Tue 19 Jun 2012 13:40

'Buy' ratings for cruise lines on falling bunker prices




The cruise industry has experienced a slowdown in business as a result of growing concerns of a potential recession in Europe. Yet some investment analysts remain keen on the industry as falling fuel prices could help significantly boost companies' profits this year.

Investment bank Jefferies has "buy" ratings on both Carnival Corp. and Royal Caribbean Cruises Ltd. Operators' profits could rise by as much as 25 percent as a result of low prices for bunker fuel, analysts at Jeffries said in a recent note.

Growing concerns of a potential recession in Europe, which accounts for roughly 20 percent of the world's consumption of oil, has seen oil prices slide to eight-month lows on Tuesday. Since early May oil prices have fallen nearly 24 percent on fears that the global economy is slowing.

According to market research firm Five Star Equities, sliding oil prices likely saw Carnival's average fuel costs for this quarter drop to approximately $735 per tonne. The cruise line had expected to pay $772 per tonne when it calculated its second-quarter earnings guidance. Jefferies analysts stated that the lower fuel costs would increase Carnival's 2012 per-share earnings by around 25 percent.

Royal Caribbean Cruises Ltd. is the world's second largest cruise company, operating the Royal Caribbean International, Celebrity Cruises, Pullmantur, Azamara Club Cruises and CDF Croisieres de France brands. The company reported improved revenues to $1.8 billion in the first quarter of 2012 compared to $1.7 billion in the first quarter of 2011 as a result of capacity increases and yield improvements.

Martin Vorgod, CEO of Global Risk Management. Martin Vorgod elevated to CEO of Global Risk Management  

Vorgod, currently CCO at GRM, will officially step in as CEO on December 1, succeeding Peder Møller.

Dorthe Bendtsen, KPI OceanConnect. Dorthe Bendtsen named interim CEO of KPI OceanConnect  

Officer with background in operations and governance to steer firm through transition as it searches for permanent leadership.

Bunker Holding's executive management team, from left to right: CCO Anders Grønborg,  COO Peder Møller, CEO Keld R. Demant and CFO Michael Krabbe. Bunker Holding revamps commercial department and management team  

CCO departs; commercial activities divided into sales and operations.

Image of a bunker delivery being performed by Peninsula's Hercules 8000 tanker vessel. Peninsula extends UAE coverage into Abu Dhabi and Jebel Ali  

Supplier to provide 'full range of products' after securing bunker licences.

A screenshot taken from Peninsula's homepage on October 4, 2024. Peninsula to receive first of four tankers in Q2 2025  

Methanol-ready vessels form part of bunker supplier's fleet renewal programme.

Stephen Robinson, pictured on his appointment as Head of Bunker Strategy and Procurement at Tankers International. Stephen Robinson heads up bunker desk at Tankers International  

Former Bomin and Cockett MD appointed Head of Bunker Strategy and Procurement.

Chart showing percentage of off-spec and on-spec samples by fuel type, according to VPS. Is your vessel fully protected from the dangers of poor-quality fuel? | Steve Bee, VPS  

Commercial Director highlights issues linked to purchasing fuel and testing quality against old marine fuel standards.

Ships at the Tecon container terminal at the Port of Suape, Brazil. GDE Marine targets Suape LSMGO by year-end  

Expansion plan revealed following '100% incident-free' first month of VLSFO deliveries.

Hercules Tanker Management and Hyundai Mipo Dockyard sign bunker vessel agreement Peninsula CEO seals deal to build LNG bunker vessel  

Agreement signed through shipping company Hercules Tanker Management.

Illustration of Kotug tugboat and the logos of Auramarine and Sanmar Shipyards. Auramarine supply system chosen for landmark methanol-fuelled tugs  

Vessels to enter into service in mid-2025.


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