Cruise holidays more popular despite US recession
Royal Caribbean Cruises has announced record net income for the fourth quarter of 2007, suggesting cruise holidays are still booming despite the economic situation in the US.
Net income for the cruise line in 2007 Q4 was $70.8 million, compared to $46.6 million in 2006. Total revenue for 2007 Q4 was $1.5 billion, compared to $1.2 billion in 2006.
"It is very gratifying to see such a strong performance, especially in light of the broader consumer and economic environment. We are particularly pleased with the solid yield performance of our brands, which produced such healthy earnings despite significantly higher fuel costs," says Royal Caribbean Cruises chairman and chief executive officer, Richard D Fain.
In May 2007 Royal Caribbean introduced a new cruise ship Liberty of the Seas, which with sister ship Freedom of the Seas is the world's largest cruise ship. These will be joined by another sister ship, Independence of the Seas in May this year.
Looking ahead to cruising in 2008, Royal Caribbean Cruises expects capacity to increase by 8.8% in the first quarter of 2008, and by 5.1% for the full year. Capacity will be helped because this will be the first full year for Liberty of the Seas, while the fleet will also be joined by Independence of the Seas and then Celebrity Solstice in November.
"The early indications from the 'wave period' are encouraging," says Fain. "We continue to see healthy booking volumes and improved pricing over the same time last year. Based on this improving revenue performance and our focus on controlling costs, we expect 2008 to be a year of double-digit improvement in EPS." Royal Caribbean says it has taken a number of steps to reduce energy consumption and fuel costs.
Royal Caribbean offers cruises to a wide range of destinations including Transatlantic cruises, Mediterranean cruises, cruises to Australia and New Zealand, and cruises to the Far East.
Written by: Nick Purdom
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