P&O Princess Cruises reported a widely expected slump in first-quarter profits, with earnings partly dented by lower cruise prices. Pre-tax profits for the three months ending March fell 64 percent from the same period last year to $18.9 million. Basic earnings per share for the company -- which was demerged from ports, logistics and ferry operator P&O last year -- fell to 2.6 cents for the quarter from 6.6 cents a year ago.
Cruise operators such as P&O Princess, Carnival and Royal Caribbean have all felt the effects of the U.S. economic slowdown on their revenues and earnings. Royal Carribean
, the world's second biggest cruise group behind Carnival, said on Wednesday that first-quarter profits nearly halved from early 2000 as U.S. economic weakness led to lower ticket prices.
P&O Princess said the North American market remained competitive on pricing but it continued to earn returns above its cost of capital. The group added that like-for-like net revenue yields were six percent lower, and forecast an overall decline in yields of two to three percent for 2001. - (Reuters)