CARNIVAL Corporation is rerouting its Red Sea transits until November for 12 ships across seven brands, due to the United States-Iran proxy war in the region.
The vast majority of the impact will take place in the second quarter, with Carnival saying it has not seen any impact on booking trends due to the Red Sea crisis.
Carnival joins other cruise companies, including MSC Group and Royal Caribbean Group, which have cancelled a number of their own Red Sea voyages.
The diversion is expected to have an adjusted earnings per share impact of USD$0.07 to USD0.08 for the full year, and it is not expected to disrupt Carnival’s early and robust start to wave season, which has thus far exceeded expectations.
Carnival is maintaining its best booked position on record, with reservations since November hitting an all-time high, while the first half of the year almost sold out.
This is expected to continue throughout the year, Carnival added, even though pricing and occupancy are considerably higher than last year’s levels.
Carnival also confirmed the redemption of the outstanding USD$571 million second-priority senior secured notes, due 2027, eliminating all of the outstanding second lien debt.
This redemption is consistent with Carnival’s December guidance, with the company using its cash flow strength to reduce interest.