Carnival to Further Accelerate Ship Exits; 18 Vessels to Leave

Amsterdam

Carnival Corporation said on Tuesday it will accelerate the removal of less efficient cruise ships from its global fleet.

Previously, the world’s largest cruise operator said it 13 ships would exit its fleet, that number has been upped to 18, of which eight have already left the fleet.

“In total, the 18 ships represent approximately 12 percent of pre-pause capacity and only three percent of operating income in 2019,” Carnival said, in an SEC filing.

“The sale of less efficient ships will result in future operating expense efficiencies of approximately two percent per available lower berth day (“ALBD”) and a reduction in fuel consumption of approximately one percent per ALBD,” Carnival said.

“We continue to take aggressive action to emerge a leaner more efficient company. We are accelerating the exit of 18 less efficient ships from our fleet. This will generate a 12% reduction in capacity and a structurally lower cost base, while retaining the most cash generative assets in our portfolio,” commented Arnold Donald, CEO, in the filing. 

Based on the actions taken to date and the scheduled newbuild deliveries through 2022, the company’s fleet will be more efficient with a roughly 13 percent larger average berth size and an average age of 12 years in 2022 versus 13 years, in each case as compared to 2019.

The most recent ship exits include the Rotterdam and Amsterdam, which have been sold to Fred. Olsen Cruise Lines from Holland America Line. 

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