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Fincantieri to set up a joint venture in China

  • Written by Teijo Niemelä

Fincantieri, world leader in cruise shipbuilding, and China State Shipbuilding Corporation (CSSC), China’s largest shipbuilding conglomerate, have signed an agreement for the constitution of a joint venture aimed at developing and supporting the growth of the Chinese cruise industry. This step allows Fincantieri to gain a leading role monitoring a strategic market with high potential.

The signing took place today in Shanghai between the CEO of Fincantieri, Giuseppe Bono, the President of CSSC, Wu Qiang, and the Chairman of CSSC Cruise Technology Development and of the Shanghai Waigaoqiao Shipbuilding facility (SWS), Wang Qi.

Attending the ceremony were Ambassador of Italy to the People's Republic of China Ettore Sequi, Consul General of Italy in Shanghai Stefano Beltrame, Chinese Vice Minister of Industry and Information Technology Xin Guobin, Vice Mayor of Shanghai Zhao Wen, for Carnival Corporation the Chief Operations Officer of Carnival Asia Michael Ungerer, and many authorities from the Chinese Government and the municipality of Shanghai.

The today’s agreement, which follows the historic ones signed with CSSC and Carnival Corporation in November 2014, provides that the joint venture will design and sell cruise ships exclusively intended and specifically customized for the Chinese and Asian market. These vessels will be built at one of CSSC’s shipyards, the SWS facility, on the basis of a technological platform licensed to the joint venture and to the SWS shipyard by Fincantieri, which will therefore perform the activities within its competence through the joint venture.

In order to ensure the success of the cooperation and to benefit from Fincantieri’s global experience and expertise in the development and construction of cruise ships, the agreement envisages that Fincantieri will also provide specialized consultancy services and supply certain key components of the vessels to the joint venture and to SWS.

According to the Chinese Ministry of Transport (MOT) the cruise market in China expanded significantly in the last years, reaching 1 million passengers in 2015. The growth potentials are estimated in 4.5 million passengers by 2020, projecting China to become the world’s second largest cruise market after the U.S., and in 8-10 million passengers by 2030 with a double-digit growth per year. If this trend is confirmed, the Chinese market is expected to become the first overall.

“This new agreement highlights once again Fincantieri’s technical and technological leading position and it places us at the center of a project without equal in the world, supported directly by Chinese Government in the form of a very ambitious project," commented Giuseppe Bono, CEO of Fincantieri. “We are equipped to face the new international scenarios and we are selected today as a shipbuilding partner for the development of the cruise sector of a country which looks at this industry with great determination. The presence of our main customer Carnival, which will purchase the vessels covered by the agreement, is also of fundamental importance for the project’s success. This result is a victory and an incentive to work even harder in the future. It confirms the Group’s ability to be the first one to seize highly strategic opportunities and a worldwide leader in all the sectors in which it operates”. Bono concluded: “Finally, it is worth recalling that our Italian shipyards have work guaranteed on average for the next ten years and that the agreement may lead to additional benefits related to top level ship components and engineering,"

Wu Qiang, President of CSSC, commented: “Signing the cruise shipbuilding joint venture agreement with Fincantieri, one of the world’s largest shipbuilding groups, is another milestone event for CSSC, for the history and development of China’s cruise industry, as well as for the cooperation between China’s and Italy’s shipbuilding industry. Joining forces will give new vitality to the rapid growth of China’s and the Asian-pacific cruise market. We look forward to working together with Fincantieri, Carnival, CIC (China Investment Corporation) and other strategic partners to strive for building and delivering China's first domestic large cruise ship."

Royal Caribbean signs agreement with Miami-Dade County to build cruise terminal for Oasis-class ships

  • Written by Teijo Niemelä

Royal Caribbean Cruises Ltd. has announced an agreement with Miami-Dade County to construct and operate a dramatic new cruise terminal at PortMiami, on land leased from the County. The new terminal will be a striking addition to PortMiami, and will serve as homeport to Royal Caribbean International ships, including a 5,400-passenger Oasis-class ship, the world’s largest and most innovative cruise ships. The agreement will come before the Miami-Dade County Board of County Commissioners on July 6, 2016.

“We are truly excited to be working with Miami-Dade County and PortMiami to create not just another cruise terminal, but a truly iconic building,” said Richard D. Fain, chairman and CEO for Royal Caribbean Cruises Ltd. “This new terminal is a symbol of our commitment to Miami, the city where our company first started almost 50 years ago. We can’t wait to bring an Oasis-class ship to PortMiami.”

“Miami-Dade County is happy to welcome Royal Caribbean’s expansion at PortMiami, and all the economic benefits that come along with it," said Carlos Gimenez, Miami-Dade County Mayor. “This public-private partnership will have an estimated economic impact of $500 million and generate approximately 4,000 jobs. Royal Caribbean has been an important part of our world-class community for almost 50 years, and this expansion will once again make PortMiami Royal Caribbean’s largest cruise port in the world. I thank them for their continued investment in and commitment to Miami-Dade.”

Broadway Malyan has been selected as the firm to design the new terminal, after a global competition was held between five of the world's leading architectural firms. The firm was selected because of their creative thinking and cutting-edge design.

The 170,000-square-foot terminal is nicknamed the ‘Crown of Miami’ because of its distinct shape. The design evokes the points of the symbolic headgear when viewed from the water; the ‘M’ of Miami when viewed from the east or western approaches; and a sense of waves rising or ships passing when viewed from the terminal side. At night, the terminal’s facade will be lit ensuring that the building makes a striking impression and providing a dynamic addition to the PortMiami landscape.

The new terminal will not be the only addition for Royal Caribbean in the coming year. The company has committed to add a 20,000-square-foot Innovation Lab to its corporate headquarters located at PortMiami. The Innovation Lab will continue to generate Royal Caribbean’s industry-leading, innovative vessels.

Currently, PortMiami welcomes approximately 750,000 Royal Caribbean passengers annually, representing about 15 percent of its overall passenger traffic. Once the new cruise terminal is completed, it is anticipated that Royal Caribbean will generate at least 1.8 million passengers at PortMiami – representing no less than 30 percent of the port’s projected passenger traffic.

Carnival says booking volumes, prices higher than year-on

  • Written by Kari Reinikainen

At this time, cumulative advance bookings for the remainder of the year are well ahead of the prior year at slightly higher prices. Since March, bookings for the remainder of the year are at higher prices with volumes running lower than last year because there is less inventory remaining for sale than at this time in 2015, the company said in a statement.

The company expects full year 2016 net revenue yields on a constant currency basis to be up approximately 3.5% versus the prior year, compared to March guidance of approximately 3%. The company now expects full year 2016 net cruise costs excluding fuel per ALBD to be upapproximately 1.5% compared to the prior year on a constant currency basis, better than March guidance of  approximately 2.0%.

Taking the   above   factors   into   consideration,   the   company  expects full year 2016   adjusted earnings per share guidance to be in the range of $3.25 to $3.35, compared to March guidance of $3.20to $3.40 and 2015 adjusted earnings of $2.70 per share.

Arnold Donald, CEO, noted in the statement: “This is shaping up to be another strong year for our company as we expect over 20 % earnings growth and are approaching a nine percent return on invested capital.”

“We have accelerated progress toward our stated goal of achieving the double digit return threshold and have accelerated distributions to shareholders, “ he said.

Carnival Corp & plc reports trebling of second quarter net profit

  • Written by Kari Reinikainen

Carnival Corporation & plc, the world’s largest cruise shipping group, said its net profit in three months to 31 May rose to $605 million from $222 million in the same period last year, while revenues increased to $3.70 billion from $3.59 billion.

In the first half of its financial year, the Anglo-American group reported a net profit of $747 million, an increase from $271 million. Revenues rose to $7.36 billion from $7.12 billion

Arnold Donald, CEO, stated: “Our strong secondquarter demonstrates continued momentum as we again achieved a near doubling of adjusted earnings per share. Our ongoing effort to drive demand for our brands in excess of our measured capacity growth has led to increased revenues and helped maintain the mid-point of our full year earnings guidance despite the recent currency movements and rises in fuel prices that combined represent negative $0.17 per share.”

Key metrics for the second quarter 2016 compared to the prior year were as follows: On a constant currency basis, net revenue yields (net revenue per available lower berthday or “ALBD”) increased 3.6% for the 2Q 2016, which was better than th ecompany’s guidance of up 1.5% to 2.5%.

Gross revenue yields increased 1.3%. Net cruise costs excluding fuel per ALBD decreased 1.9% in constant currency, compared to March guidance, up 0.5% to 1.5% due to the timing of expensesbetween   quarters. Gross   cruise   costs   including   fuel   per   ALBD   in   current   dollars decreased 5.4%.

Donald also noted several major milestones that will contribute to the future of the company including the re-mastering of Queen Mary 2, the opening of Holland America’s Denali square complex in Alaska and the introduction of AIDA Cruises’ AIDAprima, Holland America Line’s Koningsdam, and Carnival Cruise Line’s Carnival Vista. In addition, building on a legacy of pioneering achievements, Carnival group became the first cruise company to begin operating voyages from the US to Cuba in more than four decades through its Fathom brand -- a historic moment that captured world wide media coverage.

International Cruise Summit will bring together in Madrid experts of the cruise industry worldwide

  • Written by Teijo Niemelä

For two days, November 22nd and 23rd, some of the most influential professionals in the cruise industry, both national and international, will meet in Madrid. Cruise line executives, port authorities, destinations, travel agents, tour operators, shipping agents and industry suppliers … All of them will attend this new edition or the International Cruise Summit.

Present at the inauguration will be the President of Spanish Ports and other personalities from Tourspain, Madrid city council and Madrid Local Government. Delegates will attend roundtables and sessions which will discuss “The evolution of the cruise ships”, “The design of itineraries”,“The future of destination programmes”, “Selling the product”, “Passenger profiles” and “Purchases and logistics of cruise companies”.

More than 300 delegates from around the world will attend this unmissable event, which will be held at the NH Collection Madrid Eurobuilding Hotel.

ICS 2016 will have, among others speakers, prestigious personalities such as Pierfrancesco Vago (Chairman of CLIA Europe and Executive Chairman of MSC Cruises) who will handle the introduction and the state of the industry speeches. Also appearing on stage will be the following eminent speakers. Jorge Vilches (President & CEO of PULLMANTUR Group), Kerry Anastassiadis (CEO of CELESTYAL CRUISES), Shirley Henderson (Manager Shore Excursions CARNIVAL UK), Mark Robinson (President INTERCRUISES SHORESIDE & PORT SERVICES) Clare Ward (Senior Commercial Planning Manager FRED OLSEN CRUISE LINES) and Marcus Puttich (Head of Port Operations TUI CRUISES), Mario Zanetti (Vice President Revenue Management, Itinerary Planning, Air and Sea Operations COSTA CROCIERE) Helen Panagos (VP Marketing and Sales Crystal Yachts, Residences and Crystal Air Cruise Destination Experiences) CRYSTAL CRUISES and Gianluca Suprani (Head of Global Port Development and Shore Activities, MSC CRUISES).

This sixth edition will allow further enhancement of Spain’s image as the second European cruise tourist destination and the positioning of Madrid as a pivotal city in hosting international congresses. In addition, Spain will be further consolidated as a reference in the sector for its infrastructure, variety of destinations, including cultural diversions and / or entertainment for everyone. During 2015, 8.4 million cruise passengers visited the Spanish coast, which is 9.4% more than in 2014, setting a new record. Additionally, Barcelona become the most visited European port throughout the year and in the first eleven positions of this ranking, we find three Spanish ports, namely Balearic Islands, Las Palmas de Gran Canaria and Santa Cruz de Tenerife.



CBR 1/2016 contents

CBR 3/2015 contents