Following statements from Norwegian Cruise Line that it might go out of business because of the COVID-19 pandemic, the company has now indicated that it can manage to survive a year-and-a-half of voyage suspensions, should the pandemic continue that long.
This development comes as Norwegian — one of the major cruise lines to make regular calls into the territory — managed to raise an estimated $2.4 billion in funds.
The cruise company had previously revealed plans to raise the money through debt and equity offerings, which they managed to do in less than 24 hours.
With the successful fundraiser, Norwegian’s Chief Executive Frank Del Rio said the company now has $3.5 billion in cash on hand, which will be enough to bankroll the company until 2022; without any new revenue.
“That’s enough to cover our cash burn under a zero-revenue environment for at least 18 months, not 12, 18 months,” Del Rio stated.
“So unless you want to make the case that this pandemic is going to close us down more than a year-and-a-half into almost 2022, we believe the company is in a great financial position [and] has all the cash and liquidity needed to survive a prolonged lay-up and be in a position to come out strong.”
Good news for the BVI
This latest announcement means good news for the BVI, as berths from the cruise line benefit the territory’s economy by injecting millions of dollars annually.
According to cruise ship data from the BVI Ports Authority, Norwegian — which shuttles at least 4,000 passengers per trip — made about 37 scheduled calls to the territory in 2019.
President of the Florida Caribbean Cruise Association (FCCA) Michele Paige said that whenever major cruise liners like Norwegian berth in a territory, the economy stands to benefit from more than $500,000.
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