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Immediately after the tragic grounding of the Costa Concordia, bookings for Royal Caribbean dropped by 20%. Lucy Siebert reports
Royal Caribbean enters ‘unchartered territory’
ROYAL CARIBBEAN saw bookings decline by 20% in the period immediately after the Costa Concordia disaster. Richard Fain, chairman and chief
executive, admitted that the company had seen an immediate effect on bookings after the accident, despite a strong start to the wave season in the first week of January. Fain was speaking during the
company’s fourth quarter and full year 2011 results.
Net income for the fourth quarter was $36.6m, and for the full year $607.4m. Revenues in the quarter improved to $1.8bn, compared with $1.6bn in the same quarter last year. For the full year, revenue was $7.5bn compared with $6.8bn in 2010. He said: “We are in unchartered
territory and traditional models simply don’t cover things like this.” He explained that this meant that Royal Caribbean had been forced to look at its volumes in terms of pre-
INTERIM STATEMENT
City braced for first Cook update since delayed December results
THOMAS COOK has reportedly hired Credit Suisse to sell its Indian forex business ahead of its first interim management statement for 2012. A spokeswoman for Cook said the
company was not commenting on the reports, which emerged in weekend newspapers. Cook is in a process of planned
12 09.02.2012
divestments of non-core assets aimed at raising £200m. The tour operating giant was due
to release its interim management statement and to hold its AGM yesterday (February 8). Chairman Frank Meyersman was also due to give his first address to shareholders since taking on the role in December.
and post-Concordia. “We are realistic in the short-term and it is not surprising we have seen an impact. Booking volume dropped significantly immediately after [the incident] and remained down in the low to mid-teens,” Fain said. He added that the level of
“uncertainty” for the second and third quarters would stay “high”.
“We have resumed advertising and booking volumes have improved. A few days don’t make a trend but it is encouraging,” Fain said. The line pulled its advertising and
marketing activity in the immediate aftermath of the Concordia accident, but this has now been reinstated. Looking at demand levels,
European cruising was impacted the IHG +5.6%£13.67
most by the accident, due to the proximity of the incident and the level of media attention. Brian Rice, chief financial officer, added that economic and geopolitical challenges were also affecting demand in Europe, but the company was confident that the long-term prospects remained strong. “Demand for spring and summer cruises has slowed the most. In the first quarter we anticipate a modest impact to yields. But our brands, for the most part, have maintained pre- incident pricing levels for spring and summer. “Although volume is relatively small, bookings for the first quarter of next year have not been affected, which is an indication that this incident will not have a long-term effect,” Rice said.
Demand is already returning for cruises onboard the likes of Allure of the Seas This is the first update since Cook
released its delayed financial accounts last December. Since then reports have emerged suggesting that its sales have been lagging behind competitors during the peak booking season. Last year, it promised go “back to
basics” to revive its UK tour operation. Cook’s mainstream UK business made no profit during 2011 with its independent sector accounting for the UK’s entire £19.5m operating profit. This was despite UK turnover of £3.2bn for the year to the end of September.
HOTEL RESULTS
Iberostar profits up by 7.8% for 2011
IBEROSTAR, THE family-owned Spanish hotel chain has recorded profits of ¤950m for 2011, up 7.8% on the previous year, writes Patrick Whyte. The company sealed several deals
in 2011, including spending over ¤79m on the acquisition and refurbishment of a five-star hotel resort in Cancun, Mexico and
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