Norwegian Cruise Line Holdings might suspend calls to St Petersburg as Russia’s attacks on Ukraine continue, but it plans to keep vessels in the Baltic Sea despite the ongoing onslaught.
The owner of 28 ships conducts 50 sailings per year in the Baltic region and considers the Russian city to be a key destination, though only 5% of its total capacity visits St Petersburg, chief financial officer Mark Kempa said.
“We are looking at alternative ports as we speak,” he said on Thursday during a fourth-quarter earnings call with analysts.
“This is something we’ve been thinking about and worst-case scenario, if we’re not able to call on St Petersburg or the surrounding areas, there’s plenty of other ports in that Scandinavian region that we have the ability to call on.
“It’s not a huge impact. Obviously a bit disappointing because that is a premier port, but there’s other viable, very attractive ports that are available.”
He said Russia’s military actions against Ukraine have not impacted bookings for the Baltic region yet, but Norwegian has plenty of other European ports of call to send ships.
“I think it’s way too early. I mean, we definitely did not see anything as of close of business yesterday and this morning I haven’t received, we haven’t received any red flags, but like anything, you’ll probably see a little bit of a slowdown here and there around the margin,” he said.
“That’s normal, but it’s definitely too early to indicate if there’s going to be any longer-term effects.
“Europe is a big continent too. So you know this is affecting a very small portion of Europe and there’s there’s a lot of other areas that we can operate in.”
Chief executive Frank Del Rio said Norwegian will keep its ships in the Baltic Sea for now, instead of moving them west to the Mediterranean Sea and away from the conflict.
Flagship brand Norwegian Cruise Line currently sails the 2,340-berth Norwegian Dawn (built 2002) and the 3,963-berth Norwegian Getaway (built 2014) on itineraries that visit St Petersburg and other area destinations such as Stockholm and Copenhagen, according to its website.
“It is disappointing because Saint Petersburg is one of the crown jewels of the Scandinavian ice January, but certainly there are alternatives in terms of the Caribbean,” Del Rio said.
On a positive note, Del Rio said he expects that the company’s revenue will return to pre-pandemic levels in 2023, as long as Covid-19 does not disrupt the industry with another variant.
“2023 could be, assuming that no other major variant arrives on the scene, a fabulous year,” he said.
“It could be a record year.”
