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Viking Line says newbuilding finance not in place

  • Written by Kari Reinikainen
  • Category: Top Headlines

Viking Line, the Finnish cruise ferry operator that has a 58,000 gross ton cruise ferry of a new type on order at STXFinland in Turku, says financing of the vessel is not yet in place.

“Design work for a newbuilding that will be employed in service between Turku-Maarianhamina/Langnas-Stockholm has progressed according to plan. However, the European Commission as not yet approved a €28 million environmental grant granted by the Ministry of Transport and Telecommunications. The environmental grant is an essential part of the financing of the vessel,” Viking line said in a statement.

It is the only major passenger vessel on order at the Finnish shipbuilder, save for P&O Ferries' Spirit of France that is nearing completion at the STX shipyard in Rauma.

Viking Line group reported a net profit of €1.3 million for three months to 30 June on revenues of €130.8 million, compared to €1.1 million and €126.9 million respectively in the same period last year.


“Marketing mistakes” sank Crystal Cruises’ load factor to 70%

  • Written by Kari Reinikainen
  • Category: Top Headlines

CrystalCruises, the Los Angeles based luxury cruise brand owned by Nippon Yusen Kaisha(NYK) in Tokyo, has lagged markedly behind peers in terms of load factor in the past few months, butefforts are in place to put things right, the parent company said in a statement.

“Othercompanies’ load factors for luxury class vessels are over 90%, but due tomarketing mistakes the load factor for the Crystal Cruises is onlyapproximately 70%,” an unnamed NYK official was quoted as saying in a transcriptof Q&A session of the Tokyo based shipping giant’s first quarter financialyear 2011-12 interim result. The quarter in question started 1 April 2011.

“So there is a lot of room for improvement. Wehave already deployed new personnel to bring about a 180 degree turn in ourmarketing, and are carrying out measures to improve the bottom line. At thecurrent point in time, we expect a profit from the next fiscal year, butultimately we will look at cash flows and make a judgment after consultationwith our accountants,” the official said. NYK published its interims earlier this month.

NYK’scruise operations that include NYK Cruises that operates the 50,200 gross tonAsuka II on the Japanese market in addition to Crystal Cruises, had revenues of7.1 billion yen and they made a loss of 2.3 billion yen in the first quarter ofthe current financial year. By comparison, a year earlier the figures had been 9.0billion and a loss of 1.3 billion respectively. Inthe financial year to 31 March 2011, NYK’s cruise operations made a loss of 2.6billion yen on revenues of 35.8 billion yen.

TUI reports turnover rise but operating result weakens in Cruise sector

  • Written by Kari Reinikainen
  • Category: Top Headlines

TUI AG, the German tourism to container shipping group, has reported an increase in turnover in its cruise business, boosted by higher occupancy ratios and yields. However, operating result from the sector fell to a loss third quarter of the current financial year.

Operating earnings (underlying EBITA) totalled 0.2 million euro, a fall from from a 2.2 million euro in the third quarter and -3 million euro against -2 million euro for the first nine months of the previous financial year. “These earnings reflect the start-up cost for the fleet expansion in Hapag-Lloyd Kreuzfahrten and the cost required for Mein Schiff 2, operated by TUI Cruises, to enter service," the company said in a statement.

Turnover by the Cruises Sector amounted to around 49 million euro in the third quarter, almost 55 per cent up year-on-year (previous year 32 million euro). "This strong increase is of limited relevance, since the prior-year reference value included the effect of unscheduled dry-dock periods of a cruise ship."

In the first nine months, the Cruises Sector delivered turnover growth of around 10 per cent year-on-year to 145 million euro (previous year 132 million euro). The TUI Cruises joint venture is measured at equity in the consolidated financial statements so that its turnover is not shown here.

Hapag-Lloyd Kreuzfahrten increased the load factor on its vessels from 54.7 per cent to 75.7 per cent and the average rate from 367 euro to 390 euro per passenger per day in the third quarter.

TUI Cruises improved the load factor on its fleet from 92.7 per cent to 97 per cent and the average rate from 166 euro to 167 euro per passenger per day.

Regent Seven Seas' operating profit dips but net yields jump

  • Written by Kari Reinikainen
  • Category: Top Headlines

Regent Seven Seas Cruises, the luxury market brand in the Prestige Cruise Holdings group, recorded a slight fall in second quarter operating profit (EBITDA) on dry docking of a ship, but says net yield rise gives reason to be pleased with the figures.

Adjusted EBITDA was $24.6 million on revenue of $122.8 million for the second quarter of 2011 compared to Adjusted EBITDA of $25.3 million on revenue of $110.5 million for the second quarter of 2010. “In the second quarter of 2011, we had a 4.1 percent reduction in capacity caused by a scheduled drydock for Seven Seas Mariner. There were no drydocks in the second quarter of 2010,” regent said in a statement.

Net Yield for the second quarter was up 6.2 percent driven by a strong rise in pricing with Net Per Diem up 4.8 percent and occupancy increasing 1.2 percentage points. Commenting on the second quarter, the Company’s chairman and CEO, Frank Del Rio, stated, “We are extraordinarily pleased with the performance of the brand in the second quarter. Our strategy of delivering the industry’s most all-inclusive luxury cruise experience is resonating well in the marketplace and is reflected in our strong Net Yield growth.”

Net Cruise Costs, excluding Fuel and Other expenses, per APCD was up less than 1 percent increasing to $270 in 2011 compared to $268 in 2010. Fuel was up 32.3 percent, or $2.5 million, reflecting higher prices. “Our effective economic hedging strategy was able to partially offset this increase, as we recognized a $1.6 million cash benefit on executed fuel hedge contracts during the quarter that offset 65.8 percent of this increase. The realized gain of fuel derivatives was recorded in other income (expense) as these instruments do not qualify for hedge accounting,” Regent said.

Other expenses were up $3.3 million primarily attributable to a 10-day scheduled drydock for Seven Seas Mariner in 2011. “During the second quarter of 2011, we successfully issued $225 million of new senior secured notes and used a portion of the proceeds to extinguish our second lien term loan and prepay $29 million of our first lien term loan. As part of this transaction, we recorded a loss on early extinguishment of debt of $7.5 million due to the write-off of previously deferred financing costs and prepayment penalties,” the company commented.

Costa plans a complete refit for Costa Romantica

  • Written by Teijo Niemelä
  • Category: Top Headlines

Costa Cruises has placed a new order with San Giorgio del Porto shipyard in Genoa for major restyling operations on the ship Costa Romantica (53,000 gross tonnage and 1,697 total Guests), presently operating for the Costa fleet. Costa Cruises is investing a total of around 90 million euros for this work. San Giorgio del Porto shipyard – which belongs to Genova Industrie Navali Holding Company – will be supported by the sister company T. Mariotti shipyard. Thanks to the restyling, to be carried out from the end of October 2011 to the end of January 2012, the Costa Romantica will be completely renovated, just like her name, which will become the Costa neoRomantica.

This extensive make-over will include the construction of new areas and the introduction of services that represent a major evolution in the Costa product. The objective is to offer a renewed cruise experience: the perfect way to satisfy the needs of a special clientele target. Sophisticated atmospheres will be created throughout the Costa neoRomantica, starting from a contemporary, particularly elegant and refined interior design. Tillberg Design, a Swedish design company that has designed the interiors of about 130 luxury yachts and prestigious cruise ships over the last 40 years, and Syntax, a London-based company that specialises in hotels and prestigious wellness centres, have been commissioned to develop the interior design.

The new areas on the ship will include a wine bar, with 100 different labels and a wide selection of cheeses from around the world, a coffee bar to enjoy sweets and coffee, a show lounge bar with dance floor, a cabaret and a night-club. Amenities will also include the Samsara Spa, a 4,200-m² wellness area with gym, a swimming pool for thalassotherapy, treatment rooms, sauna, Turkish bath, 50 cabins and 6 suites and a special restaurant. For those who love fine cuisine there will also be a restaurant club with menus created by the best award-winning chefs. During the restyling works in the Genoa dry-dock, 2 new half-decks will be added along with 111 new cabins, and 120 cabins and suites with private balcony will be created.

Total Guest capacity will increase from 1,697 to 1,800, while the number of cabins will increase from 678 to 789 and the total displacement to approximately 56,000 gross tonnage. Once restyling has been completed, at the end of February 2012, the Costa neoRomantica will sail 11-day cruises to the Canary Islands, with departure from Savona. During the 2012 summer season, the ship will be positioned in North Europe for 2-week cruises with brand new itineraries.