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Tuesday, June 20,
2000
Carnival
reports "constrained" earnings
Carnival Corporation reported net income of $204.0 million ($0.34
Diluted EPS) on revenues of $875.1 million for its second quarter
ended May 31, 2000, compared to net income of $203.3 million
($0.33 Diluted EPS) on revenues of $796.1 million for the same
quarter in 1999. Second quarter 2000 benefited from non-recurring
net gains of $10.7 million from the company's affiliated operations.
Net income for the six months ended May
31, 2000 was $375.5 million ($0.61 Diluted EPS) on revenues of
$1.70 billion, compared to net income of $361.1 million ($0.59
Diluted EPS) on revenues of $1.54 billion for the same period
in 1999.
Commenting on the second quarter results,
chairman and CEO Micky Arison stated that earnings were constrained
by a combination of lower net revenue yields and significantly
higher fuel costs.
"Although there was some pressure
on cruise pricing, we continued to attract a record number of
first-time cruisers and grew the number of passengers carried
by more than 100,000 -- the largest quarterly increase in passenger
counts in recent history. This resulted in occupancy levels increasing
by 2.4 percent to 102.3 percent during the second quarter,"
Arison noted.
Looking to the remainder of the fiscal
year, the company expects that net revenue yields for the second
half of 2000 will be somewhat less than last year and that earnings
per share for the full year will be slightly higher than last
year.
Because existing cruise pricing is providing
unprecedented value to the vacationing public, the company attracted
a record number of first-time cruisers during the first half
of 2000. The company believes that this broadening of its customer
base better positions it to grow its earnings in the future.
Arison also pointed out that the industry should benefit from
favorable demographic trends in the coming years as more people
move into the 40 to 60 age range, a prime age group for cruising.
"A larger audience of first-time cruisers, combined with
a growing number of repeat passengers brought about by strong
levels of customer satisfaction, should produce a large number
of guests to fill our new order book of 15 ships scheduled for
delivery over the next five years," he said. Arison added
that the company remains confident of its ability to expand the
cruise market during this period and to create greater value
for its shareholders.
In February 2000, Carnival's board of directors
authorized the repurchase of up to $1 billion of its common stock.
Since then, the company has repurchased 14.3 million shares of
its common stock at a cost of approximately $340 million.
U.K.
MoD orders survey vessels
The U.K. Ministry of Defence has placed a £130 million
(approx. $220 million) prime contract for the design and build
of two new specialist warships, known as Multi-Role Hydrographic
and Oceanographic Survey Vessels, with Vosper Thornycroft (UK)
Ltd.
The ships, to be named HMS ECHO and HMS
ENTERPRISE will be built under sub-contract at Appledore Shipbuilders
in Appledore, Devon and are due to enter service in 2002 and
2003.
Construction work is expected to sustain
about 800 jobs in the shipyard and its local suppliers over the
next three years."
The contract also covers the support of
the ships throughout their 25 year service life with the Royal
Navy.
The 3,500 tonne ships will be equipped
with the latest survey systems, including multi-beam echo sounders
and modern side sonars, as well as advanced navigation and communication
systems. Each of the ships will be available for operations for
over 330 days each year - a 50 percent improvement on older existing
vessels. Considerably improved stability at sea means they will
be able to carry out survey work for 90 percent of the year in
seas much rougher than before.
As well as undertaking specialist surveying
tasks, the ships will work in world-wide front-line operational
roles, including supporting mine warfare and amphibious operations
necessary to the long-term effectiveness of the Royal Navy.
The project is being managed by the Survey
Vessels Integrated Project Team, based at the U.K. Defence Procurement
Agency Headquarters at Abbey Wood, Bristol. The team is lead
by Ian Wakeling.
Wärtsilä
NSD signs agreement with John Crane-Lips
Wärtsilä NSD, and TI Group, on behalf of John Crane-Lips,
have now signed a cooperation agreement to develop, market and
supply total marine propulsion power systems to the shipbuilding
industry.The cooperation agreement follows the signing of a letter
of intent in February and is subject to clearance by the appropriate
regulatory authorities.
Agreement has also been reached for TI
Group to purchase Wärtsilä NSD's propeller production
and related servicing business at Rubbestadneset, Norway, with
approximately 120 employees transferring from Wärtsilä
NSD Norway to John Crane-Lips.
Under the cooperation agreement, Wärtsilä
NSD, with 560 marine support people worldwide, will act as prime
contractor to shipyards for total marine propulsion power systems.
It will provide diesel engine based prime movers and gearboxes
while John Crane-Lips will supply on-board propulsion and sealing
systems. The co-operation agreement tragets the entire
commercial marine market, from fishing vessels and tug boats
to cruise ships and VLCCs, as well as defense markets
Both Wärtsilä NSD and John Crane-Lips
retain the right to market their own product ranges independently
where customers to not wish to purchase total marine power systems.
GE
Marine Engines to upgrade gear plant
GE Marine Engines says that, over the next year, it will invest
in substantial upgrades to grinding, inspection and hobbing equipment
used at its Lynn, Mass. Gear plant . The first production pieces
to be produced with this new equipment will be high speed pinions
and gears for the U.S. Navy's current DDG destroyer program.
"We' ve taken a 20-year step forward
with this large investment in new equipment, which translates
into long-term value such as greater grinding accuracy and gear
reliability," said Bill Gehr, Manager Gear Programs for
GE Marine Engines. He added that GE will be able to produce quiet,
more reliable gearing with enhanced load capacity by holding
tooth tolerances within .00005 inches --about 1/60th the size
of a human hair.
The new 1.6-meter CNC form grinding equipment replaces the grinding
equipment GE installed in the 1980s. This high precision (DIN
1) machine will enable the use of a CBN cutting wheel technology
to profile grind marine gearing. To augment the grinder, a CNC
gear inspection machine has been installed adjacent to the grinder
in the same climate controlled facility. Together, these machine
tools will manufacture and assure the highest quality gearing
for the U.S. Navy and other marine applications.
Plans are underway for GE to continue investing
in its Lynn Gear plant. By the end of 2000, GE expects to install
a CNC 1.6-meter hobber and by mid-2001 will install a 4.0-meter
profile grinder.
Plans
to expand Panama Canal
Next Monday, members of the Panama Canal Advisory Committee will
reportedly hear details of a $5.9 billion plan to build two
new locks over the next eight years, at the Atlantic and Pacific
entrances of the canal, and to widen the channel by 2030.
The expansion, which has yet to be approved,
would allow the transit of post-Panamax-size vessels and would
increase ship traffic by 36% to 51 ships per day by 2020 and
another 31% to an average of 67.2 ships per day by 2060, compared
with 37.3 transits today.
The estimated total cost is much less than
earlier studies which, in 1993, put the construction cost of
new locks and modernization program at up to $10 billion.
Financing for the expansion project would
likely come from a mix of self-financing, increased Canal tolls
and revenues and international bond placements.
Technigaz
wins Spanish LNG import terminal contract
SN Technigaz, a wholly-owned subsidiary of Bouygues Offshore
has won a contract from Bahia de Bizkaia Gas (BBG) for construction
of a Liquefied Natural Gas (LNG) import and regasification terminal
in the newly extended harbor of Bilbao. BBG is a Spanish gas
marketing company owned equally by BP Amoco, Repsol, Iberdrola
and Ente Vasco de la Energia.
The contract totals 203 million euros (about
$180 million) and SN Technigaz's portion is 81 million euros.
It will be performed through a joint venture between SN Technigaz
(leader with 40%), Initec (33%) and Sofregaz (27%). This turnkey
contract includes the design, engineering, procurement, supervision
and construction of the plant, including commissioning and start-up
of the installations, as well as training of operating and maintenance
personnel.
The LNG terminal will consist of a jetty
with the capacity to receive methane carriers of 135,000 cubic
meters, two storage tanks with a capacity of 150,000 cubic meters
each and a regasification plant able to generate 2.7 billion
cubic meters of natural gas per annum.
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