The Cruise Market and UK Perspective By William Gibbons Director Passenger Shipping Association Marketing Director European Cruise Council

Cruise Market Update More Brits than ever taking to the seas – 1.2m in 2006

EX-UK Growth Cruises taken from UK ports up 12% - 450,000 Trend set to continue with increased ex-UK capacity on its way in 2007. 2007 – 500,000 2008 – 700,000

Fly-Cruise Fly-cruise market increased by 13% - to 753,000 Brits Another trend that looks set to continue with increased capacity: 2006 – Island Cruises 2007 – Ocean Village Two, Thomson Calypso

Destinations – EX-UK

Destinations – Fly-Cruise

BALTIC Each Passenger visit at a European Port Embarkation and visiting - Expenditure €100. Average Revenue Per Passenger - £1,447. Average Revenue Per Diem - £122. Norway – (£156.) Average length of Cruise from UK 12days

Growth of UK Ports Passengers embarking in the UK grew 15% to 576,000 - Non-UK residents accounted for 127,000, a growth of 27% Ports of call passengers to UK ports grew 22% - to 392,000 Total value of cruise passenger expenditure in the UK – over £197m

Contribution of cruise tourism to the economies of Europe

Major Highlights in 2005 GP Wild/ BREA – Undertook Study Over 3.1m European residents booked cruises – 23% of cruise tourists (passengers) worldwide Over 2.8m cruise tourist embarked in Europe – 90% were European nationals Majority visited Mediterranean, Baltic and other European regions generating 13.1m visits in Europe

Major Highlights in 2005 As a result of European cruise operations and investment in new cruise ships, key economic impacts (direct, indirect, induced) throughout Europe in 2005 include: €8.3 billion in direct spending by lines and passengers €19.1 billion in total output Over 187,000 jobs €6.0 billion employee remuneration

Country Impacts - 2005 Country Spending €m Total Jobs Compensation €m Italy 2,501 61,445 1,810 UK 1,686 37,319 1,457 Germany 1,073 19,969 725 Spain 683 13,940 422 Finland 621 10,205 371 France 536 7,265 310 Top six 7,100 150,143 5,095 Total 8,326 187,252 6,017

Cruise Tourism by Destinations 2005 Country Cruise tourists Market Share (%) Italy 3,028,224 23.0 Spain 2,627,726 20.0 Greece 2,069,767 15.7 France 1,034,092 7.9 Norway 691,209 5.3 Portugal 498,431 3.8 Malta 336,400 2.6 United Kingdom 322,000 2.4 Sweden 301,826 2.3 Estonia 249,102 1.9

Western Europe as a Source Market 2003-06 Country 2003 Group Total (1,000’s Pax) 2004 2005 2006 2005/06 % Change UK 964 1,029 1,071 1,214 13 Germany 537 583 639 700 10 Italy 346 400 514 559 9 Spain 307 300 379 378 France 212 222 233 265 14 Other 305 291 339 16 Total 2,671 2,835 3,126 3,455 11

Attitudes to Cruising Research into people and their attitudes to cruising Who would consider a cruise – and if not, why not? What are the barriers to taking a cruise?

Attitudes to Cruising

Attitudes to Cruising What matters most – destination or facilities ?

Attitudes to Cruising What do people like most about cruising? Good food/ drink 35% Interesting ports of call 27% Luxurious cabins/ accommodation 27% Price/ value for money/ inclusive 20%

Attitudes to Cruising What are the barriers to cruising? Sea sickness/ bad weather 32% Being cooped up/claustrophobic 31% Not liking other passengers 25% These barriers drop considerably once a person has actually taken a cruise

LUXURY CRUISING The Exclusive Collection – an alliance of nine ships of excellence Nearly 20,000 passengers are carried by the ultra luxury lines – 1.6% of the UK market Luxury passenger numbers have doubled since 2002

SPECIALIST CRUISING Specialist Cruise Collection – an alliance of 11 cruise lines Unique itineraries to destinations best experienced by sea A 27% growth in 2006

2008 ONWARDS Boom in EX-UK Cruising Cunard – Victoria P&O – Ventura Royal Caribbean Cruise Line – Liberty of the Seas Fred Olsen – Balmoral NCL – Jade MSC – Armonia (Including 5 Baltic Capital Cruises) Carnival Cruise Line – Carnival Splendour (5 Cruises)

AND THE FUTURE… 1.3 million ocean cruise passengers in 2007 1.5 million ocean cruise passengers by 2008 Sheer diversity of cruising outperforming land based holidays – ranging from ships carrying up to 4,400 passengers to 49 passengers 39 brands represented by the PSA in the UK – more than any other country There really is something for everyone!