I'm Arnold Donald, President and CEO of Carnival Corporation & plc. Today, I'm joined telephonically by our Chairman, Micky Arison, as well as David Bernstein, our Chief Financial Officer, and Beth Roberts, Senior Vice President, Investor Relations. Thank you, all, for joining us this morning.

Now, before I begin, please note that some of our remarks on this call will be forward-looking. Therefore, I must refer you to the cautionary statement in today's press release.

Hey, I know I'm certainly not alone when I say I'm glad to put 2020 behind us. Clearly, 2020 was unprecedented. On the other hand, it also proved to be a true testament to the resilience of our Company. I am really proud of how well we've weathered the storm and I'm very grateful to all of those who helped make it happen, particularly our Carnival family, both shipboard and shoreside.

And believe me, it took all hands on deck to return over 260,000 guests home, to repatriate 90,000 crew members; to process billions of dollars, euros and pounds of guest refunds and billions in future cruise credits; to accelerate the exit of 19 vessels and negotiate the delay in 16 ships on order; to move our entire fleet into full pause status; to develop new crews protocols and put them to the test as we resume cruise operations in both Italy and in Germany; to extend debt maturities and amend agreements with over 20 lenders and 40 different agreements, all while completing over a dozen financing transactions for a cumulative $19 billion of new capital.

We ended the year with $9.5 billion in cash, and we have the liquidity in place to sustain ourselves throughout 2021 even in a zero revenue environment. And we are emerging from a pause a more efficient and even better operating company.

Now, we executed a significant rationalization of our fleet, reducing capacity by 13%. As a result, we are less reliant on new-to-cruise, thanks to our recurring base of repeat guests, and that represents a source of nearly 8 million guests each year, which will now be spread over a smaller fleet. Our strategic capacity reduction also delivers a structurally lower cost base. Just by the fact that the 19 ships leaving the fleet are smaller and less efficient ships, we benefit by a 2% reduction in unit costs and a 1% reduction in unit fuel consumption going forward.

Our efforts to right-size our shoreside operations reduces our cost further as well as our continued focus on finding efficiencies across our ship operations. And of course, over time we will achieve an additional structural benefit to unit costs as we deliver new, larger, more efficient ships, and this includes the recent delivery of Princess Cruises' Enchanted Princess; P&O UK's Iona, Costa Firenze and the highly anticipated Carnival Mardi Gras. Both the first rollercoaster at-sea onboard Mardi Gras has already generated significant media attention for Carnival Cruise Line, garnering hundreds of millions of media impressions just in the last few months, as has the Queen Mary 2 for Cunard, which was the focal point in the recent star-studded film, Let Them All Talk, capturing over 7 billion media impressions.

We further strengthened our Board of Directors, adding to an already experienced and strong Board with the addition of a new Independent Board Member with a comprehensive background in compliance. We strengthened our management team, promoting Josh Weinstein to Chief Operations Officer. Josh is uniquely suited for this role, having previously led Carnival UK and prior to that, serving as our Corporate Treasurer, and prior to that serving in a role in our legal department. And together with the rest of the leadership team, he will serve a key role as we continue to aggressively streamline our operations for effectiveness and efficiency. We are honoring our commitment to diversity and inclusion, and in fact, half of our operating companies are now led by women executives. We once again continue to make advancements in our sustainability efforts, reducing food waste and accelerating the reduction in single use plastics amongst other goals.

One of the most rewarding aspects of 2020 clearly was the strong fundamental demand for our brands. The forward booking trends we have consistently experienced throughout this period in spite of the extended pause in our operations, in spite of our minimal advertising efforts and even in spite of the abundance of negative global news affirm the underlying demand that will facilitate our staggered resumption and supports the long-term growth of our Company. And, we have not only seen tremendous support for our brands from our loyal guests, it is also very encouraging to see demand from new guests. Upon resuming service, we believe we are well positioned to optimize that pent-up demand for our leading brands around the world.

Now, as we've mentioned on our last couple of updates, our Company is uniquely positioned for a phased resumption in cruise travel given our multiple national brands which can each be restarted independently. Now, this has already proven to be instrumental in enabling us to resume cruising on a limited basis both for Costa Europe, which is nearly 80% continental European sourced, and for AIDA, which is roughly 95% German sourced. Our other brands like P&O UK, which is 98% British sourced, P&O Australia, which is more than 99% Australia / New Zealand sourced, and Carnival Cruise Line, which is 92% US sourced, all present further opportunity.

Additionally, the fact that these brands are characterized by ready access with drive-to markets and a prevalence of shorter-duration cruises strengthens the potential for success in today's environment. Of course, we will continue to utilize the six destinations we own and operate, including our two highly regarded private islands in the Caribbean: Princess Cay and Half Moon Cay. Half Moon Cay, for the 20th consecutive year, was rated by Porthole Magazine in its Reader Choice Awards as the best private island.

We continue to work diligently to resume operations in the US including, of course, ongoing discussions with the CDC. At the same time, we're working toward resuming operations in many other parts of the world, including Asia, Australia and of course the UK, and we're working hard to do so in a way that serves the best interest of public health. Our highest responsibilities, and therefore our top priorities, are always compliance, environmental protection and the health, safety and well-being of our guests, of the people in the communities we touch and serve and of our Carnival family, our team members shipboard and shoreside.

Now, we've dealt with many types of viruses previously and already have effective protocols in place onboard our ships, including screening measures, medical centers and enhanced sanitation procedures which prevent and reduce spread once brought on board from land. Clearly, however, this virus is unique. And as you know, we've been working with leading medical and science experts around the globe to develop new and enhanced protocols and procedures based on the best available science to specifically address the risks associated with COVID – 19. We expect these protocols to continue to evolve as society's understanding of COVID – 19 strengthens.

And as we are demonstrating with both Costa and AIDA, which have received high satisfaction scores from our valued guests who have appreciated the changes we've implemented, we intend to initially resume operations with a small percentage of the fleet. So, for our initial voyages, we've chosen to sail with low occupancy levels, enabling us to gain valuable experience with our enhanced safety protocols. Now, we're working toward having all of our ships back in service by the end of the year. The development of low-cost testing, the continued advent of therapies and the pace of the distribution of vaccines will certainly influence the pace of our recovery.

As the industry leader, maintaining a strong balance sheet has historically been a key strength for our Company and a differentiator for our shareholders. Accordingly, we've secured the necessary funding in a balanced and responsible way. Currently, we have the lowest leverage in our industry, and we retain the capacity to issue additional debt. Having secured the necessary financing to get through 2021, we will turn our attention to improving the balance sheet and reducing interest on our path back to investment grade credit. Now, we've stretched out the delivery schedule, pushing out newbuild capital, and more importantly, we have just one ship for delivery in fiscal 2024 and just one ship for delivery in fiscal 2025. That will significantly reduce capital expenditures during those years, enabling us to pay down debt.

Now, all of these efforts are in keeping with our primary financial objective going forward, to maximize cash generation. As we return to full operations, our cash flow will be the primary driver to return to investment grade credit over time, creating greater shareholder value. With the aggressive actions we've taken, managing the balance sheet and reducing capacity, we are well positioned to capitalize on pent-up demand and to emerge a leaner, more efficient company, reinforcing our industry-leading position.

Throughout these challenging times, we've received overwhelming support. So, again, thank you to our valued guests, thank you to our dedicated members of the Carnival family, thank you to our travel agent partners and thank you to our other stakeholders for their ongoing support. And especially thank you to our investors for their continued confidence in us and in our future.

With that, I will turn the call over to David.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Thank you, Arnold.

I'll start today with an update on booking trends. Then I'll provide our monthly average cash burn rate, along with a summary of our fourth quarter cash flows and then finish up with some insights into our financial position.

Turning to booking trends. At this point in time, our cumulative advance bookings for the second half of 2021 are within the historical range. Even better, our cumulative advance bookings for the first half of 2022 are ahead of a very strong 2019, which was at the high end of the historical range. Directionally, comparable pricing on these bookings for the second half of 2021 and the first half of 2022 are down just 1% versus pricing on bookings in the beginning of fiscal year 2019 if you exclude the negative impact of future cruise credits, or more commonly known as FCCs.

Pricing on bookings in the beginning of fiscal year 2019 is a tough comparison as that was a high watermark for historical yield. However, I must say, to some extent this is an apples and oranges comparison given the increase in bundled packages that we have offered and that guests have chosen more recently, making the underlying comparison more favorable than indicated. In the end, we expect to see the benefit of these bundled packages in onboard and other revenue.

I would also like to point out that our book position is very encouraging, given it was achieved with minimal advertising and promotional activity. Due to the pause in guest cruise operations in 2020, the Company's future booking trends will be compared to 2019 and not the prior year. It is particularly reassuring to see that approximately 60% of bookings taken during the fourth quarter 2020 for fiscal year 2021 were new bookings, with the remainder being FCC rebookings. I'm happy to report that this is a 5 percentage point improvement over the third quarter booking activity. And it's also promising to see that approximately 45% of the 2021 book position are guests that are new to brand, with the remaining 55% of guests being brand loyalists which is just a little higher than the norm, a continuation of the positive position we had at the end of the third quarter.

Now let's look at our monthly average cash burn rate. For the fourth quarter, our cash burn rate was $500 million, which was slightly better than the previous expectation of $530 million due to the timing of capital expenditures. For the first quarter, we expect our monthly average rate to be approximately $600 million, which includes restart expenditures. The average rate expected in the first quarter is higher than the fourth quarter, driven by higher capital expenditures due to the shifting of capex from the fourth quarter to the first quarter and more first quarter dry-dock days as previously indicated as we prepare for the resumption of guest cruise operations.

Next, I'll provide a summary of our fourth quarter cash flows. We are currently in a solid liquidity position with $9.5 billion of cash on our balance sheet at the end of our fiscal year. I'm happy to say that this is $1.3 billion more cash than we had on the balance sheet at the end of the third quarter. During the fourth quarter, we added to our liquidity position by completing three very well received capital market transactions with cumulative net proceeds of $4.5 billion. The two at-the-market or ATM equity offering programs raised $2.5 billion while the senior unsecured notes we completed in late November raised $2 billion. This was partially offset by three things. First, our total cash burn for the quarter was $1.5 billion, simply our monthly average cash burn rate of $500 million per month times 3; second, $1.5 billion, driven by scheduled debt maturities; and third, a slight decline in customer deposits of $0.2 billion from $2.4 billion at the end of the third quarter to $2.2 billion at the end of the fourth quarter, which was better than our previous expectations.

Finally, I will finish up with some insights into our financial position. Since the pause in our guest cruise operations earlier this year, we have raised $19 billion through a series of transactions. This series included three equity offerings raising over $3 billion. These offerings, along with retiring $1.5 billion of our convertible notes through the issuance of common stock, considerably strengthened our balance sheet by reducing debt and bolstering shareholders' equity.

From a financial position perspective, 2020 could be characterized as obtaining sufficient liquidity to get through the pause in guest cruise operations. However, with $9.5 billion of cash on hand at year-end, our focus for 2021 has now shifted to additional financial transactions that optimize our capital structure. We will look to liability management with our banking partners to refinance existing debt at lower interest rates where possible. We still have the ability to issue more debt if and when needed, and during 2021, we may also opportunistically further enhance our liquidity position.

And now I'll turn the call back over to Arnold.

Arnold W. Donald - President and Chief Executive Officer

Thank you, David.

Operator, please open the call for questions.

Question & Answers

Operator

[Operator Instructions] And we have a question from the line of Steve Wieczynski with Stifel. Please go ahead. Your line is open.

Steven M. Wieczynski - Stifel Nicolaus Capital Markets - Analyst

Yeah. Hey guys, good morning. So, David, I think…

Arnold W. Donald - President and Chief Executive Officer

Hey, good morning, Steve.

Steven M. Wieczynski - Stifel Nicolaus Capital Markets - Analyst

Hey, Arnold. How you doing?

Arnold W. Donald - President and Chief Executive Officer

Good.

Steven M. Wieczynski - Stifel Nicolaus Capital Markets - Analyst

So, David, I want to start with your last comments there about your liquidity position. I guess - I guess I'm a little confused because obviously you have wording in the release about how you expect to enter additional financial transactions which you just talked about. But, Arnold, you also indicated you expect to have all your ships operational by year-end, which I think to some folks might seem a little aggressive. So I guess the question is around maybe why would you need to really raise anything additional at this point if you think you would be fully operational by year-end? And I hope that makes sense.

Arnold W. Donald - President and Chief Executive Officer

First of all, just to restate. For me, we hope to have all of our ships operational by year-end. Obviously, as I'm hoping what's happened so far in early '21 here is just a hangover from 2020. We're still navigating this thing as a planet, this whole thing. So hopefully we'll have them all operating by the midyear. And I'll let David respond to the rest of your question. Go ahead, David.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah. So, Steve, some of the uncertainty relates to the resumption of cruise operations in the various brands around the world. Exactly when and how soon - and so we're just trying to keep people aware of the fact that we do have multiple billions of dollars of debt capacity and we can utilize that if and when needed. So we have choices, and we'll monitor the situation very carefully. And some of it also depends on, just like I said before, the timing of the restart of the operation, which at this point in time is a little bit uncertain.

Steven M. Wieczynski - Stifel Nicolaus Capital Markets - Analyst

Okay. Got you. And then I guess a bigger question would be just around the vaccines themselves. And I assume you guys have put some thought into are there going to be requirements for whether it's the crew, whether it's passengers, whether it's both that they would have to be vaccinated before they - before they're allowed to sail?

Arnold W. Donald - President and Chief Executive Officer

Well, as you can - as you are very well aware, the whole vaccine thing is at the very beginning here. And so we're monitoring, we're in dialog with not only CDC but lots of other equivalent organizations around the world for other destinations. And so we'll let it evolve over time and we'll make the most prudent decision when the time comes. But at this point, distribution remains a bit of an issue, and so we'll make a determination as things evolve.

Steven M. Wieczynski - Stifel Nicolaus Capital Markets - Analyst

Okay. Can I ask one real quick housekeeping question for David? David, can you help us maybe just think about what you guys are thinking from an interest perspective for '21?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

So, interest expense on the existing debt that we have at the end of 2020 would be about $130 million a month, or call it as $1.6 for the year. So depending on liability management and other things, it could be a little bit plus or minus from that number.

Steven M. Wieczynski - Stifel Nicolaus Capital Markets - Analyst

Okay. Great. Thanks, guys. Appreciate it.

Arnold W. Donald - President and Chief Executive Officer

Yeah. Thank you.

Operator

We have a question from Robin Farley with UBS. Please go ahead. Your line is open.

Robin Farley - UBS - Analyst

Great. Thanks. I wonder if you could give us any sense of the timing or kind of a gating issue for your first - your initial test cruises.

Arnold W. Donald - President and Chief Executive Officer

Yeah. Hi, Robin. Happy New Years to you. That's a work in process. Phase one, we're in with what's been communicated by the CDC. The additional guidelines for future phases have not yet been issued by CDC. We have weekly calls or as often as we need with them. So that remains to be seen. But what I can tell you is that we're on track to be able to do whatever we need to do in a very timely manner to be able to resume cruise ultimately.

Robin Farley - UBS - Analyst

So it sounds like you're waiting specifically for the CDC to issue some specific guidance around the test cruise timing.

Arnold W. Donald - President and Chief Executive Officer

To answer your question about specific timing on test cruise, yes, we would be waiting. But obviously, we're doing a lot of things. We've started to bring ships back into the US, we have - and bringing those ships back, are meeting the criteria that is currently put out there to be in a position to then subsequently do test cruises. But to give you a specific timing on the test cruises, we would need additional guidance from CDC.

Robin Farley - UBS - Analyst

Great. Thank you for that clarification. And then just one other…

Arnold W. Donald - President and Chief Executive Officer

Thank you.

Robin Farley - UBS - Analyst

Thank you. And maybe this one is for David. How should we think about the expense of a restart? And I guess what I'm asking specifically is, you've talked about how even when a ship is in warm layup, you have some crew onboard, you're running the systems and all of that. So is the actual cost of when that ship goes from being in warm layup to operating, is it just sort of increasing the staffing levels or is there some other incremental expense? I mean, obviously, as a ship sails, it will start to burn fuel, you'll start to have to provision for - for people. But I'm talking about, is there any sort of one-time cost or is it just that you staff up and you go from these lower levels to being what a typical expense per passenger cruise day would have been prior?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah. So I can tell you what our experience has been with Costa and AIDA because with Costa and AIDA, the capital expenditure was de minimis; the crew - they brought the crew back, which is an expense; plane flights and testing and other protocols. You've got to spend some money for food and other inventory for the ship. But while this will be a cash outflow, as you would expect during this period, if you're ramping up the ships, you'll also have a cash inflow from the customer deposits because you're getting final payments in association with those voyages.

So - and I think I have said before that the ongoing expenses that we experienced relating to protocols in Europe was a few hundred thousand euros per month per ship. For the US, for the CDC, as Arnold indicated before, we're still waiting for a lot of the technical guidance that was not included in their original conditional sail order. And so it's very difficult to estimate if there'll be anything different for the US at the time we restart operations.

Robin Farley - UBS - Analyst

Okay. Great. Thank you very much.

Operator

And our next question is from the line of James Hardiman with Wedbush Securities. Please go ahead. Your line is open.

James Hardiman - Wedbush - Analyst

Hey, good morning. Thanks for taking my call. David, you gave us the interest expense. Could you just help us out maybe with the share count, where it stands today and what you expect it to be once you're - once you're making money again on a diluted basis?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah. So today, the outstanding share count at the end of 2020 was 1.087 billion shares. And the only other thing with - that I'll add is with the conversion of the remaining converts. It would total 1.140 billion.

James Hardiman - Wedbush - Analyst

Got it. And then, as we think about a presidential transition here in the next couple of weeks, maybe how you're thinking about potential risks or maybe opportunities? Do you think that changes the conversation with the CDC at all? And obviously, what was a nice benefit for you guys during the Obama administration was the availability of Cuba. Have you had any conversations on that front? It seems like it could be maybe an opportunity going forward.

Arnold W. Donald - President and Chief Executive Officer

I think first of all - thanks for your question, and Happy New Year. I think first of all, look, we all stand together in trying to mitigate the spread of this virus. And whatever administration is in place, obviously, we're going to be totally in compliance. But we just want to be an ongoing part of the solution regardless. So in terms of incremental risks associated with one administration versus another, not thinking that way at all. Either way, we have to do the right thing to serve the best interest of public health. And I think the science ultimately will guide us all to there.

With regard to other matters, obviously, Cuba was a focal point for the Obama administration, opening up Cuba, etc. We'll see what happens with the incoming administration. We obviously will be well prepared. We were very actively with the first ones to sail to Cuba. And we'll be well prepared to be able to operate in whatever - the guidelines and rules and regulations are. But we'll be prepared to again help people really want to go to Cuba see as the best way we feel, which is arriving via cruise and then experiencing what Cuba has to offer when it opens.

James Hardiman - Wedbush - Analyst

Got it. And then just maybe lastly from me. The different brands that you employ - as we think about sort of a post vaccine environment, are you seeing major differences in terms of demand for those different brands? Obviously, depending on the country and their state in terms of the virus itself, that's going to change demand. But maybe just more broadly, are there some brands that are better positioned than others as we look to second half of '21 and into '22?

Arnold W. Donald - President and Chief Executive Officer

As I said in my opening remarks, obviously, overall demand has been very robust and we find that very affirming for our business. We do not see major differences across brands. Obviously, one would be Costa Asia, where the booking is much closer in than any of our other brands. But absent that, there is no big dramatic differences across the brands in terms of booking patterns or trends. And there is a lot of pent-up demand for cruise which is evidenced by the booking patterns. And so - and we're going to have smaller fleets, first of all, we're going to reintroduce on a staggered basis. The fact we have national brands, as we've pointed out before, plays well for us in that regard. And the fact that we - we have a number of brands that are drive-to markets, easier to get to and so on and so forth is another benefit, and that's around the world. And so, given that we don't see dramatic differences across the brands and we see genuine strength and what should be a robust opportunity once cruise resumes.

James Hardiman - Wedbush - Analyst

Got it. Thanks, Arnold, and thanks, David.

Arnold W. Donald - President and Chief Executive Officer

Thank you.

Operator

Our next question is from Brandt Montour with JPMorgan. Please go ahead. Your line is open.

Brandt Antoine Montour - JPMorgan Chase & Co. - Analyst

Good morning, everyone. Thanks for taking my questions. Just curious on bookings.

Arnold W. Donald - President and Chief Executive Officer

Good morning.

Brandt Antoine Montour - JPMorgan Chase & Co. - Analyst

Good morning. Hopefully, you can maybe flush out some of the cadence in bookings qualitatively. Sort of interested in knowing how bookings pace is faring now versus pre-vaccine and if that's a meaningful different pace and sort of when did you - might you see that inflect.

Arnold W. Donald - President and Chief Executive Officer

Bookings were robust pre-vaccine and have been post-vaccine. So we haven't seen any dramatic shift. And that - again, we haven't experienced a demand challenge for cruise for all the reasons we've pointed out, including the large base of previous cruise goers, repeat cruisers, etc., where the demand was really getting pent up because they've been many months without being able to satisfy their craving for a cruise experience. But I'll let David comment more granularly on some of the booking trends. David?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah, no, that's correct what you said, Arnold. And the thing that I would add to that is, we're seeing good demand in all of the various cruise markets, whether it be the Caribbean itineraries, Europe itineraries. We're seeing good demand for Australia, for world cruises, etc. So it's broad-based and across, as Arnold said, all the brands.

Brandt Antoine Montour - JPMorgan Chase & Co. - Analyst

Thanks for that. That's helpful. And then one more from me is, on the CDC, I was hoping that you could help us understand the relationship between maybe potentially as we move to the summer season and ships tend to sell more abroad, is it at all likely that you might look to - look to get fewer ships outfitted and certified under the CDC guidelines since there is not a whole lot of point to get certified for one month in the spring and then - and then go - and then go sail elsewhere where there is not going to be the same restrictions?

Arnold W. Donald - President and Chief Executive Officer

We want the freedom to operate, period. And so we'll be focused on, again, being in compliance with whatever CDC regulates. Obviously, we give our inputs and offer other like science, medical experts, their inputs and whatnot. But the CDC will make their determinations and we want the freedom to operate. And having said that, as we mentioned earlier, the fact that we are global, that a large number of our sailings normally are outside the US and so on gives us additional degrees of freedom, but we also have to secure [Indecipherable] the places that we've been doing a really good job so far in Europe with the limited start-ups of Costa and AIDA.

But you're right. As you look around the world and different targeted markets, but obviously the summer is also an active time for US sailings with holidays and vacations. Of course, all of that feels a little different now. But nonetheless, it is an active period. So, we're well positioned with differentiated. We have nine world-leading cruise line brands, we have national brands. As things open up in staggered ways around the world, we can take full advantage of that. But we like to have the freedom to operate everywhere.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

And I'll just add that, if you look at the CDC website, you will see that we brought 30 ships back into US waters. One more is expected to come back. It's in transit, Carnival Mardi Gras. And those are the ships that we expect to sail in US waters through the balance of the conditional sail order that the CDC issued this year, and the remainder of the ships would sail outside US waters.

Brandt Antoine Montour - JPMorgan Chase & Co. - Analyst

Perfect. Thank you.

Operator

And our next question is from Assia Georgieva with Infinity Research. Please go ahead. Your line is open.

Assia Plamenova Georgieva - Infinity Research - Analyst

Good morning. Happy New Years. Couple of quick questions. Is there…

Arnold W. Donald - President and Chief Executive Officer

Happy New Years, Assia.

Assia Plamenova Georgieva - Infinity Research - Analyst

Thank you. Is there an inclination or ability to possibly restart some of the ships that are currently scheduled to start, let's say in May and June, as opposed to the end of March? How easy is that or is that something that is not going to change?

Arnold W. Donald - President and Chief Executive Officer

If it made sense then. First of all, we're always going to act in the best interest of public health. That's number one. Number two is, if we have the freedom to operate sooner and there were itineraries that made sense, we would not rule out here in January introducing customized itineraries prior to those periods for brands, if it made sense and we were able to do so. So yes, there is the possibility even with brands that have announced a pause through a certain period of time that if the opportunities presented itself and they made sense, especially - and this is now January here - I mean, absolutely, we could introduce some customized itineraries, something to reintroduce if it made sense.

Assia Plamenova Georgieva - Infinity Research - Analyst

And Arnold, you mentioned shorter cruises which of course make more sense. But [Indecipherable] the longer voyages over seven nights for the higher end brands. Again, do you think the CDC might be open to reconsidering their position and possibly allow longer voyages before November?

Arnold W. Donald - President and Chief Executive Officer

We will have to see what evolves. And again, with the advent of vaccines, with the acceleration of low-cost, more rapid testing, with advancements in treatment and so on, I think all of this is potentially in flux. That would definitely be the CDC's call to make. But again, things change all the time and. And we have to see. So, I wouldn't say it's impossible. I think - again, everyone wants to act in the best interest based on science, and if the science and conditions made it possible, then they may change their position. And then there is other places in the world and whatnot and they have their rules and regulations. And so there will definitely be opportunity in some places in the world that have longer cruise itineraries for certain, and possibly here in the US prior to that [Indecipherable] to see.

Assia Plamenova Georgieva - Infinity Research - Analyst

And lastly, given your very active communications with the CDC, do you have any sort of an expected timeline as to when you might be receiving further technical orders and guidance or are you just waiting and they come out, that's when [Indecipherable] find out?

Arnold W. Donald - President and Chief Executive Officer

I think - I learned a long time ago in different businesses never try to predict regulatory anything because by its nature, it's not that predictable. So we provide the information, we're in active dialog. They will make their determinations and the timeframe that obviously they feel comfortable doing so, and we will respond to that. So we don't have a date definite for a future guideline release from them and - but we'll be prepared to act on whatever comes whenever it comes.

Assia Plamenova Georgieva - Infinity Research - Analyst

I think all of us will be waiting for further guidance as soon as it's available. Thank you so much, Arnold.

Arnold W. Donald - President and Chief Executive Officer

Hey, thank you so much. And then the last comment would be just that, obviously, we're in this business for the - for the long term. And while we all want to resume cruising as soon as possible because cash generation and cash maximization [Indecipherable] business at this point. The reality is, we want to do it in the right way and make certain that we're well prepared to be in compliance with whatever the rules and regulations are. But whether we start sailing in April or March or June or whenever, the real value in this business obviously extends for many years and eventually we'll all be back to the great days of growth in our industry and growth in earnings and growth in cash generation, etc. And when you look at it over time, a matter of a month here or a month there, a couple of months here or there are not determining the future value of the industry or outcome. Thank you.

Assia Plamenova Georgieva - Infinity Research - Analyst

I agree, but I have been following [Indecipherable] voyages for close to two decades now and kind of itching to start getting actual moving ships as opposed to just forward pricing and - yeah, okay, well, good luck.

Arnold W. Donald - President and Chief Executive Officer

Thank you.

Assia Plamenova Georgieva - Infinity Research - Analyst

Thank you.

Arnold W. Donald - President and Chief Executive Officer

Thank you.

Operator

We have a question from Patrick Scholes with Truist. Please go ahead. Your line is open.

Patrick Scholes - Truist Securities - Analyst

Hi, good morning, everyone.

Arnold W. Donald - President and Chief Executive Officer

Good morning.

Patrick Scholes - Truist Securities - Analyst

[Indecipherable] but I believe there was an industry meeting early last week with the CDC, and if that is correct, I'm wondering if you can share any details from that meeting.

Arnold W. Donald - President and Chief Executive Officer

No, we wouldn't share any details. There are multiple meetings with the CDC at different levels. There is technical levels, there is medical levels, there is all kinds of things. And so, at this point, what I can tell you is that we're in constant communication as are the other cruise lines. And also our industry association, CLIA, is also having dialog as appropriate. And everybody is working together, focused on resumption of cruise in a way that fits with overall what CDC is determining is best for our society.

Patrick Scholes - Truist Securities - Analyst

Okay. Fair enough. And then a second question on the 19 ships that are leaving or have left –some of them have left your fleet. Can you give us a ballpark idea of what the net cash - incoming cash flow from those are? Thank you.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

You talk about the…

Arnold W. Donald - President and Chief Executive Officer

David?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah, you talk about the sales price?

Arnold W. Donald - President and Chief Executive Officer

The 19 ships we plan to exit?

Patrick Scholes - Truist Securities - Analyst

Yeah, so…

Arnold W. Donald - President and Chief Executive Officer

[Indecipherable]

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Oh, of the cash flow, that was only 3%. We had indicated before 3% of operating income.

Arnold W. Donald - President and Chief Executive Officer

Right.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

In 2019.

Patrick Scholes - Truist Securities - Analyst

I'm talking about the - I'm sorry, the proceeds, the proceeds from…

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Oh, the proceeds.

Arnold W. Donald - President and Chief Executive Officer

Oh, the proceeds. But we wouldn't share that.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

So, we don't disclose the sales price of any ship. As you would imagine, that would put us in a disadvantage in future negotiations. But I will say that prior to COVID-19, in many cases we were selling ships for $50 million, $60 million, $70 million apiece. But obviously these - in these cases, we were selling ships for somewhat less than the historical standard post the COVID-19. So it wasn't - it was de minimis in the grand scheme of a company with - of our size.

Patrick Scholes - Truist Securities - Analyst

Okay. Great. That gives me some rough ballpark idea. Thank you very much.

Arnold W. Donald - President and Chief Executive Officer

Thank you.

Operator

We have a question from Ben Chaiken with Credit Suisse. Please go ahead. Your line is open.

Benjamin Chaiken - Credit Suisse - Analyst

Hey, how is it going?

Arnold W. Donald - President and Chief Executive Officer

Hey, Ben.

Benjamin Chaiken - Credit Suisse - Analyst

Hey, you talked about lower cruise costs from ships leaving the fleet, and then I think incremental to that, insinuated I believe some lower cost as a result of more efficient shoreside. Can you touch on what those improvements are and then maybe any way to think about sizing that opportunity? And then just one more does it for me.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah. As I mentioned, with the ships exiting the fleet, they were less efficient ships. We accelerated the exits given the fact that there was no opportunity for them to generate cash in the near term given the pause we are in. And so the - it gives us a 2% reduction in kind of base costs based on those ships exiting and then a 1% fuel advantage as well. So that's on the ship side.

On shoreside, basically with this pause, obviously we've furloughed and had to make a number of changes from a cash conservation standpoint to get our burn right down and has also given us opportunity to examine, and we continue to do so. All of our operations shoreside to see where we can be more efficient, where we can be more effective, and that's in every aspect of the business. So, when you say give you a few examples, it would be the normal things you would think about. Right now, we're not advertising and all that, but you're looking at marketing department to see how you structured also, what you're spending money on and what have you. And we want a path of continuous improvement. Before, we have been very successful through our sourcing efforts. But beyond that, even our operating procedures and stuff where we were doing a pretty good job of getting unnecessary costs out of the system. And so we continue to do that. And with this pause, we've been able to take a hard look at every aspect of the business and continue to do that and found additional opportunities for improved efficiency.

Benjamin Chaiken - Credit Suisse - Analyst

Got you. That's - that's helpful. And then I think, David, in your pricing commentary, you mentioned that - I don't know if I caught this right, but forward pricing includes bundles presumably, I guess the implication listing pricing there. So I think you mentioned that was not apples to apples. So is it possible to get an apples to apples pricing for what you're seeing on your forward books versus the '19 comparison, I think?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

So the - when we do the bundle, what we do is, we allocate a portion of the bundled product to the onboard and other revenue. So the price that we're using in the comparison is only a portion of the total price that was paid by the guest overall. So it's as close to apples and apples as we can get it, but the problem that you get into is because of the allocation, we're going to see the benefit in onboard and other revenue. So that's why I said that the comparison was probably more favorable than indicated where I said we were down 1% excluding the future cruise credits. That's about as close as I can get it because we've allocated out the onboard and other but you would expect to see a big increase in onboard and other as a result of the pre-purchase. So hopefully that clarifies it for you.

Benjamin Chaiken - Credit Suisse - Analyst

It does. Thank you.

Operator

We have a question from Jaime Katz with Morningstar. Please go ahead. Your line is open.

Jaime M. Katz - Morningstar - Analyst

Hey, good morning.

Arnold W. Donald - President and Chief Executive Officer

Good morning.

Jaime M. Katz - Morningstar - Analyst

I was just wondering if there were any interesting insights or takeaways from the 45% new to brand booker. Is that - you guys are seeing - are they even skewing younger, are they maybe longer lifetime customers than - if there is anything different than some of the new to cruise in the past?

Arnold W. Donald - President and Chief Executive Officer

No, we have not seen any like dramatic trend difference in new bookers - new cruisers than we have in the past. But, David, if you want to make a comment, go ahead.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Yeah, no, I was just going to add that overall, whether it be the 45% or the 55%, which are brand loyalists, which - by the way, just a little - just slightly more than a norm. We really haven't seen any significant change in the overall demographics of the people booking cruises. We're seeing people in their 20s and 30s as well as people in their 50s, 60s, 70s and 80s. And anecdotally, I was talking to a couple of the brands, asking them about various voyages and things, and they were telling me that some of the longer voyages in early 2022, they were seeing quite a few people 70 and up booking those voyages and we were just speculating that maybe those were retired people that didn't have to worry about a work schedule so they could plan considerably further ahead than most people.

So we're not seeing any significant changes or trends in demographics around the globe, seeing all ages booking in all products and all brands.

Jaime M. Katz - Morningstar - Analyst

Excellent. And then just a quick housekeeping follow-up. For depreciation for 2021, I know a lot of the ships that have come out of the fleet are probably largely depreciated. But can you give us an idea of like what the delta year-over-year might be in that figure?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

So 2021, we're looking at roughly $2.2 billion, which is similar to what we saw in 2020. But it is a preliminary number. The difficulty in that is trying to estimate our capex for 2021. We obviously haven't made all of our decisions for 2021 yet. It - some of it depends on the timing of the restart. So that is a preliminary number, but at this point, that's a good ballpark-ish figure.

Jaime M. Katz - Morningstar - Analyst

Thank you. That's helpful. Thanks.

Operator

And we have a question from Vince Cipiel with Cleveland Research Company. Please go ahead. Your line is open.

Vince Cipiel - Cleveland Research - Analyst

Great. Thanks. I wanted to come back to the FCCs. I think as of the last call, roughly two-thirds were still outstanding. So curious if that kind of roughly held and what do you think it's going to take for more of those to start to convert? And then the next part of that is, I think you previously alluded to a mid-single-digit type of negative impact from the FCCs coming in on the pricing side and curious if that impact kind of has held and should continue to hold as more of those convert.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

So, the last time when I was talking about the mid-single digits, I was talking about the back half of 2021. When you start looking at the time period that we're talking about the back half of '21 and the front half of '22, you're still in the same ballpark in terms of including the FCCs in terms of the pricing. And as far as the FCCs, probably - it's about 45% of our customer deposits at this point of still unapplied FCCs. So we still have quite a few FCCs that have yet to rebook. But that's not really very surprising. A lot of times, you get families that are booking multiple families with kids and you've got to coordinate vacations with supervisors at work and timeframes, so we would expect these FCCs to turn into bookings over the next six or 12 months as people plan their vacation opportunities.

Vince Cipiel - Cleveland Research - Analyst

Great. That's really helpful. And maybe - I wanted to think a little bit about the longer-term margin opportunity. You've talked about the sale of less efficient ships, probably taking out some overhead, the arrival of newer, more efficient ships. Just curious what type of EBITDA margin opportunity do you think is ahead of you as revenue more fully recovers probably in '22-'23.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

I'd be reluctant at this point to kind of give you that margin opportunity that would be providing guidance, and we're not in a position yet. I think by Arnold's comments indicating the efficiencies that we expect is alluding to an improvement, but give us some time to resume guest cruise operations get back in service and we'll be in a much better position later this year, perhaps, to give you more guidance and details into that. But at this point, all of the cost metrics would lead you to a better margin opportunity in the future.

Vince Cipiel - Cleveland Research - Analyst

Great. Thanks.

Arnold W. Donald - President and Chief Executive Officer

Operator, we'll take one more question, please. Thank you.

Operator

And we have a question from Stuart Gordon with Berenberg. Please go ahead. Your line is open.

Stuart Gordon - Joh. Berenberg, Gossler & Co. KG - Analyst

Yeah. Good afternoon. I was wondering if you could give us an approximate net debt number at the end of 2020 and ideally calendar because I think there was some export credit facilities drawn down in December [Indecipherable] side. Thanks.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

So, debt at the end of 2020 - November 30, 2020, which will balance sheet date will be $27 billion. And you're correct. We did - shortly thereafter, we took delivery of two additional ships and [Indecipherable] export credits associated with them. That was probably an additional, call it $1.5 billion, if I remember correctly, in December, on the Carnival Mardi Gras and Costa Firenze.

Stuart Gordon - Joh. Berenberg, Gossler & Co. KG - Analyst

Okay. Thanks. And just to follow up. I mean, you've obviously given us some visibility on the delivery schedule in 2021. Have you given any thoughts and whether you could cancel any future ship deliveries? And also, what would be your anticipated fleet size in 2022 versus 2019, given the changes with the ships leaving?

David Bernstein - Chief Financial Officer and Chief Accounting Officer

Okay. So in terms of the ship deliveries, I mean, we've said this many times before. I mean, we did renegotiate the delivery dates, as Arnold indicated, and we got a delay in all of the ship deliveries. But there are no cancellation clauses in our new building contracts. So as a result of that, I wouldn't expect any cancellation of any of the - of the new builds on order. We started the year with 14 on order. We took delivery of two. So we have 12 more in the ensuing years. And as far as capacity is concerned, if you look at the end of 2022, you'll see that - and we tried to do this in ALBDs - our capacity at the end of 2022 would be about 5.6 percentage points higher than 2019. So you're really just talking about less than 2% per year capacity growth from '19 to '22 because of the new builds that came in. But remember, the acceleration of the 19 ships that left the fleet. So it nets out to less than 2% a year.

Arnold W. Donald - President and Chief Executive Officer

Okay.

David Bernstein - Chief Financial Officer and Chief Accounting Officer

And with that…

Arnold W. Donald - President and Chief Executive Officer

Okay. Thank you. Yeah, thank you, everyone. We really appreciate your interest. Happy New Year. Be safe, be responsible. I'm sure you all are. And together, we look forward to what hopefully will be a very nice 2021, leading to many future years of success. So thank you. Thank you so much.

Operator

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CARNIVAL CORP

Q4 2020

Earnings Transcript

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