Norwegian Cruise Line: Prices rising for second half of year

By Gene Sloan, USA TODAY

Norwegian Cruise Line’s 4,200-passenger Norwegian Epic during sea trials off the coast of France in June 2010.


Norwegian Cruise Line today said prices for its voyages are solidly on the rise, echoing comments made last week by executives at Royal Caribbean.

North America’s third largest cruise company said in a statement that “the second half of 2010 is showing solid improvements in pricing from 2009 levels,” with load factors consistent with the prior year.

The announcement is the latest evidence that the tourism sector is on the mend after one of its toughest years in decades.

“Unlike this same time last year, the company has been successful at holding price while balancing load factor,” the line said in the statement.

Still, the line added that while the “booking curve” — a measure of the average number of days in advance that passengers book cruises — continues to be healthy, it has narrowed from the highest levels achieved in the first quarter of 2010.

Norwegian disclosed the information on booking trends and pricing today as part of its latest quarterly announcement of earnings. In the announcement, the line said it lost $14.9 million during the second quarter, which ended on June 30, on revenue of $477.9 million. The loss for the quarter compares to a gain of $15.4 million on revenue of $478.4 million in the same quarter a year ago.

A big factor behind the net loss was a non-recurring charge of $33.1 million related to foreign exchange contracts associated with the financing of the just-unveiled Norwegian Epic. Excluding the charge, the company had a net profit for the quarter of $18.2 million — about 18% better than a year ago.

The line also says its net yield — a measure of how much money it makes per cabin — rose by 6.6% during the quarter. The increase in net yield came from both higher ticket prices and increased onboard revenue per capacity day, the line adds.

The company’s earnings would have been higher if not for the impact of soaring fuel costs during the quarter. Norwegian said it paid an average of $508 per ton for fuel in the quarter, up from $356 per ton in the same quarter a year ago.

“The results for the quarter demonstrate that we are continuing to build momentum,” CEO Kevin Sheehan said in the statement.

Leave a Comment