MSC Cruises Confirms $1.7 Billion Order for New Luxury Ships

LONDON—MSC Cruises on Monday confirmed its order for two further cruise liners worth a combined €1.6 billion ($1.74 billion), as demand in ocean cruises continues to grow.

Geneva-based MSC Cruises is part of Mediterranean Shipping Co., the world's second-largest shipping operator in terms of capacity after A.P. Mø ller-Mæ rsk A/S. Mediterranean Shipping is mostly involved in container shipping.

The two cruise ships, now slated to be delivered by April 2020, will hit the water two years ahead of the original schedule. The rising demand for luxury sea travel contrasts starkly with the continued woes of the container and dry-bulk sectors, where a glut of tonnage and rock-bottom freight rates are forcing owners to cancel orders or lay up ships for long periods.

The Meraviglia Plus cruisers will be 331 meters (1,086 feet) long and can each accommodate up to 6,300 passengers. They will be built at STX France, one of France's biggest shipyards.

Closely held MSC Cruises primarily operates in the Mediterranean and the Caribbean, pooling passengers mainly from Italy, Germany, Spain and France.

Chief Executive Gianni Onorato said the company's sales in 2015 were up 10% on the year, with a total of 1.7 million passengers, and expects revenue to increase by 6% this year.

The cruise industry is dominated by Miami-based giants Carnival Corp. and Royal Caribbean Cruises Ltd.

The big players, including MSC Cruises, are investing heavily in new markets like China, where growth is expected to be around double the rate in other markets over the next few years.

Write to Costas Paris at [e-mail]

(END) Dow Jones Newswires

February 01, 2016 09:25 ET (14:25 GMT)

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