The Star Group has reported net income of $4.4 million, or $0.08 per share, on revenues of $404.5 million for the first quarter ended March 31, 2005, compared to a net loss of $9.2 million, or $0.17 per share, on revenues of $390.7 million for the first quarter of last year.
Star attributed the increase in revenues, despite a year-over-year decrease in capacity, to higher ticket prices, onboard revenues and occupancy rates. The capacity reduction resulted mainly from the sales of two older and less efficient ships, Star said, the Superstar Capricorn and the Superstar Aries.
Higher operating expenses were attributed primarily to higher crew payroll costs associated with higher staffing levels and the higher cost structure of NCL America and the increase in fuel prices.
NCL
Star Group (NCL), which is now referred to as the NCL GROUP, including NCL America (Hawaii) and Orient Lines, increased its capacity by 9 .1 percent over the same period last year, with flat occupancy rates, while revenue yields were up. Operating costs were up due to higher fuel costs and due to the increased number of U.S. crew as compared to Q l 2004.
Star stated that the year has started well for all three brands within the group and that forward bookings have been strong.
Capacity will grow further in Q2 2005 with the introduction of the Pride of America in late June and then in Q3 with the introduction of the Norwegian Jewel in August, partially offset by the withdrawal of the Norwegian Sea which will be transferred to Star Cruises in August.
Star Cruises
The brand had 39 percent less capacity in Q 1 2005 compared to 2004 because of the sale of two ships and the transfer of the Superstar Leo to NCL as the Norwegian Spirit).
Higher occupancy and higher onboard spending contributed to driving higher revenue in the quarter.
Star also announced this past April that the Superstar Libra (formerly the Norwegian Sea) will be homeported in Mumbai from October. She is the first of six ships that will be progressively transferred from NCL to Star Cruises.
In related news, Star Cruises has also entered the Nepal market which it called a “viable choice as a potential market for cruise travelers.” This follows from the encouraging response in the Indian market that the company has experienced, according to a press announcement.
Breakdown
Revenues of $399.8 million were attributed to cruise and cruise related activities and $4. 7 million came from other sources.
The NCL Group generated $300.6 million; Star Cruises $74.1 million and “others” $27.8 million. In terms of operating profit, NCL generated $15.1 million, Star $13 .3 million and “others” $1.6 million. Star said it has a combined fleet of 22 ships in service and due to be delivered with over 35,000 lower berths, including four ships under construction or contract for NCL with some 9,200 berths.
