Tuesday, May 05, 2020 10:28:01 AM
Norwegian Cruise stock tumbles after 'going concern' language used, prior to proposed debt offering
https://www.marketwatch.com/story/norwegian-cruise-proposes-debt-sale-to-furlough-20-of-shoreside-staff-stock-tumbles-2020-05-05?siteid=yhoof2&yptr=yahoo
Norwegian Cruise Line Holdings Ltd. NCLH, -19.88% said Tuesday its NCL Corp. subsidiary (NCLC) is proposing to sell $650 million in exchangeable senior notes due 2024 in a private offering. The notes will be convertible to Series A preference shares of NCLC, which will be exchangeable into a number of Norwegian Cruise ordinary shares. NCLC is also proposing to sell $600 million in senior secured notes due 2024 in a private offering. The announcement comes after Norwegian Cruise said earlier that the fact plans to obtain additional financing had not been completed raised "substantial doubt about the company's ability to continue as a going concern," given the "significant financial and operational impacts" due to the COVID-19 pandemic. The stock tumbled 13% in morning trading. Among actions the company is taking Norwegian said it will furlough 20% of its shoreside employees through July 31, although that date could change, while shoreside employees not furloughed will have shortened work weeks with a commensurate 20% salary cut at least through June 22. The cruise operator also said it has identified about $515 million of capital expenditure reductions. As of March 31, the company said it was in compliance will all of its debt covenants. The stock has plunged 78.6% year to date, while the S&P 500 SPX, 1.33% has lost 10.9%.
https://www.marketwatch.com/story/norwegian-cruise-proposes-debt-sale-to-furlough-20-of-shoreside-staff-stock-tumbles-2020-05-05?siteid=yhoof2&yptr=yahoo
Norwegian Cruise Line Holdings Ltd. NCLH, -19.88% said Tuesday its NCL Corp. subsidiary (NCLC) is proposing to sell $650 million in exchangeable senior notes due 2024 in a private offering. The notes will be convertible to Series A preference shares of NCLC, which will be exchangeable into a number of Norwegian Cruise ordinary shares. NCLC is also proposing to sell $600 million in senior secured notes due 2024 in a private offering. The announcement comes after Norwegian Cruise said earlier that the fact plans to obtain additional financing had not been completed raised "substantial doubt about the company's ability to continue as a going concern," given the "significant financial and operational impacts" due to the COVID-19 pandemic. The stock tumbled 13% in morning trading. Among actions the company is taking Norwegian said it will furlough 20% of its shoreside employees through July 31, although that date could change, while shoreside employees not furloughed will have shortened work weeks with a commensurate 20% salary cut at least through June 22. The cruise operator also said it has identified about $515 million of capital expenditure reductions. As of March 31, the company said it was in compliance will all of its debt covenants. The stock has plunged 78.6% year to date, while the S&P 500 SPX, 1.33% has lost 10.9%.
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