Key points for 1H 2011 in comparison with 1H 2010:
• Profit for the Group in 1H 2011 was US$61.8 million, increased 445.6% compared with US$11.3 million in 1H 2010
• Contributions from jointly controlled entities, Travellers International Hotel Group, Inc. and its subsidiaries (“Travellers Group”) and NCL Corporation Ltd. and its subsidiaries (“NCLC Group”), during the period were US$25.7 million and US$12.3 million, respectively. Share of profit from Travellers Group increased US$15.5 million from the same period in 2010 when Travellers Group was classified as an associate, while share of profit from NCLC Group was US$12.3 million in 1H
2011 compared with a share of loss of US$18.7 million in 1H 2010
• EBITDA for the period improved 21.8% to US$61.5 million, compared with US$50.5 million for the same period in 2010
• Capacity days increased by 10.8% from approximately 0.8 million to 0.9 million capacity days due to the full operations of m.v. SuperStar Libra in 1H 2011
• Total revenue increased by 22.9% from US$184.7 million in 1H 2010 to US$ 227.0 million in 1H
2011 mainly due to the 32.2% increase in gaming revenue from 1H 2010
• Operating expenses excluding depreciation and amortisation increased by 23.8% in 1H 2011, mainly due to higher fuel costs and payroll and related operating costs
• Selling, general and administrative expenses excluding depreciation and amortisation increased by 21.6% in 1H 2011 mainly due to increases in payroll, and advertising and promotion expenses
Press Release: Genting Hong Kong Group Announces First Half Results for 2011 Page 1 of 6
• Operating profit was US$23.5 million for 1H 2011, a 41.5% improvement compared with US$16.6 million in 1H 2010
Genting Hong Kong Group
The Group’s total revenue for 1H 2011 was US$227.0 million, an increase of 22.9% from US$184.7 million in 1H 2010. The increase in total revenue was mainly due to the 32.2% increase in gaming revenue in 1H
2011 and 10.8% increase in capacity days as a result of the full operations of m.v. SuperStar Libra in 1H
2011, whilst it was laid up in the first quarter of 2010. Occupancy percentage increased by 2% from 82% to
84% in 1H 2011 which contributed towards a 13.6 % increase in ticket and onboard revenue for the period.
The ongoing fleet rationalisation which included the refurbishment and relocation of m.v. Star Pisces from Malaysia to Hong Kong as well as the relocation of m.v. SuperStar Libra and m.v. SuperStar Aquarius to Malaysia and Taiwan regions respectively contributed towards the improvement in gaming revenue
Total costs and expenses before finance costs and other items for 1H 2011 amounted to US$203.5 million compared with US$168.1 million in 1H 2010, an increase of US$35.4 million.
Operating expenses excluding depreciation and amortisation increased US$25.1 million (23.9%) to US$130.2 million in 1H 2011 from US$105.1 million in 1H 2010, primarily due to a 26.8% increase in ship operating expenses, mainly resulting from the increase in capacity days, payroll, port charges and higher fuel expenditure. In 1H 2011, Star Asia’s average fuel price rose approximately 21.5% from US$480 per metric ton in 1H 2010 to US$583 per metric ton in 1H 2011. Excluding fuel expenses, total operating expenses increased by 22.3%, representing a 10.4% increase on a per capacity day basis compared with 1H 2010.
Selling, general and administrative expenses excluding depreciation and amortisation increased by US$6.3 million (21.6%) to US$35.4 million in 1H 2011 from US$29.1 million in 1H 2010 mainly due to higher salary related costs, and advertising and promotion expenses in 1H 2010.
Depreciation and amortisation expenses increased by US$4.1 million (12.1%) primarily due to the depreciation of m.v. Norwegian Dream which has been reclassified to property, plant and equipment from non-current assets held-for-sale since December 2010.
Finance costs increased by US$2.4 million to US$15.8 million for 1H 2011 compared to US$13.4 million for 1H 2010, primarily due to the write-off of amortised loan arrangement fees upon the refinancing of loans in 1H 2011.
Net other income was US$13.8 million for 1H 2011 compared with US$14.4 million for 1H 2010. During 1H
2011, net other income mainly comprised the agreed settlement of US$13.3 million in relation to the non- completion by Louis Plc. of the sale and purchase contract for m.v. Norwegian Dream.
During 1H 2010, the net other income comprised a realised gain of approximately US$17.6 million on the disposal of interest in Port Klang Cruise Centre Sdn Bhd and Glamourous Trendy Sdn Bhd for approximately US$55.6 million.
NCLC Group
The commentary below is prepared based on NCLC Group’s US GAAP financial statements.
Total revenue increased 19.0% in 2011 compared to 2010. Net revenue increased 20.2% in 2011, primarily due to an increase in capacity days of 16.4% and an increase in net yield of 3.3%. The increase in capacity days was due to the addition of Norwegian Epic to the fleet in late June 2010. The increase in net yield was due to an increase in passenger ticket pricing and onboard revenue which was primarily due to an increase in net revenue from NCLC Group’s gaming operations, spa services and specialty restaurants.
Total ship operating expense increased 18.1% in 2011 compared to 2010 primarily related to an increase in capacity days as described above and higher ship operating expenses. The increase in ship operating expenses was primarily due to an increase in fuel expense as a result of an 11.8% increase in average fuel price to US$557 per metric ton in 2011 from US$498 in 2010. Total other operating expense increased
11.4% compared to 2010 due to an increase in depreciation expense related to Norwegian Epic which entered service in late June 2010. Net cruise cost increased 16.2% in 2011 primarily due to an increase in capacity days. On a capacity day basis, net cruise cost was unchanged due to increases in fuel expense and dry-dock expense substantially offset by lower general and administrative expenses. Excluding fuel expense, net cruise cost per capacity day decreased 1.9%.
Finance cost, net of capitalized interest, increased to US$94.6 million in 2011 from US$72.9 million in 2010 primarily due to an increase in average outstanding borrowings related to the financing of Norwegian Epic. Other income (expense) was US$2.1 million in 2011 compared to US$(34.4) million in 2010. The income in
2011 was primarily due to gains on fuel derivatives partially offset by losses on foreign exchange. The expense in 2010 was primarily due to losses on foreign exchange contracts associated with the financing of Norwegian Epic.
Travellers Group
In 1H 2011, Travellers Group reported US$280.6 million in total revenues and US$88.2 million in EBITDA, compared with US$148.7 million total revenues and US$42.6 million EBITDA in 1H 2010.
Total operating expenses amounted to US$77.7 million in 1H 2011, compared with US$40.5 million in 1H
2010, which is mainly due to the increase of new hires to support the expansion in operations, as well as marketing and advertising efforts to promote the integrated resort.