| RCCL’s Q1 profits plummet by 40%

Royal Caribbean Cruises is
satisfied with its first-quarter
results in the current “highly
volatile” market.
THE impact of the Costa Concordia disaster
in Jan has surfaced in the latest financial
report by RCCL, which saw profits drop to
US$47 million, or 21 cents per share,
compared to US$78.4 million, or 36 cents per
share, in the same period last year.
But the company remains hopeful of an
improvement in the next quarter, describing
the Q1 results as better than expected.
“First-quarter results were satisfactory given
the difficult and uncertain operating
environment, and we continue to see gradual
improvement in the demand for our great
vacations,” said Richard Fain, RCCL ceo.
“We did not expect the impact of the
tragedy to be long term, and we are seeing
evidence the effects are waning,” he added.
On the positive side, revenues improved to
US$1.8 billion compared to US$1.7 billion in
the first quarter last year, and net yields
increased 7%.
Net cruise costs (excluding fuel) increased 5.7%.
Although bookings since Feb have been
down by “mid-single digits”, the company has
seen booking activity gradually improve over
the past few months.
“Despite the extraordinary disruptions to
our booking patterns this year, thus far the
recovery is consistent with our forecasts,”
said Brian Rice, executive vice president and
chief financial officer.
“The Caribbean and Alaska remain healthy
and, as expected, a wide range of outcomes
still persist regarding Europe this summer.”
Rice said the marketplace is “still volatile
and uncertain, so we are narrowing our yield
and EPS ranges to reflect our best estimates
at this time.”
The company estimates its second quarter
earnings per share will be between a loss of 5
cents to a gain of 5 cents.