Top Headlines

STX Europe sees gradual brightening of cruise ship newbuilding activity

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 15 November 2012 15 November 2012

Tough market conditions in the Cruise & Ferry business area of STX Europe, the Oslo based shipbuilder whose owner is the South Korean STX Business Group, although some brightening of the outlook emerged in the course of the latest quarter.

“Market conditions in the third quarter remained challenging. However, during the last couple of months several new cruise vessel orders have been placed and there are potential for other new building projects in the market,” the company said in a statement.

“While the larger cruise operators have better access to financing, others need longer time to secure funding for their new building projects in the current market and economic situation. At present activities in the ferry segment are particularly low and are expected to increase only as the economic outlook will improve.”

“Both STX Finland and STX France are strongly focusing on securing new orders and continue with the improvement programmes to improve competitiveness. This includes also increased efforts within certain other market segments such as vessels for naval operations as well as offshore and renewable energy/wind related deliveries,” the company said.

The Cruise & Ferry business area generated an EBITA negative by NOK 39 million in the third quarter compared to a positive figure of NOK 50 million in the same period last year. For January-September, the fresh figure was NOK 150 million in the red compared to NOK 20 million in the black a year earlier. Operating revenues remained fairly stable year on in both review periods, but order intake plunged to NOK 434 million in the nine month period from NOK 10.0 billion a year earlier. A recent order for a 99,300 gross ton ship from TUI Cruises at STX Finland is not included in the January-September figures.

STX Europe repeated that it is committed to remaining a world leading shipbuilder of cruise vessels and ferries through securing new orders. “The focus in ice- breaking/arctic tonnage remains a key strategic focus, predominantly in Finland.” The continuing main focus of STX Europe is to secure new orders and continue to improve its profitability and competitiveness, especially within the Cruise & Ferries business area. The business area will further develop its diversification into other market segments such as offshore and renewable energy related deliveries.

The cruise vessel market remains challenging, but there are some signs of gradual improvement. Several new orders have recently been placed and there are a few other potential new building projects currently in the market. However, competition is very tough and some operators are still constrained by the limitations of financing of projects in today’s economic climate. The continuation of solid expansion in cruise business will, however, secure the market for further contracting of newbuildings.

In September 2012, a sand dredger was delivered from the Lorient shipyard. The order book at the Saint-Nazaire yard at the end of the quarter consists of two cruise vessels, one for Hapag Lloyd and the other for MSC, and two Mistral class helicopter carriers to be delivered to the Russian defense export agency Rosoboronexpor. The order book at the Rauma shipyard at the end of the third quarter consisted of a double-ended ferry for Finferries and an offshore patrol vessel for the Finish Border Guard. The order book at the Turku shipyard at the end of the quarter consisted of a large cruise ship for TUI Cruises and a cruise ferry for Viking Line.

The order book for Arctech Helsinki Shipyard (‘AHS’) at the end of the quarter consisted of a multipurpose emergency & rescue vessel and two multifunctional icebreaking supply vessels for a Russian owner.

Project Orient aims to restore UK-Australia liner service

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 09 November 2012 09 November 2012

A new company that has been set up in the UK plans to introduce two vessels of about 100,000 gross tons to reopen a regular passenger liner service between the UK and Australia.

Project Orient Limited, which is the new company, includes former Fred. Olsen Cruise Lines’ director of marketing Nigel Lingard as a non-executive member of its board.

“If we look at the volumes of travel between North Western Europe and Australasia, we would need to grab less than 1% of the total to make this economically viable,” Lingard told Cruise Business Online.

The aim is to maintain a monthly service around the year to both directions, but itineraries could vary, from the shortest way via Capetown to Fremantle and then on to Sydney, to sailings via the Suez Canal with calls perhaps including Dubai, India and Singapore. Some sailings might also head via Panama, Lingard said, adding that rouring would depend on e.g. customer demand.

The Project Orient team has not finance in place at the moment to place orders for the planned ships and Lingard says finding the principal equity investors is a key task that the board is facing at the moment. Middle Eastern wealth funds are seen as potential investors in the company, he added.

At the moment, several ships sail on world cruises from Britain to Australia each year and sections of these cruises can be bought as liner voyages in both directions. However, virtually all sailings depart from the UK in January and because they are sold cruises rather than liner voyages, they include calls at several ports en route, which means that they often take twice the 25 days that Project Orient plans its ships to need for the voyage.

Lingard says that initial talks with travel agents have suggested that there is an interest in this kind of product. The ships would need to make about 25 knots to meet the required voyage time of 25 days. This again that they would have to be highly fuel efficient in design, Lingard pointed out.

Project Orient team hopes to start the service in four years’ time.

There was a regular liner service from the UK to Australia from 1852, when P&O started the run with a small steamship called Chusan, until 1977, when the Greek-owned Chandris Lines retired the 1940 built Australis from the service. The ship had been built as America in 1940.

P&O operated the service up to 1973 and its last newbuildings for the route, the 45,733 gross ton Canberra (1961) and 41,923 gross ton Oriana (1960, not to be confused with the present ship of the same name), made the voyage in about three weeks at an average speed of 27.5 knots.

Static UK cruise market seen 2012, next year 2% growth

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 06 November 2012 06 November 2012

Latest UK cruise industry figures released by the Passenger Shipping Association (PSA) at the World Travel Market estimate that 1.72million Brits will take an ocean cruise this year, 20,000 passengers more than the 1.70 million carried in 2011.

This has been achieved despite a challenging year for the industry following the January Concordia incident, and a protracted subdued UK economic climate for consumers that has seen market falls in many other sectors of the holiday industry.

Some eight out of ten UK cruise sales come through Britain’s travel agents, spearheaded by those specially trained to advise on cruise options through the Association of Cruise Experts (ACE).

As a sign of continued confidence, nearly $5 billion has been invested globally by the industry in six major new cruise ships launched this year, and a further $3.2billion will be spent on six more ships scheduled to enter service next year. Long term orders stretch out at an even higher level to 2015, representing more than $12 billion of investment in new ships over the next three years alone

For 2013, the PSA is predicting a growth of more than 2% in UK cruises to 1.76 million passengers, on the back of continued investment in new and refurbished cruise ships, a fiercely competitive market, and the continued popularity of ex-UK port cruises.“There is no doubt that the cruise industry faced a unique set of challenges this year;” said PSA director William Gibbons, “ but our UK figures show that the cruise sector has outperformed the rest of the holiday sector. The sheer diversity of cruises offered by our 41 members, coupled with unrivalled value for money has helped to attract the ‘new to cruise customer’, key to boosting growth within our sector.”

“The undiminished investment in new ships and product innovation is also encouraging with six new cruise ships commissioned in 2012, and six more are scheduled for launch in each of the next three years. There is no doubt that value will still be an absolute priority for UK holiday makers in 2013 and a cruise is one of the best ways to have a unique experience whatever your holiday budget.”

TUI Cruises orders second cruise ship from STX Finland

Details: Written by Teijo Niemelä Teijo Niemelä; Category: Top Headlines Top Headlines; Published: 05 November 2012 05 November 2012

TUI Cruises announced today that the company confirms the order of a second cruise ship from STX Finland. The production of the second ship will start in summer 2013 and it will be delivered from STX Finland's Turku Shipyard in spring 2015.

The sophisticated and highly innovative 99,300 GRT cruise ship will be approx. 294 metres long and approx. 36 metres wide. The ship will have 1,250 staterooms, serve 2,500 passengers and have a crew of 1,000 persons. The cruise ship will have many environmentally friendly features, with a particular emphasis on the vessel's energy efficiency.

"We are extremely pleased that TUI Cruises confirmed the order of the sister ship for magnificent Mein Schiff 3 cruise ship. We have today reached this milestone of production start of the first ship after well performed and intensive basic design phase. After this production start, manning on this project will increase significantly during the coming months to reach the maximum level before summer next year", says Jari Anttila, EVP and COO of STX Finland.

"After being just four years in the business and after successfully putting two ships on the market - Mein Schiff 1 and Mein Schiff 2 - we are proud to proceed with building our first new ship and that way continue the growth of our fleet", says Richard J. Vogel, CEO of TUI Cruises. He continues, "We have been extremely busy with the planning over the past two years, but now things are really starting to move."

RCCL raises note offering to $650 million, coupon 5.25%

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 05 November 2012 05 November 2012

Royal Caribbean Cruises Ltd. (RCCL), the second largest cruise shipping group in the world, has increased the amount of 10 year senior unsecuted notes it will offer to $650 million from $500 million.

“The Senior Unsecured Notes were priced at 100% of the principal amount, will bear interest at the rate of 5.250% per annum and will mature on November 15, 2022. The Senior Unsecured Notes are expected to be issued on November 7, 2012,” RCCL said, adding that it plans to use the proceeds from the offering to repay amounts outstanding under its unsecured debt facilities.