Travel Weeklys Cruise E-letter: March 22, 2004

ROYAL CARIBBEAN CRUISES (RCCL) is discontinuing its key account fares, a controversial policy that gives top accounts access to group rates for individual bookings. The company, which includes the Royal Caribbean and Celebrity brands, also is working on a revised group policy to discourage agencies from blocking so-called speculative group space and filling it with individual travelers. The goal is to attract true affinity and promotional groups.

NOT ALL THE DETAILS of the new policies are in place, said Lisa Bauer, Royal Caribbeans vice president of North America sales, including what types of marketing programs might replace key accounts and when the changes will go into effect. In an interview last week, Bauer said Royal Caribbean is working to come up with a program that will definitely recognize key account status and address components that include marketing and interesting ways to work together but will not have a price advantage.

IN OTHER RCCL NEWS, long-time President Jack Williams is leaving the company. Williams, who joined Royal Caribbean in 1997, has for several years been the joint president of both Royal Caribbean and Celebrity brands. Two weeks ago, the company created separate presidents for each brand -- Adam Goldstein at Royal Caribbean, Dan Hanrahan at Celebrity -- and made Williams the president of the parent company. Williams said he will turn his attention to charity work.

CARNIVAL CORP. had another banner quarter, reporting net income of $345 million, a 70% increase over first-quarter 2004, on revenues of $2.4 billion, a 21% increase year over year. The revenue increase was driven by a 15% increase in capacity and a continuing improvement in revenue yields, which increased 7.2%. The cancellation of the 2005 world cruise of P&O Cruises Aurora dragged down earnings per share by about four cents.

NCL CORP. is considering raising capital for its newbuild program through a public offering, either this year or next year, CEO Colin Veitch said during the Seatrade Cruise Shipping Convention. The equity offering would be a separate listing in the U.S., Veitch said; NCL Corp.s parent company, Star Cruises, which currently is publicly traded in Hong Kong and Singapore, would retain a majority stake in NCL Corp.

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