Announcement of Periodic Review: Moody’s announces completion of a periodic review of ratings of NCL Corporation Ltd.
Global Credit Research – 28 Aug 2020
New York, August 28, 2020 — Moody’s Investors Service (“Moody’s”) has completed a periodic review of the ratings of NCL Corporation Ltd. and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody’s reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. The review did not involve a rating committee. Since 1 January 2019, Moody’s practice has been to issue a press release following each periodic review to announce its completion.
This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history.
Key rating considerations are summarized below.
NCL’s B2 corporate family rating is supported by its market position as the third largest ocean cruise operator worldwide, as well as its well-known brand names — Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises, as well as the strong performance of its new ships in terms of pricing and bookings relative to its other ships which enables the company to compete against larger rivals across all its price points. Moody’s view that over the long run, the value proposition of a cruise vacation relative to land-based destinations as well as a group of loyal cruise customers supports a base level of demand once health safety concerns have been effectively addressed. In the short run, NCL’s credit profile will be dominated by the length of time that cruise operations continue to be highly disrupted and the resulting impacts on the company’s cash consumption and its liquidity profile. The normal ongoing credit risks include its high leverage, the highly seasonal and capital intensive nature of cruise companies and the cruise industry’s exposure to economic and industry cycles, weather incidents and geopolitical events.
This document summarizes Moody’s view as of the publication date and will not be updated until the next periodic review announcement, which will incorporate material changes in credit circumstances (if any) during the intervening period.
The principal methodology used for this review was Business and Consumer Service Industry published in October 2016. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.
This announcement applies only to EU rated and EU endorsed ratings. Non EU rated and non EU endorsed ratings may be referenced above to the extent necessary, if they are part of the same analytical unit.
This publication does not announce a credit rating action. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most updated credit rating action information and rating history.
Peter Trombetta Asst Vice President - Analyst Corporate Finance Group Moody's Investors Service, Inc. 250 Greenwich Street New York, NY 10007 U.S.A. JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 Margaret Taylor Associate Managing Director Corporate Finance Group JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653 Releasing Office: Moody's Investors Service, Inc. 250 Greenwich Street New York, NY 10007 U.S.A. JOURNALISTS: 1 212 553 0376 Client Service: 1 212 553 1653
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