Delta Queen Steamboat Company completed its public offering in March and has raised $44 million for payment of debt and construction of a new steamboat. The shares are traded on the NASDAQ under the symbol DQSB.
Along with Carnival Cruise Lines and Regency Cruises, Delta becomes the third publicly held cruise company in the United States. Also publicly held is Europa Cruises Corporation which operates one-day cruises; the Dial Corporation, which owns Premier Cruise Lines; and Club Med, which operates the Club Med I.
American Cruise Line and Bermuda Star Lines were also publicly held for relatively brief periods until both declared bankruptcy. Other attempts have never gotten beyond the announcement phase.
The Delta Queen Steamboat Company, which was a public company previously, was taken private in 1986. An Ilinois corporation called Equity acquired all the shares in a time period from 1980 through 1986, at a total cost of $10.5 million. Equity, which is also the majority owner following the stock offering, is a subsidiary of a EGI, a privately held company.
Based upon the initial public offering price of $13.50 per share, the price for approximately 33.3 percent of the company (shares offered) would be $48.6 million.
At press time, Delta Queen traded for $14.50 compared to the initial offering price of $13.50. A high and low established so far are $16.25 and $13.
Delta Queen is the only operator of overnight paddlewheel steamboat cruises in the United States. The company, based in New Orleans, provides two- to twelve-night cruises on its 176-passenger Delta Queen. which was built in 1926, and 416-passenger Mississippi Queen, which was built in 1976. In 1991, the two vessels carried more than 32,000 passengers and called at approximately 50 towns in 15 states along the Mississippi, Ohio, Cumberland and Tennessee Rivers.
The company also owns and operates the 197-room Maison Dupuy Hotel in New Orleans’ French Quarter.
First nine months of fiscal 1992
Delta Queen reported consolidated net income of $2.9 million on revenues of $49.5 million in the first nine months of its fiscal year 1992, ended December 31, 1991, compared to net income of $3.4 million on revenues of $43.3 million in the same nine month period the previous year.
Expressed as a percentage of revenues, the net income margin was six percent for the first nine months of fiscal 1992 compared to 7.9 percent in the same period in 1991.
The net income was reduced in 1991 mainly because of a non-recurring $4 million compensation expense to three senior executives.
The company reported increased boat revenues of $45 million for the nine month period compared to $39 million in the same period the previous year.
Cost of boat operations were reported to be $24 million, or 53 percent of revenues, compared to $22 million, and 56.9 percent of revenues in fiscal 1991.
Boat operating income was $5.5 million compared to $6.5 million in the same period last year. Expressed as a percentage, ship operating income was 12.2 percent of revenues in the first nine months of fiscal 1992 compared to 16.5 percent in 1991.
Passenger occupancy in the nine-month period was 95.5 percent compared to 96 percent in the previous year.
Total revenue per passenger night was $303.79 in the nine-month period compared to $274.38 last year.
The average fare revenue per passenger night in the first nine months of fiscal 1992 was $256.99; onboard revenue was $20.08; and air and land package revenue as $26.72.
As of December 31, 1991, Delta Queen listed total capitalization of $35.5 million including debt of $263 million and stockholder’s equity of $92 million.
The prospectus said the debts were incurred in conjunction with the construction of the Mississippi Queen, acquisition of the Maison Dupuy Hotel, construction of the company’s office and dock facilities and the addition of a new hull to the Delta Queen.
Steamboat Operations
According to the prospectus, revenues from boat operations were $46.1 million in fiscal 1991, ended March 31, 1991, compared to $40 million in 1990 and $34.1 million in 1989.
Boat operating income rose to $4.5 million in fiscal 1991 from $2.6 million 1990 and $738,000 in 1989. As a percentage of operating revenue, operating income was 9.9 percent in fiscal 1991, 63 percent in 1990 and 2.2 percent in 1989.
The company has attributed increased operating income to an increase in passenger nights and higher fares as well as its ability to convert incremental revenues into operating income at higher margins.
Cost of operations were reduced to 58.9 percent of revenues in fiscal 1991 compared to 60.5 percent in 1990 and 62.2 percent in 1989.
Selling, general and administrative costs were also reduced to 26.6 percent of revenues in fiscal 1991 compared to 28.4 percent in 1990 and 30.4 percent in 1989.
Average occupancy levels were 96 percent in fiscal 1991 compared to 86.1 percent in 1990 and 80.7 percent in 1989.
The average fare revenue per passenger night was $227.80 in fiscal 1991 compared to $208.59 in 1990 and $200.47 in 1989.
Onboard revenue was $18.31 per passenger night in fiscal 1991 compared to $18.09 in 1990 and $16.37 in 1989. (These vessels do not offer casino gambling onboard.)
Revenues from air and land packages were $28.30 per passenger night in fiscal 1991, compared to $25.47 in 1990 and $21.60 in 1989.
As of December 31, 1991, advance reservations for 1992 cruises represented $32.8 million compared to $243 million in potential fares for 1991 as of December 31, 1990. Advance reservations for 1992 represented 66 percent of physical occupancy. Advance reservations on the books at year’s end f or 1990 were $16.7 million, and $14 million for 19 89.
Consolidated Operations
Since the company also owns and operates the 197-room Maison Dupuy Hotel in New Orleans French Quarter, total combined revenues were $51 million in fiscal 1991, $45 million in 1990 and $38 million in 1989.
