Royal Caribbean Reports 1Q Results

Royal Caribbean Cruises Ltd. reported that its net income for the first quarter was $53 million, essentially the same as the first quarter of 2001.

Earnings per share were $0.27 for the first quarter in both 2002 and 2001. Net income for the quarter was negatively impacted by $5 million in guest and travel agent related expenses due to the unanticipated drydock of two ships.

Revenues for the first quarter of 2002 were up 10%, at $800 million compared to $727 million in 2001. The increase in revenues was due primarily to an increase in capacity, offset by a decline in yields (net revenues per available passenger cruise day). Yields were down seven percent for the first quarter of 2002 compared to the first quarter of 2001, primarily as a result of pricing actions taken in the months immediately following the terrorist attacks of September 11. Bookings during these months were taken at significantly discounted prices. By January, pricing on new bookings for the first quarter was only marginally lower than during the same period the prior year.

In recent weeks, pricing has returned to pre-September 11 levels. Looking forward, based on current pricing trends and booking levels, yields are expected to be down 5-7 percent in the second and third quarters relative to 2001.

The company will introduce Constellation, the fourth Millennium-class ship, in May, and Brilliance of the Seas, the second of the Radiance-class series, in July. The company is also considering asking the shipyard to accelerate by a few weeks the delivery of Navigator of the Seas, the fourth Voyager-class ship. If so, the ship would be delivered in December 2002 in time to take advantage of the holiday sailings. The company has also announced that it will deploy six ships in the Europe next year, more than doubling its product offerings there.