Princess Yachts booming

[dash300]

having nearly doubled it's order book this year.
Cannes orders up 85% on last year at £640m. Production capacity 100% sold for this year, 90% sold for 2018 and 30% sold for 2019 and investing £100m in it's Plymouth operation and hiring staff to cope with demand.
Good news all round, the fall in Sterling is giving some people great discounts!

 

[Powersalt]

yep, all sounds good but have a look at the accounts? You have to make profit

 

[Nigelpickin]

yep, all sounds good but have a look at the accounts? You have to make profit

You think that’s good, wait ‘til you see the order book for Fontain Pajot and Lagoon following the destruction of the charter fleet - I’m tempted to get some group Beneteau stock....

 

[dash300]

yep, all sounds good but have a look at the accounts? You have to make profit

Cash flow is king. More businesses fail from lack of cash flow than lack of profit. Profit ultimately yes but without cash flow a whole lot of problems arise. Princess has investors confidence to embark on a 5 year £100m investment program and are meeting all their financial commitments. I'd invest given the chance.

 

[Powersalt]

ok, but as was put to me 3 months ago, the more boats princess sell the bigger the annual loss. You have to sell boats so that when finished the sale puts money in the bank

 

[Nick_H]

ok, but as was put to me 3 months ago, the more boats princess sell the bigger the annual loss

If Princess were selling at prices below their variable cost then that would be true, but of course they're not. In reality more sales means a triple whammy of good news - better absorption of overheads, less discounting, and more £ per % of profit. Add that to very favourable exchange rates and I suspect the future looks quite rosy.

 

[MrB]

http://www.ybw.com/forums/showthread.php?487273-Princess-doing-well

 

[ari]

ok, but as was put to me 3 months ago, the more boats princess sell the bigger the annual loss. You have to sell boats so that when finished the sale puts money in the bank

I'd be very curious to know your source. Instinctively it feels a little unlikely that Princess sell every boat they build at a loss, but maybe it was their Managing Director that told you this..?