Royal Outlook Improves

Post-Wave bookings on a tear, says Royal Caribbean chairman

By Tom Stieghorst
Allure of the SeasRoyal Caribbean Cruises Ltd. reported an unusual surge in bookings in from mid-February to mid-April, a stretch when the booking pace typically decelerates.

Company chairman Richard Fain said that while the Wave season had been merely “typical,” which was slightly concerning, bookings in the past eight weeks were up more than 20%, driven by promotions.

“The volumes have just been unprecedented,” for a period in which the booking pace usually slackens, Fain said in a conference call with Wall Street analysts on Thursday.

He said promotions such as Royal Caribbean International’s Kids Sail Free and Celebrity Cruises’ 123Go had allowed RCCL to make up most of the booking deficit it had going into the last week of February.

Although occupancy levels are surging, pricing remains lower than a year ago. Fain also said “quality demand” in regions outside the Caribbean is contributing to the surge.

RCCL profit falls 65%, but outlook improves

By Tom Stieghorst
Royal Caribbean Cruises Ltd. raised its 2014 earnings guidance by a nickel a share despite reporting lower earnings for the first quarter.

Net income was $26.5 million, or 12 cents a share, in the quarter ended March 31, down from $76.2 million, or 35 cents per share, in 2013.

But Royal Caribbean said booking volume for the past three months have risen 16% year-over-year, with bookings for the past 8 weeks up by more than 20%, stronger than typical post-Wave periods.

The company raised its profit forecast by 5 cents a share, or about $11 million, to between $719.2 million and $763.5 million.

“Despite pressures in the Caribbean, the diversity provided by our global footprint is proving its value,” CFO Jason Liberty said.

In 2013, Royal Caribbean earned $473.7 million.

RCCL part of coalition opposing PortMiami stadium

By Tom Stieghorst
PortMiamiA proposal to build a 25,000-seat soccer stadium on a neglected corner of PortMiami is drawing opposition from a group of port users, including Royal Caribbean Cruises Ltd.

The planned stadium would be adjacent to RCCL’s headquarters campus at the port.

A coalition called the Miami Seaport Alliance was recently formed to oppose the stadium, which would house a new professional franchise partly owned by soccer superstar David Beckham.

The Miami-Dade County Commission, which governs the world’s busiest cruise port, voted in December to have the county manager begin negotiations with Beckham’s group.

There are several other non-port sites under consideration, but Beckham prefers the port site for its views of the downtown skyline.

Renderings of the proposed stadium have been created by Arquitectonica, the Miami firm that designed the nearby American Airlines Arena, home to the Miami Heat professional basketball team.

According to John Fox, president of the Miami Seaport Alliance, the area around the port entrance is already congested.

“When there’s a Heat game, or things going on at the Arsht Performing Arts Center, we now have an art museum that’s fantastic, there’s a children’s museum there, there’s a science museum coming,” Fox said. “And so, even forgetting the cruise and cargo interests, there’s horrendous, horrendous traffic problems.”

Currently, the only way to access Dodge Island where the port sits is over a bridge from downtown Miami, though a $1 billion tunnel connecting the port to a freeway is nearing completion.

RCCL-ProposedSoccerStadiumAttractionsFox, who is the former vice president of government relations at RCCL, said an open-air stadium is simply not an appropriate use of the port.

“Is there another seaport in the world that would even consider putting a sports arena with 30,000 fans right in the middle of its public property?” he wondered.

Beckham’s real estate adviser has said that games would occur at night, after cruise ships have departed. But Fox said there was no way a single team could guarantee the league’s schedule.

The stadium would take about 12 acres on the port’s southwest corner. There is currently a warehouse on the parcel used by the Marine Spill Response Corp. The port’s master plan calls for development of office towers, hotels and other such uses there.

Wary of competition, Miami’s Downtown Development Authority is supporting the Beckham stadium, which might also include ancillary development but be far less intensive.

Fox said his group includes seven or eight members, including another cruise line besides Royal Caribbean, labor unions, stevedore companies and freight forwarders. Two other cruise lines, Carnival Cruise Lines and Norwegian Cruise Line, have said they’re not involved.

The closest cruise terminal to the proposed stadium is Terminal J, which is used by Oceania, Regent Seven Seas, Crystal and Azamara.

Fox said that if the stadium were to be built and make access to PortMiami more difficult, it could mean an exodus of cruise ships and passengers to other East Coast ports, particularly Port Everglades 30 miles to the north.

“The [port] users are concerned that this will either choke off the economic engine or bring it to a halt,” Fox said, though he added that the decline would be gradual.

“This isn’t going to happen overnight,” he said. “But as businesspeople … make decisions about where to put their freight or their cruise lines, certainly this is one of the things that needs to be considered.”

Goldstein named RCCL president

By Tom Stieghorst
_Adam GoldsteinAdam Goldstein has been named president of Royal Caribbean Cruises Ltd. (RCCL), the parent company of Royal Caribbean International, Celebrity Cruises and Azamara Club Cruises.

Goldstein has been president of RCCL’s largest brand, Royal Caribbean International, for the past 12 years.

In addition to president of RCCL, he will hold the title of chief operating officer.

The company said it will begin a search to find a successor to Goldstein as president of Royal Caribbean International.

In his new role, Goldstein will lead the company’s cross-functional teams, RCCL Chairman and CEO Richard Fain said.

“Adam has played a key role in growing Royal Caribbean International, step by step, into a global leader. In the course of doing so, he has become an impressive leader in his own right,” Fain said.

Goldstein joined the company in 1988, and served in a number of positions before taking the helm of Royal Caribbean International, including senior vice president of total guest satisfaction, senior vice president of marketing and corporate secretary.

A graduate of Princeton University who also holds a law degree from Harvard University, Goldstein is an accomplished table tennis player and has competed in middle-distance running events in the National Senior Games Association track and field championships.

RCCL doesn’t currently have a president or a chief operating officer.

In addition to its three North American brands, RCCL owns Spain’s Pullmantur, French line Croisieres de France, and a 50% interest in TUI Cruises of Germany.