Tag Archives: Harmony of the Seas

Hurricanes cost Royal Caribbean $55M, but Q3 profit still rises

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Royal Caribbean’s three Oasis-class ships.Royal Caribbean Cruises Ltd. reported an 8.6% increase in third-quarter net profit despite costs from the most destructive hurricane season in its history.

Net income rose to $752.8 million from $693.3 million. If not for five hurricanes in September, including two in the Pacific, Royal Caribbean said that net profit would have been $55 million more.

“That made it by far the most expensive hurricane season in our 45-year history,” chairman Richard Fain said in a conference call with analysts.

Royal Caribbean said strong close-in demand for cruises in July and August and higher onboard spending helped it offset hurricane-related costs and lost revenue from cancelled cruises and a decrease in bookings.

Fain said demand fell “precipitously” during September, both for cruises that month and for future bookings. The softness lasted about six weeks but bookings for virtually all itineraries are back to normal now, Fain said.

Fain said he thinks that travellers have become “inured” to disruptions such as hurricanes or terror attacks so that they are affecting booking patterns for shorter time periods than in the past.

Royal Caribbean said its forecast of adjusted full-year earnings of up to $1.59 billion still holds.

In the third quarter, revenue advanced slightly to $2.57 billion from $2.56 billion a year earlier.  Onboard revenue was up 5%, led by increases in internet usage and shore excursions.

Mariner of the Seas getting massive makeover

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Mariner of the Seas

Royal Caribbean International plans a major improvement in its short-cruise product, starting with a massive makeover of the 14-year-old Mariner of the Seas.

Speaking to a conference of Cruise One/Dream Vacations and Cruises Inc. agents aboard the Harmony of the Seas, Royal Caribbean president Michael Bayley said the line will spend over $100 million on the ship.

Plans call for a six-week drydock in Cadiz, Spain, in March and April. Bayley said it is the most money Royal Caribbean has ever spent renovating a ship.

“I’m calling it a modernization, not a refurbishment,” Bayley said. “We’re going to be adding concepts and redoing concepts,” he said.

When the work is finished, the 3,114-passenger Mariner will sail three- and four-day cruises from Miami. The ship is currently sailing in Asia.

The move will coincide with the June 2018 opening of the newly constructed dock at Coco Cay, Royal Caribbean’s private island in the Bahamas, which will play a major role in the Mariner’s itineraries.

Bayley hinted there is more reinvestment yet to be disclosed. “It is attached to the Mariner and it is attached to the idea of boosting up the shore experience,” he said.

He said that the combined ship-shore package will be a “game changer” in the short-cruise market.

In May 2016, the Empress of the Seas started sailing short cruises after a $50 million renovation. That ship is now doing four-, five- and six-day cruises from Tampa on Caribbean itineraries that include Cuba.

The only other cruise line to spend more than $100 million in a single refurbishment was Carnival, which refitted the Carnival Destiny and renamed it the Carnival Sunshine in 2013 at a cost of $155 million.

STX France’s groundbreaking collaboration with Royal Caribbean and Celebrity Edge

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STX France’s groundbreaking collaboration with Royal Caribbean and Celebrity Edge

STX France has launched an ongoing monitoring services programme with Royal Caribbean and Celebrity Edge

STX France and Royal Caribbean have launched a partnership that allows ongoing monitoring by the shipyard to ensure energy efficient solutions are in optimal use on Harmony of the Seas. This is also to be rolled out to the Celebrity Cruises’ Edge-class vessels being built by the shipyard, and other ships in Royal Caribbean Cruises’ fleet.

The groundbreaking collaboration on Harmony of the Seas – which has not been carried out between a shipyard and cruise ship operator before – has led to 5% fuel savings on the cruise ship, which was delivered last year. The monitoring agenda has its foundations in STX France’s Ecorizon, a research and development programme launched in 2007 to create more environmentally friendly and energy efficient ships.

STX France Ecorizon R&D project manager and energy efficiency manager for Harmony of the Seas and Celebrity Edge-class, Arnaud Jacques told Passenger Ship Technology “We took this approach to help Royal Caribbean reach the best energy efficiency level possible. Normally the work of a shipyard stops after delivery but we believe that it is very crucial to share all this knowledge and expertise we have built up.”

He said this is what propelled STX France to go further than the usual scope of shipbuilder to deliver not just a ship that was “designed well but one designed to operate well”.

The monitoring services sees STX France following the ship year after year and see what works, what does not work as expected and looking at what can be improved (in terms of energy efficiency). A very important part of it is to train the crew how to check equipment and maintain the level of knowledge about how the ship works and maintain best practice. This is especially important as crews change frequently. The training takes place twice a year. STX France also gives Royal Caribbean weekly updates and analysis on the back of its monitoring services.

Mr Jacques said “We plan to continue co-operation with Royal Caribbean next year following other ships; they want to have a great benchmark for their fleet and make sure the ships run at an optimal energy performance.” He wasn’t able to say at this stage which ships these would be.

Celebrity Cruises’ Celebrity Edge will also undergo the same monitoring services when it is delivered at the end of 2018.