Carnival Corporation & plc Reports Second Quarter Earnings
Commenting on second quarter results, Arison said, "We were pleased with the quarterly operating results in light of the current economic environment. During the quarter, our operating companies remained focused on reducing costs which is expected to continue through the remainder of the year." A variety of energy conservation programs resulted in a six percent reduction in fuel consumption during the quarter which helped to mitigate some of the recent fuel price increases.
Key metrics for the second quarter of 2009 compared to the prior year were as follows:
-- On a constant dollar basis net revenue yields (revenue per available
lower berth day) decreased 9.8 percent for Q2 2009. Net revenue yields
in current dollars decreased 16.8 percent due to unfavorable currency
exchange rates. Gross revenue yields in current dollars decreased 17.3
percent.
-- Excluding fuel, net cruise costs per available lower berth day
("ALBD") for Q2 2009 was 1.0 percent higher on a constant dollar basis
due to more vessels in dry-dock this quarter.
-- Including fuel, net cruise costs per ALBD decreased 9.6 percent on a
constant dollar basis (decreased 15.6 percent in current dollars).
Gross cruise costs per ALBD decreased 16.5 percent in current dollars.
-- Fuel price decreased 43 percent to $304 per metric ton for Q2 2009
from $530 per metric ton in Q2 2008 and was above the March guidance
of $285 per metric ton.
"During the quarter, we also made great strides on our strategic initiatives to better position the company for the future," Arison said. Carnival continued to expand its global presence in the second quarter through the deployment of a second vessel to its emerging brand in
The company also entered into
"Since the start of the year we have completed more than
2009 Outlook
Since March, booking volumes for the second half of 2009 are running 26 percent ahead of the prior year. Although booking levels for the remainder of the year are still behind, the higher booking volumes have enabled the company to close the gap to approximately three percentage points from last year's levels. However, ticket prices for these bookings are at substantially lower levels.
Arison noted, "As we have progressed throughout the year, booking volumes have continued to accelerate with less discounting, as consumers have come to recognize the extraordinary value proposition our cruise vacations represent."
The company continues to expect full year net revenue yields, on a constant dollar basis, to decrease 10 to 12 percent. The company now forecasts a 14 to 16 percent decline in net revenue yields on a current dollar basis for the full year 2009 compared to 2008 caused by unfavorable changes in currency exchange rates. Although the company has experienced pricing pressure on net revenue yields for its Mexican deployments in the wake of the CDC's travel advisory, it has been more than offset by improved expectations for its broader deployments worldwide.
The company continues to expect net cruise costs excluding fuel for the full year 2009 to be in line with the prior year on a constant dollar basis. However, based on current spot prices for fuel, forecasted fuel costs for the full year have increased
Taking all the above factors into consideration, the company now forecasts full year 2009 earnings per share to be in the range of
"Higher forecasted fuel prices and the impact of the CDC travel advisory have reduced 2009 earnings by approximately
Third Quarter 2009
Third quarter constant dollar net revenue yields are expected to decline in the 14 to 16 percent range (down 19 to 21 percent on a current dollar basis). Net cruise costs excluding fuel for the third quarter are expected to be approximately 1 percent higher on a constant dollar basis. Excluding the impact of the
Based on current fuel prices and currency exchange rates, the company expects earnings for the third quarter of 2009 to be in the range of
During the third quarter the company will take delivery of the first of a new class of vessel for The Yachts of Seabourn, the 450-passenger Seabourn Odyssey which will debut in
Selected Key Forecast Metrics
-----------------------------
Full Year 2009 Third Quarter 2009
Current Constant Current Constant
Dollars Dollars Dollars Dollars
Change in:
Net
revenue
yields (14) to (16) % (10) to (12) % (19) to (21) % (14) to (16) %
Net
cruise
cost per
ALBD (12) to (14) % (8) to (10) % (13) to (15) % (9) to (11) %
Full Year 2009 Third Quarter 2009
Fuel price per
metric ton $353 $406
Fuel consumption
(metric tons
in thousands) 3,170 800
Currency
Euro $1.37 to euro 1 $1.39 to euro 1
Sterling $1.54 to pounds Sterling 1 $1.61 to pounds Sterling 1
The company has scheduled a conference call with analysts at
Together, these brands operate 91 ships totaling approximately 176,000 lower berths with 14 new ships scheduled to be delivered between now and
Cautionary Note Concerning Factors That May Affect Future Results
Some of the statements, estimates or projections contained in this earnings release are "forward-looking statements" that involve risks, uncertainties and assumptions with respect to
CARNIVAL CORPORATION & PLC
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
May 31, May 31,
------------------ ----------------
2009 2008 2009 2008
---- ---- ---- ----
(in millions, except per share data)
Revenues
Cruise
Passenger tickets $2,242 $2,588 $4,461 $5,026
Onboard and other 673 743 1,307 1,445
Other 33 47 44 59
----- ----- ----- -----
2,948 3,378 5,812 6,530
----- ----- ----- -----
Costs and Expenses
Operating
Cruise
Commissions,
transportation
and other 440 525 954 1,083
Onboard and other 110 121 214 246
Payroll and related 366 365 718 725
Fuel 243 425 451 817
Food 203 210 401 417
Other ship operating 488 469 946 923
Other 35 44 51 62
----- ----- ----- -----
Total 1,885 2,159 3,735 4,273
Selling and
administrative 393 425 785 850
Depreciation and
amortization 317 312 628 613
----- ----- ----- -----
2,595 2,896 5,148 5,736
----- ----- ----- -----
Operating Income 353 482 664 794
----- ----- ----- -----
Nonoperating (Expense)
Income
Interest income 2 12 6 22
Interest expense, net
of capitalized interest (90) (102) (186) (200)
Other income, net 5 4 24 (a) 6
----- ----- ----- -----
(83) (86) (156) (172)
----- ----- ----- -----
Income Before Income Taxes 270 396 508 622
Income Tax (Expense)
Benefit, Net (6) (6) 16 (b) 4
----- ----- ----- -----
Net Income $264 $390 $524 $626
==== ==== ==== ====
Earnings Per Share
Basic $0.34 $0.50 $0.67 $0.80
==== ==== ==== ====
Diluted $0.33 $0.49 $0.66 $0.78
==== ==== ==== ====
Dividends Declared Per Share $0.40 $0.80
==== ====
Weighted-Average Shares
Outstanding - Basic 787 786 787 786
==== ==== ==== ====
Weighted-Average Shares
Outstanding - Diluted 804 819 804 819
==== ==== ==== ====
(a) Includes a $15 million gain from the unwinding of a lease out and
lease back type transaction.
(b) Includes a $17 million gain from the reversal of uncertain income tax
position liabilities, which are no longer required.
CARNIVAL CORPORATION & PLC
CONSOLIDATED BALANCE SHEETS
May 31, November 30, May 31,
2009 2008 2008
---- ---- ----
(in millions, except par values)
ASSETS
Current Assets
Cash and cash equivalents $485 $650 $988
Trade and other receivables, net 424 418 542
Inventories 308 315 349
Prepaid expenses and other 317 267 300
----- ----- -----
Total current assets 1,534 1,650 2,179
----- ----- -----
Property and Equipment, Net 28,663 26,457 27,666
Goodwill 3,388 3,266 3,614
Trademarks 1,328 1,294 1,393
Other Assets 632 733 620
----- ----- -----
$35,545 $33,400 $35,472
====== ====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term borrowings $161 $256 $145
Current portion of long-term debt 1,525 1,081 1,386
Convertible debt subject to current
put options 276 271 230
Accounts payable 543 512 454
Accrued liabilities and other 810 1,142 1,269
Customer deposits 2,852 2,519 3,605
----- ----- -----
Total current liabilities 6,167 5,781 7,089
----- ----- -----
Long-Term Debt 8,317 7,735 7,689
Other Long-Term Liabilities and Deferred
Income 676 786 764
Shareholders' Equity
Common stock of Carnival Corporation ;
$0.01 par value; 1,960 shares
authorized; 644 shares at 2009 and
643 shares at 2008 issued 6 6 6
Ordinary shares of Carnival plc ;
$1.66 par value; 226 shares
authorized; 213 shares at 2009
and 2008 issued 354 354 354
Additional paid-in capital 7,699 7,677 7,653
Retained earnings 14,504 13,980 12,907
Accumulated other comprehensive
income (loss) 107 (623) 1,306
Treasury stock; 18 shares at
2009 and 19 shares at 2008 of
Carnival Corporation and 52 shares
at 2009 and November 2008 and 51
shares at May 2008 of Carnival plc ,
at cost (2,285) (2,296) (2,296)
----- ----- -----
Total shareholders' equity 20,385 19,098 19,930
----- ----- -----
$35,545 $33,400 $35,472
====== ====== ======
CARNIVAL CORPORATION & PLC
SELECTED INFORMATION
Three Months Ended Six Months Ended
May 31, May 31,
------------------ ----------------
2009 2008 2009 2008
---- ---- ---- ----
(in millions, except statistical
information)
STATISTICAL INFORMATION
Passengers carried (in
thousands) 2,029 1,985 3,898 3,896
Occupancy percentage 103.3 % 104.8% 103.6 % 104.5 %
Fuel consumption (metric
tons in thousands) 799 803 1,552 1,588
Fuel cost per metric ton (a) $304 $530 $291 $514
Currency
U.S. dollar to euro 1 $1.33 $1.56 $1.33 $1.51
U.S. dollar to
pounds Sterling 1 $1.48 $1.98 $1.47 $1.98
CASH FLOW INFORMATION
Cash from operations $1,136 $1,442 $1,441 $1,815
Capital expenditures $1,650 $1,335 $1,956 $1,593
Dividends paid $314 $314 $630
SEGMENT INFORMATION
Revenues
Cruise $2,915 $3,331 $5,768 $6,471
Other 48 65 61 79
Intersegment elimination (15) (18) (17) (20)
----- ----- ----- -----
$2,948 $3,378 $5,812 $6,530
===== ===== ===== =====
Operating expenses
Cruise $1,850 $2,115 $3,684 $4,211
Other 50 62 68 82
Intersegment elimination (15) (18) (17) (20)
----- ----- ----- -----
$1,885 $2,159 $3,735 $4,273
===== ===== ===== =====
Selling and administrative
expenses
Cruise $386 $416 $770 $833
Other 7 9 15 17
----- ----- ----- -----
$393 $425 $785 $850
===== ===== ===== =====
Depreciation and amortization
Cruise $308 $303 $610 $595
Other 9 9 18 18
----- ----- ----- -----
$317 $312 $628 $613
===== ===== ===== =====
Operating income (loss)
Cruise $371 $497 $704 $832
Other (18) (15) (40) (38)
----- ----- ----- -----
$353 $482 $664 $794
===== ===== ===== =====
(a) Fuel cost per metric ton is calculated by dividing the cost of our
fuel by the number of metric tons consumed.
CARNIVAL CORPORATION & PLC
NON-GAAP FINANCIAL MEASURES
Gross and net revenue yields were computed by dividing the gross or net
revenues, without rounding, by ALBDs as follows:
Three Months Ended Six Months Ended
May 31, May 31,
------------------ ----------------
2009 2008 2009 2008
---- ---- ---- ----
(in millions, except ALBDs and yields)
Cruise revenues
Passenger tickets $2,242 $2,588 $4,461 $5,026
Onboard and other 673 743 1,307 1,445
----- ----- ----- -----
Gross cruise revenues 2,915 3,331 5,768 6,471
Less cruise costs
Commissions,
transportation
and other (440) (525) (954) (1,083)
Onboard and other (110) (121) (214) (246)
----- ----- ----- -----
Net cruise revenues (a) $2,365 $2,685 $4,600 $5,142
====== ===== ===== =====
ALBDs (b) 15,329,812 14,480,881 29,822,062 28,642,170
========= ========== ========== ==========
Gross revenue yields (a) $190.19 $230.04 $193.42 $225.92
====== ===== ===== =====
Net revenue yields (a) $154.24 $185.45 $154.25 $179.52
====== ===== ===== =====
Gross and net cruise costs per ALBD were computed by dividing the
gross or net cruise costs, without rounding, by ALBDs as follows:
Three Months Ended Six Months Ended
May 31, May 31,
------------------ -----------------
2009 2008 2009 2008
---- ---- ---- ----
(in millions, except ALBDs and costs per ALBD)
Cruise operating expenses $1,850 $2,115 $3,684 $4,211
Cruise selling and
administrative expenses 386 416 770 833
----- ----- ----- -----
Gross cruise costs 2,236 2,531 4,454 5,044
Less cruise costs included
in net cruise revenues
Commissions,
Transportation and other (440) (525) (954) (1,083)
Onboard and other (110) (121) (214) (246)
----- ----- ----- -----
Net cruise costs (a) $1,686 $1,885 $3,286 $3,715
====== ===== ===== =====
ALBDs (b) 15,329,812 14,480,881 29,822,062 28,642,170
========== ========== ========== ==========
Gross cruise costs per
ALBD (a) $145.90 $174.79 $149.36 $176.12
====== ===== ===== =====
Net cruise costs per
ALBD (a) $109.95 $130.20 $110.18 $129.72
====== ===== ===== =====
NOTES TO NON-GAAP FINANCIAL MEASURES
(a) We use net cruise revenues per ALBD ("net revenue yields") and
net cruise costs per ALBD as significant non-GAAP financial
measures of our cruise segment financial performance. These
measures enable us to separate the impact of predictable capacity
changes from the more unpredictable rate changes that affect our
business. We believe these non-GAAP measures provide a better
gauge to measure our revenue and cost performance instead of the
standard U.S. GAAP-based financial measures. There are no
specific rules for determining our non-GAAP financial measures
and, accordingly, it is possible that they may not be exactly
comparable to the like-kind information presented by other cruise
companies, which is a potential risk associated with using them
to compare us to other cruise companies.
Net revenue yields are commonly used in the cruise industry to
measure a company's cruise segment revenue performance and for
revenue management purposes. We use "net cruise revenues" rather
than "gross cruise revenues" to calculate net revenue yields. We
believe that net cruise revenues is a more meaningful measure in
determining revenue yield than gross cruise revenues because it
reflects the cruise revenues earned net of our most significant
variable costs, which are travel agent commissions, cost of air
transportation and certain other variable direct costs associated
with onboard and other revenues. Substantially all of our
remaining cruise costs are largely fixed, except for the impact
of changing prices, once our ship capacity levels have been
determined.
Net cruise costs per ALBD is the most significant measure we use
to monitor our ability to control our cruise segment costs rather
than gross cruise costs per ALBD. We exclude the same variable
costs that are included in the calculation of net cruise revenues
to calculate net cruise costs to avoid duplicating these variable
costs in these two non-GAAP financial measures.
We have not provided estimates of future gross revenue yields or
future gross cruise costs per ALBD because the reconciliations of
forecasted net cruise revenues to forecasted gross cruise
revenues or forecasted net cruise costs to forecasted cruise
operating expenses would require us to forecast, with reasonable
accuracy, the amount of air and other transportation costs that
our forecasted cruise passengers would elect to purchase from us
(the "air/sea mix"). Since the forecasting of future air/sea
mix involves several significant variables that are relatively
difficult to forecast and the revenues from the sale of air and
other transportation approximate the costs of providing that
transportation, management focuses primarily on forecasts of net
cruise revenues and costs rather than gross cruise revenues and
costs. This does not impact, in any material respect, our
ability to forecast our future results, as any variation in the
air/sea mix has no material impact on our forecasted net cruise
revenues or forecasted net cruise costs. As such, management does
not believe that this reconciling information would be
meaningful.
In addition, because a significant portion of Carnival
Corporation & plc's operations utilize the euro or sterling to
measure their results and financial condition, the translation of
those operations to our U.S. dollar reporting currency results in
decreases in reported U.S. dollar revenues and expenses if the
U.S. dollar strengthens against these foreign currencies, and
increases in reported U.S. dollar revenues and expenses if the
U.S. dollar weakens against these foreign currencies.
Accordingly, we also monitor and report our two non-GAAP
financial measures assuming the current period currency exchange
rates have remained constant with the prior year's comparable
period rates, or on a "constant dollar basis," in order to remove
the impact of changes in exchange rates on our non-U.S. dollar
cruise operations. We believe that this is a useful measure since
it facilitates a comparative view of the growth of our business
in a fluctuating currency exchange rate environment.
On a constant dollar basis, net cruise revenues and net cruise
costs would be $2.6 billion and $1.8 billion for the three months
ended May 31, 2009 and $4.9 billion and $3.5 billion for the six
months ended May 31, 2009 , respectively. On a constant dollar
basis, gross cruise revenues and gross cruise costs would be $3.2
billion and $2.4 billion for the three months ended May 31, 2009
and $6.2 billion and $4.8 billion for the six months ended May
31, 2009 , respectively. In addition, our non-U.S. dollar cruise
operations' depreciation and net interest expense were impacted
by the changes in exchange rates for the three and six months
ended May 31, 2009 , compared to the prior year's comparable
periods.
(b) ALBDs is a standard measure of passenger capacity for the period,
which we use to perform rate and capacity variance analyses to
determine the main non-capacity driven factors that cause our
cruise revenues and expenses to vary. ALBDs assume that each
cabin we offer for sale accommodates two passengers and is
computed by multiplying passenger capacity by revenue-producing
ship operating days in the period.
SOURCECarnival Corporation -0-06/18/2009 /CONTACT: Media, US,Tim Gallagher , +1-305-599-2600, ext. 16000, or Investor Relations, US/UK,Beth Roberts , +1-305-406-4832, both ofCarnival Corporation & plc/ /Web Site: http://www.carnivalcorp.com / (CCL CUK CCL CUK) CO:Carnival Corporation ;Carnival Corporation & plc ST:Florida IN: TRAMAR LEI SU : ERN ERP CCA PR -- CL34581 -- 048106/18/2009 09:15 EDT http://www.prnewswire.com
