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October 18, 2000


Record earnings for RCL
Here's why big cruise lines keep ordering big new ships. Royal Caribbean Cruises Ltd.announced record third-quarter results today. Net income increased 18.5% to $201.5 million, or $1.04 per share, in the third quarter of 2000, compared to $170.0 million, or $0.92 per share, in the same quarter of 1999.

Revenues were $835.2 million for the third quarter of 2000, as compared with $734.5 million for the same quarter in 1999. The increase in revenues is attributable to a 17.9% increase in capacity primarily as a result of Voyager of the Seas and Millennium joining the fleet. Occupancy for the quarter was 109.7%, up slightly from last year's 109.0%. Net revenue yields (net revenue per available passenger cruise day) declined by about 1%. The company's profit margins improved during the quarter as compared to 1999. Approximately $6 to $8 million of this improvement can be attributable to the timing of certain marketing and other expenses, which will now be incurred in the fourth quarter of 2000.

Net income for the nine months ended September 30, 2000 increased 20.2% to $415.3 million, or $2.15 per share, compared to $345.5 million, or $1.88 per share for the same period last year. Revenues were $2.2 billion for the nine months ended September 30, 2000, compared to $2.0 billion for the same period in 1999. Capacity was up 14.8%, while occupancy was slightly higher at 105.9%, compared to 105.4% in the prior year. Higher pricing and lower operating expenses resulted in strong growth in net income.

"We are pleased with our ability to continue to expand our business and improve our profitability," said Richard D. Fain, chairman & CEO. "Despite an 18% increase in capacity, we were able to maintain pricing at last year's record levels and generate improved margins. We expect that the competitive pricing environment will continue in the short term, but the strong fundamentals of our industry remain intact. Our new ship deliveries are proving to be very successful and continue to stimulate the market for cruise vacations."

Update on status of Ocean Rig deliveries
Ocean Rig today issued an update on the status of the two rigs it has under construction at Friede Goldman Halter. The first rig, Leiv Eiriksson, is, according to ABB Offshore Systems AS today approximately 94%
complete. ABB Offsdhore Systems is the former Umoe Olje og Gass AS which was retained to give an object status of progress on the two rigs as part of an agreement between Ocean Rig and FGH.

The Leiv Eiriksson is currently going through a period of commissioning and electrical work and will according to the schedule leave the yard for sea-trials in mid December 2000. Ocean Rig estimates the sea-trials will last appoximately 40 days. ABB Offshore Systems AS estimates delivery of the rig during the first quarter of 2001.

The company's second rig, Eirik Raude, is reported as approximately 75% complete. ABB Offshore Systems AS estimates delivery of the rig will be during the second quarter of 2001, unless steps are taken to increase electrical manpower.

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