Credit rating firm lowers outlook on Carnival Cruise Lines

 

hsampson@MiamiHerald.com

Carnival Corp. continues to take a hit after several mechanical glitches made news over the last month.

Standard & Poor’s Ratings Services on Monday affirmed its BBB+ rating for Carnival, but lowered its outlook to negative from stable.

In a note, credit analyst Emile Courtney said the change comes as a result of the believe that net revenue yields may drop as Carnival Cruise Lines is forced to discount cruises in order to attract customers after a handful of ships have experienced back-to-back technical problems. Costs are also expected to increase as ships need repairs and preventative upgrades.

Moody's Investors Service also revised the Miami-based company’s rating outlook to negative.

The note from Moody’s said in part: “Although Carnival has historically rebounded relatively quickly from ship events, the number of incidents within a short time frame has resulted in more broad and intense media coverage that could cause the rebound to take longer and be more costly than in the past.”

A February fire aboard the Carnival Triumph left the ship without power for several days and prompted the company to conduct a review of all its ships to find and address potential problems with backup power and redundancy systems.

Carnival stock closed at $33.92 Monday, down nearly 3 percent.

Read more Breaking News stories from the Miami Herald

  •  
In this photo provided by CBS, Comedy Central’s Stephen Colbert, left, takes a “selfie” with host David Letterman on the set of the “Late Show with David Letterman,” Tuesday, April 22, 2014 in New York. This was Colbert’s first visit to the show since CBS announced that he will succeed Letterman as host when he retires in 2015. (AP Photo/Jeffrey R. Staab) MANDATORY CREDIT, NO SALES, NO ARCHIVE, FOR NORTH AMERICAN USE ONLY

    Letterman gets visit from his successor, Colbert

    Stephen Colbert, who will take over for a retiring David Letterman on CBS' "Late Show" next year, revealed Tuesday that he almost worked for Letterman — twice.

  •  
A Buddhist monks prays for the safe return of passengers of the sunken Sewol ferry at a port in Jindo, South Korea, Tuesday, April 22, 2014. As divers continue to search the interior of the sunken ferry, the number of confirmed deaths has risen, with about 220 other people still missing.

    SKorea ferry toll hits 150 as search gets tougher

    The grim work of recovering bodies from the submerged South Korea ferry proceeded rapidly Wednesday, with the official death toll reaching 150, though a government official said divers must now rip through cabin walls to retrieve more victims.

  •  
U.S. President Barack Obama waves upon his arrival at Sukiyabashi Jiro sushi restaurant for dinner with Japanese Prime Minister Shinzo Abe at Ginza shopping district in Tokyo, Wednesday, April 23, 2014.

    Obama opens Japan trip at famous sushi restaurant

    President Barack Obama opened a trip to Japan Wednesday with a close-up look at the art of sushi making at a tiny Tokyo restaurant with hard-to-come-by reservations and a hefty price tag.

Miami Herald

Join the
Discussion

The Miami Herald is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere on the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

The Miami Herald uses Facebook's commenting system. You need to log in with a Facebook account in order to comment. If you have questions about commenting with your Facebook account, click here.

Have a news tip? You can send it anonymously. Click here to send us your tip - or - consider joining the Public Insight Network and become a source for The Miami Herald and el Nuevo Herald.

Hide Comments

This affects comments on all stories.

Cancel OK

  • Marketplace

Today's Circulars

  • Quick Job Search

Enter Keyword(s) Enter City Select a State Select a Category