Disney Cruise Line’s enviable kid clout

Posted on 25 February, 2015 by Spacejunkie2

By Tom Stieghorst

Almost without exception, you can tell which cruise lines are serious about attracting families by whether there are animated characters prowling the pool deck.

Whether it is Smurfs, Cinderella, Kung-Fu Panda or SpongeBob SquarePants, they generally signify which lines have a year-round business attracting kids and which don’t.

Some lines make no claim to providing characters or attracting children, including Oceania Cruises, Azamara Club Cruises and, soon, Viking Ocean Cruises. Others don’t do a lot of family business during the school year, often because of longer itineraries.

Of the lines that do provide characters, one stands above the rest. Disney Cruise Line’s advantage is almost unfair, its roster of characters so deep and historic, that if characters are a primary consideration, it has to be tops on the list.

And the line isn’t content to rest on its laurels. Its animation factory just keeps turning out the hits.

On Sunday night, Disney took home an Oscar for its movie “Big Hero 6,” featuring Marvel Comics superheroes, who are also present on Disney Cruise Line ships. That comes on top of last year’s Oscar for “Frozen,” the top-grossing animated movie of all time.

“Big Hero 6” topped DreamWorks Studios’ entrant in the Oscars derby, “How To Train Your Dragon 2.” DreamWorks characters such as Shrek are exclusive to Royal Caribbean International ships.

Of course, popular films emerge from other studios besides Disney. The DreamWorks stable includes notable franchises such as Kung Fu Panda and Madagascar.

But Disney’s four ships have so many characters to pick from. This summer it will feature characters from “Frozen” on cruises to Norway and Iceland. Next year it will have “Star Wars Day at Sea” on eight selected sailings, featuring characters from the Star Wars movies.

The ownership of Disney Cruise Line by entertainment powerhouse Walt Disney Co., of course, gives it access to these properties. And it kind of puts the success of the cruise industry in perspective. When you ask which cruise company has the biggest investor value, it isn’t Carnival Corp, valued at $34 billion. It is Walt Disney, valued at $178 billion.

Diversification and Norwegian’s bottom line

Posted on 18 February, 2015 by Spacejunkie2


By Tom Stieghorst

The benefits of diversification in the cruise industry will be evident this week when Norwegian Cruise Line Holdings reports its results for the fourth quarter and calendar year 2014 on Tuesday.

Norwegian, until recently a single-brand company, is heavily tied to the Caribbean in the fourth and first quarters. According to analyst Rachel Rothman, of Susquehanna Financial Group, Norwegian’s results will be pulled down by its high exposure to the Caribbean relative to its competitors Carnival Corp. and Royal Caribbean Cruises Ltd.

Norwegian does not benefit from growth in Asia, which is also helping those two companies, Rothman notes.

In a positive light, Norwegian is aided by not having any cruise brands that do business in currencies other than the dollar. That means the relatively strong dollar affects it less than Carnival, with its Costa, Aida and P&O subsidiaries, or Royal Caribbean, which owns Spain’s Pullmantur and France’s CDF.

From that perspective, Norwegian’s recent acquisition of Prestige Cruise Holdings is ideal. The two Prestige brands, Regent Seven Seas Cruises and Oceania Cruises, both do business in U.S. dollars, so their results won’t be a drag because of currency exchange.

And as destination-oriented luxury lines, Oceania and Regent do relatively less sailing in the overcrowded Caribbean and have more itineraries in Asia, although neither is set up to source business there.

Rothman expects Norwegian to earn about $76 million in the fourth quarter and about $508 million for 2014. The company is building ships just about as fast as is practicable, which should help it diversify its itineraries further away from the Caribbean to areas like Brazil in the winter.

Norwegian has come a long way in a short time. Tuesday’s results may show it has further to go.

Norwegian Cruise Line chief to stand down

Posted on 9 January, 2015 by Spacejunkie2

Norwegian Cruise Line Holdings president and chief executive Kevin Sheehan is standing down.

He is being succeeded by Frank Del Rio of Prestige Cruises International, which was acquired by Norwegian in November.

Del Rio, a co-founder of subsidiary Oceania Cruises, has more than 20 years of experience in the cruise industry.

Norwegian subsidiary Prestige operates Regent Seven Seas Cruises alongside Oceania. Del Rio has served as chief executive of Prestige or its predecessor since April 2007.

Sheehan said: “It has been a privilege to lead Norwegian over the last seven years.

“I am proud of what we have accomplished, and take comfort in the knowledge that I am leaving the company much healthier and stronger than when I joined.

“With the company set for success, I hand the baton off to Frank, a proven leader in the cruise industry.”

Steve Martinez, member of Norwegian’s board of directors, said: “Frank Del Rio has established himself as a leader and innovator in our industry.

“Norwegian is poised for continued growth and we are delighted to have Frank lead our team during the next phase of the company’s evolution.

“We also thank Kevin Sheehan for his service to the company. Kevin has built Norwegian into the highly successful company it is today – a company that has reported 25 consecutive quarters of growth in trailing twelve month adjusted EBITDA coupled with consistent margin improvement.

“Most recently, Kevin was integral to the Prestige acquisition, assembling a diversified portfolio of brands that spans all market segments in the cruise industry, which we believe puts the company in a strong position for the future.”

Del Rio added: “I am excited to begin this new chapter in my long career in the cruise industry.

“I am blessed with a great team at Norwegian, and I am confident that together we can help our company continue to realize great things.”