Reporting results for the first half of 2020, Genting Hong Kong stated it is in the process of seeking additional equity or debt funding from private investors and has received letters from investors, expressing an interest to invest in one of the company’s cruise brands (believed to be Crystal Cruises). Such funding is furthermore expected to be in place within the next 12 months. Meanwhile, Genting also stated that it believes it has sufficient working capital and cash flow to meet its financial obligations through June 2021
Having suspended cruise operations since February and MV Werften’s shipyard operations since March, Genting posted a loss of US$742.6 million for the first six months of 2020, compared to a loss of US$56.5 million for the same period last year. As of June 30, Genting reported cash and cash equivalents of US$397.50 and total debt of US$3,261.2 million.
Genting said in its report that it is seeing positive developments and expects cruise operations to start in January 2021 and that it is considering alternative deployment plans in countries where restrictions have been lifted or relaxed.
Genting also announced that it has received approval from Chinese authorities to operate domestic cruises from Sanya, and said it is in the process of negotiating with other regional governments to start domestic cruises. It said these initiatives provide more visibility in the future of the company and its leadership role to restart cruising after COVID-19.
All but three ships are presently laid up; the Explorer Dream launched service from Taiwan in late July, and the Superstar Aquarius and Gemini serve as accommodation ships in Singapore for foreign workers recovering from the virus.
Shipyard operations are expected to resume in October (2020). The company said it is in the process of applying for long-term funding from the German Federal Government.
The deliveries of the Crystal Endeavor and Global Dream, currently under construction, have been rescheduled, while the construction of the second Global-class cruise ship has been postponed, and the construction of the second Endeavor class ship for Crystal has been suspended.
In managing its cash flow, Genting said it has significantly reduced the onboard crew, imposed a company-wide recruitment freeze and restricted all non-essential expenses.
Genting owns and operates Crystal Cruises, Dream Cruises and Star Cruises.
Photo: Artist’s rendering of yet-to-be-ordered next generation large cruise ship for Crystal.
