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Is Celebrity Running out of Money?

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Posted (edited)

 

7 hours ago, grandgeezer said:

 

Nov. 16, seven day Caribbean cruise on the Equinox, with all four perks. $3,124.50  p.p. total for Sky Suite

Nov. 16, seven day Caribbean cruise on Oceania Insignia, with, internet,  drink package, and economy air from Phoenix $2299 p.p. total for a Penthouse Suite.  Add $311, total, for tips and $150 obc p.p., to almost make it apples to apples. New total is $2610 p.p. total. Wait a second, it's still not apples to apples, Oceania include economy air. According to choiceair.com, the cheapest fare is on United for $493 p.p. and the flight times suck.

Adding the airfare to Celebrity to get it close to apples to apples comparison, the new pricing is $3617.50 for Celebrity... $2610 for Oceania.

My mistake, the Concierge cabin was the one mentioned. In that case, subtract $49 p.p. from tips, and $400 p.p. from cruise price. New Oceania price $2269

Just about the same price???

 

I used Nov 16 date because that's what we would have booked if we had more time after our previous cruise which docks October 19 on MSC. Too much air travel in such a short time.

I can understand the price difference you found. O posts their prices when they list the cruise and usually never change them. On the other hand X is a supply and demand cruise line where the price for the cruise is usually the cheapest when they first post the cruise, then start jacking it up based on demand.

 

Because of this we usually book with X the first week or 2, then sit back and do fake bookings for the next 18 months until the final payment is due. On our S1 corner aft facing cabin 10 day Reflection Caribbean cruise last Jan, the price had jumped $1,700 pp from the time we booked it for $3,500 pp including all 4 perks (roughly a $1,000 pp value) after about 6 months. Then ITV started coming down about 6 months before sailing as they hadn’t sold all of the S2 cabins yet.  

 

It all depends on the cruise. Sometimes the price drops. One time we had our X PCC refare a cruise 4 times to either get more perks and/or take advantage of a price drop. But those are usually associated with transoceanic cruises. 

Edited by Ken the cruiser

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8 hours ago, The_Big_M said:

 

Food in Luminae is a big step up - true. But given it only caters for ~100? people a sitting the range is really limited, and they then use the MDR menu as a fallback which gets you back to step 1. Plus you have limited hours as well again because of the smaller coverage.

 

My last cruise there were a couple of nights where there was nothing on the limited Luminae range that appealed, and I actually went hungry, just having some salads in the buffet - which are cut back from what they once were.

 

So even though the quality is good, the dining can still be disappointing in Luminae just due to the limited size and numbers it deals with.

 

Indeed. But all a little moot to the point I was making to a forum member with lets be honest, challenging expectations from X. 

 

Whatever the restaurant there will always be someone who won't like the menu at some point. You'll even find the same said about restaurants like Noma in Copenhagen or Mirazur in France. 

I'm genuinely surprised you went hungry on a cruise ship though. Particularly as you had access to multiple restaurants, a buffet and room service etc. 

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Posted (edited)
8 hours ago, Ken the cruiser said:

 

I can understand the price difference you found. O posts their prices when they list the cruise and usually never change them. On the other hand X is a supply and demand cruise line where the price for the cruise is usually the cheapest when they first post the cruise, then start jacking it up based on demand.

 

Because of this we usually book with X the first week or 2, then sit back and do fake bookings for the next 18 months until the final payment is due. On our S1 corner aft facing cabin 10 day Reflection Caribbean cruise last Jan, the price had jumped $1,700 pp from the time we booked it for $3,500 pp including all 4 perks (roughly a $1,000 pp value) after about 6 months. Then ITV started coming down about 6 months before sailing as they hadn’t sold all of the S2 cabins yet.  

 

 

Makes sense. How do you book within first week? Do you manually check for new sailings or you get notifications when they are posted?

Edited by ak1004

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Posted (edited)
18 hours ago, ak1004 said:

 

P.S. Is food in Luminae really comparable to Oceania? 

I know food is subjective, but we had heartburn for the first week solid and most of the time thereafter on our 45 day Med/TA cruise on the Riviera, and didn’t have it at all on our 22 day b2b on the Reflection this past January. In addition we just got off the Crown Princess where we ate mostly on the MDR when it was open and never got heartburn once. So, for us, yes, the food is just as tasty on X and Princess as it is on the 3 O ships (Sirena, Nautica and Riviera) we were on for 90 days in 2018.

Edited by Ken the cruiser

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On 7/23/2019 at 12:57 PM, KarlGermany said:

Absolutely correct, however it used to be different. Loyalty programs used to be not only a bag of laundry, it was about being special treated with complimentary upgrades, invitations, generally upgraded service. It was about making the guest feel like a guest not a customer.

but those days are over, both in cruise business as well as airline business.

 

 

I'm following posts on the Crystal board and many are complaining about the decline in food quality on Oceania. I've never taken Oceania so I'm not in a position to comment on their comments.

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To directly answer the question posed by the OP one needs to just look at the report of earning on RCL released today. I quote in part: "RCL reported adjusted earnings of $2.54 per share, up from $2.27 per share in the comparable quarter last year". They are doing quite well indeed. 

Despite complaints, including mine, RCL is meeting or exceeding shareholders expectations.

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It looks like RCI (parent company of Celebrity) is doing pretty good.  See below: 

 

KEY HIGHLIGHTS

Second Quarter 2019 Results:

  • US GAAP Net Income was $472.8 million or $2.25 per share and Adjusted Net Income was $532.7 million or $2.54 per share. Last year, US GAAP Net Income was $466.3 million or $2.19 per share, and Adjusted Net Income was $482.2 million or $2.27 per share.
  • Gross Yields were up 9.4% in Constant-Currency (up 8.2% As-Reported). Net Yields were up 9.5% in Constant-Currency (up 8.1% As-Reported). These results include a 30 basis point negative impact related to the discontinuation of the high yielding Cuba sailings.
  • Gross Cruise Costs per Available Passenger Cruise Days ("APCD") increased 8.2% in Constant-Currency (up 7.4% As-Reported). Net Cruise Costs ("NCC") excluding Fuel per APCD were up 8.9% in Constant-Currency (up 8.2% As-Reported).

Full Year 2019 Outlook:

  • Adjusted earnings for the full year are expected to be in the range of $9.55 to $9.65 per share.
  • Net revenue yields are expected to increase 7.75% to 8.25% in Constant-Currency (up 6.5% to 7.0% As-Reported). This range includes approximately 70 basis points related to the discontinuation of the high yielding Cuba sailings.
  • NCC excluding Fuel per APCD are expected to be up 10.0% to 10.5% in Constant-Currency (up 9.5% to 10.0% As-Reported).

"We are elated to see our brands executing so effectively, keeping our business in an exceptionally strong position," said Richard D. Fain, chairman and CEO.  "Our strategic focus on destinations, technology and people is clearly paying off.  And, our core products are doing exceptionally well, driven by a gratifyingly robust demand for the Caribbean

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34 minutes ago, Orator said:

To directly answer the question posed by the OP one needs to just look at the report of earning on RCL released today. I quote in part: "RCL reported adjusted earnings of $2.54 per share, up from $2.27 per share in the comparable quarter last year". They are doing quite well indeed. 

Despite complaints, including mine, RCL is meeting or exceeding shareholders expectations.

 

Yes, but ..... much of earnings increase due to new ships adding 8.1% to capacity.  Getting bigger doesn't necessarily mean doing things better.

 

As far as exceeding shareholders expectations, stock is down today after reporting those great earnings and is flat over past two years while S&P 500  rose 20%.  Could be worse, over those 2 years CCL is down 33% and NCL down 13%.

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1 hour ago, Orator said:

To directly answer the question posed by the OP one needs to just look at the report of earning on RCL released today. I quote in part: "RCL reported adjusted earnings of $2.54 per share, up from $2.27 per share in the comparable quarter last year". They are doing quite well indeed. 

Despite complaints, including mine, RCL is meeting or exceeding shareholders expectations.

 

So in short, don't expect to see any increase in service or quality any time soon as they are attracting enough passengers with their current product. I won't be expecting to see any decreases in fairs also. 

With their comments about the Caribbean I think it's safe to say that E class ships will be based there for quite some time along with Europe the two most lucrative markets. 

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Just now, Mynki said:

 

So in short, don't expect to see any increase in service or quality any time soon as they are attracting enough passengers with their current product. I won't be expecting to see any decreases in fairs also. 

With their comments about the Caribbean I think it's safe to say that E class ships will be based there for quite some time along with Europe the two most lucrative markets. 

Sadly I'd expect more cuts if demand increases. I would expect better value only when there is significant consumer resistance. That doesn't appear to be happening at this time. 

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8 minutes ago, Mynki said:

I won't be expecting to see any decreases in fairs also. 

Fairs or fares?  Is that a Freudian slip?

 

Phil 

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12 minutes ago, excitedofharpenden said:

Fairs or fares?  Is that a Freudian slip?

 

Phil 

 

Ha! Not really. I'm blaming the heat! 

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18 minutes ago, Orator said:

Sadly I'd expect more cuts if demand increases. I would expect better value only when there is significant consumer resistance. That doesn't appear to be happening at this time. 

 Agree 100% Still, other lines are available at least. 

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Just now, Mynki said:

 Agree 100% Still, other lines are available at least. 

But the ones that are doing well are doing the same thing. I see the same types of complaints about cutback on several threads. In the corporate world it's all about margins.

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3 minutes ago, Orator said:

But the ones that are doing well are doing the same thing. I see the same types of complaints about cutback on several threads. In the corporate world it's all about margins.

They are. But not necessarily at the same price points. My very personal opinion is that Celebrity is becoming poorer value for money year on year. Value can be found but it's becoming harder and harder to find. All IMHO of course. 

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3 hours ago, ak1004 said:

 

Makes sense. How do you book within first week? Do you manually check for new sailings or you get notifications when they are posted?

First of all, it seems like X and Princess like to post new itineraries in Nov so we keep an eye on CC around that time as someone usually opens a thread when they hear that new itineraries are going to be posted.

 

For example this past Nov, word came out X was going to be releasing new itineraries over a 4 week period starting around the middle of Nov. We then waited for itineraries associated with the cruises we were interested in, then booked then once they became available. For example last Nov we booked a Japan circumnavigation and transpacific B2B starting in Apr 2021. The price for an S2 around Japan was too high, so we booked a C2 (at the C3 rate) for $322 pp with 3 perks and then booked a S2 cabin on the TP back to Vancouver for $332 pp with all 4 perks. 

 

We also ask our X PCC to let us know when he hears the exact dates in Nov when new itineraries will be posted. But we usually see something on CC before we hear from our X PCC. 

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2 hours ago, Orator said:

To directly answer the question posed by the OP one needs to just look at the report of earning on RCL released today. I quote in part: "RCL reported adjusted earnings of $2.54 per share, up from $2.27 per share in the comparable quarter last year". They are doing quite well indeed. 

Despite complaints, including mine, RCL is meeting or exceeding shareholders expectations.

 

Shareholders satisfaction is usually directly linked to customer satisfaction, but there is always a conflict, so all companies have to work this fine line. Cutbacks = higher profits = Shareholders satisfaction = customer dissatisfaction. At some point, when customer dissatisfaction reaches certain point, it might start translating to less profit and Shareholders dissatisfaction. At this point, the company might start adding features to get back customers. But this process takes years, not months.

 

That said, on our last Reflection cruise, we did not see any noticeable decrease in quality compared to our previous cruise on Equinox in 2016. Maybe the reason is that we pay attention to different things than most people. We couldn't care less about things like foot stools (which was a 200+ posts topic on CC). We don't drink so couldn't care less about the quality of the alcohol. Food (for us) was fairly mediocre 3 years ago, and remained similarly mediocre now. Service was and still is good, not great. Again, around 7 out of 10 in most departments, with some 8s and some 6s, but this hasn't changed in 3 years in our opinion (which of course is subjective)

 

Prices went up, but this is true for all lines. So relatively speaking, whoever found Celebrity a good value 3 years ago, must still good value now - relative to other lines. We sailed 10 nights with Oceania on Med cruise last September for $4,400 CAD including flights and $300 OBC. I don't think you can find similar prices today.   

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3 hours ago, Baron Barracuda said:

 

Yes, but ..... much of earnings increase due to new ships adding 8.1% to capacity.  Getting bigger doesn't necessarily mean doing things better.

 

As far as exceeding shareholders expectations, stock is down today after reporting those great earnings and is flat over past two years while S&P 500  rose 20%.  Could be worse, over those 2 years CCL is down 33% and NCL down 13%.

How can it be said that Celebrity is exceeding shareholders expectations, the stock price sure doesn't show that? But again, if your expectations are low enough, you'll never be disappointed. A couple of factors helping is that people seem to have all kinds of extra cash, and fuel happens to be really low compared to the past.

RCL has recorded record sales and profits over the last several years, but their stock price doesn't reflect it. As of close of business today, the stock closed at $113.04 with a the all time high being $133.60, that's a loss of $20.56 per share or 15.4%.

The stock market in general (S&P 500. This is a better representation of the market than the Dow because it tracks 500 stocks rather than the Dows 30), closed at 3,003.67 with the all time high being 3019.59, that's a loss of 15.92 points or .5%.

Stock prices reflect what investors think the company will do in the future, not what they've done in the past. Also the market is driven by institutional investors, people in it to make money, not people who buy because of an emotional reason.

If money tightens up and fuel prices rise (I can remember it being over $100 per barrel), I'll be glad I have my investment money somewhere else. 

 

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17 hours ago, Mynki said:


I'm genuinely surprised you went hungry on a cruise ship though. Particularly as you had access to multiple restaurants, a buffet and room service etc. 

 

Luminae, MDR and the buffet have already been covered. That did leave room service, but I wasn't fussed to go order through them - I could afford to eat light for those meals. But it just doesn't give a good impression of overall value for all the cost of that experience.

 

"Whatever the restaurant there will always be someone who won't like the menu at some point. You'll even find the same said about restaurants like Noma in Copenhagen or Mirazur in France. "

 

Of course that's true... but there are so many other restaurants available to choose from. Here, you're stuck - on a large ship but with a limited range, especially compared to what used to be offered.

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On 7/26/2019 at 6:26 AM, The_Big_M said:

Of course that's true... but there are so many other restaurants available to choose from. Here, you're stuck - on a large ship but with a limited range, especially compared to what used to be offered.

 

Well restaurant-food on ships is not really bad quality, but it is definitely not really good either. On land, if you have a good restaurant, you have a chef who cares about his menu, adding new items regularly, especially based on seasonal available food.

 

on cruise ships, at least on celebrity, but I am pretty sure same is true for other cruise lines, the chef is just doing what the company is telling him/her to do. Menu is written centrally for all ships of the line, all prepare the same food by the same standard. Nothing individually, nothing what he/she knows best to prepare, nothing that is currently fresh available.

and on celebrity it is the exactly same menu every other week. So if you are on a b2b on two 14-Night cruises you have a good chance to see the same menu again.

adding to that, that the menu has changed from 4. courses to three courses some time ago and the total of items per Menu has decreased, you may very well end up having the same dishes on your personal selection at least twice.

not necessarily bad, if you liked something very much and you get the chance to have it again, but well, as said by The_Big_M : you can’t decide between a huge range of restaurants. You only have the option to go to one of the „pay-extra“ restaurants (where the menu is also very limited and basically the same over years).

so bottom-line: food on cruise-ships is for sure not bad, but it is not like going to a really good restaurant (not talking about 1,2,3,4-stars, just about a real good chef) it‘s more like going to one of the big chain-restaurants.

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