The largest cruise company in the world, Carnival Corporation & plc, has announced non-GAAP net income of US$1.2 billion for the third quarter of 2012.
Better than anticipated in the company’s June guidance, Carnival Corporation & plc chairman and CEO Micky Arison attributed the elevated earnings to higher than expected revenue yields and lower than expected costs, in part due to the timing of certain expenses.
“The significant efforts of our brand management teams were successful in partially mitigating the decline in cruise ticket prices,” Mr Arison said.
“Onboard revenue yields (constant dollars excluding Costa) improved three percent during the quarter.”
The company also repurchased two million shares valued at USD$67 million during the third quarter.
In keeping with the company’s strategy of launching two to three new ships per year, Carnival Corporation & plc currently has seven new ships scheduled for delivery between 2013 and 2016 with capacity growth directed toward developing emerging cruise markets.
The company is set to continue capitalising on Asia’s cruise boom with the deployment of a second Costa ship in China and the launch of a new Princess Cruises program designed specifically for the Japanese market.
“Looking forward, we remain committed to a measured pace of newbuilds and achieving a strategic balance of supply and demand in established markets,” Mr Arison said.
“Our lower capital commitments should result in significant excess free cash flow in the coming years which we intend to return to shareholders.”
Fleetwide booking volumes and pricing trends for the remainder of 2012 and the beginning of 2013 have continued to strengthen with booking volumes (excluding Costa) increasing by nine percent year-on-year in the last six-weeks.
Booking volumes for Costa over the same period have also increased nine percent however cumulative advance bookings, whilst improved, remain at five occupancy points behind 2011.
“The pace of booking volumes remains healthy enabling us to continue catching up on occupancy levels, while pricing has gradually improved,” Mr Arison said.
“Both of these trends leave us well positioned for a recovery in cruise ticket prices beginning the second quarter of 2013.”
Excluding Costa, Carnival Corporation & plc expect full 2012 net revenue yields on a constant dollar basis to be flat to down slightly, an improvement on previous guidance.