Regent reports strong profit for 2nd quarter

[HostDave]

Regent Seven Seas Cruises (RSSC), the luxury cruise line in the Prestige Cruise Holdings group, has staged a strong improvement in results in the second quarter. The company reported net profit of $6.5 million compared to a loss of $3.8 million in the same period last year.

Revenue reached a record $142.7 million for the second quarter of 2013, an increase of 8.6% over the second quarter of 2012 on a 5.4% increase in capacity due to the Seven Seas Navigator scheduled dry-dock in 2012. Adjusted EBITDA was a record $28.5 million for the second quarter of 2013, compared to $19.4 million for the second quarter of 2012. Net Yield for the second quarter of 2013 increased 3.9 percent to a record $521.24 from $501.68 in 2012.

In July, the Company announced that it entered into a definitive contract with Italy's Fincantieri shipyard to build a 738 guest vessel at an approximate cost of $450 million with delivery scheduled in summer 2016. Named Seven Seas Explorer, the Company expects the vessel will be the most luxurious cruise ship built in the modern era of cruising.

On July 31, 2013, we entered into a loan agreement providing for borrowings of up to $440 million with a syndicate of financial institutions to finance 80% of the contract cost of Seven Seas Explorer plus the export credit premium.

Borrowings under this loan agreement bear interest, at our election, at either (i) a fixed rate of 3.43% per year, or LIBOR plus 2.8%. The twelve year fully amortizing loan requires semi-annual principal and interest payments commencing six months following the draw-down date.

Commenting on the second quarter financial results, the Company's Chairman and CEO, Frank Del Rio, stated, “We are pleased to have reached record Revenues, Adjusted EBITDA, Net Yield and Net Income for the second quarter. These results continue to affirm our all-inclusive luxury offering. In looking to the future, we recently announced a contract for Seven Seas Explorer, which will set the standard for luxury cruising. The all-suite, all-balcony ship will feature sophisticated designer suites ranging from 300 square feet to 1,500 square feet with one of the highest space ratios and staff-to-guest ratios ever seen.

The ship will include six open-seating gourmet restaurants, Regent's signature nine-deck atrium, the two-story Explorer Theater, three boutiques and an expansive Canyon Ranch SpaClub. Operationally, the vessel will be a green ship, employing the most advanced environmental systems and state-of-the-art technology. With this addition to the fleet, the Company's capacity will grow nearly 40 percent, making it the world's largest luxury cruise line."