Royal Olympic Cruise Lines Reports Loss for 2001

Royal Olympic Cruise Lines Inc. has announced a loss for the fiscal year 2001, ended November 30, 2001. The events of September 11 had a substantial impact on the company's results and in the period September to November 2001, booking cancellations exceeded 3,000. EBIDA fell 25 percent from $ 21.7 mil in 2000 to $9.8 million in 2001. The inclusion of the first new vessel, Olympia Voyager, for a full year, resulted in additional interest and depreciation charges of $9.5 million, giving rise to operating losses of $18.4 million vs. profit of $3.2 million last year. The results were further deteriorated by non-operating losses on the valuation of financial instruments, in connection with the acquisition of the second new vessel, Olympia Explorer, of $7 million and a charge of $1.1 mil, resulting from the adoption of a new accounting policy on the treatment of financial instruments, bringing overall losses to $25.4 million vs. profits of $1.5 million last year. Revenues for the year however increased from 2000, reaching $128.8 million reflecting what had been an improvement through the summer in 2001, and a full year of operations for the company's first new building, the Olympia Voyager. Passengers increased by 19.8% to 146,739 and passenger days increased by 159,289, or by 20.6%. Operating expenses increased by $12.5 million to $93.6 million in 2001. The increase was primarily due to the full year operation of the Olympia Voyager, as well as from increases in insurance costs post September 11. Selling and Administrative expenses were substantially in line with last year. General and Administrative expenses decreased 3% to $16.4 million in 2001. Selling and Marketing expenses increased by $0.4 million to $9.0 million, primarily to support the promotion of the Olympia Voyager and the planned launch of the Olympia Explorer. The company operated seven ships between March and November 2001, two of which also operated between December 2000 and March 2001. The Olympia Explorer, the second of the company's two new 836 passenger cruise ships built by Blohm+Voss was delivered on April 25, 2002. The Olympia Explorer, like her sister ship Olympia Voyager, is able to cruise at speeds of up to 30 knots. The speed of the two new buildings allows them to visit more ports of call during a cruise, providing passengers the opportunity to see more and spend more time in port to tour the destinations. The Olympia Explorer was welcomed to the Port of Piraeus and a naming ceremony was held on June 7, 2002, during Posidonia week. Bookings on the vessel are on budget and the ship is sailing at near full capacity.