The US Centers for Disease Control and Prevention (CDC) stated this week that their effort to prevent the spread of COVID-19 aboard cruise ships has been discontinued. This implies that cruise lines may resume normal, non-epidemiological operations.
For cruise companies, the CDC decision implies the relaxation of several limitations. The regulator will continue to issue recommendations to safeguard passengers against COVID-19, but no extra measures or reports will be required from the firms themselves.
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For example, it is no longer necessary to get tested for coronavirus before boarding a ship. The prohibition on wearing masks on board has also been abolished. Furthermore, cruise lines are no longer obligated to record ill passenger data or track infectious passengers.
As a result, the major obstacle that likely prevented many visitors from going is lifted. This is also a chance for all cruise lines to enhance flying capacity, so raising their revenue.
Companies’ indebtedness soared dramatically during the epidemic as they were required to pay for docked liners as well as employees. Norwegian Cruise Line Holdings Inc.’s (NYSE: NCLH) debt has risen to more than $14 billion, while Carnival Corporation & plc’s (NYSE: CCL) debt has surpassed $36 billion.
Servicing this debt is a significant strain for businesses, especially given that the Federal Reserve has already announced a 1.5 percentage point increase in interest rates this year and plans another significant increase in the coming months.
Removing limitations can assist operators in attracting more visitors, increasing profitability, and paying off debt faster. It is worth noting that Norwegian Cruise Line is in a somewhat better position than its competitors’ thanks to its comparatively low debt. On July 21, NCLH stock was valued at $12.48, down roughly 8% in a single day following a huge price increase this week.
NCLH had a year-to-date performance of -39.83 percent. According to the 7-day charts, the stock’s price has increased by 11.63 percent in the previous week and 8.81 percent in the last month.