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High airfares force Carnival Cruise Lines out of Europe 2014

Details: Published on Friday, 10 May 2013 11:29; Written by Kari Reinikainen

Carnival Cruise Lines is to send a letter to the UK trade today telling them it will have no ships in Europe next year, Travel Weekly reports in a news alert emailed to Cruise Business in the UK.

Carnival Cruise Lines, which has the 86,000 gross ton Carnival Legend based in Dover and the 102,000 gross ton Carnival Sunshine operating from Barcelona and Venice this year, said it did not think Americans, who make up the vast majority of its passengers, would pay increased airfares to cross the Atlantic.

Itineraries for 2014 have yet to be announced, but UK director Adolfo Perez said agents may be expecting Carnival to have European sailings next year. He stressed the deployment did not mean any scaling back of the UK office and said he was very hopeful that Carnival would bring a ship back in Europe for the 2015 season.

Carnival Legend will reposition to Australia this autumn, where it will become the second ship of the company to cater for the local market.

"The important thing is that our sales team is staying exactly the same size. In fact, we're even recruiting someone right now to replace one of the team that has just left to move overseas. The trade has really supported us and sales have grown significantly from this market and so we will remain as committed as ever with the same great commissions and marketing support."

"We are really hopeful of getting a ship back in Europe in 2015 and you can't just pull out for a year and then expect to just come back again when we need the trade, so it will be business as usual with us really engaged with the trade. Unfortunately, we just don't think the airfares for Americans will be affordable."

The letter to agents said: “Given the current market conditions, increasing air fares, and the fact that most of our guests are from the US, we have decided to not deploy a Carnival ship to Europe in 2014. This was a difficult decision for us, as we realise our guests truly love sailing with Carnival in Europe, largely because we provide great holidays at great value for money. We are hopeful we will return in the future.”

“Carnival continues to be committed to the UK and Irish markets. Whilst we have relied on you all for our European deployment in 2013, you continue to bring guests to Carnival in the Caribbean… and they love it. In fact, the majority of our UK customers choose a cruising holiday that departs from North America. After all, we are the cruise industry leader in year-round Caribbean cruise holidays including departures from all of the major Florida ports and we are the only cruise line to offer year-round departures from Barbados, a true British favourite.”

Following last year’s decision to split the UK-based team overseeing the line from fellow Carnival Corporation operator Holland America Line, it has had a dedicated sales and marketing team under Perez based in London.

Australian source market grew 11% to 694,000 passengers in 2012

Details: Published on Thursday, 09 May 2013 08:31; Written by Kari Reinikainen

CLIA Australasia has published its 2012 Australian Cruise Industry Report, whose main findings include:

Australian cruise passenger numbers surged by 11% to reach a record 694,062 in 2012, compared to 623,294 in 2011

Australia is the only source market in the world, other than North America, to have reached a 3% market penetration rate

Australia’s share of the global cruise industry is now 3.4%

The most popular destination for Australian passengers was the South Pacific which accounted for 36.4% of the market in 2012 (252,555 passengers)

Europe is now the biggest fly-cruise market for Australians with passenger numbers rising 26% to 57,719 (8.3% of the market)

The Caribbean achieved the highest growth rate with a 36% rise to 17,316 Australian passengers

River cruising numbers continue to expand with 12% more passengers (39,275) opting for this niche holiday experience

Shorter cruises of 1-4 days experienced the greatest growth in 2012 rising 38%, with 76,719 Australians opting for a short break cruise

The first breakdown of cruise passenger age reveals almost half are under the age of 50, a quarter are aged under 40 and one-third are over 61 years

An insight into the passenger mix onboard roundtrip cruises from Australia shows Australians accounted for 84% of passengers with international travellers representing 16% or close to 100,000 passengers

Norwegian sees $2.2 billion capex on newbuildings to 2015

Details: Published on Monday, 06 May 2013 20:19; Written by Kari Reinikainen

Norwegian Cruise Line Holdings, the listed parent company says that it expects to spend $2.23 billion in capital expendidure related to its newbuildings to the end of 2015.

Future capital commitments consist of contracted commitments, including ship construction contracts and future expected capital expenditures for business enhancements, the company said in a statement. As of March 31, 2013, anticipated capital expenditures for ship construction were $681.1 million for the remainder of 2013, $755.6 million for 2014 and $788.5 million for 2015, of which export credit financing is in place of $572.8 million for 2013, $657.1 million for 2014 and $621.1 million for 2015, based on the euro/U.S. dollar exchange rate as of March 31, 2013

In addition, as of March 31, 2013, anticipated capital expenditures for business enhancements were $57.2 million for the remainder of 2013, and $77 million for each of the years 2014 and 2015, the company said.

Norwegian reports $96.4 million first quarter net loss on financial items

Details: Published on Monday, 06 May 2013 20:13; Written by Kari Reinikainen

Norwegian Cruise Line Holdings, the listed parent company of Norwegian Cruise, has reported loss for the first quarter of the year due to financial items.

The company booked $110.4 million in expenses related to debt prepayments funded by the aggregate net proceeds from the IPO and the Notes Offering as well as non-cash compensation and other expenses related to the Company's IPO. On a GAAP basis, net loss and diluted EPS were $96.4 million and $0.49, respectively

Excluding these items, adjusted net income improved to $12.9 million with adjusted EPS of $0.06 from $3.3 million and $0.02 in 2012 respectively. Net yield increased 3.3% on both an as reported and constant currency basis, the company said in a statement.

"We are excited to announce another quarter of strong results, especially in light of this being our first quarter as a publicly traded company," said Kevin Sheehan, Norwegian Cruise Line's President and CEO. "These strong results bring us to nineteen consecutive quarters of year over year Adjusted EBITDA growth."

On January 24, 2013, the Company closed on its successful IPO at a price of $19.00 per share. In addition, on February 6, 2013, the Company issued $300 million of 5.00% senior unsecured notes. The aggregate net proceeds of the IPO and the Notes Offering were used to prepay certain credit facilities, prepay amounts due pursuant to the Norwegian Sky Purchase Agreement, redeem the full amount of the outstanding $450 million 11.75% senior secured notes due 2016, redeem a portion of the outstanding $350 million 9.5% senior unsecured notes due 2018 and for general corporate purposes.

Interest expense, net for the period was $127.7 million and included $90.5 million in charges related to the prepayment of certain credit facilities and the redemption of certain of the Company's senior notes in connection with proceeds from both the Company's IPO and Notes Offering

Carnival sets up Asia unit in Singapore, sees 3.7 million Asians to cruise 2017 - report

Details: Published on Friday, 03 May 2013 09:10; Written by Kari Reinikainen

Carnival Corporation & plc, the world’s largest cruise shipping group, has set up regional unit in Singapore and unveiled plans to develop the city state a hub for its Asian operations.

The Anglo-American group is aiming for a 50% share of the Asian cruise market in 2017 and intends to establish South-east Asia as Caribbean of the East, with Singapore as the hub, TTG Asia reports on its website. Carnival has established its regional unit, Carnival Asia, in Singapore and it projects that the Asian cruise market would grow to 3.7 million passengers by 2017, from 1.5 million now.

Pier Luigi Foschi, Carnival Asia chairman and CEO, told TTG Asia e-Daily in an interview this morning: “We would like our share of Asia to be the same as our share of the market worldwide, which is 50%,” the report said