World News
Royal Caribbean Bunker Spending Down in Q2
Royal Caribbean Cruises Ltd. [NYSE:RCL] (Royal Caribbean) says it reduced its spending on bunkers in the second quarter of 2013 as it consumed less fuel than expected.
The cruise operator's fuel spending for the quarter ended June 30 was $232.5 million, down from $238.0 million in the same quarter last year.
The company's net income for the quarter was $24.7 million on revenues of $1.37 billion compared with a loss of $3.7 million on revenues of $1.33 billion in the same quarter last year.
Bunker pricing net of hedging for the quarter was $697 per tonne, and consumption was 333,600 tonnes, which was 6,400 tonnes less than expected.
"While the operating environment has been frustrating, our bookings trajectory is looking good and I'm thrilled to see our cost initiatives beginning to pay off," said Chairman and CEO Richard D. Fain.
"Exploiting this positive momentum will help us take our returns and our profitability to the next level."
The company said its European business improved year-over-year and U.S. consumer spending rose, while the Caribbean market experienced discounting but maintained solid demand.
Royal Caribbean said it expects fuel costs for the rest of the year to stay steady from its original guidance despite an increase in oil prices thanks to its hedging and energy conservation efforts.
David Dingle, chief executive of Carnival UK, said earlier this year that higher bunker costs are pushing cruise operators to use larger ships moving at slower speeds and visiting fewer ports.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 504.50 | 2.50 | 620.00 | 3.00 |
| Rotterdam | 456.00 | 1.50 | 621.50 | 2.00 |
| Houston | 476.00 | 7.00 | 624.00 | 1.00 |
| Fujairah | 496.50 | 2.00 | 713.00 | 2.50 |
| Global 20 Ports Average | 526.50 | 0.50 | 712.00 | 0.50 |
| Global 4 Ports Average | 483.00 | 2.00 | 644.50 | 0.50 |
| Global Average Bunker Price | 570.50 | 1.50 | 751.00 | 1.00 |
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