MARKET GOING? CDU Conference (19 September 2013) PETER LITTLE VICE - PowerPoint PPT Presentation

WHERE IS THE DOMESTIC CRUISING MARKET GOING? CDU Conference (19 September 2013)

PETER LITTLE – VICE PRESIDENT FLEET OPERATIONS • A 22 year veteran with the organization • Held various technical positions onboard up to Chief Engineer • Moved from ship to shore in 2003 covering roles in Compliance, Assurance and Operations • Joined the Carnival Australia leadership team in 2008 heading up the Fleet Operations division 2

GREAT DOMESTIC POTENTIAL

DYNAMICS OF A SUCCESSFUL MARKET • Australia’s economic performance = strong consumer balance sheet • Conditions have remained robust over the past 5 years • Unemployment approx 5.5% for last 3 years • Interest rates slowly declining • A$ retreated slightly 4

DYNAMICS OF A SUCCESSFUL MARKET Port Fees Fuel Costs Infrastructure 5

UNPRECEDENTED CAPACITY GROWTH • Market size has almost doubled in 4 years Australia & New Zealand Home Port Deployed Capacity ALB YoY (%) 21 6 15 77 28 4 17 23 22 2 Growth 8 7 6 5 ALBD (Millions) 4 3 2 1 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 P&O Cruises Princess Carnival Holland America Costa Cunard Royal Caribbean Celebrity Other 6 Source: 2011 ICCA Annual Cruise Market Report & internal estimates

PASSENGER NUMBERS FORECAST TO EXCEED 700K BY END OF 2013: AN INCREASE OF +200% SINCE 2008 • Passenger numbers grew to 660k in 2012, a two fold increase since 2008 and expected to reach +1 million by 2016 • The economic contribution of the cruise sector was A$830m in 2010-11 and expected to grow to over A$3.2b by 2020 NOTE 1 Australian Passenger Cruise Growth 2003-12 800 Fly-Cruise Homeport +12% 700 +34% 200% increase in pax 600 numbers since 2008 160 133 500 +28% 400 +12% 109 +21% 300 +14% 86 +18% 97 498 +18 % 456 +1% 91 200 82 329 64 31 42 255 207 100 160 140 125 122 116 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: ICCA Annual Market Report 2012 (excludes river cruising passenger numbers) 7 NOTE 1: Deloitte Access Economic Report March 2012

MARKET PENETRATION RATES APPROACHING US LEVELS: DOUBLING IN UNDER 5 YEARS • Penetration rate at 2.8% in 2012 and forecast to reach 2.9% in 2013 • Australia second most penetrated market globally remaining ahead of Germany and now surpassing the UK 3.5% Penetration Rate 2.5% 1.5% 0.5% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Germany United Kingdom USA Australia & New Zealand Source: PSA and CLIA Australia annual reports & internal estimates

COASTAL POPULATION WITH EASY ACCESS TO HOMEPORTS: POTENTIAL FOR THE PENETRATION RATE TO GROW WELL BEYOND THE US 0.2m (1 %) 0.9% 4.5m (17 %) 3.3% 2.3m (9 %) Brisbane 2.6% 1.6m (6%) 2.1% 7.3m (27%) Fremantle 4.1% Sydney Auckland 5.6m (21 %) 2.0% 4.4m (15 %) Melbourne 1.1% Australia/New Zealand population 2012 penetration by State 0.5m (2 %) Homeports 2.0% Source: ABS & CLIA 2012 annual report 9

HOME PORTED SHIPS REGIONAL CALLS P&O Cruises Princess Costa Princess P&O Cruises UK Ocean Princess Pacific Pearl Diamond Princess Costa Deliziosa Pacific Princess Aurora Cost Neo Romantica Arcadia Cunard Queen Mary 2 Queen Victoria Queen Elizabeth Sun Princess Pacific Jewel Dawn Princess Pacific Dawn Sea Princess Carnival HAL HAL Seabourn Spirit Soujourn Oosterdam Amsterdam Legend Odessey Volendam ^Seasonal deployment from Oct-14

CRUISE BRANDS SHORTENING ITINERARIES: HOLIDAY TRENDS SUGGEST MORE FREQUENT SHORTER TRIPS AND FEWER LARGER HOLIDAYS Average Cruise Duration Over Time 19 17 Average Duration 15 13 11 9 7 5 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Financial Year Carnival P&O Cruises Princess

THE GROWTH OF P&O’S DOMESTIC CRUISING MARKET Annual average growth rate of 22% over the past 5 years 18 domestic sailings in 2010 rising to 39 in 2014

2-5 night cruises Only cruise line with one-stop short cruises Food & wine, comedy and Meet Luke Mangan lifestyle themed cruises 13 Over 30 cruises

Still the best way to experience the Melbourne Cup Mothers Day cruises 3 ships in Sydney Harbour for Australia Day 2014 Only Australian Open Tennis cruises Christmas cruises New Year cruises 14

MORETON ISLAND

Visit Kangaroo islands, Australia’s Galapagos 18 cruises on 5 unique itineraries Cruise from every 16 Australian mainland state

EDEN – A REGIONAL OPPORTUNITY 17

F1 and V8 car simulators Kids stop-motion film onboard classes Moreton island one-stop short cruise Dedicated Papua New Guinea Australia Day cruises cruises NZ Natural ice cream Celebrity chef restaurant onboard Salt grill by Luke Mangan Australian Open Tennis cruises Live NRL & AFL on the Big Screen

FUEL PRICE ON UPWARD TREND AGAIN 1,000.00 900.00 800.00 US$ Fuel Price per MT 700.00 Sydney Singapore 600.00 500.00 400.00 July Aug Sept Nov Dec Jan Feb July Aug Sept Nov Dec Jan Feb July Aug Sept Nov Dec Jan Feb July Aug May June Mar Apr May June Mar Apr May June Mar Apr May June Oct Oct Oct 2010 2011 2012 2013 Source: Sydney prices from CAU actual lifting’s Singapore prices from Corporate forecast 19

CRUISING HUBS KEY TO SHORT CRUISE SUCCESS

12-16 night cruises visiting up to 5 countries in one P&OSEAASIA holiday 12 nt cruises rndtrip Fremantle to Indonesia 21

AUSTRALIA VS ASIA

CRUISE V CONTAINER Australia Day cruises

THANK YOU