Yes, pricing is up

Yes, cruise pricing is up. CCL Corp. (which owns Princess) had a conference call with stock analysts today to discuss the recently released earnings report. Basically, record profits with higher pricing for cruises.

And the future promises more increased prices for cruising. From the earnings press release: “At this time, cumulative bookings for the next three quarters are higher at prices that are well ahead of the prior year. During the quarter, booking volumes for the next three quarters have been running in line with last year, also at prices that are well ahead. Per Arnold Donald: "We are realizing sustained strength in booking trends across all core products. We are delivering on our strategy to grow demand in excess of measured capacity growth while leveraging our industry-leading scale resulting in increased return on invested capital...”

Some points from the conference call (some apply to CCL Corp brands in general, some to Princess specifically):

o For the North American Brands (which includes Princess), Caribbean bookings are ahead in number of bookings and at “nicely higher prices” while European bookings are about the same in number but also at “nicely higher prices”.

o There is a “pricing premium” for Carnival and Holland America cruises with Cuba ports on the itineraries

o Helping to keep ticket prices high is following a plan to increase capacity at a slower rate than the growth in demand. Ticket yields are up 5.7%, mainly driven by the North American brands.

o Helping to increase awareness of cruising in general and increased demand for cruising on CCL brands are the four proprietary TV programs (over 70 hours of shows so far) that CCL Corp has developed and are shown on various TV networks as well as available on Netflix and outer programming outlets.

o Industry-wide cabin numbers are about 2% of available hotel rooms in the world, so the potential to sell cruising to those who have never cruised on a vacation is high.

o CCL Corp capacity changes for 2018: up 4-5% in the Caribbean, up 3% in Europe, up 7-8% in Alaska, down in both Australia and China.

o Capacity growth worldwide for all cruise lines is 5.3% for 2017 and will be 5.9% in 2018.

o Capacity in the Chinese market is a relatively small percentage of available capacity. Although the Chinese market is expected to be the largest in the world at some point in the future, it is growing slowly now. One factor limiting bookings is the elimination (for political reasons) of South Korean ports on the Chinese based itineraries.

o The naming ceremony for the Majestic Princess in China is expected to provide great publicity within China for cruising with Princess.

o Although the Majestic Princess will now spend part of its time during cruising from Australia and New Zealand, these cruises are being marketed to the Chinese market as an opportunity to fly and then cruise. Thus this ship which was built for the Chinese market is likely to have a number of Chinese on the Australia/New Zealand itineraries.

o A new computer-based Yield Management Tool (YMT) is being rolled out to all the CCL Corp brands. One example of its use is formulas to determine pricing for itineraries. An example was given where UK planners found the YMT suggesting higher pricing for an itinerary than the planners expected. Thinking the YMT was wrong, they examined the formulas used and could not find an error. Thus they went with the pricing the YMT suggested and found the cruise sold well at the higher prices.

o The Ocean Medallion concept, to be implemented first on Princess ships, is receiving much favorable publicity. Supposedly ship crews are “excited” to have this tool to provide a better cruise experience. Benefits to the cruise lines include opportunities for higher ticket prices as well as opportunities for increased on board revenues.

Time to buy more CCL stock? :)

Thanks for sharing. As a CCL stockholder, I am thrilled that they have taken steps that have more than doubled the price since I bought it. As a cruiser, :(

Thank you very much for summarizing & sharing the information with us.

It confirms many of my thoughts about the current situation at Princess which apparently is similar at other CCL companies. One factor stock analysts mention is that a substantial decrease in fuel costs is driving up stock prices for all cruise lines. All of the factors have resulted in cruise stocks increasing including CCL: 2017-over 27%; past 12 months-36%; past 5 years-over 90%.

Since Ocean Medallion hasn't been implemented yet then saying it's "receiving much favorable publicity" is more based on Princess marketing hype than substance. Princess@Sea took years to be fully functional and it's understandable that ***** will undoubtedly experience growing pains. They've greatly promoted the idea about how it will improve the cruise experience but are for the first time acknowledging to investors the opportunity to increase ticket prices & onboard sales. Increasing income is something that many passengers already understood to be the primary reason for *****.

Not attempting to turn this into one of several discussions about ***** which is probably best discussed on those other threads. Just a few comments based on their ***** statements & again Bill appreciate posting the summary from the CCL conference call with stock analysts.

Thanks so much for the review of the conference call. None of it is especially surprising information; but it does give insight to thoughts many of us have had about cruising and Princess in particular.

Thanks for the information. Having been a long time Celebrity cruiser who, because of their recent high prices & on board cuts, has been leaning more towards Princess, it appears that with prices increasing here as well,we will be doing our new bookings at the last minute to take advantage of the lower prices.

Thanks for sharing that information.

Not surprised that the cruise companies are raising their prices as the economy in general seems to be

improving as well. This now explains the high costs to cruise.

As a shareholder, I think this is great news! :)

Conclusion: You've been warned. So book early before prices go up.

So frequently I've read on these boards that it's best to book your cruise and cabin EARLY to get the best prices. This is something that I rarely do because of work schedules that are less flexible with my husband.

Today I decided to see what the rates were for 2019 Alaska cruises. I checked both the spring rates and the fall rates. They did seem a bit high and I did take into account that most did have the drink package included. So then I checked with comparable cabins that did not have the drink package included (2017 vs. 2018) and 2017 was almost $1,000 less, per cabin.

So either the "book early" mantra doesn't apply any longer or that Princess really has increased their rates for future cruising quite drastically.

I believe it was ColoradoCruiser who said on another thread that the S&S "sales" raises the overall prices for all bookings. I'm in agreement.

Thanks, Bill..

Record profits and record cutbacks. Too bad so sad. :(

So frequently I've read on these boards that it's best to book your cruise and cabin EARLY to get the best prices. This is something that I rarely do because of work schedules that are less flexible with my husband.

.

That's when the cancellation button comes in handy. Lock up the cruise price/cabin early and cancel for a full refund if your schedule doesn't work or a better deal comes along at a later date. It's up to you how you want to manipulate your early booking to your advantage.

Our twelve Princess cruises have mostly been booked on short notice.

I began noticing late last year that reasonably priced last-minute deals had dried up. I also noticed Princess seems to be taking blocks of cabins out of service close to sailing date. Entire sections of cabins become "SOLD" overnight. Sometimes they never return as available before the cabin class shows as "SOLD OUT" for the ship. My speculation is they are shuttering cabins to reduce costs and show even higher per cabin pricing. I can't find how CCL calculates ALBD (Available Lower Berth Days), but I'm guessing by removing blocks of cabins as available they skew non-GAAP metrics. As a side effect, those who are cruising are paying extra for the empty cabins on CCL ships.

I know this kind of wonky but I'm trying to figure out why the bargain hunters among us are not finding many bargains on Princess these days. Of course, it could be that their new YMT tool is really, really good at extracting the last dollar from each cabin.

So frequently I've read on these boards that it's best to book your cruise and cabin EARLY to get the best prices. This is something that I rarely do because of work schedules that are less flexible with my husband.

 

Today I decided to see what the rates were for 2019 Alaska cruises. I checked both the spring rates and the fall rates. They did seem a bit high and I did take into account that most did have the drink package included. So then I checked with comparable cabins that did not have the drink package included (2017 vs. 2018) and 2017 was almost $1,000 less, per cabin.

 

So either the "book early" mantra doesn't apply any longer or that Princess really has increased their rates for future cruising quite drastically.

 

I believe it was ColoradoCruiser who said on another thread that the S&S "sales" raises the overall prices for all bookings. I'm in agreement.

I just checked an Alaska Denali cruise tour for this July (most sold out but at least one sailing has balcony cabins mid forward between decks) and also for next July. This July is a little more expensive and no "perks". Next July is slightly less expensive AND includes the drink package. So basically.... it all depends on which sailings. In this case it is better to book a year in advance than last minute.

Conclusion: You've been warned. So book early before prices go up.

Or book at the last minute when the prices go down. (providing you are able to be very flexible)

I wonder what the accurate bottom line is with increased bookings & prices? :confused:

Increased sales & prices help their stock's value but wonder what percentage book early & cancel when the price is too high at final payment? What percentage of the many $1 deposit bookings will actually sail? How many of the higher prices are offset by increased benefits?

Just a few questions but obviously there will never be a completely accurate accounting which could devalue their stock's value.

Or book at the last minute when the prices go down. (providing you are able to be very flexible)

I notice the general trend for last minute deals is now around 45 days prior to sailing. They usually get snitched up pretty fast before hitting the 30 days mark.