Top Headlines

RCCL upbeat on outlook as yields, bookings firm

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 25 October 2013 25 October 2013

Royal Caribbean Cruises Ltd (RCCL), the world's second largest cruise shipping group, says the yield outlook has improved and booked load factors for 2014 are ahead of the situation a year earlier at stable prices.

"The company's yield outlook has improved for the full year 2013. Constant-Currency Net Yield outlook for the full year has been raised to an increase of approximately 3%. Constant-Currency expectations for NCC excluding fuel are unchanged at an increase of 1% to 2%. Fuel costs are expected to be $3 million lower than previously calculated due primarily to energy conservation measures and the Millennium unscheduled drydock," the company said in a statement.

"Based on the above and current fuel prices and currency exchange rates, the company expects that full year adjusted earnings per share will increase to a range of $2.30 to $2.35 per share."

The company's booked load factors are currently ahead of the same time last year in all four quarters of 2014. Booked prices for the first quarter are in-line with the same time last year and are up for the second, third and fourth quarters. Caribbean bookings have consistently been running ahead of the same time last year, although slightly below on a capacity adjusted basis.

"Caribbean pricing remains under some pressure, but while it is early in the booking cycle, we expect yields in the Caribbean to be flat to only slightly down in 2014," said Jason T. Liberty, chief financial officer. "Fortunately, the summer Caribbean is a core strength of ours and with the improvements we are seeing in our other products, we are forecasting overall yield improvement in the low single digits for 2014," said Liberty.

Royal Caribbean reports better than expected third quarter

Details: Written by Teijo Niemelä Teijo Niemelä; Category: Top Headlines Top Headlines; Published: 24 October 2013 24 October 2013

Royal Caribbean Cruises Ltd. (NYSE, OSE: RCL) today reported third quarter results, updated its 2013 outlook and provided early commentary for 2014.

Third quarter results were better than expected, driven by stronger close-in demand and good cost control which more than offset the revenue and cost impacts from Celebrity Millennium's unscheduled drydock. Constant-Currency Net Yield for the third quarter increased 2.6%, which was 110 basis points better than the mid-point of previous guidance. Stronger close-in demand in Europe and Asia, as well as robust onboard revenue drove the revenue improvement.

– Adjusted earnings per share ("adjusted EPS"), which excludes a special charge of $12.2 million for restructuring and related expenses, was $1.71 per share for the third quarter. U.S. GAAP EPS (after the charge) was $1.65.

– Constant-Currency Net Yield outlook for the full year has been raised to an increase of approximately 3%. NCC excluding fuel outlook is unchanged at an increase of 1% to 2%.

– Full year adjusted EPS is now expected to be $2.30 to $2.35 (raising the mid-point by 7.5¢ per share).

– The order book for 2014 remains ahead on both load factor and rate. Most markets and products are showing year-over-year improvement, including Europe, Alaska and Asia, while advanced bookings for the Caribbean are somewhat weaker.

– 2014 should be the fifth consecutive year for yield growth and current earnings estimates are consistent with Street consensus of $3.06 per share.

"We are beginning to see the payoff from our efforts to improve returns during these challenging times," said Richard D. Fain, chairman and chief executive officer. "We have a ways to go, but our strategy and our investments are driving higher revenues and achieving cost efficiencies that bode well for 2014 and beyond. We are especially grateful for our employees' dedication to our profitability improvement initiatives," Fain continued.

Third quarter results

Royal Caribbean today announced third quarter 2013 adjusted net income of $377.9 million, or $1.71 per share, versus net income of $367.8 million or $1.68 per share, in the third quarter of 2012. US GAAP net income, including the $12.2 million of restructuring and related charges was $365.7 million or $1.65 per share.

NCC excludes exceptional items such as the restructuring and related charges so that period-over-period comparisons are more meaningful. Net yields are not affected by these charges.

Net Yields on a Constant-Currency basis increased 2.6% during the third quarter. Ticket revenue, particularly in Europe, exceeded expectations and on-board revenue yields increased 7.0% during the quarter. The company also experienced better than expected close-in demand for its sailings in China. The combination of these improvements more than offset the impact of the Millennium unscheduled drydock.

Constant-Currency NCC excluding fuel increased 3.9% – in line with expectations – despite such pressures as the Millennium drydock. Bunker pricing net of hedging for the third quarter was $668 per metric ton and consumption was 323,000 metric tons. Currency translation rates for the quarter were in line with prior expectations.

OUTLOOK

Full year 2013
The company's yield outlook has improved for the full year 2013. Constant-Currency Net Yield outlook for the full year has been raised to an increase of approximately 3%. Constant-Currency expectations for NCC excluding fuel are unchanged at an increase of 1% to 2%. Fuel costs are expected to be $3 million lower than previously calculated due primarily to energy conservation measures and the Millennium unscheduled drydock.

Based on the above and current fuel prices and currency exchange rates, the company expects that full year adjusted earnings per share will increase to a range of $2.30 to $2.35 per share.

Fourth Quarter 2013
Constant-Currency Net Yields are expected to be up 2% to 3% in the fourth quarter of 2013 and NCC excluding fuel are expected to increase 1% to 2% on a Constant-Currency basis. Based on current fuel pricing and currency exchange rates, the company expects that fourth quarter adjusted earnings will be in the range of $0.15 to $0.20 per share.

The company expects to incur additional restructuring and related expenses during the fourth quarter, on top of the $13.9 million it has recorded year-to-date.

Booking environment
The company's booked load factors are currently ahead of the same time last year in all four quarters of 2014. Booked prices for the first quarter are in-line with the same time last year and are up for the second, third and fourth quarters. Caribbean bookings have consistently been running ahead of the same time last year, although slightly below on a capacity adjusted basis.

Booked load factors and rate are both up significantly year-over-year for Europe, which will account for 22% of the company's capacity in 2014. Despite the continued territorial dispute between China and Japan, Asian bookings are up considerably. Advanced bookings for Alaska and the company's other product lines are also providing encouragement for yield improvement.

FUEL EXPENSE & GUIDANCE SUMMARY

Fuel expense
The company does not forecast fuel prices, and its fuel cost calculations are based on current at-the-pump prices, net of hedging impacts. Based on today's fuel prices the company has included $230 million and $920 million of fuel expense in its fourth quarter 2013 and full year 2013 guidance, respectively.

Forecasted consumption is now 63% hedged via swaps for the remainder of 2013 and 56%, 45%, 25% and 5% hedged for 2014, 2015, 2016 and 2017, respectively. For the same five-year period, the average cost per metric ton of the hedge portfolio is approximately $563, $618, $639, $612 and $640, respectively.

RCCL expected to report EPS of $1.65 for third quarter

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 23 October 2013 23 October 2013

Royal Caribbean Cruises Ltd (RCCL), the second largest cruise shipping group in the world, is expected to report earnings per share (EPS) of $1.65 for the third quarter of the year.

The figures will be released on Thursday, 24 October.

RCCL, which is listed on the New York and Oslo stock exchanges, reached EPS of $1.71 in the third quarter of last year.

Seabourn orders new ship from Fincantieri

Details: Written by Teijo Niemelä Teijo Niemelä; Category: Top Headlines Top Headlines; Published: 18 October 2013 18 October 2013

Fincantieri, the world leader in cruise ship construction, and Seabourn, a Carnival Corporation & plc brand, have signed a letter of intent for a new ultra-luxury cruise ship.

The new ship, due to join the Seabourn fleet in the second half of 2016, will be built according to the standards and technical solutions that make Seabourn one of the most prestigious brands in the super-luxury segment.

“We are pleased to be moving forward with the plans we announced earlier this year to build a fourth ship similar to the highly regarded new design we introduced with Seabourn Odyssey, Seabourn Sojourn, and Seabourn Quest,” said Seabourn President, Richard Meadows. “The experience and the amenities offered by these award-winning ships has raised the bar in ultra-luxury cruising.”

Gabriele Cocco, Fincantieri's Executive Senior Vice President Merchant Vessels, said: "We are very pleased to have acquired a new customer like Seabourn and at the same time to have strengthened our historic partnership with the Carnival Group. This agreement is particularly important: it strengthens our leadership in the luxury cruise niche and confirms our primacy in the cruise industry."

QE2 Holdings selects COSCO Shipyard to refurbish Queen Elizabeth 2 into five-star hotel

Details: Written by Teijo Niemelä Teijo Niemelä; Category: Top Headlines Top Headlines; Published: 16 October 2013 16 October 2013

For over four decades, the Queen Elizabeth 2 (QE2) was “The Most Famous Ocean Liner in the World”. Yesterday, QE2 Holdings Ltd. (“QE2 Holdings”) announced its appointment of COSCO Shipyard Group (“COSCO Shipyard”), a subsidiary of China Ocean Shipping Company (COSCO), to complete the refurbishment of the QE2 into a luxury floating hotel – taking the ship into the next chapter of its illustrious history.

The cruise ship, which hosted kings, queens, presidents, prime ministers and celebrities throughout its legendary 40-year history, will depart from Dubai and arrive in COSCO Shipyard’s facility in Zhoushan, Zhejiang Province. Once there, it will receive a thorough revitalization and makeover that is scheduled for completion by 2015. The existing 990 staterooms onboard the cruise ship will be converted into 400 premium all-suites ranging from 60 to 150 square metres. COSCO Shipyard will be responsible for all the technical repairs and coordinate with an appointed interior renovation contractor to revamp the accommodation and ballroom, as well as the refitting of seven restaurants, 10 lounges, a cinema, a maritime museum displaying QE2 memorabilia, and a shopping mall.

Mr Khamis Juma Buamim, Chairman of QE2 Holdings and Dubai’s Drydocks World, said, “No other ship can match the QE2’s prestige, or her legacy. She is an absolute icon of maritime history, one of the best and most powerful ships in the world. Therefore, our decision on a partner was critical.”

“We are pleased to be working closely with COSCO Shipyard for the technical repair and refurbishment process, which will be carried out with the utmost respect to the QE2’s heritage and splendour. China COSCO’s expertise in cruise ship conversion will complement our extensive experience in comprehensive ship repair work and upgrades.”

Mr Yan Chengxiang, Vice President of COSCO Shipyard, said, “The Zhoushan shipyard is one of COSCO’s largest and newest, and it certainly has the capacity to host a cruise ship of the QE2’s stature. QE2 Holdings’ decision to carry out this work with us is a reflection of COSCO Shipyard and COSCO Group’s leading position in China’s shipbuilding industry, and it also should also generate optimism for a sector that is rapidly transforming.”

QE2 Holdings also announced that it has invited seven international interior architecture houses to participate in a competition for the interior design and concept for the QE2’s conversion into an all-suite luxury floating hotel. Submitted designs from Benoy of UK, BG Studio of USA, Jerde Partnership of USA, Dsign Vertti Kivi from Finland, Ong & Ong of Singapore, Santarossa of Italy and Wilson Associates of USA will be showcased at the official QE2 website (http://www.qe2hotels.com) for public review and comment from Oct 15 to Nov 15, 2013.

Mr Daniel Chui, President and Chief Executive of QE2 Holdings and Managing Director of Oceanic Group, said, “The QE2 offers more than 500,000 square feet of usable space, in a structure roughly equivalent to any five-star hotel. The ship’s redevelopment is a once-in-a-lifetime opportunity for any interior design professional to create what will become one of Asia’s major waterfront tourist attractions. The goal for the final design is to preserve the soul of the QE2 — many of the original furnishings and much of the décor will be incorporated — while creating a modern luxury hotel.”

The winner of the competition will be chosen by QE2 Holdings and an advisory panel composed of some of the most illustrious names in the global architectural and design industry, based on a list of set criteria to be posted on the QE2 website and comments from the public. The results will be announced on November 30, 2013.