The Star Cruises Group has reported a net loss of $2.2 million, or $0.04 per share, on revenues of $412 million for the first quarter ended March 31, 2003, compared to net income of $6.3 million, or $0.02 per share, on revenues of $368 million for the first quarter of 2002.
Star attributed the higher revenue to an increase in capacity and higher yield compared to the same quarter last year. Operating costs, excluding fuel, were up 3.6 percent, according to Star, due to increased environmental and security expenses. What it called "shore costs" were also higher, mainly due to the expansion into China beginning in the second half of 2002. Fuel costs were up about 60 percent and added $11.1 million to the costs year-over-year, Star stated.
The results in the Asia/Pacific were affected by passenger cancellations and greatly reduced forward bookings as a consequence of the outbreak of SARS, especially in the company's core markets of Hong Kong and Singapore, where the Superstar Leo and Superstar Virgo were based. Both ships were redeployed to Australia in April for "one to three months." Star said that bookings were strong, considering the short lead time and may consider seasonal deployment there in the future. It called the situation in the Asia/Pacific region "unprecedented but manageable."
Norwegian Cruise Line (NCL) recorded an increase of 11.3 percent in capacity days in Q1 due to the introduction of the Norwegian Dawn, which was partially offset by the scheduled drydockings of the Norwegian Sea and the Norwegian Crown. Star said that yield for the NCL Group, including Orient Lines, was up 3.6 percent year-over-year, with NCL's yield up slightly more and Orient Lines' flat.
Q1 expenses were up, primarily due to the launch of advertising and promotional activities for the Dawn's New York sailings, as well as fuel costs, which were up 60 percent, adding $8.4 million to costs.