there are more than 40 that don't. These are called open registries and there are a large number in the Caribbean, with others dotted around Africa, the Pacific, Europe and Asia offering flags of convenience, which provide a lucrative income stream. The ships that fly their home flag However, not all cruise ships take this option, as a few are registered in countries to which they have the strongest ties. For instance, Holland America Line ships sail under the Netherlands flag to reflect their Dutch heritage, while Viking's ocean ships have Norwegian registry in a nod to the line's Nordic roots. Three Princess Cruises ships – Sapphire Princess, Diamond Princess and Majestic Princess – are registered in the UK. Conversely, Cunard stopped sailing under the Union Jack in 2011, breaking a 171-year tradition. It swapped its UK registry to Bermuda to enable it to conduct weddings on board, though at the time some observers felt it was more to do with cutting wage costs. The problem with the Stars and Stripes A complication for cruise companies contemplating American registration is that it requires ships to have been built in the US. This presents an immutable problem for nearly all cruise lines, as there are no shipyards with the capacity or expertise to build the size and type of modern cruise ships now in operation. That's why they are largely built in Europe. Thus the American flag is only found on small-ship boutique lines offering coastal and river cruises, such as UnCruise Adventures and American Cruise Lines, as their vessels have been built at US shipyards. The only exception is Norwegian Cruise Line's 2,150-passenger Pride of America, which is based in Hawaii year-round. It was granted a special exemption by the US authorities because its hull was constructed at a Mississippi yard, and then towed to Europe to be completed at German shipyard Lloyd Werft. US registry means these ships have significantly higher operating costs, in part due to them having to employ US crews on American wages. However, the big advantage they have over foreign-flagged ships is that under the US Passenger Vessel Services Act, only US-registered ships are permitted to sail exclusively to US ports. All others have to include at least one foreign stop in itineraries, which explains why Alaska voyages either start or finish at Vancouver, or if they depart from a US port, the itinerary will include a stop in Canada. Sailings along America's west coast and around the Hawaiian islands invariably include Mexican ports for the same reason. Pride of America 's US registry is estimated to cost millions of dollars in higher costs. However, on the plus side, it stands out as the only major cruise line with a ship based in Honolulu for sailings exclusively devoted to the islands without the need for superfluous detours. It's a bureaucratic system the cruise industry has successfully navigated over the years. Whether Trump will now rock the boat is anyone's guess.
Yahoo
16-05-2025
- Yahoo
Another MSC cruise passenger arrested; Silversea cruise ship fined
Violent altercations involving passengers sailing on multiple cruise lines have made headlines in recent weeks, and the trend grew more troubling with the latest incident, which remains under investigation. A 60-year-old man died on board MSC Cruises' MSC Virtuosa on Saturday, May 3 following an altercation that happened shortly after the ship departed from Southampton, England, on a short weekend cruise to Bruges, deadly fight prompted British police to launch an investigation that led to a passenger's arrest on suspicion of murder. Now, a second passenger has been arrested. British police have reassured concerned cruisers and local residents that the onboard incident appeared to be isolated, and thanked MSC Virtuosa crew members for their cooperation and assistance. Doug Parker shared more details on the ongoing cruise ship murder investigation and other cruise news, including a Silversea cruise ship captain who crossed an environmental line, on the May 13th edition of Cruise News Cruise News Today with Doug Parker. Good morning, here's your cruise news for Tuesday, May 13th. A second man has been arrested after a passenger died following an altercation aboard the MSC Virtuosa. Now police say a 56-year-old man from Richmond was arrested on suspicion of manslaughter. This following a 57-year-old man who was previously arrested for suspected murder. Both men have already been released on incident occurred on May 3rd, shortly after departure from Southampton. Authorities say it appears to be isolated and are asking anyone on board at the time to come forward with information. And a luxury cruise ship has been fined for sailing into protected waters near Italy's Capri island on May Silver Ray came within 500 meters of Faraglioni rock formations, violating environmental regulations. Smartphone footage and tracking data confirmed the breach, prompting an $1,100 fine and a warning to the captain from maritime authorities. The incident has reignited calls to designate the area a formal marine protected zone. And Carnival Miracle has returned to service in Europe after a major dry dock. Yeah, the ship launched its summer season from Lisbon on May 11th, featuring updates like a new Heroes Tribute Bar, a dedicated Chef's Table, and refreshed public areas. The ship will sail 16 sailings this summer across Europe, including British Isles and the then, November it heads to Tampa for Caribbean and Bahamas cruises. Carnival Miracle was launched in 2004. And cruise stocks were up on Tuesday. Carnival Corporation: up 10%, 22.13. Royal Caribbean: up 4%, 242.18. Norwegian: up 8%, 19.15. And Viking: up 5%, 45.57. If you have a lead on a story, let us know. Tips@ Have yourself a great Tuesday. I'm Doug Parker with Cruise News Today. (The Arena Group will earn a commission if you book a cruise.) , or email Amy Post at or call or text her at 386-383-2472.
Yahoo
16-05-2025
- Climate
- Yahoo
Carnival Cruise Line ship hit hard by flooding during storm
Severe weather is something many cruise passengers never hope to experience during a vacation at sea, but sometimes it can't be avoided. A rainy day on a cruise is sometimes cause for disappointment, but usually doesn't result in more significant concerns like a missed port of call. Thunderstorms can disrupt or shut down certain cruise activities. though. including shore excursions, pools, and line private islands like Royal Caribbean's Perfect Day at CocoCay in The Bahamas can even shut down entirely when severe weather moves in, sending cruisers back to their ships early. And even without lightning, heavy rain can have an impact on cruises, but not just because it closes down the pool and sends passengers indoors. When rain comes down hard and fast on a cruise ship, it can actually flood certain areas of the ship as drainage systems struggle to keep up with the deluge of rainwater. That's what happened on board one Carnival cruise ship sailing through a heavy rainstorm in The Bahamas this week. Doug Parker shared more details on the cruise ship flood and other cruise news on the May 14th edition of Cruise News Cruise News Today with Doug Parker. Good morning, here's your cruise news for Wednesday, May 14th. Severe weather has caused major flooding aboard the Carnival Conquest currently sailing in The Bahamas. Passengers report water nearly entering cabins with balconies submerged and crew working nonstop to contain the flooding. The storm began Monday evening and is expected to continue through today. The Bahamas has been hit hard this week by that same weather front that moved through Florida earlier in the guest sailing on Conquest told us that this is some of the worst flooding they've ever seen on a cruise ship. And Royal Caribbean Symphony of the Seas was diverted to Port Everglades on Tuesday to evacuate an injured guest. Yeah, the ship had left CocoCay earlier that day because lightning shut the island down. Around noon, an Alpha medical alert was issued for an injury in the ship's Central Park area.A later call requested Type O blood donors in which 30 passengers volunteered. The injured guest was transferred to a Broward County rescue boat around 4 p.m. on Tuesday. Royal Caribbean refunded all excursions from CocoCay. And the cruise industry is now clarifying details on Mexico's new in-transit cruise passenger fee set to begin this summer. Now, unlike prior claims, this is an in-transit fee, not a non-resident duty tax. And the final rate kicks in a year later than initially reported. The fee will start at $5 per guest on July 1st, rising in stages to $21 by 2028. The change impacts all ships visiting cruise stocks were up on Tuesday. Carnival Corporation: up 3%, 22.74. Royal Caribbean: up 2.3%, 247.84. Norwegian: up 1%, 19.33. And Viking: up 1.4%, 46.18. If you have a lead on a story, let us know. Tips@ Have yourself a great Wednesday. I'm Doug Parker with Cruise News Today. (The Arena Group will earn a commission if you book a cruise.) , or email Amy Post at or call or text her at 386-383-2472.
Yahoo
15-05-2025
- Business
- Yahoo
Down 11%, Is Carnival Stock a Buy?
Trump's April tariff announcements caused cruise stocks to plummet. But is the crash overdone? Carnival's business has long rebounded from the COVID-19 crisis, but the mountain of debt remains. 10 stocks we like better than Carnival Corp. › Sometimes, economic uncertainty can create opportunities in the stock market. With shares down 11% since the start of the year, Carnival Corporation (NYSE: CCL) stock is probably on the radar of deal-hungry investors. The cruise ship operator's focus on consumer experiences could shield it from tariff-related effects on physical goods. But can it overcome its debt-laden balance sheet? Let's dig deeper to find out. U.S. President Donald Trump's April tariff announcement sparked a sharp decline in Carnival and other cruise stocks. This reaction is understandable. As the Trump administration has often pointed out, the U.S. has fallen behind in commercial shipbuilding, making cruise companies hugely reliant on foreign supply chains. Carnival's multi-million-dollar vessels are typically built with the help of European partners like Italy's Fincantieri and Germany's Meyer Werft in shipyards across Europe and Asia. While many of Trump's tariffs are currently paused or under negotiation, potential levies of 10% and higher could dramatically increase Carnival's capital expenditure budget, which is expected to total $1.1 billion for new-build ships and $2.5 billion for non-new-build ships this year. The good news is that management can mitigate this challenge by focusing on shifting ships within its brand portfolio to the locations where they are needed. It can also acquire pre-owned ships from American companies that will likely be exempt from the tariffs. More importantly, however, Carnival's core business of operating cruises seems relatively insulated from tariff-related pressure. Tariffs generally apply to physical products arriving at a nation's ports. Since Carnival mainly provides experiences, this won't significantly affect its business model. Onboard revenue should also be relatively safe because the Florida-based company sources food from a vast network of local suppliers, often located near its embarkation points. Business is booming. First-quarter revenue jumped 7% year over year to $5.8 billion, driven by strength in both ticket sales and onboard revenue. Margins also remain strong, helping to contribute to adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $1.2 billion. But when we look a little closer, there are still some challenges. With $25.5 billion in long-term debt on its balance sheet, Carnival is incurring a whopping $377 million per quarter in interest expense on top of the sizable debt maturities it faces ($1.1 billion this year, and $2.7 billion in 2026). While companies can usually refinance high-interest debt, the current economic uncertainty keeps inflation expectations high and makes the Federal Reserve reluctant to lower interest rates. While Carnival's adjusted EBITDA looks good, it is adding back significant non-cash outflows like depreciation and amortization, which are essential to track considering the asset-heavy nature of its business. When all such outflows are factored in, the company generated a net loss of $78 million in the first quarter, which better reflects the value it's creating (or instead destroying) for its shareholders despite the top-line growth. With a forward price-to-earnings (P/E) multiple of just 12, Carnival stock may look cheap, especially compared to the S&P 500 average of 28. However, investors shouldn't overlook the $25 billion in long-term debt that will substantially drain the company's cash flow and earnings. While Trump's trade policy will have a limited effect on Carnival's direct operations, it will probably make the Federal Reserve less likely to lower interest rates, which the company will need to refinance on favorable terms. Investors should look for better deals in the market. Before you buy stock in Carnival Corp., consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Carnival Corp. wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $613,951!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $796,353!* Now, it's worth noting Stock Advisor's total average return is 948% — a market-crushing outperformance compared to 170% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 12, 2025 Will Ebiefung has no position in any of the stocks mentioned. The Motley Fool recommends Carnival Corp. The Motley Fool has a disclosure policy. Down 11%, Is Carnival Stock a Buy? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
12-05-2025
- Business
- Yahoo
Carnival Corporation & plc Announces the Redemption of Existing $993 Million 7.625% Senior Unsecured Notes due 2026 and Launch of New Senior Unsecured Notes Offering for Interest Expense Reduction
MIAMI, May 12, 2025 /PRNewswire/ -- Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) today announced that Carnival Corporation (the "Company") commenced a private offering (the "Notes Offering") of new senior unsecured notes in an aggregate principal amount of $1.0 billion, expected to mature in 2031 (the "Notes"), to refinance the Company's $993 million 7.625% senior unsecured notes due 2026 (the "2026 Unsecured Notes"), expecting to reduce interest expense and manage its future debt maturities. In addition, the indenture that will govern the Notes is expected to have investment grade-style covenants. The Company issued a conditional notice of redemption for the entire outstanding principal amount of the 2026 Unsecured Notes to be redeemed on or about May 22, 2025, at a redemption price equal to 100.0% of the principal amount of the 2026 Unsecured Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. The Company expects to fund the redemption using the net proceeds from the Notes Offering. The redemption is conditioned on the closing of the Notes Offering. This press release does not constitute a notice of redemption with respect to the 2026 Unsecured Notes. The Notes will be offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States, only to non-U.S. investors pursuant to Regulation S under the Securities Act. The Notes will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws. This press release shall not constitute an offer to sell or the solicitation of an offer to purchase the Notes or any other securities and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which such offering, solicitation or sale would be unlawful. About Carnival Corporation & plc Carnival Corporation & plc is the largest global cruise company, and among the largest leisure travel companies, with a portfolio of world-class cruise lines - AIDA Cruises, Carnival Cruise Line, Costa Cruises, Cunard, Holland America Line, P&O Cruises, Princess Cruises and Seabourn. Cautionary Note Concerning Forward-Looking Statements Carnival Corporation and Carnival plc and their respective subsidiaries are referred to collectively in this press release as "Carnival Corporation & plc," "our," "us" and "we." Some of the statements, estimates or projections contained in this press release are "forward-looking statements" that involve risks, uncertainties and assumptions with respect to us, including some statements concerning the financing transactions described herein, future results, operations, outlooks, plans, goals, reputation, cash flows, liquidity and other events which have not yet occurred. These statements are intended to qualify for the safe harbors from liability provided by Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts are statements that could be deemed forward-looking. These statements are based on current expectations, estimates, forecasts and projections about our business and the industry in which we operate and the beliefs and assumptions of our management. We have tried, whenever possible, to identify these statements by using words like "will," "may," "could," "should," "would," "believe," "depends," "expect," "goal," "aspiration," "anticipate," "forecast," "project," "future," "intend," "plan," "estimate," "target," "indicate," "outlook" and similar expressions of future intent or the negative of such terms. Forward-looking statements include those statements that relate to our outlook and financial position including, but not limited to, statements regarding: Interest, tax and fuel expenses Liquidity and credit ratings The transactions described herein Because forward-looking statements involve risks and uncertainties, there are many factors that could cause our actual results, performance or achievements to differ materially from those expressed or implied by our forward-looking statements. This note contains important cautionary statements of the known factors that we consider could materially affect the accuracy of our forward-looking statements and adversely affect our business, results of operations and financial position. These factors include, but are not limited to, the following: Events and conditions around the world, including geopolitical uncertainty, war and other military actions, pandemics, inflation, higher fuel prices, higher interest rates and other general concerns impacting the ability or desire of people to travel could lead to a decline in demand for cruises as well as have significant negative impacts on our financial condition and operations. Incidents concerning our ships, guests or the cruise industry may negatively impact the satisfaction of our guests and crew and lead to reputational damage. Changes in and non-compliance with laws and regulations under which we operate, such as those relating to health, environment, safety and security, data privacy and protection, anti-money laundering, anti-corruption, economic sanctions, trade protection, labor and employment and tax, may be costly and lead to litigation, enforcement actions, fines, penalties and reputational damage. Factors associated with climate change, including evolving and increasing regulations, increasing concerns about climate change and the shift in climate conscious consumerism and stakeholder scrutiny and increasing frequency and/or severity of adverse weather conditions could have a material impact on our business. Inability to meet or achieve our targets, goals, aspirations and initiatives, and our public statements and disclosures regarding them, including those related to sustainability matters, may expose us to risks that may adversely impact our business. Cybersecurity incidents and data privacy breaches, as well as disruptions and other damages to our principal offices, information technology operations and system networks and failure to keep pace with developments in technology have adversely impacted and may in the future materially adversely impact our business operations, the satisfaction of our guests and crew and may lead to fines, penalties and reputational damage. The loss of key team members, our inability to recruit or retain qualified shoreside and shipboard team members and increased labor costs could have an adverse effect on our business and results of operations. Increases in fuel prices, changes in the types of fuel consumed and availability of fuel supply may adversely impact our scheduled itineraries and costs. We rely on suppliers who are integral to the operations of our businesses. These suppliers and service providers may be unable to deliver on their commitments, which could negatively impact our business. Fluctuations in foreign currency exchange rates may adversely impact our financial results. Overcapacity and competition in the cruise and land-based vacation industry may negatively impact our cruise sales, pricing and destination options. Inability to implement our shipbuilding programs and ship repairs, maintenance and refurbishments may adversely impact our business operations and the satisfaction of our guests. We require a significant amount of cash to service our debt and sustain our operations. Our ability to generate cash depends on many factors, including those beyond our control, and we may not be able to generate cash required to service our debt and sustain our operations. Our substantial debt could adversely affect our financial health and operating flexibility. The risk factors included in Carnival Corporation's and Carnival plc's Annual Report on Form 10-K filed with the SEC on January 27, 2025. The ordering of the risk factors set forth above is not intended to reflect our indication of priority or likelihood. Additionally, many of these risks and uncertainties are currently, and in the future may continue to be, amplified by our substantial debt balance incurred during the pause of our guest cruise operations. There may be additional risks that we consider immaterial or which are unknown. Forward-looking statements should not be relied upon as a prediction of actual results. Subject to any continuing obligations under applicable law or any relevant stock exchange rules, we expressly disclaim any obligation to disseminate, after the date of this document, any updates or revisions to any such forward-looking statements to reflect any change in expectations or events, conditions or circumstances on which any such statements are based. Forward-looking and other statements in this document may also address our sustainability progress, plans and goals (including climate change and environmental-related matters). In addition, historical, current and forward-looking sustainability- and climate-related statements may be based on standards and tools for measuring progress that are still developing, internal controls and processes that continue to evolve and assumptions and predictions that are subject to change in the future and may not be generally shared. View original content: SOURCE Carnival Corporation & plc
