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Star Cruise

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Submitted By hoholalahoop
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Analysis of the Financial Statements of
Star Cruises Limited

Executive Summary
Star Cruises Limited provides cruise service to the Asia-Pacific region as well as certain investment into resorts and casinos in Macau as well as in Philippines. The year 2008 was an eventful year for Star Cruises Limited (Star Cruises), with events such as the overwhelming financial crisis which had affected Star Cruises, as well as the deemed disposal of the Norwegian Cruise Line Corporation Ltd (NCLC), where NCLC ceased to be a subsidiary of the Company and became a jointly controlled entity of the Company.

Star Cruises’ financial performance was poor, as reflected in the financial statements. Gross profit for the company (Star Cruises without its subsidiaries) recognized a 25.86% decline. However, while profitability ratios such as Return on Assets (ROA) and Return on Equity (ROE) improved from last year; it is good to note that they are still a negative ratio. Although the improvement on face value may seem good when compared to its competitors, it is unfair to judge the value as Star Cruise made an overall loss and its absolute ROA and ROE are bad compared to its competitors.

Overall, Star Cruises recorded a -20% change in her total assets, and was most salient compared to her other competitors which recorded an increase of either 10% or a fall of 2%. However, Star Cruises’ current assets had increased by a significant 118.79% in the year 2008. This increase in current assets is possible due to a much more significant increase of 34580.65% in her ‘other current assets’ account, which more than offsets a dip in other accounts such as cash & short term investments, net receivables, inventory, which is a result of NCLC becoming a jointly controlled entity instead. In fact, 50% of all of NCLC’s assets now belong to Apollo. Similarly for the total change in

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