Top Headlines

Windstar Cruises retrofits fleet with HEPA filters and UV-C light, partners with University of Colorado’s Anschutz Medical Center

Details

Written by Teijo Niemelä Teijo Niemelä

Category: Top Headlines Top Headlines

Published: 14 July 2020 14 July 2020

To address health concerns brought on by the pandemic, Windstar Cruises has committed to a holistic Beyond Ordinary Care program and will retrofit its fleet of six yachts with hospital-grade HEPA filters, ultraviolet germicidal irradiation and will employ a safe sanitization formula used in health care settings. A new partnership with the epidemiology department at the University of Colorado’s Anschutz Medical Center provides ongoing guidance.

“We are taking extensive measures and making multi-million dollar investments to operate our yachts more safely in this new environment,” said Windstar Cruises CEO Andrew Todd. “Building upon Windstar’s 180 degrees from ordinary service, the Beyond Ordinary Care program implements a layered system of science-led best practices aimed at keeping everyone aboard healthy.”

For additional guidance on combatting illnesses, Windstar connected with the epidemiology department at the University of Colorado’s Anschutz Medical Center, known for its work and expertise in infectious disease epidemiology. The collaboration aims to implement appropriate layers of protection to create a safe experience for guests on Windstar’s yachts.

"Windstar’s holistic approach has multiple layers of safety at hospital grade standards, and when combined with responsible hygiene practices from guests, it’s the safest environment achievable with tech and science as we know it today,” said Dr. Michelle Barron, Medical Director of Infection Prevention at University of Colorado Hospital and Professor of Medicine, Division of Infectious Diseases, at University of Colorado’s Anschutz Medical Center. “When you're sailing on a Windstar yacht, your biggest worry should be how to avoid a sunburn, not getting COVID-19."

Windstar is making significant investments and major operational adjustments to meet the requirements of the Centers for Disease Control and Prevention (CDC) and global governmental and public health guidance. Enhanced cleaning protocols on board include crew dedicated to frequent cleaning with special attention to high touch points and public areas. Going further, the Beyond Ordinary Care program employs proven technology and the highest-standard cleaning methods in combination with each other, as follows:

1. Install high-efficiency particulate air (HEPA) filters to filter the air on board
Current CDC Guidelines for Environmental Infection Control in Healthcare Facilities recommend HEPA filtration for recirculated air from patient isolation rooms in hospitals. These filters are being installed in the HVAC systems on all Windstar yachts.

2. Add yet another layer to sanitize/disinfect the HEPA-filtered air with UV-C light for germicidal irradiation 
Once air has moved through the HEPA filtration system, there is an opportunity to “zap” the air with UV-C light (also called germicidal irradiation) before the air recirculates on the ship. When air passes the UV-C light, microbes such as bacteria and viruses not trapped in the HEPA filter will be destroyed. Germicidal irradiation is a solution that has been proven to kill coronaviruses.

3. Use EvaClean with PurTab for disinfecting surfaces via sprayers
In addition to an elevated frequency of cleaning, sanitizing provides another layer of safety. This EPA-approved powerful sanitizer utilizes a safe and effective formula for disinfecting all types of hard and soft surfaces throughout the ship including guest rooms, crew spaces, and all public spaces. It has been used for everything from lower-level sanitization required for food-contact surfaces to powerful infection control used in health care settings. Every yacht will have the following areas sanitized regularly by dedicated crew trained and assigned to monitor and clean the ship by use of the improved sanitation products:
Guest rooms – Before each cruise departure
Public spaces – Lobbies, restrooms, open deck areas, restaurants, public sitting areas, etc., will all be disinfected before each cruise departure and then regularly during each cruise.
Crew quarters – To help the crew stay healthy, their environments will be cleaned and sanitized often.
Medical clinic and other wellness areas – Will be frequently sanitized

CEO Todd stressed that the cruise line, working with health experts and following the guidelines of the CDC, has carefully chosen cleaning and sanitation methods that have been shown to be effective against coronaviruses, as well as many other illness-causing microorganisms. These systems, in combination with an abundance of other prevention and mitigation steps, and diligence on behalf of guests, give Todd and Windstar Cruises confidence to sail the Windstar fleet in this challenging environment.

“Windstar operates small yachts that visit ports and waterways that large cruise ships simply can’t access,” said Todd. “There are major advantages to smaller ships besides less tonnage and passengers. Let’s face it, cleaning and purifying a 342-passenger ship is logistically easier than a 5,000 passenger ‘city at sea.’”

As part of the multi-layered approach, new pre-trip protocols for guests include a pre-departure questionnaire, and a request to wear masks when traveling to and from the ships. Each guest will receive a health screening prior to embarkation. Staggered arrival and departure times at check-in and disembarkation in ports will reinforce proper social distancing between guests.

Once on board, guests will find personalized service by dining staff in all venues, expanded dining times and seating arranged to provide more space between diners. The popular outdoor, top-deck BBQ will still be held with crew on hand to serve guests. Additional al fresco restaurants and complimentary room service (main restaurant dinner menu available via room service) increase dining options for all. Main dining venues will operate at 65 percent capacity, while specialty venues will operate at 60 percent. Crew, who will also be COVID-19 (PCR) tested before joining their assignment, will wear masks and instead of the usual embrace or handshake, look for the new “Windstar Wave” hand signal – a W made with one’s index fingers and thumbs. Temperature measurements will be required twice daily for crew.

Safety standards established on board will carry over to shore-side experiences. Tenders, motor coaches and smaller boats will operate at 50 percent capacity and will be cleaned between each use. Windstar will also expand medical staff on board, as well as increase crew training in cleaning practices, social distancing, and emergency response protocols. As more becomes known about the COVID-19 virus, Windstar’s policies will evolve. Information will be shared with crew and training ongoing.

Windstar operates a fleet of six small yachts carrying from 148 to 342 guests and is known for visiting small ports and hidden harbors around the world. Ports will be continually evaluated for safety and changes made as necessary. The 148-guest Wind Spirit will be its first yacht to resume sailing on September 10, 2020 in Tahiti. Other Windstar yachts will start cruising in the Mediterranean in October and the Caribbean in November, while other ships will come online in 2021 following scheduled major renovations.

Carnival Corporation & plc provides a business update, expect to dispose 13 vessels

Details

Written by Teijo Niemelä Teijo Niemelä

Category: Top Headlines Top Headlines

Published: 10 July 2020 10 July 2020

Carnival Corporation & plc provides a business update and additional financial information for the second quarter ended May 31, 2020.

In the face of the global impact of COVID-19, the company paused its guest cruise operations in mid-March. The company expects to resume guest operations, with ongoing collaboration from both government and health authorities, in a phased manner. Specific brands and ships are expected to return to service over time to provide guests with unmatched joyful vacations in a manner consistent with the company's highest priorities, which are compliance, environmental protection and the health, safety and well-being of its guests, crew and the communities its ships visit.

AIDA to resume cruise operations

AIDA previously announced it will resume guest cruise operations from ports in Germany beginning August 2020 with three of its ships, making it the first of the company's nine cruise brands to resume guest cruise operations. AIDA will introduce additional safety and protective measures which will include pre-boarding health questionnaires and temperature checks for both guests and crew, physical distancing guidelines, routing systems on arrival, departure and onboard, increased mitigation and sanitation efforts in all cabins and public areas, as well as closely managing capacities at onboard experiences. These enhanced measures have been developed with advice from medical experts and align with the current guidance from the World Health Organization ("WHO") and the German Robert Koch Institute ("RKI"), as well as other governmental and health authorities.

Capacity reduced by ship delivery deferrals and 13 expected ship dispositions

The company expects future capacity to be moderated by the phased re-entry of its ships, the removal of capacity from its fleet and delays in new ship deliveries. As previously announced, the company intends to accelerate the removal of ships in fiscal 2020 which were previously expected to be sold over the ensuing years. The company sold one ship during June 2020 and has agreements for the disposal of five ships and preliminary agreements for an additional three ships, all of which are expected to leave the fleet in the next 90 days. These agreements are in addition to the sale of four ships, which were announced prior to fiscal 2020. In total, the 13 ships expected to leave the fleet represent a nearly nine percent reduction in current capacity. The company currently expects only five of the nine ships originally scheduled for delivery in fiscal 2020 and fiscal 2021 will be delivered prior to the end of fiscal year 2021. In addition, the company expects later deliveries of ships originally scheduled for fiscal 2022 and 2023.

Carnival Corporation & plc President and Chief Executive Officer Arnold Donald noted, "We have been transitioning the fleet into a prolonged pause and right sizing our shoreside operations. We have already reduced operating costs by over $7 billion on an annualized basis and reduced capital expenditures also by more than $5 billion over the next 18 months. We have secured over $10 billion of additional liquidity to sustain another full year with additional flexibility remaining. We have aggressively shed assets while actively deferring new ship deliveries. We are working hard to resume operations while serving the best interests of public health with our way forward informed through consultation with medical experts and scientists from around the world."

Donald added, "We will emerge a leaner, more efficient company to optimize cash generation, pay down debt and position us to return to investment grade credit over time providing strong returns to our shareholders."

Maximizing liquidity

Since the pause in guest operations, the company has taken significant actions to preserve cash and secure additional financing to maximize its liquidity. While maintaining compliance, environmental protection and safety, the company significantly reduced ship operating expenses by transitioning ships into paused status. The company also reduced its administrative expenses, non-newbuild capital expenditures by $1.3 billion for 2020 and expects to reduce its newbuild capital expenditures by over $600 million for 2020, (net of export credit facilities). Additionally, since March, the company has raised over $10 billion through a series of financing transactions, including transactions that have occurred in the last three weeks, as follows:

– Borrowed an aggregate principal amount of $2.8 billion in two tranches under a first priority senior secured term loan facility on June 30, 2020
– Negotiated Debt Holiday amendments, deferring certain principal repayments otherwise due through March 2021. (Certain export credit agencies have offered a 12-month debt amortization and financial covenant holiday ("Debt Holiday"))

In addition, the company has $8.8 billion of committed export credit facilities that are available to fund ship deliveries originally planned through 2023.

Carnival Corporation & plc Chief Financial Officer and Chief Accounting Officer David Bernstein noted, "Quickly recognizing the financial situation, we took swift action to improve our liquidity by reducing expenses and leveraging our strong balance sheet to complete several capital transactions".

During the pause in guest operations, the monthly average cash burn rate for the second half of 2020 is estimated to be approximately $650 million. This rate includes approximately $250 million of ongoing ship operating and administrative expenses, working capital changes (excluding changes in customer deposits and reserves for credit card processors), interest expense and committed capital expenditures (net of committed export credit facilities) and also excludes scheduled debt maturities. The company continues to explore opportunities to further reduce its monthly cash burn rate.

The pause in guest operations is continuing to have material negative impacts on all aspects of the company's business. The longer the full or partial pause in guest operations continues, the greater the impact on the company's liquidity and financial position. The company continues to expect a net loss on both a U.S. GAAP and adjusted basis for the second half of 2020.

Demand continues for 2021 sailings

The company's brands have announced various incentives and flexibility for certain booking payments on select sailings to support guest confidence in making new bookings. These incentives vary by brand and sailing and include onboard credits and reduced or refundable deposits. In addition, the company is providing flexibility to guests with bookings on sailings cancelled due to the pause by offering guests the flexibility of enhanced future cruise credits ("FCC") or an election for a refund in cash. Enhanced FCCs increase the value of the guest's original booking or provide incremental onboard credits. As of June 21, 2020, approximately half of guests affected have requested cash refunds. Despite substantially reduced marketing and selling spend, the company continues to see demand from new bookings for 2021. For the most recent booking period, the first three weeks in June 2020, almost 60 percent of 2021 bookings were new bookings. The remaining 2021 booking volumes resulted from guests applying their FCCs to specific future cruises.

As of June 21, 2020, cumulative advanced bookings for the full year of 2021 capacity currently available for sale remain within historical ranges at prices that are down in the low to mid-single digits range, on a comparable basis, including the negative yield impact of FCCs and onboard credits applied.

As of May 31, 2020, the current portion of customer deposits was $2.6 billion, the majority of which are FCCs. $121 million of the company's customer deposit balance relates to third quarter sailings and $353 million relates to fourth quarter sailings. The company continues to expect any decline in the customer deposits balance in the second half of 2020, all of which is expected to occur in the third quarter, to be significantly less than the decline in the second quarter of 2020.

Protecting the health and safety of guests and team members

Throughout the pause in its guest cruise operations, the company has acted to protect the health and safety of guests and shipboard team members. The company returned over 260,000 guests to their homes, coordinating with a large number of countries around the globe. In addition, the company worked around the clock with various local governmental authorities, utilized its ships and chartered hundreds of planes to repatriate shipboard team members as quickly as possible. The company is extremely pleased with its ability to successfully repatriate approximately 77,000 of its shipboard team members to more than 130 countries around the globe, which is substantially all of its onboard workforce other than the safe manning team members who will remain on the ships, and thanks the numerous governments who worked closely with the company during the repatriation process.

Donald commented, "I could not be more proud of how collectively our team has handled this. We looked after our guests, each other and the over 700 places we go each year. Thanks to our crew for continuing to exceed guest expectations through challenging circumstances and our shoreside operations for working 24/7 to enhance our liquidity and to repatriate our guests and our crew. Also, thanks to our loyal guests, travel partners, shareholders and other stakeholders for their support during this challenging time."

Active consultation with science and medical experts

Throughout the pause in guest cruise operations, the company has been consulting and assembling the best minds in medical science, public health and infectious disease. These individuals include a robust line-up of world renowned medical, epidemiology and public health experts to provide the company with the latest science and medical evidence to inform practical, adaptable and science-based solutions for detection, prevention and mitigation of COVID-19.

In coordination with the World Travel and Tourism Council, the company is hosting an online Global Scientific Summit on COVID-19 on July 28, a forum which is open to the public and free of charge. Speakers and panelists include the company's expert advisors, representing a diverse range of science, research and business backgrounds, including amongst others, members of Scientists to Stop COVID-19, who have volunteered to participate. The company is grateful to bring together a select group of science and medical experts who will bring such relevant insight into COVID-19. To register for the Summit, please go to CovidScienceSummit.com.

Royal Caribbean Group acquires remaining interest in Silversea

Details

Written by Teijo Niemelä Teijo Niemelä

Category: Top Headlines Top Headlines

Published: 10 July 2020 10 July 2020

Royal Caribbean Group has purchased the remaining shares of Silversea Cruises, a pioneer and leader in ultra-luxury and expedition cruising.

The move to full ownership comes two years after Royal Caribbean Group acquired a two-thirds share of the cruise line in July 2018.

"Silversea has been a great fit for our company from the very first day," said Richard D. Fain, Chairman and CEO of Royal Caribbean Group. "The cultures of the two organizations have proven to be harmonious, and guests have responded favorably to the combination."

Manfredi Lefebvre d'Ovidio, who took over the company from his late father, will serve as chairman of Silversea. Roberto Martinoli will remain the brand's president and CEO.

"Manfredi and Roberto have brought a fresh point of view to our company, as well as deep knowledge of their brand's unique audience," Fain said. "Their skills – and Manfredi's inimitable style – will continue to play an important role in growing Silversea into the future."

Said Lefebvre: "The combination of our companies has been everything I hoped for. The skills and resources of Royal Caribbean Group have helped us grow and flourish. We share a vision about the bright future of cruising, and I look forward to being a shareholder in the broader Royal Caribbean Group."

Added Martinoli: "Thanks to the incredible resources and skills of Royal Caribbean Group, Silversea will grow and thrive. Today marks another key step in our drive to uncontested leadership in ultra-luxury and expedition cruising."

The remaining one-third stake held by Heritage Cruise Holding Ltd. was paid for in the form of 5.2 million shares of Royal Caribbean Group common stock, which represents about 2.5% of the total common stock.

Perella Weinberg Partners LP served as financial advisor and Skadden Arps, Slate, Meagher & Flom LLP served as legal advisor to the company regarding this transaction. Barclays Bank PLC served as financial advisor to Manfredi Lefebvre and Morgan, Lewis & Bockius LLP provided legal counsel.

Don’t go on a cruise yet – British foreign affairs ministry

Details

Written by Kari Reinikainen Kari Reinikainen

Category: Top Headlines Top Headlines

Published: 10 July 2020 10 July 2020

The British ministry of foreign affairs has issued a statement in which it advises against cruise travel, tightening its recommendation as in march it only advised those over he age of 70not to cruise.

“The Foreign & Commonwealth Office advises against cruise ship travel at this time. This is due to the ongoing pandemic and is based on medical advice from Public Health England,” the ministry said, adding that the government would continue to review its cruise ship travel advice based on the latest medical advice.

“If you have future cruise travel plans, you should speak to your travel operator, or the travel company you booked with, for further advice,” the ministry said.

The Foreign & Commonwealth Office continues to support the Department for Transport’s work with industry for the resumption of international cruise travel, it concluded.

While the recommendation does not mean an outright ban for British nationals to cruise, going on a cruise holiday during the time the recommendation is in force may invalidate the travel insurance of those doing so.