Royal Caribbean Cruise Lines 2001 Annual Report Download - page 8

6Royal Caribbean Cruises Ltd.
Nordic Empress in Tampa, Splendour of the Seas in Houston, and Grandeur of the Seas in New Orleans. We believe there is much
untapped potential in these ports as well as mid-Atlantic ports such as Baltimore and Charleston, S.C., where this year
Celebrity’s Galaxy starts operating 10 - and 11-night cruises to the Caribbean.
Royal Celebrity Tours began escorting guests on pre- and post-cruise tours to Denali National Park and other scenic areas along
the route of the Alaska Railroad. Two glass-domed “Wilderness Express” traincars offer views of remote landscapes, and
95 percent of our cruise-tour guests told us they would recommend it to a friend. We are adding a third and fourth traincar,
thus doubling the number of guests we can accommodate on cruise-tour packages.
Five ships offered itineraries in Europe in summer 2001 as part of our efforts to tap this fast-growing market. Unfortunately,
9/11 forced us to redeploy some of these ships back to the U.S. But for 2002, we have assigned our two newest ships,
Constellation and Brilliance of the Seas,to Europe along with Splendour of the Seas. Island Cruises, our joint venture with United
Kingdom tour operator First Choice Holidays, also will cater to the European market this summer with Island Escape,
formerly Viking Serenade.
In 2001, we introduced a sophisticated system for pre-selling shore excursions through the Internet – still the only cruise lines
with this capability. Besides improving revenues, this new system has meant greater convenience for our guests and cost savings
to the company and to travel agents.
MERGER OPPORTUNITY
In addition to strengthening the brands of Royal Caribbean International and Celebrity Cruises, in 2001 we pursued a signif-
icant merger opportunity – a merger of equals with P&O Princess Cruises plc. On November 20, we announced an agreement
to create a merged “dual-listed company” that would retain separate legal identities, tax residencies and listings on the stock
exchanges in New York, London and Oslo. Our efforts to combine forces with P&O Princess prompted a competing, hostile
takeover bid by Carnival Corporation, and there is still a long way to go before the outcome is known.
Should we ultimately gain the necessary approvals for a combination, we would create the world’s largest cruise vacation
company, deploying 41 ships and 75,000 double-occupancy berths, not including newbuilds in 2002. The 14 firm orders for new
ships between 2002 and 2004 – six by Royal Caribbean and eight by P&O Princess – would bring the combined enterprise to
more than 100,000 berths. While we are optimistic about the future as we stand, we believe this merger would accelerate our
already excellent prospects for improving margins and profits.
While we are optimistic about the future
as we stand, we believe this merger would
accelerate our already excellent prospects for
improving margins and profits.