NCL’s parent blames currency moves for losses

The rising value of the euro accounts for its net loss of $21.3 million

HONG KONG » Star Cruises Ltd., Asia's biggest cruise operator and parent of Miami-based NCL Corp., posted a third-quarter loss because the rising euro increased the size of its foreign-currency debt.

However, the company -- whose U.S. unit operates the Hawaii-based cruise ships Pride of Hawaii, Pride of Aloha and Pride of America -- said it would have managed a profit if not for the currency fluctuation.

Net loss was $21.3 million, or 0.3 cent per share, compared with a profit $60.4 million, or 1.03 cents, a year earlier, Star Cruises said in a Hong Kong stock exchange filing yesterday. Sales gained 6.5 percent to $733.7 million.

Revaluation of euro-denominated debt to U.S. dollars resulted in a loss of $41.7 million, compared with a gain of $3.5 million a year earlier, Star Cruises said. The euro was about 12 percent higher on Sept. 30 than it was 12 month earlier.

Excluding the currency translation, profit fell to $20.4 million from $32.9 million, Hong Kong-based Star said. Ship operating expenses rose 6.9 percent from a year earlier, partly because of increasing fuel costs, Star Cruises said.

Star Cruises' stock has risen 25 percent this year, compared with a 38 percent gain in the benchmark Hang Seng Index.

In April, blaming its Hawaii operations for widening losses as competing lines' ships stepped up island visits, NCL announced that it would be pulling the Pride of Hawaii out of island service in February 2008 to reposition the ship in Europe.

In August, Star sold a stake in NCL to private equity firm Apollo Management LP for $1 billion, saying it expected to decide by mid-2008 whether the Hawaii operations were viable.