Norwegian Cruise Line Holdings, the world's third largest cruise shipping company, has increased its forecast for the synergy effects the acquisition of Prestige Cruise Holdings would generate this year to $75 million from $40 million.
"As a result of continued integration and synergy identification efforts, the Company has now identified $75 million in synergies for full year 2015, comprised of $30 million in revenue and $45 million in cost synergies," the company said in a statement.
"The company had previously communicated the identification of $15 million in revenue and $25 million in cost synergies for a total of $40 million for 2015. Of the incremental synergies, the Company is earmarking $20 million for reinvestment directed to business initiatives to further drive demand to the Company’s three brands, resulting in net synergies of $55 million for 2015," Norwegian said.
“The identification of additional synergies has come as the result of a truly collaborative effort between our dedicated integration team and all areas of the organisation,” said Frank Del Rio, president and chief executive officer, in the statement.
“Tasked with a mandate that synergies have a neutral or positive impact on the guest experience, the organisation has come together to identify meaningful incremental synergies. The net synergies will have an immediate impact on the bottom line in 2015, while amounts reinvested in our business initiatives will benefit our strategies for earnings growth in 2016 and beyond,” continued Del Rio.
For the full year 2016, the Company has identified synergies of $115 million which includes the annualization of initiatives introduced in 2015 coupled with new initiatives. Of these, the Company plans to reinvest $40 million, resulting in net synergies for the year of $75 million.
