- MedCruise General Assembly: Discussing and advancing best practices in Med ports
- Queen Victoria's dining options refreshed with new Verandah
- Silversea opens reservations for its 2015 World Cruise
- Royal Caribbean International names new Senior VP of Marketing
- Swan Hellenic says summer's ex UK programe now sold out
- Carnival UK's Dingle airs thoughts of online's future role
- Carnival Corporation appoints Senior VP of Corporate Communications
- Gianni Onorato leaves Costa Crociere
- Mariner of the Seas celebrates maiden Hong Kong call – more Voyager-class programs announced for 2013 and 2014
- Star Cruises to homeport Aquarius in Kota Kinabalu from November 2013
- Creditors agree to $271 million emergency cash injection to STX Shipbuilding & Offshore
- Perception of top cruise brands continues US decline post Carnival Triumph - poll
Ports & Destinations
- Honduras President Lobo dedicates Banana Coast Port
- Martinique to welcome Royal Caribbean's Quantum of the Seas
- Australian government grants AUD13 million to Norfolk Island cruise infrastructure
- Cruise Copenhagen Network focuses on new strategy to increase cruise guests to one million by 2015
- Six percent increase in cruise passenger throughput at Valencia in January-May
Products & services
- MEIKO appoints new head of export sales and marketing
- Wärtsilä launches a new more powerful version of its Wärtsilä 34DF engine
- Viking Cruises selects MAN engines to power its new ocean-going cruise ships
- Herkules Private Equity buys Umoe Schat-Harding and Noreq
- Viking Line to recycle vegetation brushed off from bottoms of ships
- Published on Thursday, 30 May 2013 14:16
- Written by Kari Reinikainen
Royal Caribbean Cruises Ltd. (RCCL) announced today that it has signed a contract with the Meyer Werft shipyard to construct a third Quantum-class cruise ship for delivery in mid-2016. The price and terms of the new ship are similar to the price and terms of the first two Quantum-class ships and the contract is subject to financing conditions.
The company recently unveiled details of this new class of ship and was gratified by the public response to the design innovations. It also said that the new design included an advantageous configuration which includes a greater proportion of higher priced staterooms and that it achieves some of the greatest energy efficiencies at sea.
“We are creating a compelling experience for vacationers with innovative design, winning service, and appealing destinations around the world,” said Richard D. Fain, chairman and chief executive officer of RCCL. Brian J. Rice, vice chairman added, "This order follows our stated goals of moderate growth, driving improved returns and leading to an investment grade rating."
“We are encouraged by the very positive response we received from travel agents and consumers when we first announced some of the unprecedented offerings on Quantum Class last month,” said Adam Goldstein, president and chief executive officer of Royal Caribbean International, the contemporary market unit of the RCCL group that will operate the ship.
The yet-unnamed Quantum-class vessel will join the Royal Caribbean International fleet, alongside Quantum of the Seas, which will make its maiden voyage in 2014, and Anthem of the Seas, scheduled to debut in 2015."
Including today's contract and existing ship orders, projected capital expenditures for 2013, 2014, 2015 and 2016 are $700 million, $1.2 billion, $1.2 billion and $2.1 billion, respectively. Including Quantum III, the company's capacity growth rate from 2012 to 2017 will be approximately 4% per annum.
- Published on Thursday, 30 May 2013 08:11
- Written by Kari Reinikainen
Norwegian Cruise Line Holding, the listed parent company of Norwegian Cruise Lin e and NCL America, has announced the refinancing of certain of its secured credit facilities.
In addition, the Company has received commitments to refinance certain of its other secured credit facilities. No material incremental debt will result from these transactions. Once completed, the transactions mean that the company has replaced higher cost debt with lower cost options.
“The first transaction, totaling $1.3 billion, consists of a $675 million term loan and a $625 million non-amortizing revolving credit facility. This new facility matures in 2018 and refinanced existing credit facilities which had maturities beginning in 2015 and were secured by Norwegian Star, Spirit, Sun, Dawn, Pearl and Gem,” the company said in a statement.
The facility bears interest at LIBOR (London Inter-Bank Offered Rate) plus an applicable margin of between 2.25% and 1.50% based upon the company's leverage ratio.
In connection with this transaction, the company has issued a notice of redemption for the remaining $228 million outstanding of its $350 million 9.5% Senior Unsecured Notes due 2018 with a redemption date of June 28, 2013.
The second transaction, for which the Company has received commitments, will refinance facilities secured by Norwegian Jewel, Jade and Pride of America by amending the credit agreements to reduce the applicable margins and enhance certain terms and conditions. This transaction is subject to customary closing conditions and is expected to close in the second quarter of 2013.
"These transactions, coupled with our recent initial public offering and unsecured notes offering, reflect the optimization of our capital structure and positions the company for the future," said Kevin Sheehan, President and Chief Executive Officer of Norwegian Cruise Line. "We have now replaced all of our higher rate debt with facilities with more favorable rates and terms and enhanced our maturity profile to better match the increased cash flow generation that accompany our upcoming fleet additions."
Royal Caribbean quantifies financial impact of the Grandeur of the Seas fire – cancels more sailings
- Published on Wednesday, 29 May 2013 21:09
- Written by Teijo Niemelä
Royal Caribbean Cruises Ltd. today quantified the financial impact of the Grandeur of the Seas fire.
On May 27, 2013, Royal Caribbean Cruises Ltd.'s vessel Grandeur of the Seas experienced a fire in an industrial area on the aft of the ship. The company has taken the vessel out of service and expects that it will take approximately six weeks to complete the repair efforts. The company estimates that the direct financial impact of this event, net of insurance, is a reduction of $0.10 per share. "The extent of the financial impact was relatively high because the affected sailings were during the premium summer season," said Jason Liberty, senior vice president and chief financial officer. The ship is expected to return to service for its July 12, 2013 sailing date.
"We are gratified that no one was hurt and that the safety and comfort systems performed exactly as designed," said Adam Goldstein, president and chief executive officer of Royal Caribbean International. "I extend my appreciation to our crew who performed so well, as well as to our guests who have been cooperative, understanding and highly complimentary of the shipboard team throughout," Goldstein continued.
- Published on Wednesday, 22 May 2013 09:01
- Written by Kari Reinikainen
Carnival Cruise Lines, the US focused contemporary market brand in the Carnival Corp & plc group, should invest more in upgrading its existing vessels in order to regain pricing power that has been hurt in incidents involving its ships in the recent past, a cruise industry analyst says, adding that the same goes for the industry as a whole.
Karl Burns, analyst at Panmure Gordon in London, told the Financial Times that the decline in yields “bodes ill for the future as we think Carnival will struggle to regain pricing power.” He added that “the market must begin to appreciate there are structural as well as cyclical challenges to the Carnival business model.”
“The focus seems to be on new ships. Older vessels need to be marketed better to boost revenues,” Burns told Cruise Business. More investment may be needed in upgrading older vessels to allow them to obtain better yields.
Carnival Corp & plc recently unveiled a $700 million programme to technical upgrades to reduce the risk of incidents such as the one that crippled Carnival Triumph in the Caribbean in the spring. About $300 million of the total will be invested in the ships of Carnival Cruise Lines. The incident combined with bad publicity that followed has put Carnival Cruise Lines’ yields under downward pressure and the parent company issued a profit warning yesterday, largely as a result of these problems.
Burns welcomed the investment decision, but added that it might serve the industry as a whole well to focus investment on upgrades of existing ships rather than adding capacity on the market by contracting newbuildings. Yields per berth have trended lower over a long period of time and weak consumer markets in Europe in particular and to some degree also in the US indicate that the situation is unlikely to improve in the near future.
Cruise operators have struggled to stimulate on board spending too, which combined with low ticket prices poses a headache for the industry. “By investing more in upgrading existing ships, you could get the dual benefit of higher yields and no capacity growth,” Burns said, concluding that the bottom line of the industry's current problems is that it has not succeeded in significantly increasing its penetration rate on key markets, such as North America and Europe.
- Published on Wednesday, 22 May 2013 08:16
- Written by Kari Reinikainen
The worst may not be over yet for Carnival Cruise Lines, the US focused mass market brand in Carnival Corp & plc group, says Robin Farley, leisure, lodging and gaming analyst at UBS Invesrment Research in New York.
Farley downgraded Carnival to neutral from buy after a profit warning on Tuesday.
“We had maintained a buy rating after previous incidents due to the belief that the worst was behind for the Carnival brand and that perception issues would start to resolve going forward. Tonight's news signals that the worst may not yet be behind for the Carnival brand, and the guidance reduction suggests that booking trends have gotten worse, not better, in the last two months, signaling that perception problems may not have bottomed yet,” she said in a research note emailed to Cruise Business.
“Remaining on the sidelines in the near term may be the best course of action until the tide turns on Carnival's perception problems. Carnival management has been one of the best regarded management teams in the consumer sector and on a wider basis for more than a decade.”
“Our downgrade is a change in our view of the stock, not a change in our view of the company. This management team will right the ship. Our downgrade is only a matter of timing.
“Downgrading after bad news has already happened, but our concern is that the worst is not behind Carnival just yet. We had maintained BUY after previous incidents with belief that perception issues would start to resolve going forward, but lower guidance tonight means bookings have gotten worse, not better, in the last few weeks.”
Carnival group management is focused on rebuilding the Carnival Cruise Lines’ brand and re-establishing service to travel agents for improved relationships. “Constant negative publicity has damaged the Carnival brand more than what management had expected when CCL (Carnival group) last gave guidance in March’13, and that is particularly notable for a management team that historically has been viewed as guiding conservatively. “
“Based on the 75 bps of lowered guidance due to the Carnival brand in March, and now an additional 250 bps of yield decline attributable to the brand, the cumulative 325 bps of yield reduction for Carnival Corp suggests that the Carnival brand, which is about 30% of Carnival Corp, may be seeing yield declines of 10-11% at the brand level this year,” Farley stated.
- The American Steamboat Company to expand west
- Carnival shares open sharply lower in New York, partly recover in London after morning rout
- Carnival issues profit warning, says yields to fall, shares dive in London
- Richard J. O'Hanlon appointed Vice President, Nautical and Safety Operations for Carnival Cruise Lines
Oasis of the Seas Coverage
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- Allure of the Seas features 3D digital cinema engineered by FUNA
- Allure of the Seas sails with KONE people flow solutions
- Starbucks and Royal Caribbean to offer first ever Starbucks at sea on Allure of the Seas
- Autronica delivers extensive safety system to Allure of the Seas