Star Cruises slips into the red as costs rise
More gloomy results are expected for the second quarter because of Sars
Star Cruises, the world's fourth-largest cruise line operator, has reported a first-quarter net loss of US$5.04 million as fuel costs and other expenses increased.
It also warned its second-quarter results would be negatively affected by the Sars outbreak.
In the first quarter of last year, the group posted a net profit of US$681,000.
It said costs and expenses in the first three months of this year jumped 16 per cent to US$390.6 million. Ship expenses surged 21.9 per cent, largely due to an increase in fuel prices, a 9.5 per cent capacity expansion and higher environmental and security costs.
Looking ahead, chairman Lim Kok Thay said: 'The second-quarter result in the Asia-Pacific will be affected by passenger cancellations and reduced forward bookings as a consequence of the outbreak of Sars, especially in the core markets of Hong Kong and Singapore where SuperStar Leo and SuperStar Virgo were hubbed respectively.'
Last month, the company redeployed SuperStar Leo and SuperStar Virgo to Australia for one to three months, after two suspected Sars cases were discovered among crew members. It said its experience in Australia with the two ships would open another possible market.
'The situation the group is facing in the Asia-Pacific is unprecedented but manageable,' Mr Lim said.
Earlier, HSBC had expected Star Cruises to report a net loss of about US$8 million for this year, compared with a US$84 million profit last year.
Mr Lim said the company booking volumes in late April and the first two weeks of this month were ahead of the same time last year, following the end of the US-Iraq war, which had affected its North America business.
The company said sales for the three months to March were US$411.96 million, up 11.93 per cent from the same quarter last year.
Star Cruises shares yesterday rose 1.73 per cent to HK$1.76.