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Carnival plc stock 17.5% down in early London trade after Costa Concordia

Carnival plc, the British holding company in Carnival Corp & plc group, suffered a sharp fall in its share price at London opening on Monday, the first trading day after grounding of Costa Concordia on Friday.

At 0915 local time, the shares traded 17.5% lower since the opening at £18.55. However, they had hot a low of £16.00 earlier in the day.

The current share price means that the company has lost almost half of its value since a 52 week high of £31.71 early last year. The shares trade nevertheless well below their lows reached earlier in the economic downturn as in late 2008, they hit a five year low of below £13.00.

“Significant human error” likely cause of Costa Concordia disaster

  • Written by Kari Reinikainen
  • Category: Top Headlines

A “significant human error” has emerged as likely cause of grounding and subsequent capsizing of the 114,5000 gross ton Costa Concordia on Friday night, media reports say.

“Owners of the wrecked Costa Concordia cruise ship said ‘preliminary indications’ suggested the captain may have been guilty of "significant human error", the Daily Telegraph newspaper in London reported on its website. In the early stages after the incident, a major technical problem with the ship’s diesel-electric propulsion plant was suggested as a possible cause, but this now looks increasingly remote reason to the accident.

"We are aware that the lead prosecutor has levelled serious accusations against the ship's Captain, who joined Costa Crociere in 2002 as a Safety Officer and was appointed Captain in 2006, after acting as Staff Captain as well,” Costa Crociere, owner of the 2006 built Costa Concordia, was reported by Daily Telegraph as saying.

Prosecutors believe Mr Schettino had been intending to perform the nautical equivalent of a fly-by past the island's main port when the accident happened. It had apparently become a long-standing practice for the Costa Concordia to sail close to the island in order to greet its inhabitants with a siren from the ship. The tradition appears to have begun when the wife of a former senior officer lived on the island.

The tradition appears to have begun when the wife of a former senior officer lived on the island and he would take the ship close to Giglio to greet her. There were reports last night that the vessel's current officers had a friend ashore, from the Italian merchant navy, that they wanted to salute in a similar manner. As the ship approached the port from the south, it sailed too close to the coastline and struck a rocky reef, known to locals as "Le Scole", a few hundred yards out. Islanders said they had never seen the ship try to pass so close before. Ships usually pass by up to five miles away. A 160ft gash was torn in the £370 million ship's hull, causing it to take on large quantities of water in minutes and list violently. The 4,200 passengers and crew were told to abandon ship, Telegraph said..

Reports about this practise started to circulate in the media on Sunday after La Stampa, an Italian newspaper, reported it had obtained copy of a letter in which mayor of Giglio had thanked the ship's officers for sailing past the island at close range and founding its foghorn 

Telegraph continued by saying that Franco Verusio, the procurator of Grosseto who is leading the investigation, said: "Schettino approached the island of Giglio in a carelessly clumsy manner. The ship hit a reef which embedded itself in the left flank, the ship listed and took on lots of water in the space of two or three minutes. Captain Schettino was in command at that point. "He was the one who ordered that course to be taken, at least according to what we have discovered. There was someone in particular that wanted to be signalled from the ship."

Mr Schettino, who is being questioned on suspicion of multiple manslaughter, claimed yesterday that the reef had not appeared on the nautical charts and had not been picked up by the ship's navigation systems. "We should have had deep water beneath us," he said. "We were about 300 metres [1,000ft] from the rocks more or less."

Prosecutors also accused Mr Schettino of abandoning his ship "well before" the last of his passengers, a criminal offence that can carry a sentence of up to 12 years in jail. The captain denied this, insisting he was the last to leave.

The Concordia capsized after the captain tried to turn around and head into the island’s port in an apparent attempt to make it easier to evacuate. Mr Schettino’s lawyer, Bruno Leporatti, said his client’s manoeuvre had saved the lives of “several hundred people”. The rescue of the Korean honeymoon couple and Mr Giampetroni, who had a broken leg, gave hope to divers searching thousands of cabins for the missing. The ship’s “black box” navigation system is being examined — with officials saying that the vessel was up to four miles off course.

The death toll from Friday night's disaster, one of the worst in the cruise industry's recent history, rose to six today after rescuers discovered three more victims, including the bodies of two elderly men wearing life vests inside the vessel. A further 15 people remained missing, Daily Telegraph reported.

Passenger Shipping association (PSA) statement regarding Costa Concordia

  • Written by Kari Reinikainen
  • Category: Top Headlines

Our thoughts are with those passengers and crew involved with the Costa Concordia. 

Incidents of this nature are isolated and very rare. Ships' crews undertake rigourous training, drills and scenarios for emergency situations including the evacuation of a vessel. 

The ships themselves comply with stringent regulations and procedures from the governing maritime authorities covering every aspect of their build and operation. 

While focus should rightly be on attending to the immediate incident at hand there will, of course, be a full and thorough investigation into the causes of this event and the full cooperation of both the company and the wider industry is assured.  

 ---

PSA is the cruise and ferry industries’ ceiling organisation in the UK.

Carnival Corporation & plc statement regarding Costa Concordia

  • Written by Teijo Niemelä
  • Category: Top Headlines

This statement is from Carnival Corporation & plc in Miami, FL. Carnival Corporation & plc is the parent company of Costa Cruises.

On January 13, 2012, Costa Cruises vessel, the Costa Concordia, departed from Civitavecchia, Italy with approximately 3,200 passengers and 1,000 crew members on a seven-day voyage. At approximately 10:00pm CET, the vessel struck rock off the coast of Isola del Giglio, Italy and sustained significant damage causing the ship to list severely. The order was given to abandon ship and deploy the lifeboats.

Tragically, there are reports of some deaths and injuries. This is a terrible tragedy and we are deeply saddened. Carnival Corporation & plc offers our sympathies and heartfelt condolences to all of the Costa Concordia guests, crew members and their families. Carnival Corporation & plc and Costa Cruises are committing our full resources to provide assistance and ensure that all guests and crew are looked after.

We want to express our deep gratitude to the Italian Coast Guard and local authorities and community members who have gone to extraordinary lengths to assist in the evacuation of the ship and provide support for our guests and crew.

We are working to fully understand the cause of what occurred. The safety of our guests and crew members remains the number one priority of Carnival Corporation & plc and all of our cruise lines.

Costa Concordia was sailing on a Mediterranean cruise from Civitavecchia (Rome) with scheduled calls at Savona, Italy; Marseille, France; Barcelona, Spain; Palma de Mallorca; Cagliari and Palermo, Italy.

UPDATE - Are there similarities between Costa Concordia and Carnival Splendor incidents?

  • Written by Kari Reinikainen
  • Category: Top Headlines

UPDATE 1: It has now emerged that significant human error rater than technical problems, as had been suggested earlier, was the cause of the accident.

 

It has been suggested an a power surge in the diesel electric propulsion plant of Costa Crociere's 114,500 gross ton Costa Concordia caused the ship run aground (see separate report) as those on the bridge lost control of the vessel. 

In the autumn of 2010, Carnival Cruise Line's 110,239 gross ton Carnival Splendor suffered an engine room fire that resulted in the loss of all power and the ship had to be towed to port. Built in 2008, Carnival Splendor is technically similar to the 2006 built Costa Concordia. Both are powered by diesel electric propulsion plants as indeed are most cruise ships in service today.

On most of these ships - but not on all - the diesel generators feed power to various systems on board via a single electric switchboard. On some ships, there are two switchboards, which means that there is redundancy in case of an accident involving one of them, chief engineer of a major cruise ship told Cruise Business. 

Below news report on Carnival Splendor incident: 

 

 TUESDAY, 09 NOVEMBER 2010 06:43

 

 

 

 

The cruise ship Carnival Splendor, which lost power after experiencing an engine room fire, is currently being towed via tug boats to San Diego. Based on favorable sea conditions, the ship is expected to arrive around midday on Thursday.

As the ship gets closer to coastal areas, guests are now beginning to receive intermittent cellular service. Additionally, the ship’s phone system is working on a limited basis and guests are able to make complimentary calls home. A large Carnival team continues to work on hotel, flight and transportation arrangements for the guests and will be on the ground in San Diego when the ship arrives.

Guests continue to be provided food and beverage service and a limited schedule of activities. Toilets continue to function in most staterooms and all public restrooms. 

At approximately 6 am yesterday morning (U.S. Pacific Standard Time), a fire was detected in the aft engine room aboard the cruise ship Carnival Splendor. The fire was extinguished and there were no injuries to guests or crew. The ship has been operating on auxiliary generators throughout the day and engineers have been unable to restore additional power to the vessel. As a result, the current voyage is being terminated. Tugboats are currently en route to the ship which is located off the coast of Mexico, approximately 150 miles south of San Diego. The tugs will tow the vessel to Ensenada, Mexico in an effort to get the guests home as quickly as possible.

Currently several key hotel systems, including air conditioning, hot food service, flushing toilets and telephones are not available. The ship’s crew is actively working to restore partial services. Regular announcements apprising guests of the situation began at approximately 6.30 am. Guests were initially asked to move from their cabins to the ship’s upper open deck areas. At this time, guests have access to their cabins and are able to move about the ship. Bottled water and cold food items are being provided.

The vessel’s command is in contact with the U.S. Coast Guard which has deployed aircraft and cutters to the cruise ship’s location.

Guests on the current voyage will be receiving a full refund along with reimbursement for transportation costs. Additionally, they will receive a complimentary future cruise equal to the amount paid for this voyage.

"We know this has been an extremely trying situation for our guests and we sincerely thank them for their patience. Conditions on board the ship are very challenging and we sincerely apologize for the discomfort and inconvenience our guests are currently enduring. The safety of our passengers and crew is our top priority and we are working to get our guests home as quickly as possible," said Gerry Cahill, President and CEO of Carnival Cruise Lines.

Carnival Splendor was on the first leg of a 7-night Mexican Riviera cruise that departed yesterday, Nov. 7, from Long Beach, Calif. Today was a scheduled day at sea. The ship’s normal itinerary includes stops in Puerto Vallarta, Mazatlan and Cabo San Lucas, Mexico. The ship, which measures 113,000 gross registered tons and first entered service in July 2008, is carrying 3,299 guests and 1167 crew.


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