Carnival Corp & PLC Report Third Quarter Earnings

[Jason]

Carnival Corporation & plc Reports Third Quarter Earnings

MIAMI/PRNewswire-FirstCall / --

Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) reported net income of $1.23 billion, or $1.49 diluted EPS, on revenues of $3.91 billion for its third quarter ended August 31, 2006. Net income for the third quarter of 2005 was $1.18 billion, or $1.40 diluted EPS, on revenues of $3.61 billion.

Net income for the nine months ended August 31, 2006 was $1.86 billion, or $2.25 diluted EPS, on revenues of $9.03 billion, compared to net income of $1.92 billion, or $2.29 diluted EPS, on revenues of $8.52 billion for the same period in 2005.

Third quarter 2006 revenues increased 8.3 percent, primarily driven by a 5.2 percent increase in capacity and an increase in revenue yields (revenue per available lower berth day). Net revenue yields in current dollars for the third quarter of 2006 increased 1.0 percent compared to the prior year. Net revenue yields as measured on a local currency basis ("constant dollar basis"), which the company believes better reflects underlying revenue performance, were in line with the same period last year. Gross revenue yields increased 2.1 percent.

Net cruise costs per available lower berth day ("ALBD") for the third quarter of 2006 increased 4.8 percent compared to the same period last year. On a constant dollar basis, net cruise costs per ALBD increased 3.8 percent from the same period last year. The increase in costs per ALBD was primarily due to a 29 percent increase in fuel prices. Excluding the increased fuel prices, the company’s 2006 third quarter net cruise costs per ALBD were in line with last year on a constant dollar basis. Gross cruise costs per ALBD increased 5.4 percent.

Carnival Corporation & plc Chairman and CEO Micky Arison said, "Despite rising fuel costs and softness in Caribbean business, we still managed to grow earnings by over six percent in a difficult environment. The successful introduction of three new ships along with strong European and Alaska cruise seasons helped us overcome $55 million in higher fuel costs and weakness in Caribbean demand," he explained. "Both our European and North American brands have enjoyed a very strong summer in Europe and the North American brands operating in Alaska also performed very well during the quarter."

Forward Outlook

For the fourth quarter, advance booking levels are slightly behind last year at this time on a capacity adjusted basis, with average pricing slightly above last year in current dollars. As a result, the company expects that net revenue yields for the fourth quarter of 2006 will increase slightly (flat to down slightly in constant dollars) compared to last year’s fourth quarter.

Net cruise costs per ALBD in the fourth quarter of 2006 are expected to be flat to up slightly (flat to down slightly in constant dollars) compared to 2005. The company’s cost guidance for fuel is based on recent forward prices for the balance of the year which are in line with the average prices for the fourth quarter of 2005.

Based on these estimates, the company expects diluted earnings per share for the fourth quarter of 2006 to be in the range of $0.46 to $0.48. This guidance is based on currency exchange rates of $1.27 to the euro and $1.87 to sterling.

Arison also noted that for the full year the company is currently on track to post earnings per share of $2.71 to $2.73. This is slightly higher than last year despite significant challenges in 2006, not the least of which was a $210 million or $0.25 per share increase in fuel costs.

Looking to early 2007, Arison said that overall booking levels on a capacity adjusted basis, for the first quarter of 2007 are modestly down compared to the same time last year. The sluggish demand for the Caribbean is continuing into the first quarter of 2007 causing North American booking levels to be behind last year, while business for the company’s European brands for that period is running ahead of last year’s pace.

New Ship Delivery

During the third quarter, the company’s Costa Cruises brand took delivery of the new 3,000-passenger Costa Concordia, which launched seven-day Mediterranean cruises from Civitavecchia (Rome) on July 23, 2006.

Also in the third quarter, the company launched its first Asian-based cruise initiative, Costa Asia, with the newly refurbished Costa Allegra operating five-day voyages from Shanghai, the People’s Republic of China, which began July 3, 2006.

Carnival has scheduled a conference call with analysts at 10 a.m. EDT (15.00 London time) today to discuss its 2006 third quarter earnings. This call can be listened to live, and additional information can be obtained, via Carnival Corporation & plc’s Web site at www.carnivalcorp.com and www.carnivalplc.com.

Carnival Corporation & plc is the largest cruise vacation group in the world, with a portfolio of cruise brands in North America, Europe and Australia, comprised of Carnival Cruise Lines, Holland America Line, Princess Cruises, Seabourn Cruise Line, Windstar Cruises, AIDA Cruises, Costa Cruises, Cunard Line, Ocean Village, P&O Cruises, Swan Hellenic, and P&O Cruises Australia.

Together, these brands operate 81 ships totaling approximately 144,000 lower berths with 15 new ships scheduled to enter service between March 2007 and spring 2010. Carnival Corporation & plc also operates the leading tour companies in Alaska and the Canadian Yukon, Holland America Tours and Princess Tours. 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.

Cautionary note concerning factors that may affect future results

Some of the statements contained in this earnings release are "forward- looking statements" that involve risks, uncertainties and assumptions with respect to Carnival Corporation & plc, including some statements concerning future results, outlook, 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. You can find many, but not all, of these statements by looking for words like "will," "may," "believes," "expects," "anticipates," "forecast," "future," "intends," "plans," and "estimates" and for similar expressions. Because forward-looking statements involve risks and uncertainties, there are many factors that could cause Carnival Corporation & plc’s actual results, performance or achievements to differ materially from those expressed or implied in this earnings release. Forward-looking statements include those statements which may impact the forecasting of earnings per share, net revenue yields, booking levels, pricing, occupancy, operating, financing and/or tax costs, fuel costs, costs per available lower berth day, estimates of ship depreciable lives and residual values, outlook or business prospects. These factors include, but are not limited to, the following: risks associated with the DLC structure, including the uncertainty of its tax status; general economic and business conditions, which may impact levels of disposable income of consumers and thereby impact the net revenue yields for cruise brands of Carnival Corporation & plc; conditions in the cruise and land-based vacation industries, including competition from other cruise ship operators and providers of other vacation alternatives and increases in capacity offered by cruise ship and land-based vacation alternatives; risks associated with operating internationally; the international political and economic climate, armed conflicts, terrorist attacks and threats thereof, availability of air service, other world events and adverse publicity, and their impact on the demand for cruises; accidents, unusual weather patterns or natural disasters, such as hurricanes and earthquakes, and other incidents, (including machinery and equipment failures or improper operation thereof), which could cause the alteration of itineraries or cancellation of a cruise or series of cruises and the impact of the spread of contagious diseases, affecting the health, safety, security and vacation satisfaction of passengers; changing consumer preferences, which may, among other things, adversely impact the demand for cruises; the ability of Carnival Corporation & plc to implement its shipbuilding programs and brand strategies and to continue to expand its business worldwide; Carnival Corporation & plc’s future operating cash flow may not be sufficient to fund future obligations and Carnival Corporation & plc may not be able to obtain financing, if necessary, on terms that are favorable or consistent with Carnival Corporation & plc’s expectations; Carnival Corporation & plc’s ability to attract and retain qualified shipboard crew and maintain good relations with employee unions; the impact of changes in operating and financing costs, including changes in foreign currency exchange rates and interest rates and fuel, food, payroll, insurance and security costs; the impact of pending or threatened litigation; changes in and compliance with the environmental, health, safety, security, tax and other regulatory regimes under which Carnival Corporation & plc operates, including the implementation of U.S. regulations requiring U.S. citizens to obtain passports for travel to or from additional foreign destinations; continued availability of attractive port destinations; Carnival Corporation & plc’s ability to successfully implement cost reduction plans and the continuing financial viability of Carnival Corporation & plc’s travel agent distribution system and air service providers. 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 listing rules, Carnival Corporation & plc expressly disclaims 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.

[jacketwatch]

:cool: If they are making that much $$ then it should be a breeze to provide refunds inre the above suit vs. :grin: HAL.