MIAMI (December 19, 2014) – Carnival Corporation & plc (NYSE/LSE:
CCL; NYSE: CUK) announced non-GAAP net income for the full year 2014 of $1.5
billion, or $1.96 diluted EPS, compared to non-GAAP net income of $1.2 billion,
or $1.58 diluted EPS, for the prior year.
Full year 2014 U.S. GAAP net income was $1.2 billion, or $1.59 diluted
EPS, which included unrealized losses (non-cash) on fuel derivatives of $268
million and $20 million of net charges. Full year 2013 U.S. GAAP net income was
$1.1 billion, or $1.39 diluted EPS, which included net unrealized gains
(non-cash) on fuel derivatives of $36 million and impairments and other charges
of $190 million.
Revenues for the full year 2014
were $15.9 billion compared to $15.5 billion for the prior year. Cash from
operations for the full year 2014 totaled $3.4 billion compared to $2.8 billion
in 2013.
Carnival Corporation & plc President and Chief Executive Officer
Arnold Donald noted, “Full year earnings were significantly higher than the
prior year primarily due to strong profit improvement at both our Carnival
Cruise Lines and Costa Cruises brands. We enjoyed some early wins from our
collaboration efforts that contributed to our improved results, particularly
for onboard revenues. We worked hard to contain costs and achieved an almost
five percent reduction in fuel consumption for the year as we continue to
implement energy conservation measures. We also made a number of strategic decisions
in fleet investments that will position us well for the future.”
Commenting on the fourth quarter Donald stated, “Last quarter operating
profit more than doubled due to higher ticket prices and onboard spending
combined with lower costs, also exceeding previous guidance.” During the
quarter, the Carnival Cruise Lines brand achieved a significant increase in
revenue yields despite a highly competitive environment in the Caribbean . Additionally, Costa’s Asia
operations achieved double-digit revenue yield improvement on a capacity
increase in that region.
New ship introductions during the
quarter generated substantial media coverage and positive buzz including the
star-studded North American debut of Regal
Princess which featured a reunion of the Love Boat cast and numerous guest
stars who appeared on the hit TV show, as well as the delivery of Costa Diadema at a stunning and festive
inaugural in Genoa , Italy
Key metrics
for the fourth quarter 2014 compared to the prior year were as follows:
·
Revenues of $3.72 billion compared to $3.66
billion in the prior year.
·
On a constant dollar basis, net revenue yields (net
revenue per available lower berth day or “ALBD”) increased 2.8 percent for 4Q
2014, which was better than the company’s September guidance, up 1.5 to 2.5
percent. Gross revenue yields decreased 0.2 percent in current dollars.
·
Net cruise costs excluding fuel per ALBD
decreased 1.7 percent in constant dollars, which was in line with September
guidance, down 1 to 2 percent. Gross cruise costs including fuel per ALBD in
current dollars decreased 5.3 percent.
·
Fuel prices declined 13 percent to $584 per
metric ton for 4Q 2014 from $671 per metric ton in 4Q 2013 and were better than
the September guidance of $635 per metric ton.
·
Fuel consumption per ALBD decreased 4.8 percent
in 4Q 2014 compared to the prior year.
·
Non-GAAP net income was $210 million, or $0.27
diluted EPS, before U.S. GAAP unrealized losses (non-cash) on fuel derivatives
of $277 million, or $0.36 diluted EPS, and other charges of $35 million, or
$0.04 diluted EPS.
2015 Outlook
At this time, cumulative advance bookings for the first three quarters of
2015 are ahead of the prior year at slightly higher prices. Since September, booking volumes for the
first three quarters of 2015 are running ahead of last year’s levels at
slightly lower prices driven by transactional currency impacts.
Donald noted, “The current base of business for 2015 builds confidence in
our expectation of continuing yield growth with acceleration in yield
improvement starting in the second quarter.”
Based on current booking trends,
the company forecasts full year 2015 net revenue yields, on a constant dollar
basis, to be up approximately 2 percent compared to the prior year. First
quarter revenue yields (constant dollars) are expected to be slightly higher
than the prior year and improve during the remainder of 2015.
The company expects net cruise costs excluding fuel per ALBD, on a
constant dollar basis, for full year 2015 to be up approximately 3 percent
primarily due to higher dry-dock costs, advertising expenses and product
enhancements. Based on current spot prices for fuel, forecasted fuel costs for
the full year 2015 are expected to decrease $475 million compared to 2014, net
of fuel derivatives, benefiting the company by $0.61 per share. This is
forecasted to be partially offset by unfavorable movements in currency exchange
rates worth $0.20 per share (includes both translational and transactional
currency exchange impacts). Taking the above factors into consideration, the
company forecasts full year 2015 non-GAAP diluted earnings per share to be in
the range of $2.30 to $2.60, compared to 2014 non-GAAP diluted earnings of $1.96
per share.
Looking forward, Donald stated, “Based on our current 2015 guidance, we
expect to achieve a 50 percent improvement in earnings compared to 2013 and are
firmly on a path toward delivering double-digit returns on invested capital.”
First Quarter 2015 Outlook
First quarter constant
dollar net revenue yields are expected to be flat to up 1.0 percent compared to
the prior year. Net cruise costs excluding fuel per ALBD for the first quarter
are expected to be 5.5 to 6.5 percent higher on a constant dollar basis
compared to the prior year and are higher than full year guidance mostly due to
the timing of expenses between quarters. Current currency exchange rates and
fuel prices net of fuel derivatives are expected to benefit first quarter
earnings by $130 million compared to the prior year, or $0.16 per share. Based
on the above factors, the company expects non-GAAP diluted earnings for the
first quarter 2015 to be in the range of $0.07 to $0.11 per share, compared to 2014
non-GAAP earnings of $0.00 per share.
Selected Key
Forecast Metrics
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Full Year 2015
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First Quarter 2015
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Year
over year change:
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Current
Dollars
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Constant Dollars
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Current
Dollars
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Constant Dollars
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Net revenue yields
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approx.
(1) %
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approx.
2 %
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(2.0)
to (3.0) %
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0.0
to 1.0 %
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Net
cruise costs excl. fuel / ALBD
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approx.
0 %
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approx.
3 %
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2.0
to 3.0 %
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5.5
to 6.5 %
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Full Year 2015
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First Quarter 2015
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Fuel
price per metric ton
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$
436
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$
421
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Fuel
consumption (metric tons in thousands)
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3,170
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780
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Currency:
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Euro
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$1.23
to €1
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$1.23
to €1
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$1.57
to £1
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$1.57
to £1
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Australian dollar
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$0.83 to A$1
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$0.83 to A$1
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