Royal Caribbean Cruises has reported net income of $136.6 million or $2.25 per share on revenues of $1.2 billion for 1994 compared to net income of $106.7 million or $1.80 per share on revenues of $1.1 billion for 1993.

Income before an extraordinary item of $5.7 million was $142.3 million for 1994. The item resulted from the early retirement of a portion of the company's debt associated with its refinancing program.

Royal Caribbean attributed the revenue increase to continued yield improvement combined with both higher rates and occupancy levels. The company operated the same fleet capacity in both 1994 and 1993.

Operating income for 1994 was $185.7 million compared to $161.5 million in 1993. The increase was attributed to improved yields, operating efficiencies, capital structure improvements and a revised depreciation policy.

Royal Caribbean reported 5,180,426 passenger cruise days and a load factor of 100.8 percent for 1994 compared to 5,074,830 passenger cruise days and a load factor of 98.8 percent for 1993. Richard Fain, Royal Caribbean's Chainnan and CEO, said in a prepared statement that "achieving this improvement without any increase in fleet capacity highlights Royal Caribbean's fundamental strength in the marketplace."

Royal Caribbean boosted its net margin to 11.7 percent in 1994 compared to 9.6 percent in 1993 and the operating margin to 15.9 percent in 1994 compared to 14.5 percent in 1993.

Revenue per passenger day rose to $226.12 in 1994 compared to $218.28 in 1993; and net income per passenger day rose to $26.27 in 1994 compared to $21.03 in 1993.

Fain was cautious about 1995, however, and said that booking patterns for early 1995 sailings have not been as robust as one would expect during an economic recovery. "However, our strong market position and the introduction of our new vessel gives me confidence looking forward," Fain said.

"We are now preparing for the delivery of the Legend of the Seas in the second quarter. Until that time we will see a slight reduction in fleet capacity due to the timing differences and the sale of a vessel (Nordic Prince)," Fain added.

4th Quarter

While 1994 was a strong year for Royal Caribbean, the fourth quarter seemed tougher than usual.

Although the company managed to increase revenues and net earnings with no capacity increase, costs and expenses were up compared to the same quarter the previous year, with net and operating margins down as a result.

Net income for the fourth quarter of 1994 was $18.7 million or $0.30 per share on revenues of $281.9 million compared to $18.5 million or $0.28 per share on revenues of $263.8 million in the fourth quarter of 1993.

Net income before an extraordinary item of $2.3 million was $21.0 million or $0.34 per share for the fourth quarter of 1994.

Operating income for the fourth quarter was $31.4 million in 1994 compared to $29.7 million for the same quarter in 1993.

The net margin for the fourth quarter of 1994 was 6.6 percent compared to 7.0 percent a year ago, and the operating margin was 11.1 percent compared to 11.3 percent in the fourth quarter of 1993. Sales and administrative costs increased to 17.2 percent of revenues in 1994 from 14.5 percent in 1993.

Revenue per passenger day was $215.66 in the fourth quarter of 1994 compared to $205.09 in 1993 and net income per passenger day was $14.31 in the fourth quarter of 1994 compared to $14.32 in the same quarter a year ago.

Royal Caribbean reported 1,307,167 passenger cruise days and a load factor of 98 percent for the last quarter compared to 1.285,282 passenger cruise days and a load factor of 100.4 percent for the same quarter a year ago.

Market Reaction

Assumingly based on the fourth quarter result and the company's cautionary flrst quarter outlook, Royal Caribbean's shares retreated and traded at $25 1/4 at press time compared to a 52-week high/low of $30 1/2 - $23 5/8.