ECC Euro Cruise Port Overview 2011 John Tercek

ECC: Euro Cruise Port Overview 2011 John Tercek Royal Caribbean Cruises, Ltd. Sea Trade Europe 2010

Strong Industry Fundamentals n Steady Long-term industry growth n Great vacation product & Value for Money n Product innovation: Regular new ships n Low penetration of vacation market (Sawgrass Mills shopping mall in Fort Lauderdale receives 18 million annually= entire world cruise industry customers) n Favorable demographics: World is becoming middle class n Consolidated industry: Only 4 cruise companies are 96% n Ability to absorb new capacity: supply driven business n Proven resilience: post 9/11; post 2009 recession

European Cruise Overview Planning Parameters and. Limitations:

Where Do We Cruise? n. Customer Interest: “We take our Customers where they think they want to go…” n. Customer n. Weather n. Time Sourcing / Airlift / Homeports & Seasonality: Northern / Southern Hemispheres / Speed / Distance Formula: 200 nautical miles /night n. Supportive n. Safety Host Government Policies & Security

Where Do We Cruise? Caveat, Disclosure and Apologies: n. This presentation is considering the possibilities for larger ships (2, 000+ pax) targeted at mass middle class market n. There are many more niche, boutique, adventure, upscale, downscale targeted cruise offerings than can be addressed in a 10 minute presentation…

One Technical Slide…

Freedom (“Workhorse”) of the Seas Dimensions & Characteristics Tonnage (GRT) 160, 000 Tons Double Occupancy 3, 643 Guests Maximum Capacity Req. Min Draft Length 4, 375 Guests 339 Meters Maximum Breadth Air Draft 10. 5 Meters 63. 45 Meters 55. 9 Meters

Baltic (Homeports in Italics) Umea Belem Bay of Bothnia Fortaleza Natal Helsinki Recife Oslo Stockholm Tallinn S to c Riga St. Petersburg Salvador

Market Sector: BALTIC Baltic Pros n. Customer Interest: Plenty of Destinations & St. Petersburg n Sourcing /Airlift Plenty of Homeports n. Time / Speed / Distance Ports are close together n. Safety & Security

Market Sector: BALTIC Baltic Pros n. Customer Interest: Plenty of Destinations & St. Petersburg n Sourcing /Airlift Plenty of Homeports Baltic Cons • Weather & Seasonality: Short Season 16 weeks • Government Policies: Expensive Ports!! n. Time • Competition: Upscale Ferries n. Safety Local Source Market: Been there, done that. . / Speed / Distance Ports are close together & Security

Scandinavia & Great Britain Honningsvag Tromso Reykjavik Molde Alesund Olden Geiranger Helsinki Bergen Oslo St. Petersburg Tallinn Stockholm Glasgow Copenhagen Dublin Kiel Gdansk Warnemunde Cork Harwich Southampton Amsterdam Bruges Dover Le Havre Cherbourg

Market Sector: SCANDANAVIA & GB Scan/GB Pros n. Customer Interest: Traditional Fjords; Ireland, Scotland. Iceland n Sourcing /Airlift: Heathrow! n. Safety & Security

Market Sector: SCANDANAVIA & GB Scan/GB Pros n. Customer Interest: Traditional Fjords; Ireland, Scotland. Iceland n Sourcing /Airlift: Heathrow! n. Safety & Security Scan/GB Cons • Weather & Seasonality: Shorter Season 12 weeks • T/S/D: some long hauls: Glasgow-Bergen • Local Source Market: Brits & Scans want sun! • Limited interest from North Americans

Western Europe Atlantic & West Mediterranean Southampton Cherbourg Amsterdam Le Havre La Coruña Vigo Lisbon Madeira Bilbao, Spain Marseille; Nice Toulon Barcelona Ajaccio Mallorca Malaga Gibraltar Cartagena Casablanca Tangier; Ceuta Lanzarote Tenerife Gran Canaria Livorno Rome Naples Cagliari Palermo Tunis

Market Sector: WESTERN EUROPE W. E. Pros Customer Interest: Brits/Scans/Germans love sun Americans love Spain & Italy n. Lots of Destinations: Marquee & “Hidden Gems” (ie, Zeebruge) n. Seasonality: 40 -52 weeks n. Benign Gov'ts & Policies n Sourcing /Airlift: Heathrow! Barcelona! Mallorca! Malaga! Fiumicino!

Market Sector: WESTERN EUROPE W. E. Pros Customer Interest: Brits/Scans/Germans love sun Americans love Spain & Italy n. Lots of Destinations: Marquee & “Hidden Gems” n. Seasonality: 40 -52 weeks n. Benign Gov'ts & Policies n Sourcing /Airlift: Heathrow! Barcelona! Mallorca! Malaga! W. E. Cons • Customers: Not much interest from Americans in East Atlantic • T/S/D: some long hauls: Southampton-Sardinia

Mediterranean Venice, Italy Ravenna, Italy French Ports Livorno Dubrovnik, Croatia Civitavecchia; Napoli Barcelona, Spain Ajaccio, Corsica Valencia, Spain Malaga, Spain Tangiers; Ceuta Cagliari Algiers Bari Italy Palermo, Italy Tunis Istanbul, Turkey Athens Kusadasi Catania Greek Islands Valletta, Malta Heraklion Bodrum, Turkey Rhodes Larnaca Haifa Ashdod Alexandria Port Said Sharm ell Sheik

RCL Summer Med Deployment: wow! Mediterranean Caribbean Alaska Baltic Bermuda/New England Asia/Australia Mexico (Pacific) Total 2004 6 ships 10 ships 6 ships 3 ships 2010 15 ships 9 ships 5 ships 4 ships 2011 21 ships 8 ships 5 ships 4 ships 2 ships 3 ships 1 ship 39 ships 42 ships 27 ships

Market Sector: MEDITERRANEAN Med Pros n. Customer Interest: HUGE n. Lots of Destinations n. Seasonality: 40 -52 weeks n. Supportive Gov'ts & Policies n Sourcing /Airlift/ Homeports: Barcelona! Civitavecchia! Venice! Malta! Marseille! Savona! Napoli…Kusadasi!

Market Sector: MEDITERRANEAN Med Pros n. Customer Interest: HUGE n. Lots of Destinations n. Seasonality: 40 -52 weeks n. Supportive Gov'ts & Policies n Sourcing /Airlift/ Homeports: Barcelona! Civitavecchia! Venice! Malta! Savona! Napoli. . Med Cons • Operations: Some ports are getting pretty crowded • MENA Jasmine Revolution: south Med may be a challenge in near term • Rough Seas in Winter

Mediterranean: No Fly Zone Venice, Italy Ravenna, Italy Livorno Barcelona, Spain Dubrovnik, Croatia Civitavecchia; Napoli Ajaccio, France Bari Italy French Ports Valencia, Spain Malaga, Spain Tangiers; Ceuta Palermo, Italy Cagliari Algiers Tunis 800, 000 Athens Kusadasi Catania Greek Islands Valletta, Malta Heraklion Istanbul, Turkey Bodrum, Turkey Rhodes Larnaca Haifa Ashdod Alexandria Port Said 300, 000 Sharm ell Sheik

Black Sea Ports Odessa, Ukraine Sevastopol, Ukraine Constanta, Romania Yalta, Ukraine Sochi, Russia Varna, Bulgaria Istanbul, Turkey Sinop, Turkey Batumi, Georgia

Market Sector: BLACK SEA B. S. Pros n. Interesting Small Destination Cities for Day Visits (like Baltic) n. Supportive n. T/S/D: Gov'ts & Policies good operating circuit n. Potential local source markets: Turkey, Russia, Ukraine

Market Sector: BLACK SEA B. S. Pros B. S. Cons • Customer Interest? Undiscovered & Unknown to n. Interesting Small Destination Cities for Day Visits (like Baltic) Americans & Western Euros n. Supportive n. T/S/D: Gov'ts & Policies good operating circuit n. Potential • Seasonality: 16 weeks • Sourcing /Airlift/ Homeports Challenge: Istanbul or Athens logical homeports local source markets: • Technical Limits of Bosporus Turkey, Russia, Ukraine

Mediterranean Home/Base Ports Marseille, France Venice, Italy Savona, Italy Barcelona, Spain Civitavecchia; Ajaccio, France Dubrovnik, Croatia Bari Italy Valencia, Spain Palma Mallorca Napoli Malaga, Spain Cagliari Palermo, Italy Tangiers; Ceuta Algiers Tunis Kotor, Montenegro Athens Kusadasi Catania Greek Islands Valletta, Malta Heraklion Istanbul, Turkey Bodrum, Turkey Rhodes Larnaca Haifa Ashdod Alexandria Port Said Sharm ell Sheik

Mediterranean 7 day Routes Venice, Italy Savona Villefranche Barcelona, Spain Livorno Dubrovnik, Croatia Civitavecchia; Bari Italy Napoli Palma Mallorca Tunis Athens Catania Valletta, Malta Istanbul, Turkey Kusadasi Santorini Heraklion, Crete Limissol, Cyprus Alexandria, Egypt

Mediterranean 7 & 14 day Routes Venice, Italy Savona Villefranche Barcelona, Spain Livorno Civitavecchia; Dubrovnik, Croatia Bari Italy Napoli Palma Mallorca Tunis Catania Valletta, Malta Istanbul, Turkey Athens Kusadasi Santorini Mykynos Limissol, Cyprus Alexandria, Egypt

Mediterranean Challenging Ports 500, 000 Villefranche Venice, Italy Barcelona, Spain 1, 000 800, 000 Livorno, Italy Dubrovnik, Croatia Civitavecchia; 2, 500, 000 Bari Italy Napoli 1, 300, 000 Tunis 800, 000 Valletta, Malta Athens Greek Islands Santorini 700, 000 Istanbul, Turkey Kusadasi

SELECT MEDITERRANEAN PORT VOLUMES Port 2001 2005 2011 est Barcelona 650, 000 1, 225, 000 2, 500, 000 Livorno 250, 000 460, 000 820, 000 Civitavecchia 470, 000 990, 000 2, 450, 000 Venice 520, 000 820, 000 1, 800, 000 Dubrovnik 215, 000 510, 000 1, 050, 000 Tunis 230, 000 560, 000 850, 000 Cyprus 560, 000 380, 000 400, 000

SELECT MEDITERRANEAN PORT VOLUMES Port 2001 2005 2011 est CAGR Barcelona % 650, 000 1, 225, 000 2, 500, 000 16% Livorno 250, 000 460, 000 820, 000 Civitavecchi 470, 000 990, 000 2, 450, 000 20% Venice 520, 000 820, 000 1, 800, 000 15% Dubrovnik 215, 000 510, 000 1, 050, 000 19% Tunis 230, 000 560, 000 850, 000 16% Cyprus 560, 000 380, 000 400, 000 -4% 15%

Some Issues Facing Continued Growth in European Cruise Markets n EU Economic Stability & USA Economic Recovery n “Tourism-Friendly” Resolution of Middle East & Africa Turmoil n Stabilization of Fuel prices n Sourcing New Customers from New Source Countries (Russia, Eastern Europe, Turkey) n Infrastructure Expansion & Upgrade; New Destinations

ECC Euro Cruise Overview 2011 John Tercek Royal Caribbean Cruises, Ltd. Sea Trade Europe 2010