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Richard Fain - 'It's important we have a clear policy everyone could understand and follow'

RCL makes it consistent: No price cuts within 30 days of sailing

Royal Caribbean Cruises Ltd. has expanded its pricing integrity policy to no new discounts within 30 days of sailing, chairman and ceo Richard Fain said Tuesday. The policy applies regardless of itinerary, and three- and four-day cruises are the only exception.

That should make things clearer for the public but also the company's yield management team, Fain said, adding: 'It's important we have a clear policy everyone could understand and follow.'

Previously the 'no new discounts' edict varied depending on the cruise; sometimes it applied from 10 days prior to sailing and sometimes, further out. Within those limits, not a single exception was granted, he said.

'We now think we've got it right and we do not expect any changes in the near future,' Fain told analysts during the company's fourth quarter earnings call.

He cautioned in 2016 there will still be some residual impact related to empty cabins but said that's expected to disappear by 2017.

Fain attributed part of the company's booked position—roughly equal to last year's record high, at higher rates—to the pricing integrity policy.

After first introducing the policy about a year ago applicable to the US and Canada, across all brands, Royal Caribbean expanded that to include the UK and Ireland last October.

Two-thirds of Royal Caribbean's revenue is derived from these four markets.

 

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