Feb 29 (Reuters) - Cruise operator Royal Caribbean Cruises Ltd said on Wednesday that as media coverage of a rival company's shipwreck last month in Italy has subsided, bookings are experiencing "a slow improvement."
On Jan. 13, the Costa Concordia, a liner operated by a unit of rival Carnival Corp & Plc, hit a reef and capsized, killing at least 25 people. Immediately after the disaster, bookings across the industry fell, a drop exacerbated by cruise lines and travel agencies pulling back on marketing.
But in recent weeks, as media coverage of the Concordia has grown less intense and marketing has picked up again, business is once more on the upswing, Royal Caribbean said in its annual report filed with the U.S. Securities and Exchange Commission.
"We have continued to experience a slow improvement," the company said, even though the pace of bookings remains lower than at the same time last year.
"We continue to believe that the tragedy will not have a significant long-term impact on our business."
Costa's troubles, however, have not ended. An engine room fire on Monday knocked out the power on its smaller cruise ship Allegra, which is being towed to the Seychelles capital of Victoria.
Before the Costa Concordia incident, Royal Caribbean's bookings had been up about 5 percent and fetching higher prices. Immediately after the incident, Royal Caribbean saw a "significant" decline in new bookings, though cancellations remained at normal levels.
In early February, the company had forecast revenue generated per cabin would be up between 1 percent and 5 percent this year.
Separately, Royal Caribbean said on Wednesday it exercised an option to build a second Sunshine-class cruise ship, to be delivered in the spring of 2015.
Royal Caribbean's shares were up 1.8 percent to $28.56 in late morning trading on the New York Stock Exchange. Larger rival Carnival's shares were up 0.3 percent at $30.09, also on the NYSE.