TIDMCCL
CARNIVAL CORPORATION & PLC REPORTS ALL-TIME RECORD REVENUE AND DEMONSTRATES
STRONG THIRD QUARTER 2023 EARNINGS MOMENTUM
MIAMI, Sept. 29, 2023 /PRNewswire/ -- Carnival Corporation & plc (NYSE/LSE: CCL;
NYSE: CUK) reports third quarter 2023 earnings and provides an outlook for the
full year and fourth quarter 2023.
· U.S. GAAP net income of $1.07 billion, or $0.79 diluted EPS, and adjusted
net income of $1.18 billion, or $0.86 adjusted EPS, exceeded the June guidance
range (see "Non-GAAP Financial Measures" below).
· Adjusted EBITDA of $2.22 billion also exceeded the June guidance range (see
"Non-GAAP Financial Measures" below).
· Third quarter revenues hit an all-time high of $6.9 billion.
· Continued strength in close-in demand enabled the company to increase its
net per diems guidance for full year 2023 by one percentage point to up
approximately 7.0 percent compared to 2019 (in constant currency).
· Booking volumes during the third quarter and the month of September
continued at significantly elevated levels.
· The company's cumulative advanced booked position for full year 2024 is well
above the high end of the historical range at higher prices (in constant
currency) than 2023 levels.
· Total customer deposits reached a third quarter record of $6.3 billion.
· The company now expects fuel consumption per available lower berth day
("ALBD") for full year 2023 to be nearly 16 percent lower than 2019, better than
previously expected.
· The company reduced its debt by nearly $4 billion from its peak in the first
quarter of 2023 and ended the third quarter with $5.7 billion of liquidity.
"We delivered over $1 billion to the bottom line with revenue reaching an all
-time high" commented Carnival Corporation & plc's Chief Executive Officer Josh
Weinstein. "Both revenue and earnings significantly exceeded expectations this
quarter enabling us to take up expectations for the year."
Weinstein continued, "The outperformance was driven by strength in demand, with
both our North America and Australia segment and Europe segment equally
outperforming expectations. It is gratifying to see the power of our portfolio
deliver, as our continental European brands have stepped up nicely. Our demand
generation efforts are working across all regions, as we have consistently been
achieving quarterly net per diems well in excess of 2019 levels, while closing
the occupancy gap by 11 points over the course of the year."
Weinstein added, "I continue to be encouraged with our revenue trajectory
heading into next year as we see no signs of slowing from our consumers."
Third Quarter 2023 Results
· For the first time since the resumption of guest cruise operations, U.S.
GAAP net income turned positive, generating $1.07 billion, or $0.79 diluted EPS,
marking a significant milestone. Adjusted net income of $1.18 billion, or $0.86
adjusted EPS, exceeded the June guidance range of $0.95 billion to $1.05
billion.
· Adjusted EBITDA of $2.22 billion also exceeded the June guidance range of
$2.05 billion to $2.15 billion.
· Third quarter revenues hit an all-time high of $6.9 billion.
· While gross margin yields were down compared to 2019, net yields (in
constant currency) exceeded strong 2019 levels (see "Non-GAAP Financial
Measures" below).
· Occupancy in the third quarter of 2023 was 109 percent, better than the
company's expectations and a return to historical levels.
· Gross margin per diems were down compared to 2019. Net per diems (in
constant currency) exceeded 2019 levels, overcoming headwinds from the removal
of St. Petersburg, Russia as a marquee destination and were approximately one
percentage point above the midpoint of the June guidance range (see "Non-GAAP
Financial Measures" below).
· Cruise costs per ALBD increased 8.9 percent as compared to the third quarter
of 2019. Adjusted cruise costs excluding fuel per ALBD (in constant currency)
increased 15 percent compared to the third quarter of 2019, in line with June
guidance (see "Non-GAAP Financial Measures" below).
· Total customer deposits reached a third quarter record of $6.3 billion,
surpassing the previous third quarter record of $4.9 billion (as of August 31,
2019), by 28 percent.
Bookings
Booking volumes during the third quarter continued at significantly elevated
levels, setting a new third quarter record for total bookings during the
quarter. Weinstein noted, "We are maintaining strong momentum and continuing to
build demand through our improved commercial execution. Booking volumes during
the quarter were running nearly 20 percent above 2019 levels and multiples of
our capacity growth, which has continued into September. This has helped us
extend the booking curve even further, with our North American brands exceeding
historical highs and our European brands essentially achieving pre-pause
levels."
The cumulative advanced booked position for full year 2024 is well above the
high end of the historical range at higher prices (in constant currency) than
2023 levels. This aligns with the company's yield management strategy to base
load bookings, lengthen the booking curve and optimize net yields. Weinstein
added, "Our booked position for 2024 is further out than we have ever seen and
at strong prices. With less remaining inventory to sell, despite a five percent
increase in capacity, we are well positioned to drive pricing higher and deliver
strong yield improvement in 2024."
2023 Outlook
For the full year 2023, the company expects:
· Adjusted EBITDA of $4.1 billion to $4.2 billion, within the June guidance
range, despite the $125 million net unfavorable impact from fuel price and
currency from June guidance
· Occupancy of 100 percent or higher
· Net per diems (in constant currency) up approximately 7.0 percent compared
to 2019, one percentage point higher than the midpoint of June guidance, based
on the continued strength in close-in demand
· Adjusted cruise costs excluding fuel per ALBD (in constant currency) at the
high end of June guidance range
· Fuel consumption per ALBD to be nearly 16 percent lower than 2019, better
than previously expected
For the fourth quarter of 2023, the company expects:
· Adjusted EBITDA of $800 million to $900 million
· Net yields (in constant currency) up mid-single digits compared to 2019 with
occupancy in line with historical levels and net per diems (in constant
currency) up 7.0% to 8.0% compared to 2019
See "Guidance" and "Reconciliation of Forecasted Data" for additional
information on the company's 2023 outlook.
Financing and Capital Activity
Carnival Corporation & plc Chief Financial Officer David Bernstein noted, "We
are accelerating our debt repayment efforts and aggressively managing down our
interest expense. In just the last six months, we have reduced our debt balance
by over 10 percent or nearly $4 billion. With improving performance, growing
operating cash flows and $5.7 billion of liquidity, we are on a path to end the
year with less than $31 billion of debt."
The third quarter generated cash from operations of $1.8 billion and adjusted
free cash flow of $1.1 billion. The company expects continued growth in adjusted
free cash flow to be the driver for paying down debt over time.
The company took the following actions to proactively manage its debt portfolio
since May 31, 2023:
· Completed a $1.3 billion senior secured first lien term loan B facility due
2027 and completed a $500 million private offering of first-priority Senior
Secured Notes due 2029 to repay its existing U.S. dollar first-priority secured
term loan facility maturing in 2025
· Called $1.2 billion of its highest cost debt
· Prepaid an additional $1.1 billion of debt with maturities from 2024 through
2027
· On an annualized basis, saved $200 million in gross interest expense and
approximately $100 million in net interest expense as a result of lower interest
income following these debt prepayments
During the third quarter of 2023, the company reduced its debt by $2.4 billion
and ended the third quarter with $5.7 billion of liquidity, including cash and
borrowings available under the revolving credit facility. In addition, $0.9
billion of customer deposit reserves were returned to the company, leaving a
balance of $1.3 billion held in reserve by the credit card providers as of
August 31, 2023. Substantially all of the credit card reserves are expected to
be returned by the end of 2024.
Other Recent Highlights
· Carnival Corporation was named one of America's Best Employers for Women by
Forbes for the second year.
· Seabourn took delivery of Seabourn Pursuit, sister to Seabourn Venture, the
line's second purpose-built ultra-luxury expedition ship.
· Carnival Cruise Line named its new destination in Grand Bahama Island
"Celebration Key", which is expected to open in the second half of 2025.
· Holland America Line had its highest booking day in the brand's 150-year
history on July 11.
· Cunard became the company's fourth brand to enable shore power connection
capability across its entire fleet.
· Cunard announced a three-year partnership with the UK's leading film
organization, British Film Institute, which will feature short films and beloved
blockbusters shown exclusively on the outdoor screen onboard Queen Anne, the
lines newest ship expected April 2024.
· Carnival Corporation continues to expand next generation internet across its
fleet with the installation of SpaceX's Starlink on Costa Cruises, Cunard and
P&O Cruises (UK) ships, with plans for all of the company's capacity to have
Starlink capability by the end of the first quarter of 2024.
· P&O Cruises (UK) is delighted to have been chosen by publisher St James's
House as the only cruise brand to be featured in King Charles III The Leadership
and Vision of a Modern Monarch album.
Guidance
(See "Reconciliation
of Forecasted Data")
4Q 2023 Full
Year
2023
Change compared to Current Constant Current Constant Currency
2019 Dollars Currency Dollars
Net per diems 5.5% to 7.0% to Approx. Approx. 7.0%
6.5% 8.0% 5.5%
Adjusted cruise costs 8.5% to 10.0% to Approx. Approx. 11.0%
excluding fuel per 9.5% 11.0% 9.5%
ALBD
4Q 2023 Full Year 2023
ALBDs (in 23.3 91.3
millions) (a)
Capacity growth 7.1 % 4.5 %
compared to 2019
Occupancy 101% or higher 100% or higher
percentage (a)
Fuel 0.7 2.9
consumption in
metric tons (in
millions)
Fuel cost per $ $
metric ton 765 700
consumed
Fuel expense (in $ $
billions) 0.6 2.0
Depreciation and $ $
amortization (in 0.6 2.4
billions)
Interest expense, $ $
net of capitalized 0.4 1.9
interest and
interest
income (in
billions)
Adjusted $800 to $900 $4,100 to $4,200
EBITDA (in
millions)
Adjusted net $(225) to $(125) $(150) to $(50)
income (loss) (in
millions)
Adjusted earnings $(0.18) to $(0.10) $(0.12) to $(0.04)
per share
Weighted-average 1,263 1,262
shares outstanding
-
diluted
Currencies (USD to
1)
AUD $ $
0.64 0.67
CAD $ $
0.74 0.74
EUR $ $
1.06 1.08
GBP $ $
1.22 1.24
(a) See "Notes
to Statistical
Information"
Sensitivities (impact 4Q 2023
to adjusted
net income (loss) in
millions)
1% change in net per
$
diems
39
1% change in adjusted $
cruise costs
24
excluding fuel per
ALBD
1% change in currency $
exchange
4
rates
10% change in fuel
$
price
55
100 basis point
$
change in variable
16
rate debt (including
derivatives)
Capital Expenditures
The company's annual capital expenditures, which include year-to-date actuals
for 2023, are as follows:
(in 2023 2024 2025
2026
billions)
Contracted $ $ $
$
newbuild 1.9 2.4 1.0
-
Non 1.5 1.7 1.7
1.7
-newbuild
Total (a) $ $ $
$
3.4 4.1 2.7
1.7
(a) Future capital
expenditures
will fluctuate
with foreign
currency
movements
relative to the
U.S. Dollar.
These figures do
not include
potential ship
additions that
the company may
elect in the
future.
Committed Ship Financings
(in 2023 2024 2025
billions)
Future $ $ $
export - 2.2 0.7
credit
facilities
at August
31,
2023
Outstanding Debt Maturities
As of August 31, 2023, the company's outstanding debt maturities are as follows:
(in 2023 2024 2025
2026
billions)
First Lien $ $ $
$
0.0 0.0 0.9
0.0
Second Lien - - -
-
Export 0.3 1.2 1.2
1.2
Credits
All other 0.2 0.8 0.2
2.0
Total $ $ $
$
Principal 0.5 2.0 2.2
3.2
payments on
outstanding
debt
Refer to Financial Information within the Investor Relations section of the
corporate website for further details on the company's Debt Maturities:
https://www.carnivalcorp.com/financial-information/supplemental-schedules
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 earnings release. This call can be listened
to live, and additional information can be obtained, via Carnival Corporation &
plc's website
at www.carnivalcorp.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=658931428&u=https%3A%2F%2Fwww.carnivalcorp.com%2F&a=www.carnivalcorp.com) an
d www.carnivalplc.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=3894711354&u=https%3A%2F%2Fwww.carnivalplc.com%2F&a=www.carnivalplc.com).
Carnival Corporation & plc is the largest global cruise company, and among the
largest leisure travel companies, with a portfolio of world-class cruise lines -
AIDA Cruises, Carnival Cruise Line, Costa Cruises, Cunard, Holland America Line,
P&O Cruises (Australia), P&O Cruises (UK), Princess Cruises, and Seabourn.
Additional information can be found
on www.carnivalcorp.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=658931428&u=https%3A%2F%2Fwww.carnivalcorp.com%2F&a=www.carnivalcorp.com), w
ww.aida.de (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=3703779113&u=https%3A%2F%2Fwww.aida.de%2F&a=www.aida.de), www.carnival.com (
https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=2790760729&u=https%3A%2F%2Fwww.carnival.com%2F&a=www.carnival.com), www.cos
tacruise.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=1585794257&u=https%3A%2F%2Fwww.costacruise.com%2F&a=www.costacruise.com), ww
w.cunard.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=103404015&u=https%3A%2F%2Fwww.cunard.com%2F&a=www.cunard.com), www.hollandam
erica.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=3035220645&u=https%3A%2F%2Fwww.hollandamerica.com%2F&a=www.hollandamerica.co
m), www.pocruises.com.au (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=2329420164&u=https%3A%2F%2Fwww.pocruises.com.au%2F&a=www.pocruises.com.au),
www.pocruises.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=1040698330&u=https%3A%2F%2Fwww.pocruises.com%2F&a=www.pocruises.com), www.pr
incess.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=3972650538&u=https%3A%2F%2Fwww.princess.com%2F&a=www.princess.com) and www.s
eabourn.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=918750718&u=https%3A%2F%2Fwww.seabourn.com%2F&a=www.seabourn.com). For more
information on Carnival Corporation's industry-leading sustainability
initiatives,
visit www.carnivalsustainability.com (https://c212.net/c/link/?t=0&l=en&o=3983742
-1&h=3776475010&u=https%3A%2F%2Fwww.carnivalsustainability.com%2F&a=www.carnivals
ustainability.com).
Cautionary Note Concerning Factors That May Affect Future Results
Some of the statements, estimates or projections contained in this document are
"forward-looking statements" that involve risks, uncertainties and assumptions
with respect to us, including some statements concerning future results,
operations, outlooks, plans, goals, reputation, cash flows, liquidity 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, as amended. 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," "aspiration," "anticipate," "forecast," "project," "future," "intend,"
"plan," "estimate," "target," "indicate," "outlook," and similar expressions of
future intent or the negative of such terms.
Forward-looking statements include those statements that relate to our outlook
and financial position including, but not limited to, statements regarding:
· Pricing · Adjusted net income
(loss)
· Booking levels · Adjusted EBITDA
· Occupancy · Adjusted earnings per
share
· Interest, tax and fuel · Adjusted free cash
expenses flow
· Currency exchange rates · Net per diems
· Goodwill, ship and · Net yields
trademark fair values
· Liquidity and credit · Adjusted cruise costs
ratings per ALBD
· Investment grade leverage · Adjusted cruise costs
metrics excluding fuel per ALBD
· Estimates of ship · Adjusted return on
depreciable lives and invested capital
residual values
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 by our forward-looking
statements. 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. Additionally, many of these risks and uncertainties are
currently, and in the future may continue to be, amplified by our substantial
debt balance as a result of the pause of our guest cruise operations. There may
be additional risks that we consider immaterial or which are unknown. These
factors include, but are not limited to, the following:
· Events and conditions around the world, including war and other military
actions, such as the war in Ukraine, inflation, higher fuel prices, higher
taxes, higher interest rates and other general concerns impacting the ability or
desire of people to travel have led, and may in the future lead, to a decline in
demand for cruises as well as negative impacts to our operating costs and
profitability.
· Pandemics have in the past and may in the future have a significant negative
impact on our financial condition and operations.
· Incidents concerning our ships, guests or the cruise industry have in the
past and may, in the future, negatively impact the satisfaction of our guests
and crew and lead to reputational damage.
· Changes in and non-compliance with laws and regulations under which we
operate, such as those relating to health, environment, safety and security,
data privacy and protection, anti-corruption, economic sanctions, trade
protection, labor and employment, and tax have in the past and may, in the
future, lead to litigation, enforcement actions, fines, penalties and
reputational damage.
· Factors associated with climate change, including evolving and increasing
regulations, increasing global concern about climate change and the shift in
climate conscious consumerism and stakeholder scrutiny, and increasing frequency
and/or severity of adverse weather conditions could adversely affect our
business.
· Inability to meet or achieve our sustainability related goals, aspirations,
initiatives, and our public statements and disclosures regarding them, may
expose us to risks that may adversely impact our business.
· Breaches in data security and lapses in data privacy as well as disruptions
and other damages to our principal offices, information technology operations
and system networks and failure to keep pace with developments in technology may
adversely impact our business operations, the satisfaction of our guests and
crew and may lead to reputational damage.
· The loss of key team members, our inability to recruit or retain qualified
shoreside and shipboard team members and increased labor costs could have an
adverse effect on our business and results of operations.
· Increases in fuel prices, changes in the types of fuel consumed and
availability of fuel supply may adversely impact our scheduled itineraries and
costs.
· We rely on supply chain vendors who are integral to the operations of our
businesses. These vendors and service providers may be unable to deliver on
their commitments, which could negatively impact our business.
· Fluctuations in foreign currency exchange rates may adversely impact our
financial results.
· Overcapacity and competition in the cruise and land-based vacation industry
may negatively impact our cruise sales, pricing and destination options.
· Inability to implement our shipbuilding programs and ship repairs,
maintenance and refurbishments may adversely impact our business operations and
the satisfaction of our guests.
· Failure to successfully implement our business strategy following our
resumption of guest cruise operations would negatively impact the occupancy
levels and pricing of our cruises and could have a material adverse effect on
our business. We require a significant amount of cash to service our debt and
sustain our operations. Our ability to generate cash depends on many factors,
including those beyond our control, and we may not be able to generate cash
required to service our debt and sustain our operations.
The ordering of the risk factors set forth above is not intended to reflect our
indication of priority or likelihood.
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 document, 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.
Forward-looking and other statements in this document may also address our
sustainability progress, plans and goals (including climate change and
environmental-related matters). In addition, historical, current and forward
-looking sustainability- and climate-related statements may be based on
standards and tools for measuring progress that are still developing, internal
controls and processes that continue to evolve, and assumptions and predictions
that are subject to change in the future and may not be generally shared.
CARNIVAL CORPORATION &
PLCCONSOLIDATED
STATEMENTS OF INCOME
(LOSS)(UNAUDITED)(in
millions, except per
share data)
Three Nine Months
Months EndedAugust
EndedAugust 31,
31,
2023 2022 2023 2022
Revenues
Passenger ticket $ $ $ $
4,546 2,595 10,557 4,753
Onboard and other 2,308 1,711 5,640 3,577
6,854 4,305 16,197 8,329
Operating Expenses
Commissions, 823 565 2,097 1,141
transportation and
other
Onboard and other 752 537 1,785 1,060
Payroll and related 585 563 1,768 1,601
Fuel 468 668 1,492 1,577
Food 364 259 1,000 586
Ship and other - - - 8
impairments
Other operating 928 787 2,546 2,118
Cruise and tour 3,921 3,379 10,688 8,092
operating expenses
Selling and 713 625 2,162 1,774
administrative
Depreciation and 596 581 1,774 1,707
amortization
5,230 4,585 14,624 11,573
Operating Income (Loss) 1,624 (279) 1,572 (3,244)
Nonoperating Income
(Expense)
Interest income 59 24 183 34
Interest expense, net (518) (422) (1,600) (1,161)
of capitalized interest
Debt extinguishment (81) - (112) -
and modification costs
Other income (19) (81) (67) (108)
(expense), net
(559) (479) (1,595) (1,235)
Income (Loss) Before 1,065 (759) (23) (4,478)
Income Taxes
Income Tax Benefit 9 (11) (3) (17)
(Expense), Net
Net Income (Loss) $ $ $ $
1,074 (770) (26) (4,495)
Earnings Per Share
Basic $ $ $ $
0.85 (0.65) (0.02) (3.89)
Diluted $ $ $ $
0.79 (0.65) (0.02) (3.89)
Weighted-Average Shares 1,263 1,185 1,262 1,154
Outstanding - Basic
Weighted-Average Shares 1,396 1,185 1,262 1,154
Outstanding - Diluted
CARNIVAL CORPORATION &
PLCCONSOLIDATED BALANCE
SHEETS(UNAUDITED)(in
millions, except par values)
August 31, November 30,
2023 2022
ASSETS
Current Assets
Cash and cash equivalents $ 2,842 $ 4,029
Restricted cash 18 1,988
Trade and other receivables, 485 395
net
Inventories 483 428
Prepaid expenses and other 855 652
Total current assets 4,683 7,492
Property and Equipment, Net 39,952 38,687
Operating Lease Right-of-Use 1,277 1,274
Assets, Net
Goodwill 579 579
Other Intangibles 1,168 1,156
Other Assets 2,098 2,515
$ 49,756 $ 51,703
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current Liabilities
Short-term borrowings $ - $ 200
Current portion of long-term 1,780 2,393
debt
Current portion of operating 153 146
lease liabilities
Accounts payable 1,103 1,050
Accrued liabilities and other 2,017 1,942
Customer deposits 5,955 4,874
Total current liabilities 11,008 10,605
Long-Term Debt 29,516 31,953
Long-Term Operating Lease 1,180 1,189
Liabilities
Other Long-Term Liabilities 1,091 891
Shareholders' Equity
Common stock of Carnival 12 12
Corporation, $0.01 par value;
1,960 shares authorized;
1,250 shares at 2023 and
1,244 shares at 2022 issued
Ordinary shares of Carnival 361 361
plc, $1.66 par value; 217
shares at 2023 and 2022
issued
Additional paid-in capital 16,699 16,872
Retained earnings 233 269
Accumulated other (1,896) (1,982)
comprehensive income (loss)
Treasury stock, 130 shares at (8,449) (8,468)
2023 and 2022 of Carnival
Corporation and 73 shares at
2023 and 72 shares at 2022 of
Carnival plc, at cost
Total shareholders' equity 6,960 7,065
$ 49,756 $ 51,703
CARNIVAL
CORPORATION &
PLCOTHER
INFORMATION
OTHER BALANCE August 31, 2023 November 30, 2022
SHEET
INFORMATION (in
millions)
Liquidity (a) $ $ 8,635
5,730
Debt (current $ $ 34,546
and long 31,296
-term)
Customer $ $ 5,089
deposits 6,261
(current and
long
-term)
(a) November 30, 2022
liquidity includes
restricted cash from the
2028 Senior Priority
Notes which became
unrestricted in December.
Three Months Nine Months
EndedAugust EndedAugust
31, 31,
STATISTICAL 2023 2022 2023 2022
INFORMATION
Passenger 25.8 17.7 67.8 36.4
cruise days
("PCDs") (in
millions) (a)
ALBDs (in 23.7 21.0 68.1 51.0
millions) (b)
Occupancy 109 % 84 % 100 % 71 %
percentage
(c)
Passengers 3.6 2.6 9.3 5.2
carried (in
millions)
Fuel 0.7 0.7 2.2 1.9
consumption
in
metric
tons (in
millions)
Fuel 31.1 33.4 32.3 37.2
consumption
in
metric tons
per thousand
ALBDs
Fuel cost per $ $ $ $
metric ton 636 958 681 836
consumed
Currencies
(USD to 1)
AUD $ $ $ $
0.66 0.70 0.67 0.71
CAD $ $ $ $
0.75 0.78 0.74 0.78
EUR $ $ $ $
1.09 1.03 1.08 1.08
GBP $ $ $ $
1.27 1.21 1.24 1.28
Notes to
Statistical
Information
(a) PCD represents the number of cruise passengers on a voyage
multiplied by the number of revenue-producing ship operating days
for that voyage.
(b) ALBD is a standard measure of passenger capacity for the period
that we use to approximate rate and capacity variances, based on
consistently applied formulas that we use to perform 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.
(c) Occupancy, in accordance with cruise industry practice, is
calculated using a numerator of PCDs and a denominator of ALBDs,
which assumes two passengers per cabin even though some cabins
can accommodate three or more passengers. Percentages in excess
of 100% indicate that on average more than two passengers
occupied some cabins.
CARNIVAL
CORPORATION &
PLCNON
-GAAP
FINANCIAL
MEASURES
Three Nine Months
Months EndedAugust 31,
EndedAugust
31,
(in millions) 2023 2022 2023 2022
Net income $ $ $ $
(loss) 1,074 (770) (26) (4,495)
(Gains) losses - - (54) 1
on ship sales
and
impairments
Debt 81 - 112 -
extinguishment
and
modification
costs
1 - 16 2
Restructuring
expenses
Other 20 82 43 53
Adjusted net $ $ $ $
income (loss) 1,176 (688) 90 (4,439)
Interest 518 422 1,600 1,161
expense, net
of
capitalized
interest
Interest (59) (24) (183) (34)
income
Income tax (9) 11 3 17
(expense),
benefit
Depreciation 596 581 1,774 1,707
and
amortization
Adjusted $ $ $ 3,285 $
EBITDA 2,221 303 (1,588)
Three Nine Months
Months EndedAugust 31,
EndedAugust
31,
2023 2022 2023 2022
Earnings per $ $ $ $
share (a) 0.79 (0.65) (0.02) (3.89)
(Gains) losses - - (0.04) -
on ship sales
and
impairments
Debt 0.06 - 0.09 -
extinguishment
and
modification
costs
Restructuring - - 0.01 -
expenses
Other 0.01 0.07 0.03 0.05
Adjusted $ $ $ $
earnings per 0.86 (0.58) 0.07 (3.85)
share
(a)
Weighted 1,396 1,185 1,262 1,154
-average
shares
outstanding -
diluted (in
millions)
(a) Earnings
per share
and
adjusted
earnings
per share
for the
three
months
ended
August 31,
2023
includes
the add
-back of
dilutive
interest
expense
related to
the
company's
convertible
notes of
$24
million.
The add
-back
expense is
anti
-dilutive
to the nine
months
ended
August 31,
2023
calculation
and
accordingly
has been
excluded.
Three Nine Months
Months EndedAugust
EndedAugust 31,
31,
(in millions) 2023 2022 2023 2022
Cash from (used in) $ $ $ $
operations 1,834 (344) 3,359 (1,553)
Capital expenditures (837) (538) (2,609) (3,759)
(Purchases of Property and
Equipment)
Proceeds from export credits 140 - 1,157 2,343
Adjusted free cash flow $ $ $ $
1,137 (883) 1,906 (2,969)
(See Non-GAAP Financial
Measures)
CARNIVAL CORPORATION & PLC
NON-GAAP FINANCIAL MEASURES (CONTINUED)
Data in the below table is compared against 2019 as it is the most recent year
of full operations due to the pause and resumption of guest cruise operations.
Gross margin per diems and net per diems were computed by dividing the gross
margin and adjusted gross margin by PCDs. Gross margin yields and net yields
were computed by dividing the gross margin and adjusted gross margin by ALBDs as
follows:
Three
Nine
Months
Months
Ended
Ended
August
August
31,
31,
(in 2023 2023ConstantCurrency 2019 2023
2023ConstantCurrency 2019
millions,
except
per diems
and yields
data)
Total $ $ $ 16,197
$
revenues 6,854 6,533
16,043
Less: Cruise (3,921) (3,532) (10,688)
(9,833)
and tour
operating
expenses
Depreciation (596) (548) (1,774)
(1,607)
and
amortization
Gross margin 2,337 2,453 3,734
4,604
Less: Tour (172) (200) (216)
(299)
and other
revenues
Add: Payroll 585 548 1,768
1,671
and
related
Fuel 468 401 1,492
1,204
Food 364 284 1,000
821
Ship and - - -
-
other
impairments
Other 928 828 2,546
2,390
operating
Depreciation 596 548 1,774
1,607
and
amortization
Adjusted $ $ 5,133 $ $ 12,099
$ 12,281 $
gross margin 5,107 4,862
11,999
PCDs 25.8 25.8 25.7 67.8
67.8 70.8
Gross margin $ $ $
$
per 90.45 95.54 55.04
65.05
diems (per
PCD)
Net per $ 197.64 $ 198.66 $ $ 178.36
$ 181.05 $
diems (per 189.37
169.53
PCD)
ALBDs 23.7 23.7 22.7 68.1
68.1 65.7
Gross margin $ $ $
$
yields (per 98.50 107.92 54.85
70.11
ALBD)
Net $ 215.22 $ 216.33 $ $ 177.73
$ 180.40 $
yields (per 213.91
182.71
ALBD)
(See Non
-GAAP
Financial
Measures)
CARNIVAL CORPORATION & PLC
NON-GAAP FINANCIAL MEASURES (CONTINUED)
Data in the below table is compared against 2019 as it is the most recent year
of full operations due to the pause and resumption of guest cruise operations.
Cruise costs per ALBD, adjusted cruise costs per ALBD and adjusted cruise costs
excluding fuel per ALBD were computed by dividing cruise costs, adjusted cruise
costs and adjusted cruise costs excluding fuel by ALBDs as follows:
Three
Nine
Months
Months
Ended
Ended
August
August
31,
31,
(in millions, 2023 2023ConstantCurrency 2019 2023
2023ConstantCurrency 2019
except
costs per ALBD
data)
Cruise and $ $ $ 10,688
$
tour 3,921 3,532
9,833
operating
expenses
Selling and 713 563 2,162
1,813
administrative
expenses
Less: Tour and (112) (117) (190)
(220)
other
expenses
Cruise costs 4,522 3,978 12,660
11,426
Less: (823) (803) (2,097)
(2,125)
Commissions,
transportation
and
other
Onboard and (752) (668) (1,785)
(1,620)
other
costs
Gains (losses) - (3) 54
11
on ship
sales and
impairments
Restructuring (1) - (16)
-
expenses
Other - (23) -
(43)
Adjusted 2,946 2,965 2,480 8,817
8,933 7,648
cruise costs
Less: Fuel (468) (468) (401) (1,492)
(1,492) (1,204)
Adjusted $ $ 2,497 $ $
$ 7,441 $
cruise costs 2,478 2,079 7,325
6,444
excluding fuel
ALBDs 23.7 23.7 22.7 68.1
68.1 65.7
Cruise costs $ 190.5 $ 175.01 $ 185.97
$ 173.98
per ALBD
8
% increase 8.9 % 6.9 %
(decrease)
vs 2019
Adjusted $ 124.1 $ 124.98 $ 109.12 $ 129.51
$ 131.22 $ 116.46
cruise costs
per ALBD
6
% increase 14 % 15 % 11 %
13 %
(decrease)
vs 2019
Adjusted $ 104.4 $ 105.25 $ $ 107.59
$ 109.31 $
cruise costs 91.49
98.12
excluding fuel
per 2
ALBD
% increase 14 % 15 % 9.7 %
11 %
(decrease)
vs 2019
(See Non-GAAP
Financial
Measures)
Non-GAAP Financial Measures
We use non-GAAP financial measures and they are provided along with their most
comparative U.S. GAAP financial measure:
Non-GAAP Measure U.S. GAAP Use Non-GAAP Measure to Assess
Measure
· Adjusted net · Net · Company Performance
income (loss) and income
adjusted EBITDA (loss)
· Adjusted · Earnings · Company Performance
earnings per share per share
· Adjusted free · Cash from · Impact on Liquidity Level
cash flow (used in)
operations
· Net per diems · Gross · Cruise Segments Performance
margin per
diems
· Net yields · Gross · Cruise Segments Performance
margin
yields
· Adjusted cruise · Gross · Cruise Segments Performance
costs per ALBD cruise costs
and adjusted per
cruise costs ALBD
excluding
fuel per ALBD
· Adjusted return - · Company Performance
on invested capital
("ROIC")
The presentation of our non-GAAP financial information is not intended to be
considered in isolation from, as a substitute for, or superior to the financial
information prepared in accordance with U.S. GAAP. It is possible that our non
-GAAP financial measures may not be exactly comparable to the like-kind
information presented by other companies, which is a potential risk associated
with using these measures to compare us to other companies.
Adjusted net income (loss) and adjusted earnings per share provide additional
information to us and investors about our future earnings performance by
excluding certain gains, losses and expenses that we believe are not part of our
core operating business and are not an indication of our future earnings
performance. We believe that gains and losses on ship sales, impairment charges,
debt extinguishment and modification costs, restructuring costs and certain
other gains and losses are not part of our core operating business and are not
an indication of our future earnings performance.
Adjusted EBITDA provides additional information to us and investors about our
core operating profitability by excluding certain gains, losses and expenses
that we believe are not part of our core operating business and are not an
indication of our future earnings performance as well as excluding interest,
taxes and depreciation and amortization. In addition, we believe that the
presentation of adjusted EBITDA provides additional information to us and
investors about our ability to operate our business in compliance with the
covenants set forth in our debt agreements. We define adjusted EBITDA as
adjusted net income (loss) adjusted for (i) interest, (ii) taxes and (iii)
depreciation and amortization. There are material limitations to using adjusted
EBITDA. Adjusted EBITDA does not take into account certain significant items
that directly affect our net income (loss). These limitations are best addressed
by considering the economic effects of the excluded items independently and by
considering adjusted EBITDA in conjunction with net income (loss) as calculated
in accordance with U.S. GAAP.
Adjusted free cash flow provides additional information to us and investors to
assess our ability to repay our debt after making the capital investments
required to support ongoing business operations and value creation as well as
the impact on the company's liquidity level. Adjusted free cash flow represents
net cash provided by operating activities adjusted for capital expenditures
(purchases of property and equipment) and proceeds from export credits that are
provided for related capital expenditures. Adjusted free cash flow does not
represent the residual cash flow available for discretionary expenditures as it
excludes certain mandatory expenditures such as repayment of maturing debt.
Net per diems and net yields enable us and investors to measure the performance
of our cruise segments on a per PCD and per ALBD basis. We use adjusted gross
margin rather than gross margin to calculate net per diems and net yields. We
believe that adjusted gross margin is a more meaningful measure in determining
net per diems and net yields than gross margin because it reflects the cruise
revenues earned net of only our most significant variable costs, which are
travel agent commissions, cost of air and other transportation, certain other
costs that are directly associated with onboard and other revenues and credit
and debit card fees.
Adjusted cruise costs per ALBD and adjusted cruise costs excluding fuel per
ALBD enable us and investors to separate the impact of predictable capacity or
ALBD changes from price and other changes that affect our business. We believe
these non-GAAP measures provide useful information to us and investors and
expanded insight to measure our cost performance. Adjusted cruise costs per ALBD
and adjusted cruise costs excluding fuel per ALBD are the measures we use to
monitor our ability to control our cruise segments' costs rather than cruise
costs per ALBD. We exclude gains and losses on ship sales, impairment charges,
restructuring costs and certain other gains and losses that we believe are not
part of our core operating business as well as excluding our most significant
variable costs, which are travel agent commissions, cost of air and other
transportation, certain other costs that are directly associated with onboard
and other revenues and credit and debit card fees. We exclude fuel expense to
calculate adjusted cruise costs excluding fuel. The price of fuel, over which we
have no control, impacts the comparability of period-to-period cost performance.
The adjustment to exclude fuel provides us and investors with supplemental
information to understand and assess the company's non-fuel adjusted cruise cost
performance. Substantially all of our adjusted cruise costs excluding fuel are
largely fixed, except for the impact of changing prices once the number of ALBDs
has been determined.
Adjusted ROIC provides additional information to us and investors about our
operating performance relative to the capital we have invested in the company.
We define adjusted ROIC as the twelve-month adjusted net income (loss) before
interest expense and interest income divided by the monthly average of debt plus
equity minus construction-in-progress, excess cash, goodwill and intangibles.
Reconciliation of Forecasted Data
We have not provided a reconciliation of forecasted non-GAAP financial measures
to the most comparable U.S. GAAP financial measures because preparation of
meaningful U.S. GAAP forecasts would require unreasonable effort. We are unable
to predict, without unreasonable effort, the future movement of foreign exchange
rates and fuel prices. We are unable to determine the future impact of gains and
losses on ship sales, impairment charges, debt extinguishment and modification
costs, restructuring costs and certain other non-core gains and losses.
Constant Currency
Our operations primarily utilize the U.S. dollar, Australian dollar, euro and
sterling as functional currencies to measure results
and financial condition. Functional currencies other than the U.S. dollar
subject us to foreign currency translational risk. Our operations also have
revenues and expenses that are in currencies other than their functional
currency, which subject us to foreign currency transactional risk.
Constant currency reporting removes the impact of changes in exchange rates on
the translation of our operations plus the transactional impact of changes in
exchange rates from revenues and expenses that are denominated in a currency
other than the functional currency.
We report adjusted gross margin, net per diems, adjusted cruise costs excluding
fuel and adjusted cruise costs excluding fuel per ALBD on a "constant currency"
basis assuming the 2023 periods' currency exchange rates have remained constant
with the 2019 periods' rates. These metrics facilitate a comparative view for
the changes in our business in an environment with fluctuating exchange rates.
Examples:
· The translation of our operations with functional currencies other than U.S.
dollar 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.
· Our operations have revenue and expense transactions in currencies other
than their functional currency. If their functional currency strengthens against
these other currencies, it reduces the functional currency revenues and
expenses. If the functional currency weakens against these other currencies, it
increases the functional currency revenues and expenses.
CONTACT: MEDIA CONTACT - Jody Venturoni, +1 469 797 6380; INVESTOR RELATIONS
CONTACT - Beth Roberts, +1 305 406 4832
This information was brought to you by Cision http://news.cision.com
END
(END) Dow Jones Newswires
September 29, 2023 09:15 ET (13:15 GMT)
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