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TICKERS: G13.SI, RCL

EVENTS

  • June 4: CCL special press announcement in NYC

COMPANY NEWS  

G13.SI- Genting Singapore bought back 136,500 shares at 90.5 Singapore cents each on Tuesday and another 2 million shares Wednesday at 91 Singapore cents per share. 

RCL - The upcoming dry docks for Azamara Club Cruise's two ships, Journey and Quest, will result in significant changes to the two upscale vessels. "From bow to stern, and stern to bow, there is no area on the line's ships that will be untouched," Azamara CEO Larry Pimentel said.

The refurbishment of the 15-year-old ships - both former R-class vessels, so named because they were acquired from Renaissance Cruises - will take place in 2016.  Azamara Journey will enter dry dock in January 2016 in the Bahamas and Azamara Quest will receive the changes during an April 2016 dry dock in Singapore.

Takeaway: Much needed makeover for Azamara.

INDUSTRY NEWS 

Junket smoking area request rejected - Secretary for Economy and Finance, Lionel Leong, dismissed requests from Macau's junket association for smoking rooms in VIP gaming areas. This rejection comes shortly after secretary Alexis Tam also asserted his position against the request in a meeting with the group three days ago.

MGM China CEO Grant Bowie also called for casinos to be able to retain smoking lounges. While the company supports the ban, the customers’ interests also have to be taken into account, he was cited as saying by TDM Macau. “We clearly support the initiatives of the government in terms of protecting the interest of the staff, and therefore, have supported the banning of smoking on the gaming floor but we would also suggest that we should allow people to smoke in smoking lounges,” he said.

ARTICLE HERE

Takeaway: Full smoking ban is an inevitability 

China river tragedy - Major travel agencies, when contacted, said there have been no trip cancellations yet as of Tuesday. 

"It is an exceptional case," said Zhou Yingfeng, product manager at China Youth Travel Service Shanghai. Zhou said the travel agency had no customers on the boat and it has not yet received any notices of cruise cancellations on the Yangtze River after the accident.

ARTICLE HERE

Takeaway: Damage control by the river cruises following incident. Given media coverage, the sentiment could be negative towards any cruising in China. 

Yellow Brick Road Casino - had a grand opening on June 2nd. The casino near Schenectady, NY has 430 slots. 

MACRO

Hedgeye Macro Team remains negative on Europe, their bottom-up, qualitative analysis (Growth/Inflation/Policy framework) indicates that the Eurozone is setting up to enter the ugly Quad4 in Q4 (equating to growth decelerates and inflation decelerates) = Europe Slowing.

Takeaway:  European pricing has been a tailwind for CCL and RCL but a negative pivot here looks increasingly likely in 2015.