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Tuesday, July 31, 2001


American Classic Voyages
to defer dividends


By Russ Lynch
rlynch@starbulletin.com

American Classic Voyages Co., which doubled its first-quarter losses to $12.7 million this year from $6.4 million in 2000, said it will defer dividends for about a year on a class of its preferred stock, eliminating around $7 million in payments.

American Classic Voyages The dividends on the trust preferred securities have been worth 87.5 cents a share for each quarter during the past three years and the company, owner of American Hawaii Cruises and United States Lines in the Hawaii cruise market and Delta Queen Steamboat Co. and Delta Queen Coastal Voyages on the mainland, said it has the right to suspend them for a time.

The rules on the dividends allow the company to skip payments that had been scheduled for Aug. 15 and Nov. 15 this year and Feb. 15 next year.

The plan now is to pay them on May 15 next year, the company said.

The company has said special discounting for Hawaii round-the-islands cruises this summer, including partner-travels-free deals, have stemmed the booking loss in the islands and future island business is looking strong. But skipping the preferred dividends will give provide financial flexibility, the company said.

American Classic, which in Hawaii operates the SS Independence under the American Classic Voyages flag and the ms Patriot under the United States Lines flag, incurred much of its loss in the past couple of years from development and marketing expenses related to the decision to build two 1,900- passenger ships for Hawaii.

American Classic's stock plunged 15.7 percent, or 36 cents, to $1.93 today on the Nasdaq. Its shares, which hit a 52-week high of $18.88 on Aug. 4, are off 86.2 percent this year.



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