Carnival’s China operations profitable for first time 2012

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Published on Tuesday, 23 April 2013 09:21

Written by Kari Reinikainen

Carnival Corporation & plc recorded a profit from its operation in China for the first time last year, six years after its Costas Crociere unit commenced business there, said Howard S. Frank, Vice Chairman, Chief Operating Officer and Member of Executive Committee of the world’s largest cruise shipping group.

“In China, the cost of China business, which was established as I said in 2006, achieved profitability for the first time in 2012, which is greatly encouraging. We added a second ship to Costa Atlantica to the Asian fleet, doubling the size, more than doubling the size of Costa Victoria has already been there,” he told the shareholders meeting of the group in London last week.

“And we will source, we expect to source 185,000 Chinese passengers in 2013 on the Costa fleet. In Japan, where we are just beginning at the end of this month to open up cruising to the Japanese market. We have a sort of a step ahead of other operators. We are really the only major -- Princess will be the only major operator in Japan."

“And we are looking to source up to 100,000 passengers, Japanese passengers in 2014. You can see -- you continue to see the strategy is to move our business further East… And looking at emerging markets where we've doubled our share, that's been part of our strategy to move further East into Asia. And that has worked, so we've doubled our share for Asia in emerging markets passengers and that's worked for us. And that, in some measure, is the future growth of the business, if you will, as we move East. So that is part of our strategy,” he said.

Carnival Corp & plc: repeaters increase to 68% from 54% of total volume in six years

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Published on Tuesday, 23 April 2013 09:08

Written by Kari Reinikainen

The proportion of passengers who return to cruise on ships of Carnival Corporation & plc brands has increased to 68% last year from 54% in 2006, but in absolute terms the number of first timers has not declined thanks to the growth of the total volume, said Howard S. Frank, said Vice Chairman, Chief Operating Officer and Member of Executive Committee of the world’s largest cruise shipping group.

“In 2006… we sailed with 7 million passengers on a worldwide basis. In 2012, we sailed with an excess of 10 million passengers on a worldwide basis. What's interesting is that repeat cruises in the left-hand side, in 2006, were 54%, that is people who come back and cruise with us. We've increased that to 68%,” Frank told the shareholders’ meeting of the dual listed group in London last week.

“Why is that important to our business? Because repeat cruises are our best customers. They understand cruising, how to have fun on a ship, how to enjoy it and they pay the best prices for our cabins and they spend the most on board. So having this enumerator of 68% of your 10 million passengers that are repeat cruisers, is an ongoing revenue stream for us.”

“It's very important. And as we've grown this in that six-year period, that endures to our benefit. At the same time, you can see our first time cruisers have come down from 46% to 32%. But in reality, they haven't come down at all because it's still 3 million passengers of -- 3 million passengers in 2006 were new cruisers. It's the same 3 million passengers on an absolute basis in 2010. So what is good, is you need to get cruisers to your ship the first time so they come back and repeat, so we need to continue to drive new business for us, new cruisers, introducing new people to cruising.”

TUI Cruises expects STX Finland to complete Mein Schiff 3 on time

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Published on Monday, 22 April 2013 17:09

Written by Kari Reinikainen

TUI Cruises, the Hamburg based joint venture between TUI AG and Royal Caribbean Cruises Ltd (RCCL), says it expects STX Finland to complete Mein Schiff 3, the first of two newbuildings in has on order at the Finnish yard, on timedespite a delay in implementation of a multi-party agreement to inject funds in the yard.

“Unfortunately the materialisation of the agreement has taken longer than expected.  However, now the owner has taken the necessary steps to move forward and TUI Cruises expects to proceed with the original agreements this week,” the Hamburg based company said in a statement.

It made the statement in light of recent public speculation relating to the shipyard, the company also confirmed that it expects all details to be clarified and confirmed with a few days.  “The company noted that all relevant parties, including the shipyard, its owner, the buyer, the Finnish government and Finnish government agencies, previously reached an agreement to cover the financing of the work and ensure that the shipyard had the liquidity it needed to complete the ship on time,” TUI Cruises said.

“We are confident that this ship will make all of us involved in the process proud,” said Richard Vogel, TUI Cruises President and CEO, who is in Finland this week reviewing the status of the construction of the company’s two ship orders and provided an update.

Vogel noted that Mein Schiff 3 had just reached an important milestone – construction at STX Finland is now 25% complete and the main engines have completed their acceptance testing.  Formal keel-laying has been set for Friday 24 May, 2013 with delivery almost exactly one year later.  “It is very exciting to see all the pieces coming together to form this spectacular vessel,” said Vogel.  “We can’t wait to amaze our guests with the special spaces aboard this beautiful and innovative ship.”

The construction of the vessel is being overseen by Harri Kulovaara, EVP-Maritime of RCCL, who also commented that the pace of construction was encouraging.  “I have no doubt in the ability of the Finnish yard and its contractors to complete this ship in a timely way and to produce yet another excellent ship.”

Suspension of activities at STX Finland “highly likely” – report

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Published on Friday, 19 April 2013 08:18

Written by Kari Reinikainen

The Finnish government is preparing for the possibility that activity at the two shipyards of STX Finland would be suspended in the next couple of weeks due to lack of funds, the Finnish broadcasting company YLE reports on its website.

“According to the information obtained by YLE News, the government considers the suspension of activity at STX shipyards in Turku and Rauma highly likely,” the broadcaster reported.

YLE did not disclose the source of the information.

“According to assessment of the situation, STX Finland should obtain new funding in the next couple of weeks in order to be able to maintain its activities. Three Finnish civil servants have been in South Korea on a fact finding mission,” the report continued.

STX Finland is part of STX Europe headquartered in Oslo, which again is owned by STX Shipbuilding & Offshore, one of the three listed main companies in the Seoul based STX Business Group. The group is facing financial difficulties and, according to YLE, it has not been able to meet its obligation based on an agreement earlier this year to inject cash in the Finnish subsidiary.

Earlier this year, the government agreed to buy the site of STX Finland’s Turku shipyard and the STX group agreed to inject funds into STX Finland to ensure the completion of two 97,000 gross ton cruise liners the company has on order from TUI Cruises in Germany.