Top Headlines

Helsinki fears 12% fairway due rise to hit cruise calls hard

Details: Written by Teijo Niemelä Teijo Niemelä; Category: Top Headlines Top Headlines; Published: 25 August 2011 25 August 2011

The Port of Helsinki fears that a plan by the Finnish government to increase fairway dues by 12% from the beginning of 2012 will hit hard cruise calls to the city.

"We have done quite a bit of work to get fairway dues for cruise ships to a moderate level. And then comes this! We have made calculations about the effects of the cost (increase) and we inform the Ministry all the time. Obviously, we think that the negative effect will not be as minor one," Eeva Hietanen, head of communications and cruise development at the Port of Helsinki, told Cruise Business Online.

The port expects 270 cruise calls with a total of 370,000 passengers this year, which is broadly speaking line with the figures of 2010. Fairway dues are a tax levied by the government on ships using Finland's waterways. It is charged for each visit. The Ministry of Transport and Telecommunications has included the 12% increased of the due as part of the government's 2012 draft budget.

Viking Line says newbuilding finance not in place

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 25 August 2011 25 August 2011

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%

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 23 August 2011 23 August 2011

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

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 13 August 2011 13 August 2011

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

Details: Written by Kari Reinikainen Kari Reinikainen; Category: Top Headlines Top Headlines; Published: 13 August 2011 13 August 2011

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.