Vow (VOW) Status Update summary

Market trends and industry overview

• The cruise industry is dominated by four major players, controlling over 80% of capacity and more than 600,000 beds globally.

• The sector is experiencing steady growth, with a current order book representing about 5% of the global merchant fleet and a projected annual fleet growth of around 4%.

• New ship orders are increasing post-COVID, with over $6 billion in contracts signed this year and a trend toward larger vessels.

• European shipyards, especially in Italy, Germany, France, and Finland, dominate cruise ship construction, delivering about 10 large ships per year.

• The global cruise passenger base is forecast to grow, with Asia, particularly China, as a key driver, and profit per bed capacity rebounding post-pandemic.

Technology and sustainability advancements

• Advanced wastewater and waste management systems, including pyrolysis, are being widely adopted for zero discharge and circularity at sea.

• New systems enable near-drinking water standards for effluent, significant reductions in food waste and emissions, and carbon sequestration benefits.

• Cruise operators are investing in alternative fuels, shore power, energy storage, and 60% of new ships ordered are dual-fuel or alternative propulsion capable.

• Carnival has reduced GHG emissions by 10% over the past decade despite a 30% increase in fleet capacity, achieved a 42% reduction in food waste per person, and eliminated over 500 million single-use plastic items since 2018.

• Ongoing R&D and investment in battery storage, circular economy practices, and advanced air quality systems are central to future sustainability goals.

Business performance and outlook

• Technology providers like Vow ASA have a strong order backlog (NOK 1.2–1.3 billion), with 35 new builds scheduled and significant aftersales growth.

• Recurring revenue from operational support and retrofits is growing, now representing a significant portion of total revenue.

• The average contract size for new builds has tripled, reflecting the trend toward larger, more complex ships.

• The industry is absorbing higher costs due to inflation, with shipyards and suppliers maintaining profitability.

• Success rates in bidding for new builds and retrofits remain high, with a current market share of about 60%.