31st Mar 2020 13:34
(Alliance News) - Carnival Corp on Tuesday suspend dividend payments and said it will raise USD6 billion in an effort to stay afloat amid the Covid-19 pandemic.
Shares in Carnival PLC were down 11% at 810.26 pence on Tuesday in London, while Carnival Corp shares in New York closed 11% lower at USD12.80 on Monday. In pre-market trade, shares were 15% lower.
The travel company, which has been forced to cancel several voyages due to the virus outbreak, has launched a private offering for USD3 billion in first priority senior secured notes and USD1.75 billion in senior convertible notes, Both the notes are due 2023.
The FTSE 100-listed cruise ship operator also plans to raise a further USD1.25 billion through public offering of its shares.
Proceeds from the capital raise are to be used by the company for general corporate purposes.
Carnival has been hit hard by the virus outbreak, with growing port restrictions around the world forcing the company to halt cruise operations and offer refunds to customers.
The company's P&O Cruises and Cunard divisions on Monday extended suspension of sailings by a month. The cruise lines were previously due to resume operations on April 11, but were cancelled up to and including May 15.
For the first quarter ended February, Carnival expects to report adjusted earnings before interest, taxes, depreciation and amortisation of USD781 million, down sharply from USD903 million the period before. Revenue is predicted to rise to USD4.8 billion from USD4.7 billion.
As of March 15, the company's cumulative advanced bookings for the remainder of 2020 were
materially lower than the prior year and at considerably lower prices.
By Dayo Laniyan; [email protected]
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