Carnival Corporation & plc Reports Third Quarter Earnings Which Marks The Company's Strongest Quarterly Non-GAAP Performance On Record

Carnival Corporation & plc today reported its results for the third quarter ended August 31, 2015.  The results of Carnival Corporation and Carnival plc have been consolidated and include results on a U.S. GAAP and non-U.S. GAAP basis.

3Q Highlights

• 3Q net revenue yields in constant dollars increased 4.3% compared to the prior year, better than June guidance of up 2 to 3%
• 3Q net cruise costs excluding fuel per available lower berth day (“ALBD”) in constant dollars increased 1.0% compared to the prior year, better than June guidance of up 2 to 3% due to the timing of certain expenses
• 3Q non-GAAP earnings per share (diluted) of $1.75, compared to $1.58 for the prior year
• 3Q U.S. GAAP earnings per share (diluted) of $1.56, included unrealized losses on fuel derivatives of $137M, compared to $1.60 for the prior year

Outlook

• At this time, cumulative advance bookings for the first half of 2016 are well ahead of last year at lower constant dollar prices
• FY 2015 net revenue yields on a constant currency basis are expected to be up approximately 4% compared to the prior year versus previous guidance of up 3 to 4% (up approximately 3% in constant dollars)
• FY 2015 net cruise costs excluding fuel per ALBD on a constant currency basis are expected to be up approximately 3.5% compared to the prior year (up approximately 3% in constant dollars)
• FY 2015 non-GAAP earnings per share (diluted) are expected to be in the range of $2.56 to $2.60, better than both the June guidance range of $2.35 to $2.50 and $1.93 per share for 2014
• 4Q 2015 non-GAAP earnings per share (diluted) are expected to be in the range of $0.36 to $0.40, compared to $0.27 for 4Q 2014

President and Chief Executive Officer Arnold Donald commenting on these results:

“Our third quarter non-GAAP performance was the strongest of any quarter on record with earnings $0.17 per share higher than the prior year despite a slight drag from the net impact of fuel prices and currency. Non-GAAP earnings for the quarter were also $0.17 higher than the mid-point of prior guidance. Net revenue yields improved 5 percent (constant currency) from the prior year benefiting from strong demand which led to higher occupancy levels, increased ticket prices and increased onboard spending. Clearly our ongoing investments in the guest experience, combined with our global marketing and public relations efforts along with our initiatives to leverage our scale are having a positive impact.”

“In 2015, we are on track to achieve a nearly 35 percent earnings improvement and we are accelerating progress toward achieving double digit return on invested capital in the next three to four years. Our improved performance has driven even stronger operating cash, which is expected to exceed $4 billion this year. We remain committed to further enhancing shareholder returns as demonstrated by our recent 20 percent increase in quarterly dividends.”

“Looking forward to 2016, we have driven a significant lengthening of the booking curve and have less inventory remaining for the first half of 2016 than at this time last year, which bodes well for continued year-over-year revenue yield improvement. Although we already have a solid base of business for next year, we are working hard to maintain the momentum through our ongoing initiatives to create additional demand.”

MEDIA CONTACT                                       INVESTOR RELATIONS CONTACT

Roger Frizzell                                                  Beth Roberts

001 305 406 7862                                           001 305 406 4832

Conference Call

The company has scheduled a conference call with analysts at 3:00 p.m. BST (10:00 a.m. EDT) today to discuss its 2015 third quarter results.  This call can be listened to live, and additional information can be obtained, via Carnival Corporation & plc’s Web site at http://www.carnivalcorp.com/ and http://www.carnivalplc.com/.

Carnival Corporation & plc is the largest cruise company in the world, with a portfolio of 10 cruise brands in North America, Europe, Australia and Asia, comprised of Carnival Cruise Line, Holland America Line, Princess Cruises, Seabourn, AIDA Cruises, Costa Cruises, Cunard, P&O Cruises (Australia), P&O Cruises (UK) and Fathom.

Together, these brands will operate 100 ships in 2015 totaling 219,000 lower berths with 17 new ships scheduled to be delivered between 2016 and 2022. Carnival Corporation & plc also operates Holland America Princess Alaska Tours, the leading tour companies in Alaska and the Canadian Yukon. Traded on both the New York and London Stock Exchanges, Carnival Corporation & plc is the only group in the world to be included in both the S&P 500 and the FTSE 100 indices.

Additional information can be found on http://www.carnival.com/, http://www.hollandamerica.com/, http://www.princess.com/, http://www.seabourn.com/, http://www.aida.de/, http://www.costacruise.com/, http://www.cunard.com/, http://www.pocruises.com.au/, http://www.pocruises.com/ and http://www.fathom.org/.

Carnival Corporation & plc Reports Third Quarter Earnings Which Marks The Company's Strongest Quarterly Non-GAAP Performance On Record

MIAMI, Sept. 22, 2015  -- Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) announced non-GAAP net income of $1.4 billion, or $1.75 diluted EPS for the third quarter of 2015 compared to non-GAAP net income for the third quarter of 2014 of $1.2 billion, or $1.58 diluted EPS. For the third quarter of 2015, U.S. GAAP net income, which included unrealized losses on fuel derivatives of $137 million, was $1.2 billion, or $1.56 diluted EPS down slightly from the prior year. For the third quarter of 2014, U.S. GAAP net income, which included net unrealized gains on fuel derivatives of $15 million, was $1.2 billion, or $1.60 diluted EPS. Revenues for the third quarter of 2015 were $4.9 billion, in line with the prior year.

Carnival Corporation & plc President and Chief Executive Officer Arnold Donald noted, "Our third quarter non-GAAP performance was the strongest of any quarter on record with earnings $0.17 per share higher than the prior year despite a slight drag from the net impact of fuel prices and currency. Non-GAAP earnings for the quarter were also $0.17 higher than the mid-point of prior guidance. Net revenue yields improved 5 percent (constant currency) from the prior year benefiting from strong demand which led to higher occupancy levels, increased ticket prices and increased onboard spending. Clearly our ongoing investments in the guest experience, combined with our global marketing and public relations efforts along with our initiatives to leverage our scale are having a positive impact."

Key metrics for the third quarter 2015 compared to the prior year were as follows:

• On a constant dollar basis, net revenue yields (net revenue per available lower berth day or "ALBD") increased 4.3 percent for 3Q 2015, better than June guidance of up 2 to 3 percent. Gross revenue yields decreased 2.1 percent in current dollars.
• Net cruise costs excluding fuel per ALBD increased 1.0 percent in constant dollars, better than June guidance of up 2 to 3 percent due to the timing of certain expenses. Gross cruise costs including fuel per ALBD in current dollars decreased 9 percent.
• Fuel prices declined 33 percent to $439 per metric ton for 3Q 2015 from $650 per metric ton in 3Q 2014 and were less than June guidance of $492 per metric ton.
• Fuel consumption per ALBD decreased 2 percent in 3Q 2015 compared to the prior year.

Other highlights during the third quarter included Princess Cruises' announcement that the Golden Princess will begin sailing out of Tianjin, China on a seasonal basis starting in 2016, which totals six Carnival Corporation vessels based in China, the largest capacity commitment from any cruise company. Additionally, it was announced in July that two vessels in the four-ship newbuild contract with Meyer Werft shipyard will be earmarked for Costa Cruises and will be the largest ships ever built based on guest capacity. Like the two previously announced AIDA Cruises ships that will also be constructed by Meyer Werft, the Costa ships will be powered at sea by Liquefied Natural Gas, the world's cleanest burning fossil fuel. Last week, Carnival Corporation announced its new sustainability goals, which include a further reduction in CO₂ emissions of 25 percent by 2020 from the company's 2005 baseline, along with a fleetwide reduction in shipboard waste generation and improved water usage.

Outlook

Based on the strength in third quarter net revenue yields and current booking trends, the company has increased its expectations for full year 2015 net revenue yields. The company now expects revenue yields to be up approximately 4 percent compared to the prior year versus previous guidance of up 3 to 4 percent on a constant currency basis, which excludes translational and transactional currency impacts (up approximately 3 percent on a constant dollar basis). The company continues to expect full year 2015 net cruise costs excluding fuel per ALBD to be up approximately 3.5 percent compared to the prior year on a constant currency basis (up approximately 3 percent on a constant dollar basis).

Taking the above factors into consideration, the company has increased its full year 2015 non-GAAP diluted earnings per share guidance to be in the range of $2.56 to $2.60, better than both the June guidance range of $2.35 to $2.50 and 2014 non-GAAP diluted earnings of $1.93 per share.

Donald stated, "In 2015, we are on track to achieve a nearly 35 percent earnings improvement and we are accelerating progress toward achieving double digit return on invested capital in the next three to four years. Our improved performance has driven even stronger operating cash, which is expected to exceed $4 billion this year. We remain committed to further enhancing shareholder returns as demonstrated by our recent 20 percent increase in quarterly dividends."

During the last quarter, fleetwide booking volumes for the first half of 2016 were running nearly 20 percent higher than the prior year relative to a capacity increase of less than 3 percent, at lower constant dollar prices. At this time, cumulative advance bookings for the first half of 2016 are well ahead of last year at lower constant dollar prices.

Donald added, "Looking forward to 2016, we have driven a significant lengthening of the booking curve and have less inventory remaining for the first half of 2016 than at this time last year, which bodes well for continued year-over-year revenue yield improvement. Although we already have a solid base of business for next year, we are working hard to maintain the momentum through our ongoing initiatives to create additional demand."

Fourth Quarter 2015 Outlook

Fourth quarter constant currency net revenue yields are expected to be up approximately 3 percent compared to the prior year (up approximately 1 percent in constant dollars). Net cruise costs excluding fuel per ALBD for the fourth quarter are expected to be higher by approximately 3 percent on a constant currency basis compared to the prior year (up approximately 2 percent in constant dollars).

Based on the above factors, the company expects non-GAAP diluted earnings for the fourth quarter 2015 to be in the range of $0.36 to $0.40 per share versus 2014 non-GAAP earnings of $0.27 per share.

Conference Call

The company has scheduled a conference call with analysts at 10:00 a.m. EDT (3:00 p.m. BST) today to discuss its 2015 third quarter results. This call can be listened to live, and additional information can be obtained, via Carnival Corporation & plc's Web site at http://www.carnivalcorp.com/ and http://www.carnivalplc.com/.

Carnival Corporation & plc is the largest cruise company in the world, with a portfolio of 10 cruise brands in North America, Europe, Australia and Asia, comprised of Carnival Cruise Line, Holland America Line, Princess Cruises, Seabourn, AIDA Cruises, Costa Cruises, Cunard, P&O Cruises (Australia), P&O Cruises (UK) and Fathom.

Together, these brands will operate 100 ships in 2015 totaling 219,000 lower berths with 17 new ships scheduled to be delivered between 2016 and 2022. Carnival Corporation & plc also operates Holland America Princess Alaska Tours, the leading tour companies in Alaska and the Canadian Yukon. Traded on both the New York and London Stock Exchanges, Carnival Corporation & plc is the only group in the world to be included in both the S&P 500 and the FTSE 100 indices.

Additional information can be found on http://www.carnival.com/, http://www.hollandamerica.com/, http://www.princess.com/, http://www.seabourn.com/, http://www.aida.de/, http://www.costacruise.com/, http://www.cunard.com/, http://www.pocruises.com.au/, http://www.pocruises.com/ and http://www.fathom.org/.

Cautionary Note Concerning Factors That May Affect Future Results

Carnival Corporation and Carnival plc and their respective subsidiaries are referred to collectively in this release as "Carnival Corporation & plc," "our," "us" and "we." Some of the statements, estimates or projections contained in this release are "forward-looking statements" that involve risks, uncertainties and assumptions with respect to us, including some statements concerning future results, outlooks, plans, goals and other events which have not yet occurred. These statements are intended to qualify for the safe harbors from liability provided by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts are statements that could be deemed forward-looking. These statements are based on current expectations, estimates, forecasts and projections about our business and the industry in which we operate and the beliefs and assumptions of our management. We have tried, whenever possible, to identify these statements by using words like "will," "may," "could," "should," "would," "believe," "depends," "expect," "goal," "anticipate," "forecast," "project," "future," "intend," "plan," "estimate," "target," "indicate" and similar expressions of future intent or the negative of such terms.

Forward-looking statements include those statements that may impact, among other things, the forecasting of our non-GAAP earnings per share; net revenue yields; booking levels; pricing; occupancy; operating, financing and tax costs, including fuel expenses; net cruise costs per available lower berth day; estimates of ship depreciable lives and residual values; liquidity; goodwill, ship and trademark fair values and outlook. Because forward-looking statements involve risks and uncertainties, there are many factors that could cause our actual results, performance or achievements to differ materially from those expressed or implied in this release. This note contains important cautionary statements of the known factors that we consider could materially affect the accuracy of our forward-looking statements and adversely affect our business, results of operations and financial position. It is not possible to predict or identify all such risks. There may be additional risks that we consider immaterial or which are unknown. These factors include, but are not limited to, the following:

• general economic and business conditions;
• increases in fuel prices;
• incidents, the spread of contagious diseases and threats thereof, adverse weather conditions or other natural disasters and other incidents affecting the health, safety, security and satisfaction of guests and crew;
• the international political climate, armed conflicts, terrorist and pirate attacks, vessel seizures, and threats thereof, and other world events affecting the safety and security of travel;
• negative publicity concerning the cruise industry in general or us in particular, including any adverse environmental impacts of cruising;
• geographic regions in which we try to expand our business may be slow to develop and ultimately not develop how we expect;
• economic, market and political factors that are beyond our control, which could increase our operating, financing and other costs;
• changes in and compliance with laws and regulations relating to the protection of persons with disabilities, employment, environment, health, safety, security, tax and other regulations under which we operate;
• our inability to implement our shipbuilding programs and ship repairs, maintenance and refurbishments on terms that are favorable or consistent with our expectations;
• increases to our repairs and maintenance expenses and refurbishment costs as our fleet ages;
• lack of continuing availability of attractive, convenient and safe port destinations on terms that are favorable or consistent with our expectations;
• continuing financial viability of our travel agent distribution system, air service providers and other key vendors in our supply chain and reductions in the availability of, and increases in the prices for, the services and products provided by these vendors;
• disruptions and other damages to our information technology and other networks and operations, and breaches in data security;
• failure to keep pace with developments in technology;
• competition from and overcapacity in the cruise ship and land-based vacation industry;
• loss of key personnel or our ability to recruit or retain qualified personnel;
• union disputes and other employee relationship issues;
• disruptions in the global financial markets or other events that may negatively affect the ability of our counterparties and others to perform their obligations to us;
• the continued strength of our cruise brands and our ability to implement our strategies;
• additional risks to our international operations not generally applicable to our U.S. operations;
• our decisions to self-insure against various risks or our inability to obtain insurance for certain risks at reasonable rates;
• litigation, enforcement actions, fines or penalties;
• fluctuations in foreign currency exchange rates;
• whether our future operating cash flow will be sufficient to fund future obligations and whether we will be able to obtain financing, if necessary, in sufficient amounts and on terms that are favorable or consistent with our expectations;
• risks associated with our dual listed company arrangement;
• uncertainties of a foreign legal system as Carnival Corporation and Carnival plc are not U.S. corporations and
• the ability of a small group of shareholders to effectively control the outcome of shareholder voting.

Forward-looking statements should not be relied upon as a prediction of actual results. Subject to any continuing obligations under applicable law or any relevant stock exchange rules, we expressly disclaim any obligation to disseminate, after the date of this release, any updates or revisions to any such forward-looking statements to reflect any change in expectations or events, conditions or circumstances on which any such statements are based.

Notes to Statistical Information

(See next page for Notes to Non-GAAP Financial Measures.)

Notes to Non-GAAP Financial Measures

SOURCE  Carnival Corporation & plc
 

CONTACT: MEDIA CONTACT: Roger Frizzell, 1 305 406 7862 ; INVESTOR RELATIONS CONTACT: Beth Roberts, 1 305 406 4832