Cruise giant Carnival Corp. posts quarterly profit decline
cents per share…and we exceeded the midpoint of our guidance by seven cents,” said Arnold Donald, company president and CEO, during an earnings call with analysts.
Donald said the quarter’s results combined with a “strong booked position” for future cruises this year has enabled the cruise company to raise full year adjusted earnings per share guidance, now expected to be between $3.60 and $3.70. In March, the company had forecast guidance of $3.50-$3.70.
“Strong execution drove significant operational improvements, which more than offset the substantial drag from fuel and currency, Donald noted in an earlier earnings press release.
Also aiding the quarter’s results: a more than 5 percent improvement in cruise ticket prices, Donald said. Additionally, the period posted gains in onboard spending and other revenue.
Carnival’s second-quarter earnings beat analysts’ estimates of 42 cents per share and revenue of $3.87 billion, according to Zacks Equity Research.
The cruise company's nine cruise brands are Carnival Cruise Line, Princess Cruises, Holland America Line, Seabourn, Cunard, Costa Cruises, AIDA Cruises, P&O Cruises (UK) and P&O Cruises (Australia). They join Fathom, a former cruise concept that now operates as the company’s immersion and enrichment experience travel brand.
Highlights of the second quarter included the delivery of the Majestic Princess, Princess’s new ship earmarked for the China market, and the addition of AIDAperla to the company’s German brand, AIDA.
Two additional Princess ships — Caribbean Princess and Royal Princess — were also outfitted with the company’s new Ocean Medallion guest enhancement platform. The wearable technology — effectively an interactive concierge service — will make its debut on Regal Princess when it sails this November.
Looking ahead, cumulative fleet-wide bookings for the next three quarters are running ahead of the prior year “at nicely higher prices,” said David Bernstein, Carnival Corp.’s chief financial officer.
“We are realizing sustained strength in booking trends across all core products,” including Caribbean and seasonal European cruises, Donald added.
The company, however, is seeing some softness in China, considered an “embryonic market” due likely to the travel ban prohibiting Chinese citizens from traveling to South Korea, he noted.
Carnival is expecting adjusted earnings per share for the third quarter 2017 to be in the range of $2.16 to $2.20, compared to $1.92 in the 2016 period.
In trading Thursday, the company’s stock finished down 74 cents or 1.1 percent to $65.69 on the New York Stock Exchange, just below a 52-week high of 67.30.