CCL Stock: Covid-19 Still Very Real on Carnivals Cruise Ships

Table Of Content

• Royal Caribbean shares tumble as 6 Covid cases discovered on board a ship, cruise line expands U.S. testing policy
• Is SoundHound AI Stock a Bargain After the 50% Crash? The Pros and Cons.
• Each New Wave Roils CCL Stock
• Cruises are 'a recipe for transmission'
• CDC warns older adults, travelers in COVID high-risk groups not to take cruises, even if they're vaccinated
• Relying on a negative Covid test is also a flawed strategy

CDC protocol says at least 95% of passengers and crew must show proof of vaccination to board a cruise ship. The port said it lost an estimated $113.6 million in cruise ship and cruise-related parking revenue during the shutdown, which began in March 2020. Pre-pandemic, about 80% of the port's revenue came from various fees it charged cruise ships and from cruise passenger parking. The appearance of COVID-19 on the Mardi Gras as cruising returned to Port Canaveral is a sign of just how precarious the restart of cruising can be. Due to the rapidly spreading delta coronavirus variant, the cruise line will be expanding its test procedures for cruises departing from the U.S. that are five nights or longer.

Royal Caribbean shares tumble as 6 Covid cases discovered on board a ship, cruise line expands U.S. testing policy

Port Canaveral Secretary/Treasurer Robyn Hattaway expressed some frustration during Wednesday's Canaveral Port Authority meeting about how long it was taking for the port to get its ARPA money. Even with the ARPA money, Port Canaveral expects to report losses of $39.48 million during the current budget year. "We can try to do cruises as safely as possible, but we are going to have breakthrough cases," says Ostrosky. You eat and drink indoors at buffet restaurants with large communal tables, attend shows in theaters and touch all kinds of surfaces, from railings to casino games. If an outbreak happens at sea, you're restricted to the boat, which can make the outbreak harder to contain and treat.

Is SoundHound AI Stock a Bargain After the 50% Crash? The Pros and Cons.

According to Cruise Law News, 26 crew and one passenger (Tackett) on the Carnival Vista tested positive for Covid-19. Further, something like 27 cruise ships have reported cases of Covid-19. The publication also has reported that a Carnival chief engineer died of Covid-19 after working for the company for more than 34 years with nary a mention from the company. The Centers for Disease Control and Prevention (CDC) gives cruise ships a color-coded safety status ⁠— green, yellow, orange and red ⁠— based on reports of cases of Covid or Covid-like illness. The agency also indicates when there are investigations into outbreaks on ships.

Each New Wave Roils CCL Stock

In the Mardi Gras incident, three Carnival Cruise Line passengers had COVID-19 on the inaugural sailing of the ship from Port Canaveral on July 31. Some of the cruise companies are fighting another battle, too ⁠— against state governments that have passed laws or executive orders aimed at stopping vaccine mandates. On Wednesday, Texas Gov. Greg Abbott passed an executive order banning any state or local mandates requiring Covid vaccination. In Florida, home to multiple popular cruise departure ports, Gov. Ron DeSantis signed an executive order in May prohibiting vaccine passports statewide.

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Three passengers tested positive for COVID-19 at the end of the recent inaugural seven-night sailing from Port Canaveral of Carnival Cruise Line’s newest and largest ship, the Mardi Gras. Cruises are even particularly risky when compared to other types of travel, like driving or flying, because they present more opportunities for prolonged exposure. "Frankly, the risk on a two-hour flight where everyone is masked and airflow is good is [lower] than being on a cruise ship for five days straight," says Dr. Preeti Malani, chief health officer at the University of Michigan. Only one of the positive cases was a passenger; the remaining 26 were crew members. All 27 people were vaccinated and are experiencing mild or no symptoms, the country's tourism board said.

Other port segments

The six guests were immediately quarantined and their close contacts were identified and tested. Three of the four fully-vaccinated passengers had no symptoms and the fourth passenger had mild symptoms, Royal Caribbean said in a statement. The two unvaccinated guests are minors traveling in the same party and are asymptomatic. "Carnival is managing a small number of positive COVID cases on Carnival Vista sailing out of Galveston. This despite all of our crew and almost all of our guests being vaccinated," a spokesperson for Carnival Cruises said in a statement. For example, he is projecting that ships sailing from Port Canaveral will operate at 50% of their double-occupancy capacity from October through December 2021.

The four of those guests were fully vaccinated and not traveling together. The Motley Fool’s Rich Smith recently highlighted the fact that cruising isn’t enjoyable these days. You don’t have to tell the passengers of the Carnival Vista that. As my InvestorPlace colleague, Larry Ramer, recently wrote, cruise lines may again face no-sail bans due to the surge in cases from the Delta variant. However, it shows what risks are involved in taking a cruise at this point, vaccinated or not.

When the cruise departed on Saturday from Nassau in the Bahamas, the guests were required to show proof of a negative PCR test. Unvaccinated minors were also required to take another test at check-in. Everyone had tested negative prior to boarding, according to a spokesperson for the company. Royal Caribbean Cruises shares fell about 4% on Friday after six passengers on board its Adventure of the Seas ship tested positive for Covid-19. There are 2,895 guests and 1,441 crew on the ship that sailed from Galveston, Texas, the tourism board said. That includes sailings on eight ships operated by four cruise lines.

Relying on a negative Covid test is also a flawed strategy

Then, look for cruises that require vaccination proof and only allow reduced capacity ⁠— the lower, the better. While on the cruise, pick activities and excursions that are lower-risk, she says, like always dining outdoors. And of course, board the ship with the understanding that no matter what happens, you're taking a risk. To make cruises genuinely safe, he says, companies would need to require mandatory two-week quarantines for each passenger and crew member, negative Covid tests 24 to 48 hours before boarding and another negative Covid test immediately after boarding.

He said the port will continue reduced spending levels for promotions, advertising, travel, sponsorships and consultants. Poole said, with cruising resuming, the port will have increases in various other expenses, including for service contracts, utilities and public safety. Additionally, there will be 630 half-day sailings of the Victory 1 gambling ship. The money will help cover its losses stemming from a 16½-month shutdown of the cruise industry locally because of COVID-19. Carnival said it also has a process in place to randomly test a large percentage of its crew on a rotating basis multiple days per week, even though all are vaccinated.

Then, he is projecting that they will operate at 75% of their double-occupancy capacity from January through September 2022. In all, 14 ships operated by five cruise lines will be based at Port Canaveral either year-round or part of the year. Some cruise lines in recent days have announced new measures designed to keep COVID-19 off their ships.

A recent story appeared in Jim Walker’s Cruise Law News detailing the death of a 77-year-old woman who took a Carnival cruise with her family, leaving Galveston, Texas on July 31. During the pandemic, the port reduced its staff by 43% — from 268 positions to 153. That was done through a combination of 68 permanent layoffs, 17 unpaid furloughs, and not filling 30 positions that were left vacant because of retirement or employees taking jobs elsewhere. But that's still less than the port's pre-pandemic staffing level.

At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities. “[C]ome the end of July, the cruise operator’s new ship, Mardi Gras, will sail from Port Canaveral on a seven-day Caribbean cruise,” I wrote on June 28. After hearing the presentation, Port Authority Chairman Wayne Justice noted that there is excitement about the return of cruising at the port — which is expected to lead to a return to profits in the coming budget year. He is using estimates of passenger counts that are much lower than the port has historically seen. Poole said he was conservative in his projections for port revenue from cruise operations.

That's an onerous process, and difficult to organize and pull off, especially in the middle of a passenger's vacation. Norwegian Cruise Line sued Florida's top health official in July, requesting a preliminary injunction to let the company implement its vaccine mandate for all passengers and crew. District Judge Kathleen Williams writing that Norwegian "demonstrated that public health will be jeopardized if it is required to suspend its vaccination requirement."

"The CDC’s conditional sail order and our own protocols anticipate the potential for COVID on board, and our procedures are designed to manage and mitigate any situation," Carnival said in a statement on that incident. "The health, safety and well-being of our guests, crew and the destinations we visit is our priority." Carnival discovered the cases when doing required COVID-19 tests near the end of its cruise.

According to The Washington Post, Carnival said it announced last week that there were positive cases on board but did not disclose how many cases there were at that time. The change comes as the U.S. faces its fourth wave of COVID-19, driven by the delta variant. As of Friday, the country has reported 987,417 new cases and 6,037 virus-related deaths in the past week, according to data from Johns Hopkins University. Sailing on the Carnival Vista to several ports in the Caribbean, Marilyn Tackett became ill while on a port visit in Belize. The ship doctor gave the retired Sunday school teacher a Covid-19 test. Eventually, she was sent by air ambulance to Oklahoma, where she died while on a ventilator on Aug. 14.