Genting Hong Kong, the parent company of Crystal Cruises, Dream Cruise, Star Cruises and MV Werften, warns of a first half net loss of between $200 million to $220 million as a number of its businesses are encountering headwinds.
The company said it expects an operating loss in Crystal Cruises, the Los Angeles based luxury brand that has expanded nto river cruises and aviation, due to a more competitive environment resulting from a 13.7% increase in new luxury cruise ship capacity in the industry, higher marketing costs and startup costs of new Crystal river ships and AirCruises operations.
Genting Hong Kong also sees full half year startup losses in 2017 versus two months in 2016 in MV Werften, its German new building shipyards as they gear up for steel cutting for the Global Class and Endeavor Class ships in March 2018.
Furthermore, additional depreciation and amortisation of new Genting Dream and shipyards; and additional interest of new Genting Dream ship. “Despite the decline in its consolidated net results, the performance of the underlying core Asian cruise business has improved in the second quarter of 2017 compared to the first quarter of 2017, and the Group remains positive on the underlying core Asian cruise business for the second half of the year,” the company said in a statement.
It pointed out that based on the preliminary assessment of the latest unaudited financial information, excluding the share of results of Travellers, the Group is expected to record a consolidated net loss in the range of US$200 million to US$220 million for the six months ended 30 June 2017, as compared with a consolidated net loss of US$73.7 million, excluding the share of results of Travellers, for the six months ended 30 June 2016.