The last year has been a year of remarkable progress - and a year of accelerated momentum - at Royal Caribbean. Revenues, profits and cash flow have all reached record levels, but the numbers do not tell the whole story. It is difficult to summarize our activities succinctly, but they can be broadly grouped into three categories: brand expansion from our merger with Celebrity; capacity growth from the introduction of new ships; and increased shareholders' value due to business efficiency.
Celebrity Merger The most talked-about event was, of course, the successful acquisition of Celebrity Cruises. This deal gave us not only a powerful new premium brand, but also an active partner whose philosophy, operating principles and commitment to excellence parallel our own. The merger was a seminal event in our history and, while it was completed a scant seven months ago, it has already proven to be a galvanizing force for our Company and our employees. No merger is painless; but the excellence of the Celebrity brand and the enthusiastic response by our guests, our travel-agency partners and our employees demonstrates how fortunate a move this has been for our Company. We can already feel the revenue and expense benefits of the merger and expect to do even better in the future. It is no coincidence that our first new vessel orders after the merger are for the Celebrity brand.
Capacity Growth One of the biggest challenges we face has been and will be managing the enormous growth to which we have committed. Last year, the Royal Caribbean brand increased its passenger capacity by 19% and, including Celebrity, the Company's total passenger capacity increased 41% over 1996. The fact that we were able not only to sustain such growth but to do so with increased occupancy levels and continued strong yields demonstrates the great strength of our Company and our industry.
And the growth continues. During 1998, our capacity will be 32% higher than 1997, including the full-year impact of Celebrity. We currently have seven new vessels on order with another three under option. These 10 ships fall into four categories: Vision, Eagle, Millennium and Voyager. The Vision of the Seas will be the last of this series of six ships, which have proven so successful. The other three classes build on our extensive shipbuilding experience and prepare us for the 21st century.
Already, we have the youngest fleet of any major cruise operator and these ships will help us maintain that position. Within the North American cruise market, we now carry almost one passenger out of every three and these orders will facilitate our efforts to provide the superlative vacation that has always been our hallmark.
Business Efficiency Absorbing such growth also increases the need to operate consistently and efficiently. We continue to refine and expand our brand positioning through better and more targeted marketing initiatives. This includes expanding and strengthening our European sales and marketing organization, where we expect to be able to do an even better job. One particular bright spot is our revenue management system to which we are applying increasingly sophisticated tools and where we are constantly honing our skills in "selling the right product to the right customer at the right time for the right price."
We continue to push technology to its outermost limits and recently introduced an Internet version of our CruiseMatch 2000® automated reservations system for travel agents - the first of its kind in the industry. We also began participation in SABRE CruiseDirector, enhanced Royal Caribbean's award-winning Web site (www.royalcaribbean.com) and added a new ship-to-shore communications service, ShipNet. This new technology provides our shipboard management better tools to perform their tasks and enables them to give on-line confirmation to guests who want to book their next Royal Caribbean cruise while still onboard.