TUI AG to take at least €200 million hit from Boeing 737 MAX grounding
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- Written by Kari Reinikainen Kari Reinikainen
- Category: Top Headlines Top Headlines
- Published: 29 March 2019 29 March 2019
TUI AG, the Hannover based travel company that has a large foothold in the cruise industry, said it would book a one off charge of about €200 million as a result of grounding of Boeing 737 MAX passenger jets following two major accidents.
The company said it has 15 of these in its fleet of 150 aircraft. TUI AG owns Hapag-Lloyd Cruises and Marella Cruises in full and has a 50% stake in TUI Cruises.
The news sent shares in the company, which have their main listing London, sharply lower and at around 1000am local time, they traded at 8.1% lower at £7.07. They had hit a low of £6.86 earlier in the session. The company issued a profit warning – not related to its cruise operations – in January, which accounted for another sharp price fall. TUI AG shares have lost almost two thirds of their value since hitting a peak of just under £18.00 in may 2018.
“Assuming 737 MAX flight resumption latest by mid-July, the Group currently expects to see a one-off impact on underlying EBITA1 rebased of approx. €200 million in connection with the 737 MAX grounding. This impact is especially attributable to costs related to the replacement of aircraft, higher fuel costs, other disruption costs, and the anticipated impact on trading,” the company said in a statement.
Consequently, the Executive Board of TUI AG has decided to update the guidance and now expects an underlying EBITA1 rebased for FY19 of approx. minus 17% (previously “broadly flat”) compared with FY18 of €1,177 million.
“Should it not become clear within the coming weeks that flying the 737 MAX will resume by mid-July, TUI will need to extend the abovementioned measures until the end of the summer season. The current assumption for this additional one-off impact until 30 September 2019 is up to €100 million. For this scenario the Executive Board of TUI AG has also decided today to update the guidance for the underlying EBITA1 rebased for FY19 to up to minus 26% compared with FY18 of €1,177 million,” the company said.
Princess Cruises and Fincantieri sign contracts for two next-generation, LNG-powered cruise ships
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- Written by Teijo Niemelä Teijo Niemelä
- Category: Top Headlines Top Headlines
- Published: 27 March 2019 27 March 2019
Princess Cruises and Fincantieri announced today the signing of the final contracts for the construction of two next-generation 175,000 gross ton cruise ships, which will be the largest ships built so far in Italy with deliveries scheduled in Monfalcone in late 2023 and in spring 2025. This announcement follows the initial signing of a memorandum of agreement between the two parties in July 2018.
The vessels will each accommodate approximately 4,300 guests and will be based on a next-generation platform design, being the first Princess Cruises ships to be dual-fuel powered primarily by Liquefied Natural Gas (LNG). LNG is the marine industry’s most environmentally friendly advanced fuel technology and the world’s cleanest fossil fuel, which will significantly reduce air emissions and marine gasoil usage.
“Princess Cruises continues to grow globally -- adding new ships to our fleet built by our long-time trusted ship building partner, Fincantieri, who brings decades of expertise to these next-generation cruise ships” said Jan Swartz, Princess Cruises President. “Even more exciting is that these two ships are being designed to include our MedallionClass platform, powered by OceanMedallion, the most advanced wearable device available within the global hospitality industry”.
Giuseppe Bono, CEO of Fincantieri, commented on the announcement: “This result proves, once again, the trust we receive from the market, which allows us to look to the future with ambition. It honors our great work focused on innovation thanks to which we have been able to offer to the client a record-breaking proposal not only in terms of size. Besides we firmly believe that a new class of Princess Cruises’ ships, one of Carnival Group’s top brands, can stem from this promising project. In fact, for Princess Cruises, we have received orders for 21 ships, another unprecedented result in this industry”.
Considered a breakthrough in the vacation industry and recently honored with a CES® 2019 Innovation Award, the OceanMedallion is leading-edge technology that delivers personalized service on a large scale through enhanced guest-crew interaction, as well as enabling interactive entertainment. Guests are currently experiencing Princess MedallionClass vacations onboard Caribbean Princess and Regal Princess. By the end of the year, MedallionClass vacations will be activated on three additional ships, Royal Princess, Crown Princess and Sky Princess.
Cruise Lines International Association (CLIA) and United Nations reported that growth in the number of people cruising between 2004 and 2014 outpaced land-based vacations by over 20 percent, and CLIA projects 30 million people will take an ocean cruise in 2019, an all-time record. These stats signal a bright future for the cruise industry, as well as for professional travel advisor partners enthusiastic for more inventory to meet the growing demands for cruising.
With five ships being built over the next six years, Princess Cruises is the fastest growing premium cruise line in the world.
Carnival reduces 2019 EPS guidance to $4.35 to $4.55 range
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- Written by Kari Reinikainen Kari Reinikainen
- Category: Top Headlines Top Headlines
- Published: 26 March 2019 26 March 2019
Carnival Corporation & plc, the world’s largest cruise shipping group, has reduced its guidance for earnings per share (EPS) for the financial year to 30 November from one it issued in December.
The US-UK company now expects full year 2019 adjusted earnings per share to be in the range of $4.35 to $4.55, compared to December guidance of $4.50 to $4.80, due to changes in fuel price and currency exchange rates and 2018 adjusted earnings per share of $4.26.
“At this time, cumulative advanced bookings for the remainder of 2019 are ahead of the prior year at prices that are in line with the prior year on a comparable basis. Pricing on bookings taken since January have been running in line on a comparable basis to the prior year while booking volumes are ahead compared to the prior year. As a result, even with higher capacity, there is less inventory remaining for sale than at the same time last year,” the company said in a statement.
President and Chief Executive Officer Arnold Donald said: "Booking trends achieved during wave season rivaled last years' historical highs and were consistent with the demand trends we experienced going into the year, building further confidence in our full year guidance.”
“For our North America and Australia brands, our booked position is ahead of the prior year at higher prices while our Europe and Asia brands are well ahead of the prior year at lower prices. Our brands are strong and growing, including Continental Europe, where we continue to expect revenue growth driven by double-digit capacity increases," he said in the statement
Based on current booking trends, the company continues to expect full year 2019 constant currency net cruise revenues to be up approximately 5.5 percent, with capacity growth of 4.6 percent, and net revenue yields in constant currency expected to be up approximately 1.0 percent compared to the prior year driven by our NAA brands.
The company continues to expect full year net cruise costs excluding fuel per ALBD in constant currency to be up approximately 0.5 percent compared to the prior year.
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