Jan 30, 2008 12:16 pm US/Eastern
Royal Caribbean Reports 4th Qtr. Surge
MIAMI (CBS4) ―
The world's number two cruise line has reported a whopping 52-percent surge in fourth quarter profits.
Miami based Royal Caribbean Cruises Ltd. said strong bookings produced better-than-expected revenue despite high fuel costs.
The cruise operator says earnings increased to $70.8 million, or 33 cents per share, from $46.6 million, or 22 cents per share, compared to the fourth quarter of the previous year. Analysts polled by Thomson Financial expected net income of 34 cents per share.
Higher fuel costs hurt profit by 21 cents per share in 2007, according to Royal Caribbean, but strong close-in bookings helped offset those costs in the fourth quarter.
Royal Caribbean's Chairman and Chief Executive Richard Fain said the cruise industry is somewhat cushioned by softness in the economy because consumers "focus on getting more vacation for their money."
"We believe that our business, while it's not recession-proof, is recession-resistant," said Fain. "Cruising continues to be the best value in the vacation industry, and the fixed-price nature of the purchase becomes even more appealing during tough times."
Fain said bookings were encouraging for the January-to-March "wave period" -- the busiest reservation period of the year, when many people plan summer vacations.
Royal Caribbean expects 2008 earnings between $3.20 and $3.40 per share on cost control efforts and increased revenue. It anticipates first-quarter profits of 30 cents per share to 35 cents per share.
Analysts predict 2008 net income of $3.21 per share and first-quarter earnings of 6 cents per share.
(© 2009 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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