Cruise line shares drop on lack of stimulus money

Cruise line shares were dropping Friday because the companies won’t be getting some of the $500 billion in aid for major employers.

A spokeswoman for the Cruise Lines International Association told Dow Jones that the industry didn’t ask for a bailout anyway. However, some investors bid up shares from recent 52-week lows in anticipation that there might be assistance.

The  bailout legislation says companies must be created or organized in the United States or under the laws of the nation. While it may look to many South Floridians that Carnival, Royal Caribbean and Norwegian are headquartered here, they are technically registered in other countries, such as Panama (Carnival),  Liberia (Royal Caribbean) and Bermuda (Norwegian). As mentioned in a previous SFBW article, the cruise lines were facing a bailout backlash because they aren’t registered here and don’t pay federal income taxes.

The Senate bill also says employers must have a majority of employees based in the United States. As most cruisers know, ships are staffed with an array of workers from around the globe. Still, the cruise company offices in South Florida employ thousands of workers.

Capt. Don Marcus, president of the International Organization of Masters, Mates & Pilots, which represents U.S. sea captains, deck officers and other mariners, issued a strong statement supporting Congress.

“The members of the Masters, Mates & Pilots are gratified that federal stimulus funds will not be extended to flag-of-convenience, tax-dodging cruise ship companies. While many of these businesses are American-owned and publicly traded, they choose to sail under the flags of the Bahamas, Panama and other nations in order to avoid hiring Americans, paying reasonable wages and adhering to our labor and environmental standards. They avoid almost all corporate taxes. The workers employed on these vessels generally come from countries such as the Philippines, India and Indonesia,” the statement said.

In trading approaching 3 p.m. Friday:

  • Carnival Corp. & plc (CCL) was down $3.26, or 18.27 percent, to $14.57 a share (52-week range $7.90 to $56.04)
  • Royal Caribbean Cruises Ltd. (RCL) was down $6.09, or 15 percent to $34.52 a share (52-week range $19.25 to $135.52)
  • Norwegian Cruise Line Holdings (NCLH) was down $3.47, or 22.08 percent, to $12.24 a share. (52-week range $7.03-$59.78)

A major question for cruise investors now is whether the companies may cut their dividends to conserve cash. The depressed stock prices of the companies have created high dividend yields: 7.68 percent for Royal Caribbean and 11.22 percent for Carnival. NCLH doesn’t pay a dividend.

It could be some time before cruise lines start sailing again. That will ripple through the South Florida economy since so many jobs are dependent on the industry, such as supplying the ships.

An email Friday morning from Royal Caribbean to its customers said, “Late Monday, we announced that we have suspended all sailings through May 11, 2020 and have suspended all Alaska & Canada sailings until July 1, 2020. Rest assured, when we do return to service, we will be stronger than ever and ready to continue our partnership in delivering exceptional events at sea to your valued clients.”



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Drew Limsky

Drew Limsky



Drew Limsky joined Lifestyle Media Group in August 2020 as Editor-in-Chief of South Florida Business & Wealth. His first issue of SFBW, October 2020, heralded a reimagined structure, with new content categories and a slew of fresh visual themes. “As sort of a cross between Forbes and Robb Report, with a dash of GQ and Vogue,” Limsky says, “SFBW reflects South Florida’s increasingly sophisticated and dynamic business and cultural landscape.”

Limsky, an avid traveler, swimmer and film buff who holds a law degree and Ph.D. from New York University, likes to say, “I’m a doctor, but I can’t operate—except on your brand.” He wrote his dissertation on the nonfiction work of Joan Didion. Prior to that, Limsky received his B.A. in English, summa cum laude, from Emory University and earned his M.A. in literature at American University in connection with a Masters Scholar Award fellowship.

Limsky came to SFBW at the apex of a storied career in journalism and publishing that includes six previous lead editorial roles, including for some of the world’s best-known brands. He served as global editor-in-chief of Lexus magazine, founding editor-in-chief of custom lifestyle magazines for Cadillac and Holland America Line, and was the founding editor-in-chief of Modern Luxury Interiors South Florida. He also was the executive editor for B2B magazines for Acura and Honda Financial Services, and he served as travel editor for Conde Nast. Magazines under Limsky’s editorship have garnered more than 75 industry awards.

He has also written for many of the country’s top newspapers and magazines, including The New York Times, Washington Post, Los Angeles Times, Miami Herald, Boston Globe, USA Today, Worth, Robb Report, Afar, Time Out New York, National Geographic Traveler, Men’s Journal, Ritz-Carlton, Elite Traveler, Florida Design, Metropolis and Architectural Digest Mexico. His other clients have included Four Seasons, Acqualina Resort & Residences, Yahoo!, American Airlines, Wynn, Douglas Elliman and Corcoran. As an adjunct assistant professor, Limsky has taught journalism, film and creative writing at the City University of New York, Pace University, American University and other colleges.