Marine Log

September 7, 2006

NCL orders at Aker's French yard

NCL Corporation Ltd. announced today that it has entered into a contract with Aker Yards S.A. of France to build up to three new cruise ships, totaling 12,600 berths for delivery between 2009 and 2011.

This is the first contract announced since Aker Yards became the owner of the yard in Saint Nazaire.

The contract price, comprising two firm ships and one option, is Euros 2.17 billion, or approximately $2.8 billion at today's exchange rate.

The contract represents activity at the Saint Nazaire yard equal to approximately 7 800 man-years until 2010.

With this order Aker Yards has built, or is building, all twelve of the largest cruise ships in the world.

Mr. Yrjo Julin, President of Cruise & Ferries in Aker Yards comments "We are very proud to be able to contribute to the bold expansion of NCL's fleet with these new type of cruise ships. The contract was made possible by using best practice from our French and Finnish yards, which currently are undergoing a rigorous integration process. Without the envisaged synergies, this contract would not have been attainable for either of the yards individually".

The contract between NCL Corporation Limited and Aker Yards S.A. is subject to a number of conditions, including financing, completion of the design specification, and Star Cruises shareholder approval

The vessels will each carry up to 6,400 people onboard including crew, and have 2,100 passenger cabins giving 4,200 passenger berths. All the outside staterooms will have private balconies. In total,each ship will have over 1,470 balcony staterooms and suites.

Each ship will be 325 meters long, (which is approximately the height of the Eiffel Tower), 40 meters wide, and have a gross tonnage of approximately 150,000.

The huge cruise vessels will be built for the company's Norwegian Cruise Line brand and will offer multiple restaurants, and entertainment options to support NCL's unique Freestyle Cruising concept.

They will be prepared for cruise experiences world wide, including the Caribbean and Europe.

The order is firm for two ships for delivery in the fourth quarter of 2009 and the second quarter of 2010, and there is an option for a third sister ship for delivery in the first quarter of 2011. The contract price for each of the first two ships is Euros 735 million, and for the optional third ship is Euros 700 million.

At today's exchange rate, the contract price on the two firm ships translates to approximately $224,000 per passenger lower berth.

The contracts are being placed in Euros, equivalent to Euros 175,000 per lower berth. The option ship is priced at Euros 166,667 per berth, or approximately $213,000 per berth at today's exchange rate.

The new ships, with the project name "F3", will incorporate a world of new features and will represent NCL's third generation of Freestyle Cruising ships, described as "a further evolution of NCL's progressive dismantling of the structure, regimentation, and constraints of the traditional cruise experience."

Details of the ship's design will be released closer to delivery. The cabin mix will be the richest of any NCL ship to date, and will include the feature that 100% of outside staterooms will have private balconies. In total, the ship will have 1,415 balcony staterooms and suites.

The new ship design will offer 60% more passenger space than the largest ships built so far by NCL, and will use that space to introduce what is termed "a major leap forward in the flexibility and variety of the cruise experience."

NCL says "the unique use of space on these new ships is designed for optimal cost efficiency per capacity day, as well as being highly attractive in terms of cabin revenue mix and onboard revenue generation. The design is a unique blend of cruise industry best practice, offering both an exciting, high quality product, and a space efficient, cost efficient framework in which to deliver that product."

The company is currently undergoing a complete renewal of its fleet and these new orders, when delivered, are projected to take the combined Norwegian Cruise Line and NCL America fleets, in 2010, to a position of being by far the youngest fleet amongst the major North American lines, with an average ship size, fleet wide, of over 2,500 passenger lower berths, and with over 50% of all staterooms fleet wide offering private balconies.

Commenting on the order, Tan Sri K T Lim, chairman of NCL and Star Cruises, said: "This order, placed in NCL's 40th anniversary year, marks the culmination of our plans to transform this great company. By 2010 there will be almost nothing left of the NCL we bought in 2000 except the name and the people, and in place of the old, mixed fleet we inherited, there will be the youngest, most innovative and exciting fleet in the industry."

NCL's President and CEO, Colin Veitch, said: "This order is a strong statement of our confidence in the North American cruise industry and NCL's leading role in it. Our U.S. flag start-up costs have obscured, for the past two years, the attractive financial returns on the international fleet of ships that we have built since Star Cruises bought NCL. All our growth from now on will be in this strongly profitable sector of our fleet, and will take us well past the goal we set ourselves of having the youngest fleet in the industry and a transformed financial profile by 2010."