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Carnival's Costa Revisits Sea: Is Cruise Revival a Reality?

Zacks Equity Research
·4 mins read

Carnival Corporation’s CCL Italy-based Costa Cruises is the latest liner to return to the sea, giving a much-needed breather to cruise operators as their business was brought to a grinding halt in the wake of the COVID-19 pandemic. Costa Cruises’ Costa Deliziosa departed on its seven-day voyage on Sep 6 from the Adriatic port of Trieste. With enhanced health and safety protocols in place, the ship is scheduled to stop only at the Italian ports and is reserved exclusively for Italian guests.

The cruise liner’s stringent set of health and safety mandates is in line with the Italian government guidelines and the EU Healthy Gateways program. These include staggered entry timings, online check-ins, temperature monitoring, health questionnaire and rapid swab tests. As far as the crew members are concerned, they will also have to undergo molecular swab tests at intervals before embarking along with quarantining for 14 days. In addition, their health conditions are monitored with regular temperature recording while each crew member will have a swab test every month.

Costa is also the first cruise operator to be accredited with RINA Biosafety Trust Certification, the first management system certification that provides an array of best practices to prevent and control the spread of this deadly infectious disease in crowded places. Although it is designed for the entertainment and tourism sectors, the certification can be applied to many other sectors as well.

Michael Thamm, Group CEO for Costa Group and Carnival Asia, said: “We’re delighted to be able to welcome our guests on board again after more than five months without cruising and we’re also happy to be restarting operations right here in Italy. Our decision to resume responsibly with Italian cruises for Italian guests is particularly significant for us, since we’ve believed and invested in this country for more than 70 years as the only cruise company flying the Italian flag.”

With resumed operations in Italy, Costa cancelled operations for Costa Fascinosa, Costa Luminosa and Costa Pacifica cruises for the 2020-21 season in South America with scheduled departures between November 2020 and April 2021. Costa, however, welcomed bookings on Sep 8, 2020 for the 2021-22 season with two cruises, namely Costa Favolosa and Costa Pacifica operating in South America between December 2021 and April 2022 period.

Nonetheless, the fear of the novel coronavirus is far from over. Norway’s shipping and cruise liner Hurtigruten, which recently restarted sailing, experienced an outbreak of COVID-19 aboard its new hybrid exploration ship MS Roald Amundsen. Consequently, it had to cancel all its further operations. Royal Caribbean Cruises Ltd. RCL and Norwegian Cruise Line Holdings Ltd. NCLH also paused their sailings until the end of next month, if not later.

On the contrary, Costa’s next ship Costa Diadema is set to recommence operations on Sep 19 from Genoa to several Italian ports. Like Deliziosa, it will also usher in exclusively Italian residents. Lindblad Expeditions Holdings Inc. LIND too plans to revive operations at the earliest.

Carnival Corporation, which currently carries a Zacks Rank #4 (Sell), witnessed several cases of the coronavirus outbreak in its early stages. All passengers aboard Carnival Cruise Line’s Diamond Princess in February were quarantined after testing COVID-19 positive.

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Click to get this free report Carnival Corporation (CCL) : Free Stock Analysis Report Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report Norwegian Cruise Line Holdings Ltd. (NCLH) : Free Stock Analysis Report Lindblad Expeditions Holdings Inc. (LIND) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research