UK and Ireland market generated 1.7 million passengers 2022

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Written by Kari Reinikainen Kari Reinikainen

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Published: 02 May 2023 02 May 2023

Cruise Lines International Association (CLIA) has published its statistics for the UK and Ireland market, which shows that the market generated around 1.7 million cruise passengers, nearing  pre-pandemic demand levels.

The figure stood at 1.99 million passengers in 2019, but, this was a slight decrease from 2.01 million in the previous year.

In data published CLIA said that:

* In 2022 British and Irish holidaymakers took around 1.7 million cruises, up from 479,000 the previous year.

* The Mediterranean remains the number one destination for cruise travellers from the UK and Ireland.

* Of the top three destinations in 2022, 38.4% of passengers travelled to the Mediterranean, 29% to Northern Europe and 10.6% to the Caribbean.

* The UK and Ireland markets accounted for 29% of all European source passengers.

* Globally, over a quarter (27%) of those who sailed for two or more nights in the last 12 months travelled in a party consisting of three or more generations, a sign that cruise holidays offer a great experience for all ages.

* The average age of UK & Ireland cruise guests last year was 55.8 years, as cruising continues to diversify and attract holidaymakers of all ages.

* The average length of a cruise by British or Irish holidaymakers in 2022 was 9.7 days (down slightly on 2019).

* Intent to cruise is stronger than ever. 85% of cruise passengers from the UK and Ireland say they intend to take a holiday at sea again (a 6% increase from 2019) and 60% will do so in the next two years (up from 53% in 2022).  

* Strikingly, 70% of those who have never cruised before would consider a cruise in the next few years (up from 68% in March 2022), showing more people are open to trying a cruise than ever before. 

NCLH cuts first quarter net loss and reports small operating profit

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Written by Kari Reinikainen Kari Reinikainen

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Published: 01 May 2023 01 May 2023

Norwegian Cruise Line Holdings Ltd (NCLH), the world’s third largest listed cruise shipping company, has reduced its net loss and reported a small operating profit for the first quarter of 2023.

Net loss narrowed to $159.3 million from $982.7 million a year earlier, while operating result showed a profit of $10.7 million compared to a loss of $688.7 million. Revenues increased to $1,821.9 million from $521.9 million.

The company said it had continued its phased occupancy ramp-up in the first quarter, achieving a 15-point sequential improvement to approximately 101.5%, exceeding guidance of approximately 100%.

“The phased Occupancy ramp-up is expected to be complete in the second quarter at approximately 105%. As planned, this is slightly lower than the second quarter of 2019, reflecting the Company’s strategic shift to longer, more immersive itineraries. Full year 2023 Occupancy, which reflects the phased voyage ramp-up, is expected to average 103.5%, consistent with prior guidance,” NCLH said in a statement.

On the heels of a very strong WAVE season, NCLH continues to experience strong consumer demand. Cumulative booked position for the remainder of 2023 is ahead of 2019 levels inclusive of the company’s approximately 18% increase in capacity, at continued higher pricing.

Advance ticket sales well ahead of 2019

“As of March 31, 2023, the Company’s advance ticket sales balance, including the long-term portion, was a record $3.4 billion, approximately 26% higher than the prior quarter and approximately 60% higher than the first quarter of 2019. Onboard revenue generation remains robust, and the Company continues to focus on increasing its pre-sold revenue from guests prior to voyage sailing, as this typically results in higher overall spend throughout the cruise journey,” NCLH said.

Total revenue per Passenger Cruise Day was up approximately 17.5% as-reported and approximately 18.3% in constant currency in the first quarter of 2023 versus 2019. Looking ahead, full year guidance remains unchanged at Net Per Diem growth in the range of 9.0 to 10.5% and Net Yield growth in the range of 5.0 to 6.5%, both on a constant currency basis and compared to 2019.

Total cruise operating expense increased in 2023 compared to 2022, due to the full resumption of voyages, which resulted in higher payroll, fuel, and direct variable costs of fully operating ships.

Costs for certain items were also impacted by lagging inflationary pressures. Gross Cruise Costs per Capacity Day was approximately $298 in the quarter as-reported and $301 in constant currency.

Adjusted Net Cruise Costs excluding Fuel per Capacity Day in constant currency was approximately $161, reflecting an approximately 14% decrease compared to the second half of 2022 as benefits from the company’s ongoing margin enhancement initiative are taking effect.

Fuel costs, interest expenses minus one- off items increase

Fuel price per metric ton, net of hedges, increased to $779 from $724 in 2022. The Company reported fuel expense of $194.9 million in the period.

Interest expense, net was $171.3 million in 2023 compared to $327.7 million in 2022. The fresh figure included lower extinguishment of debt and debt modification costs, which were $2.4 million in 2023 compared to $188.4 million in 2022. "Excluding this, interest expense increased primarily as a result of higher rates," the company said.

“Other income (expense), net was expense of $(9.0) million in 2023 compared to income of $38.1 million in 2022. In 2023, the expense primarily related to losses on foreign currency remeasurements. In 2022, the income primarily related to gains on fuel swaps not designated as hedges and foreign currency remeasurements,” NCLH said.

The company did not provide a GAAP based guidance for the rest of 2023.

Havila Voyages receives license from Central Bank of Ireland

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Written by Teijo Niemelä Teijo Niemelä

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Published: 01 May 2023 01 May 2023

Havila Voyages has received a license from the Central Bank of Ireland to enable the financing and delivery of its coastal cruise ships Havila Polaris and Havila Pollux to proceed. The license also allows the company to settle its debts with the original lenders.

"The situation we are in is very complex and demanding. The licenses are required for us to legally implement our financing solutions. Despite good assistance from the Norwegian authorities the process has taken longer than we would like. Fortunately, the license from Ireland is now in place, which enables us to legally finance our ships," says CEO Bent Martini of Havila Voyages.

Havila Voyages has also applied for licenses in the UK and the USA, to ensure both British and American investors can participate in the financing. The license from Ireland, and a previously received license from the Norwegian Ministry of Foreign Affairs, ensure legal financing from EU countries and Scandinavia.

Havila Voyages has engaged Arctic Securities AS and Fearnley Securities AS as facilitators to assist in the financing process.

"The licenses are crucial for our facilitators to be able to work freely in relevant markets for us to settle our debts to the original lender to a frozen account according to the sanction regulations and releasing the security in the vessels," explains Martini.

"The ships will be ready for delivery as soon as we have completed the financing process, and we apologize to all affected parties for having to postpone once again," he continues.

Due to the time-consuming processes, the start-up of operations for Havila Polaris and Havila Pollux will be further delayed. The start-up date for Havila Polaris is set for 12th of June while Havila Pollux will commence operations on 18th June.

Good sales figures

Despite the uncertainty that Havila Voyages is experiencing, the company sees significant interest in the latest additions to the historic coastal route Bergen-Kirkenes-Bergen and is reporting strong sales figures.

"We have a high volume of traffic, both to our customer center and via our website, and had close to 70% occupancy in the first quarter, with 50% of all capacity for all four ships sold out for the year. This is ahead of what we expected for the year," says Martini.

"For us, it will be crucial to capitalize on the interest and get all four ships in operation. We have a societal mission to deliver, and we depend on running the company in an economically sustainable way. It is challenging when we constantly face setbacks and situations far beyond our control, but we look forward to soon being able to focus on delivering a top quality, modern product along the Norwegian coast in accordance with the agreement with Norwegian authorities," he concludes.

Photo credit: Ronny M. Olsen

Registration opens for Interferry’s 47th annual conference

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Written by Teijo Niemelä Teijo Niemelä

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Published: 01 May 2023 01 May 2023

Global trade association Interferry is set to welcome a worldwide audience of industry professionals to Australia in November for its 47th annual conference, which will focus on customer experience and sustainability. Delegate registration has now opened on the conference website, together with a Call for Speakers.

This year’s event takes place in Hobart, Tasmania from November 4-8. It provides a forum for ferry operators and suppliers to present innovative approaches to enhancing passenger satisfaction along the whole customer journey, while improving efficiency to optimise positive revenues. In addition, a comprehensive networking and social program will enable the entire ferry community to connect, exchange knowledge and share experiences.

Interferry CEO Mike Corrigan comments: “I am delighted to bring the conference to Tasmania this year in close cooperation with our host ferry operator and board member Spirit of Tasmania. Here, as in all other parts of the world, our industry is facing more economic, commercial and regulatory changes than ever while maintaining a vital role in society.

“By extending our geographical networks, exchanging best practices and collectively embracing opportunities, we improve the position of every member and truly demonstrate our ’Stronger Together’ creed. We look forward to meeting many friends old and new Down Under.”

As well as the delegate registration facility, the conference website includes a Call for Speakers portal inviting submissions from potential contributors by a deadline of May 31. Speaking slots are expected to fill quickly, with selected applicants notified by mid-June.

Delegate registration is available at https://interferryconference.com/ and speaking applications should be made at https://interferryconference.com/call-for-speakers/