Royal Caribbean Cruises Ltd. (NYSE:RCL) Q1 2020 Earnings Conference Call - Final Transcript

May 20, 2020 • 10:00 am ET

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Royal Caribbean Cruises Ltd. (NYSE:RCL) Q1 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instruction] The first question will come from Steve Wieczynski with Stifel. Please go ahead.

Analyst
Steven W. Wieczynski

Yeah. Hey, good morning, guys. Thanks for all the details. That was very helpful. So Jason, it's pretty clear that you guys helpful. So Jason, it's pretty clear that you guys are in a pretty good liquidity position right now. But I guess if you remain in a zero-revenue environment for an extended period of time, can you help us think about what other options you have down the road to further increase liquidity? I mean, we've seen your competitors go down the highly dilutive converted equity path. I'm just wondering, what your appetite is for something like that?

Executive
Jason Liberty

Sure, Steve. Thanks for the comments. So, yesterday, we closed on our bond that we launched last week. And we were really happy with the additional liquidity we were able to gain by raising that money. But the other thing that we were really happy about is that, by raising that bond, it really provided a lot of flexibility for us to raise additional capital, especially debt. So there's a pretty significant basket and flexibility on our ability to raise additional debt. But -- and I would also say that, we believe that our return to service plans, as we consider them, that we have adequate liquidity. But if those circumstances change, and depending on how things play out, we would certainly need to consider all alternatives that would be available to us.

Analyst
Steven W. Wieczynski

But to add on to that, the equity/convert would be your last option that you would want to do?

Executive
Jason Liberty

I would say that, we are very sensitive to dilution. And -- but overall, I think that we purposely made sure we had maximum flexibility on the debt side.

Analyst
Steven W. Wieczynski

Okay, great. And then second question would be around, how do you see a return to service for your ships around the rest of the world? It seems like everybody right now is so focused on the CDC and what they're telling you to do here in the U.S. But given your strong position in China and your JV with TUI, couldn't you guys start operations around the rest of the world sooner than here in the U.S.? And I guess if that answer is yes, do you feel there could be some potential negative pushback from the CDC or the U.S. government?

Executive
Michael Bayley

Hi, Steve, it's Michael. Interestingly, yesterday, I was on the Clear European Executive Committee call, where we had an extensive update from all of the National Directors in the various European countries. And I would say that, from the feedback from that call yesterday and then the discussion we've had with our China team in Shanghai, it's a very different story by region and by country. And I think it's highly likely that either the Asian markets and China, for example, or the European region, could come back earlier, because of course they went through this experience earlier and that's particularly true of