Royal Caribbean Cruises: Aggressive steps taken to minimize coronavirus risk

Royal Caribbean Cruises: Aggressive steps taken to minimize coronavirus risk

Royal Caribbean Cruises Ltd commented on the ongoing Coronavirus outbreak today:

As has been widely reported, China and other countries are moving aggressively to contain the spread of the virus.  The company communicates regularly with the CDC, the WHO and other health authorities around the world and has implemented measures to protect our guests and crew.  These include denying boarding to those that have traveled from, to or through mainland China or Hong Kong in the past 15 days and performing mandatory specialized health screenings on at-risk guests and crew. The company is assessing the developments constantly and will update these measures as needed.

“It is important that every organization acts responsibly, and we have already taken aggressive steps to minimize risk through boarding restrictions and itinerary changes,” said Richard D. Fain, Royal Caribbean Cruises Ltd. chairman and CEO.  “Our shipboard and shoreside teams have been working tirelessly through these circumstances and I want to thank them for all of their extraordinary efforts. We appreciate our responsibility to our guests and to each other, and our focus on public health is unwavering.”

As a result of the travel restrictions in place and related circumstances, the company has now cancelled a total of 18 sailings in Southeast Asia and has also modified several itineraries.  Taken together, these measures have an estimated impact on the company’s financial performance for 2020 of approximately $0.65 per share.  While not currently planned, if the company was to cancel all of its remaining sailings in Asia through the end of April, it would impact 2020 financial performance by an additional $0.55 per share.  

There are still too many variables and uncertainties to make a reasonable forecast for 2020.  While the early impact due to concerns about the coronavirus is mainly related to Asia, recent bookings for our broader business have also been softer.

If the travel restrictions and concerns over the outbreak continue for an extended period of time, they could materially impact the company’s overall financial performance.