Richard D. Fain
Chairman and Chief Executive Officer at Royal Caribbean Cruises
Good morning, everyone, and thank you all for joining us on the call today.
You all know it's been almost a year and a half since the onset of the pandemic and it's certainly been a difficult time. We intended a virtual standstill for this long period, and there is no business school that has a course in how to succeed in business with zero revenue. Fortunately, our people have responded well to these unprecedented challenges and I'm very proud on the progress that they have produced.
Today, we are reporting another painful set of financial results, but we also reporting on the dramatic progress on the restarting of our operations and the continued strength in the demand environment for our leading brands. Most importantly, we have already restarted almost half of our capacity and we're bringing more online as we speak. Our protocols appear to be working very well, which gives us and our guests comfort about the safety onboard. Lastly, bookings are remarkably strong, especially for 2022.
I would like to address these three issues in order: first, I want to talk about the process of restarting; second, our operational protocols and their impact; and then lastly, come back to our booking outlook.
Now, starting with the process of resuming operations, it seems like only yesterday that people were asking me if I thought cruising would restart by December. Suddenly, we have half of our ships sailing on revenue cruises. We know this is going to take us a while to return to full normalcy. But while people are emerging from their isolation, it's clearly going to take them a while to feel totally comfortable. We believe that the best way to get them comfortable is to demonstrate just how well the process works. We call that the flywheel effect. Once we get the vast majority of our fleet back online and thousands of people sailing safely, it will make even more people feel comfortable doing the same thing. Once the flywheel starts spinning, it keeps spinning and the machinery keeps getting more powerful.
And some of you have asked why we were the first to restart in the States and how we've gotten our ships operating so quickly? The answer is simply that we started earlier and we have the very best people in the business who have been very aggressive in implementing the new protocols. We started preparing before we had official word that we would be allowed to sail, but at the point where we thought the approval was inevitable. And our people have worked hard and diligently to make sure that our ships could be back in the water quickly. Also, thanks in large part to the vaccine rollout, society has been progressing faster towards normalcy, which has maximized the pace of our recovery.
In this accelerated return to service, the health and safety of our passengers and crew remain a top priority. For every ship that we restart, we have committed to three pillars: first, ensuring our ship experiences are as safe, or safer, than the shoreside equivalents; second, meeting and exceeding our exacting pre-pandemic expectations, especially in regard to guest experience; and three, doing so in a financially prudent manner.
Now, turning to the second item on my list, I think it's important to talk about the safety protocols related to COVID. As you all know, our goal from the beginning of the pandemic has been to make cruising not just as safe as comparable to land [Phonetic] vacations, but safer. We believe that the unique [Technical Issues] could allow us to control the environment to an unusual extent. We can ensure a level of vaccinations and testing that would be impossible for most other places to even contemplate. Specifically, we require a 100% of the crew to be fully vaccinated. And we require the bulk of our guests to be fully vaccinated as well. The only exceptions are children under 12, and in Florida, a minor number of people who choose not to get vaccinated. Excluding Singapore, which is a special case, an average of 92% of the people onboard our ships in July were fully vaccinated. And this number is likely to rise going forward. The idea is to limit the spread of COVID-19 aboard our ships. We all know it's impossible to eliminate cases onboard a ship totally just as it is impossible to eliminate cases on land. But the steps that we're taking are designed to prevent the isolated cases from becoming an outbreak. And it seems to be working. We have had people test positive, but because almost everyone around them is vaccinated, they've remained isolated cases. That's the goal; rare individual cases and no significant spread. Repeat this with a few hundred thousand or million cruises and that creates the trust that will drive our resurgence.
Now the Delta variant is problematic for everyone, but even this looks manageable by our extensive protocols. It's too early to draw a definitive conclusions, but the vaccines are the ultimate weapon and they work. Our experience shows that while there are breakthrough cases aboard, the vaccines help keep them contained. In fact, and I thought this was quite unusual, in most of our positive cases even the cabinmate of the infected individual has tested negative. But in light of the Delta variant and other variance, we have recently strengthened our protocols further; even more testing and even more people required to be vaccinated than we had in June and July. We have gone from this -- from cruises being a source of concern to cruises being an exemplary for how to deal with COVID-19. I'm thrilled that we're making this dream a reality.
And that brings us to how our customers responding and fortunately that outlook is good. Our guests are easier to cruise again. We had hoped that there would be pent-up demand for cruises, but even we were surprised by the level that we're seeing. We are also encouraged by the improvements we are seeing more broadly across the travel industry. Cruise consideration remains high among active cruisers and it's steadily increasing among non-cruisers. It is clear people are eager to travel to take a vacation. And we are ready to make their vacation dreams come true. Jason is going to speak more about our booking trends in a moment.
Now, we all know it's going to take some time for this situation to settle. There's still a lot of confusion in the marketplace and that definitely hurts the next few months or so. In addition, people usually book their cruise vacations well in advance and it will take some time for us to catch up with the bookings that we didn't arrange or we didn't get up until now. But if we only obsess about the present, we will fail to prepare for the future. We must keep our eye firmly on that future that we can see is coming. We need to prepare ourselves forward, so we are focusing our thoughts, our efforts and our plans on that future.
While the third and fourth quarters of this year will continue to be painful, it's booking generally in line with our return to service and occupancy ramp up expectations. Due mainly for the timing of the ramp up the service and the abnormal booking window, we don't expect 2022 to be a normal year, however, we are seeing rapid and steady progress towards normalcy starting in the spring and summer of next year.
One important additional point is that we are not only in the business of delivering the best vacations possible, but also doing it sustainably. The Company's commitment to corporate stewardship remained a priority even during our return to service. Despite pandemic headwinds, the Company has made tremendous progress across environmental, social and governmental -- governance focus areas. Some of the key achievements could include: a 35% reduction in our greenhouse gas emissions from our 2005 baseline; we removed 60% of single-use plastics from our supply chain; 60% of our ships are equipped with emission purification system that remove 98% of sulfur oxides and our newer ships are equipped the selective catalytic reduction, which reduces NOx emissions; we reduced to waste-to-landfill by 85% from our 2007 baseline; and we've also completed the introduction of over 2,000 certified tours and three assessments by the Global Sustainability Tourism Council.
One interesting point is that our windfarm, expands 20,000 acres in Northern Kansas, has 62 turbines, with a total power generation capability of 200 megawatts. It's now been operational for more than a year. We will annually generate 760,000 megawatt hours of carbon-free energy. That's saving some 500,000 tons of carbon. And to put in perspective, it's the equivalent to the energy use of about 60,000 homes.
It is just a few of the many initiatives underway at the Company and I've only focused here on the area of the environment. Our press release covered other initiatives in accordance with our -- in accordance with our mantra of continuous improvement. We will continue to elevate and will introduce new initiatives to improve all of our ESG efforts across the board.
The last 16 months have cost much pain and much suffering, but the tide is clearly turning. I'd like to thank our Board of Directors for their support and dedication. I also want to thank our partner organizations and communities for staying the course and preparing for the future. But most of all, I want to thank the men and women of the Royal Caribbean Group for their tireless efforts under the most challenging of circumstances. Their dedication to seeing us through this black swan event in the best way possible is nothing short of extraordinary. So I look forward to sunnier days ahead.
And with that, I'll turn it back to you, Jason.
