Royal Caribbean Sees Profit Hurt by Swine Flu

Cruise operator Royal Caribbean Cruises said Tuesday that the recent swine flu outbreak will lower its earnings by about 22 cents per share.

After an incident aboard the Crown Princess, the cruise ship returns to the port at Cape Canaveral, Fla. on Tuesday, July 18, 2006. The Crown Princess suddenly rolled heavily to its left Tuesday, throwing passengers and crew to the deck and leaving two people critically injured, including a child, officials said.(AP Photo/John Raoux)
John Raoux

"The flu outbreak had a short, but highly disruptive impact to our operations," Chairman and Chief Executive Richard D. Fain said in a statement.

The Miami-based company said the virus led Royal Caribbean International's ships to steer clear of Mexican ports. It also canceled the launch of Pullmantur's Pacific Dream, which targets Mexican nationals, and significantly lowered Pullmantur's Mexican tour capacity.

Royal Caribbean said its Celebrity cruises were not impacted by the virus.

"Fortunately, our vessels are quickly returning to their original itineraries, but the impact from the publicity surrounding the H1N1 virus on our Mexican business is frustrating," Fain said.

The World Health Organization says the disease has reached 66 countries and infected more than 19,000 people. It has caused 117 deaths, mostly in Mexico.

Royal Caribbean, which has 37 ships in service and six being built, did not specify which period would be impacted by the swine flu.

The swine flu outbreak is yet another hurdle cruise operators have had to contend with during the recession. The industry had already been struggling to keep its ships filled with vacationers, as many had curtailed their discretionary spending due to economic and job worries. Bookings have started to stabilize lately due to deep discounts.