Carnival Corp & plc Fourth Quarter Results
Carnival Corporation & plc Reports Fourth Quarter and Full Year Earnings
Carnival Corporation & plc today announced earnings for the fourth quarter and full year
ended November 30, 2012. The earnings of Carnival Corporation and Carnival plc have been
consolidated, and this statement includes consolidated results on a U.S. GAAP basis.
4Q and Full Year Highlights
* 4Q net revenue yields in constant dollars decreased 4.5% compared to the prior year,
which was better than the company's September guidance, down 5 to 6%
* 4Q net cruise costs, excluding fuel, per available lower berth day ("ALBD") decreased
0.9% in constant dollar, less than September guidance, down 2 to 3%
* 4Q non-GAAP earnings per share (diluted) of $0.13, compared to $0.28 for the prior year
* Full year non-GAAP earnings per share (diluted) of $1.88, compared to $2.42 for the
prior year
* Unfavorable changes in fuel prices and currency exchange rates reduced full year 2012
earnings by $300 million or $0.39 per share, compared to the prior year.
2013 Outlook
* Since September, booking volumes for the first three quarters, including Costa, are
running in line with the strong volumes experienced last year at slightly lower prices
* At this time, cumulative advance bookings for 2013 continue to be behind the prior year
at slightly lower prices
* Net revenue yields on a constant dollar basis for full year 2013 expected to be up 1 to
2%
* Net cruise costs excluding fuel per ALBD for full year 2013 expected to be up 1 to 2%
on a constant dollar basis
* Full year 2013 non-GAAP earnings per share (diluted) expected to be in the range of
$2.20 to $2.40, compared to $1.88 for 2012
* 1Q 2013 non-GAAP earnings per share (diluted) expected to be in the range of $0.03 to
$0.07, compared to $0.02 in 1Q 2012
Chairman and Chief Executive Officer Micky Arison commenting on these results:
"As a result of the Costa Concordia tragedy in January, the past year has been the most
challenging in our company's history. However, through the significant efforts of our brand
management teams, we were able to maintain full year 2012 net revenue yields (excluding Costa)
in line with the prior year. In addition, we drove down net cruise costs, excluding fuel,
slightly and fuel consumption by four percent."
"Cash from operations of $3.0 billion was more than sufficient to fund $1.8 billion in net
capital investments and positioned the company with excess free cash flow to return to
shareholders. Our regular quarterly dividend of $0.25 per share, combined with our recently
announced special year-end dividend of $0.50 per share, will result in $1.2 billion of
dividend distributions to our shareholders. Additionally, since the start of the fiscal year
we purchased 3.5 million of the company's shares in the open market at a cost of $120
million."
"We remain well positioned for a recovery in 2013 and beyond evidenced by the demonstrated
resilience of our global portfolio of cruise brands, as consumers continue to capitalize on
cruising's superior value versus land-based vacation alternatives. We continue to focus on a
measured growth strategy through the introduction of two to three new ships per year and the
development of emerging cruise markets in Asia."
"Based on 2013 guidance, we estimate that cash from operations will reach $3.3 billion for
the year while our capital commitments will be just $2.0 billion. As a result, we anticipate
significant free cash flow in 2013, which we intend to continue to return to shareholders."
MEDIA CONTACT INVESTOR RELATIONS CONTACT
Jennifer de la Cruz Beth Roberts
001 305 599 2600, ext. 16000 001 305 406 4832
Analyst conference call
The company has scheduled a conference call with analysts at 3:00 p.m. GMT (10:00 a.m. EST)
today to discuss its 2012 fourth quarter and full year 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 company in the world, with a portfolio of
cruise brands in North America, Europe, Australia and Asia, comprised of Carnival Cruise
Lines, Holland America Line, Princess Cruises, Seabourn, AIDA Cruises, Costa Cruises, Cunard,
Ibero Cruises, P&O Cruises (Australia) and P&O Cruises (UK).
Together, these brands operate 100 ships totaling 203,000 lower berths with nine new ships
scheduled to be delivered between March 2013 and March 2016. Carnival Corporation & plc also
operates Holland America Princess Alaska Tours, the leading tour company in Alaska and the
Canadian Yukon. 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.
Carnival Corporation & plc Reports Fourth Quarter and Full Year Earnings
MIAMI, Dec. 20, 2012 -- Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) announced
non-GAAP net income of $98 million, or $0.13 diluted EPS, for the fourth quarter of 2012.
Reported U.S. GAAP net income, which included net unrealized losses on fuel derivatives of
$5 million, was $93 million, or $0.12 diluted EPS. Net income for the fourth quarter of 2011
was $217 million, or $0.28 diluted EPS. Revenues for the fourth quarter of 2012 were
$3.6 billion compared to $3.7 billion for the prior year.
Non-GAAP net income for the full year 2012 was $1.5 billion, or $1.88 diluted EPS, compared
to net income of $1.9 billion, or $2.42 diluted EPS, for the prior year. Full year 2012 U.S.
GAAP net income was $1.3 billion, or $1.67 diluted EPS, which included the non-cash write
down for Ibero Cruises' goodwill and trademark assets of $173 million. Revenues for the full
year 2012 were $15.4 billion compared to $15.8 billion for the prior year.
Carnival Corporation & plc Chairman and CEO Micky Arison noted that fourth quarter earnings
on a non-GAAP basis were better than anticipated in the company's September guidance.
Stronger than expected revenue yields combined with lower than expected fuel costs more than
offset higher than anticipated operating costs.
Commenting on full year 2012, Arison stated, "As a result of the Costa Concordia tragedy in
January, the past year has been the most challenging in our company's history. However,
through the significant efforts of our brand management teams, we were able to maintain full
year 2012 net revenue yields (excluding Costa) in line with the prior year. In addition, we
drove down net cruise costs, excluding fuel, slightly and fuel consumption by four percent."
Arison added that unfavorable changes in fuel prices and currency exchange rates reduced
earnings by $300 million, or $0.39 per share, compared to the prior year.
Arison noted, "Cash from operations of $3.0 billion was more than sufficient to fund $1.8
billion in net capital investments and positioned the company with excess free cash flow to
return to shareholders. Our regular quarterly dividend of $0.25 per share, combined with our
recently announced special year-end dividend of $0.50 per share, will result in $1.2 billion
of dividend distributions to our shareholders. Additionally, since the start of the fiscal
year we purchased 3.5 million of the company's shares in the open market at a cost of $120
million."
Key metrics for the fourth quarter 2012 compared to the prior year were as follows:
* On a constant dollar basis, net revenue yields (net revenue per available lower berth
day or "ALBD") decreased 4.5 percent for 4Q 2012, which was better than the company's
September guidance, down 5 to 6 percent. Gross revenue yields decreased 5.7 percent in
current dollars.
* Net cruise costs excluding fuel per ALBD decreased 0.9 percent in constant dollars,
less than the September guidance, down 2 to 3 percent. Gross cruise costs including
fuel per ALBD in current dollars decreased 2.5 percent.
* Fuel prices increased 5.4 percent to $716 per metric ton for 4Q 2012 from $680 per
metric ton in 4Q 2011 and were better than the September guidance of $739 per metric
ton.
During the fourth quarter, the company also announced it had reached an agreement for the
construction of two new cruise ships - a 2,660-passenger ship for its Holland America Line
brand to be delivered in 2015 and a 4,000-passenger vessel for its Carnival Cruise Lines
brand to be delivered in 2016. Both are the largest ships ever built for those brands.
Full Year 2013 Outlook
Since September, booking volumes for the first three quarters, including Costa, are running
in line with the strong volumes experienced last year at slightly lower prices. At this time,
cumulative advance bookings for 2013 continue to be behind the prior year at slightly lower
prices.
Based on current booking trends, the company forecasts full year 2013 net revenue yields, on
a constant dollar basis, to be up 1 to 2 percent. Revenue yields (constant dollars) are
expected to decline 2 to 3 percent in the first quarter and improve sequentially during the
remainder of 2013 based on a recovery in ticket prices and occupancy for the North American
brands and Costa. However, the company's European brands continue to be negatively impacted
by a deteriorating economic environment.
The company expects net cruise costs excluding fuel per ALBD for the full year 2013 to be up
1 to 2 percent on a constant dollar basis. Taking the above factors into consideration, the
company forecasts full year 2013 non-GAAP diluted earnings per share to be in the range of
$2.20 to $2.40, compared to 2012 non-GAAP diluted earnings of $1.88 per share.
Looking forward, Arison stated, "We remain well positioned for a recovery in 2013 and beyond
evidenced by the demonstrated resilience of our global portfolio of cruise brands as
consumers continue to capitalize on cruising's superior value versus land-based vacation
alternatives. We continue to focus on a measured growth strategy through the introduction of
two to three new ships per year and the development of emerging cruise markets in Asia."
Arison added, "Based on 2013 guidance, we estimate that cash from operations will reach $3.3
billion for the year while our capital commitments will be just $2.0 billion. As a result, we
anticipate significant free cash flow in 2013, which we intend to continue to return to
shareholders."
During 2013, the company expects to carry over 10 million guests on its global fleet and will
introduce two new ships, the 2,192-passenger AIDAstella which is scheduled for delivery in
March and the 3,560-passenger Royal Princess, which is scheduled for delivery in May.
First Quarter 2013 Outlook
First quarter constant dollar net revenue yields are expected to decrease 2 to 3 percent
compared to the prior year. Net cruise costs excluding fuel per ALBD for the first quarter
are expected to be down 1.5 to 2.5 percent on a constant dollar basis compared to the prior
year.
Based on the above factors, the company expects non-GAAP diluted earnings for the first
quarter 2013 to be in the range of $0.03 to $0.07 per share versus 2012 non-GAAP earnings of
$0.02 per share.
Selected Key Forecast Metrics
Full Year 2013 First Quarter 2013
----------------------------- -------------------------------------
Current Constant Current Constant
Year over year change: Dollars Dollars Dollars Dollars
------- ------- ------- -------
Net revenue yields 1.5 to 2.5 % 1.0 to 2.0 % (1.5) to (2.5) % (2.0) to (3.0) %
Net cruise costs excl. fuel / ALBD 1.5 to 2.5 % 1.0 to 2.0 % (1.5) to (2.5) % (1.5) to (2.5) %
Full Year 2013 First Quarter 2013
-------------- ------------------
Fuel price per metric ton $ 692 $ 674
Fuel consumption (metric tons in thousands) 3,300 835
Currency: Euro $1.30 to EUR1 $1.30 to EUR1
Sterling $1.61 to GBP1 $1.61 to GBP1
Conference Call
The company has scheduled a conference call with analysts at 10:00 a.m. EST (3:00 p.m. GMT)
today to discuss its 2012 fourth quarter and full year 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 company in the world, with a portfolio of
cruise brands in North America, Europe, Australia and Asia, comprised of Carnival Cruise
Lines, Holland America Line, Princess Cruises, Seabourn, AIDA Cruises, Costa Cruises, Cunard,
Ibero Cruises, P&O Cruises (Australia) and P&O Cruises (UK).
Together, these brands operate 100 ships totaling 203,000 lower berths with nine new ships
scheduled to be delivered between March 2013 and March 2016. Carnival Corporation & plc also
operates Holland America Princess Alaska Tours, the leading tour company in Alaska and the
Canadian Yukon. 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
Carnival Corporation and Carnival plc and their respective subsidiaries are referred to
collectively in this release as "Carnival Corporation & plc," "our," "us" and "we." Some of
the statements, estimates or projections contained in this release are "forward-looking
statements" that involve risks, uncertainties and assumptions with respect to us, including
some statements concerning future results, outlooks, 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. We have tried, whenever possible, to identify these
statements by using words like "will," "may," "could," "should," "would," "believe,"
"depends," "expect," "goal," "anticipate," "forecast," "future," "intend," "plan,"
"estimate," "target," "indicate" and similar expressions of future intent or the negative of
such terms. Forward-looking statements include those statements that may impact, among other
things, the forecasting of our non-GAAP earnings per share ("EPS"); net revenue yields;
booking levels; pricing; occupancy; operating, financing and tax costs, including fuel
expenses; costs per available lower berth day; estimates of ship depreciable lives and
residual values; liquidity; goodwill and trademark fair values and outlook. 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 in this release. These factors include, but are not limited to, the following:
general economic and business conditions; increases in fuel prices; incidents, the spread of
contagious diseases and threats thereof, adverse weather conditions or other natural
disasters and other incidents affecting the health, safety, security and satisfaction of
guests and crew; the international political climate, armed conflicts, terrorist and pirate
attacks, vessel seizures, and threats thereof, and other world events affecting the safety
and security of travel; negative publicity concerning the cruise business in general or us in
particular, including any adverse environmental impacts of cruising; litigation, enforcement
actions, fines or penalties; economic, market and political factors that are beyond our
control, which could increase our operating, financing and other costs; changes in and
compliance with laws and regulations relating to the protection of persons with disabilities,
employment, environment, health, safety, security, tax and other regulations under which we
operate; our ability to implement our shipbuilding programs and ship repairs, maintenance and
refurbishments on terms that are favorable or consistent with our expectations; increases to
our repairs and maintenance expenses and refurbishment costs as our fleet ages; lack of
continuing availability of attractive, convenient and safe port destinations; continuing
financial viability of our travel agent distribution system, air service providers and other
key vendors in our supply chain and reductions in the availability of, and increases in the
pricing for, the services and products provided by these vendors; disruptions and other
damages to our information technology and other networks and operations, and breaches in data
security; our failure to keep pace with developments in technology; competition from and
overcapacity in the cruise ship or land-based vacation industry; loss of key personnel or our
ability to recruit or retain qualified personnel; union disputes and other employee relation
issues; disruptions in the global financial markets or other events may negatively affect the
ability of our counterparties and others to perform their obligations to us; the continued
strength of our cruise brands and our ability to implement our brand strategies; our
international operations are subject to additional risks not generally applicable to our U.S.
operations; geographic regions in which we try to expand our business may be slow to develop
and ultimately not develop how we expect; our decisions to self-insure against various risks
or our inability to obtain insurance for certain risks at reasonable rates; fluctuations in
foreign currency exchange rates; whether our future operating cash flow will be sufficient to
fund future obligations and whether we will be able to obtain financing, if necessary, in
sufficient amounts and on terms that are favorable or consistent with our expectations; risks
associated with the dual listed company arrangement and uncertainties of a foreign legal
system as we are not incorporated in the U.S. 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 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.
CARNIVAL CORPORATION & PLC
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(in millions, except per share data)
Three Months Ended Twelve Months Ended
November 30, November 30,
---------------------- ------------------------
2012 2011 2012 2011
---- ---- ---- ----
Revenues
Cruise
Passenger tickets $ 2,659 $ 2,821 $ 11,658 $ 12,158
Onboard and other 894 847 3,513 3,357
Tour and other 26 28 211 278
--- --- --- ---
3,579 3,696 15,382 15,793
----- ----- ------ ------
Operating Costs and Expenses
Cruise
Commissions, transportation and other 499 549 2,292 2,461
Onboard and other 155 128 558 506
Fuel 603 583 2,381 2,193
Payroll and related 443 442 1,742 1,723
Food 238 236 960 965
Other ship operating 586 606 2,233 2,247
Tour and other 28 25 154 204
--- --- --- ---
2,552 2,569 10,320 10,299
Selling and administrative 459 434 1,720 1,717
Depreciation and amortization 392 385 1,527 1,522
Ibero goodwill and trademark impairment charges - - 173 -
--- --- --- ---
3,403 3,388 13,740 13,538
----- ----- ------ ------
Operating Income 176 308 1,642 2,255
--- --- ----- -----
Nonoperating (Expense) Income
Interest income 2 3 10 11
Interest expense, net of capitalized interest (77) (92) (336) (365)
Unrealized (losses) gains on fuel derivatives, net (5) 1 6 1
Realized losses on fuel derivatives (1) - (13) -
Other (expense) income, net (1) (11) (7) 10
--- ---- --- ---
(82) (99) (340) (343)
---- ---- ----- -----
Income Before Income Taxes 94 209 1,302 1,912
Income Tax (Expense) Benefit, Net (1) 8 (4) -
--- --- --- ---
Net Income $ 93 $ 217 $ 1,298 $ 1,912
==== ===== ======= =======
Earnings Per Share
Basic $ 0.12 $ 0.28 $ 1.67 $ 2.43
====== ====== ====== ======
Diluted $ 0.12 $ 0.28 $ 1.67 $ 2.42
====== ====== ====== ======
Non-GAAP Earnings Per Share-Diluted $ 0.13 $ 0.28 $ 1.88 $ 2.42
====== ====== ====== ======
Dividends Declared Per Share $ 0.75 $ 0.25 $ 1.50 $ 1.00
====== ====== ====== ======
Weighted-Average Shares Outstanding - Basic 777 778 778 787
=== === === ===
Weighted-Average Shares Outstanding - Diluted 779 780 779 789
=== === === ===
CARNIVAL CORPORATION & PLC
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in millions, except par values)
November 30,
------------------------
2012 2011
---- ----
ASSETS
Current Assets
Cash and cash equivalents $ 465 $ 450
Trade and other receivables, net 270 263
Insurance recoverables 460 30
Inventories 390 374
Prepaid expenses and other 236 195
--- ---
Total current assets 1,821 1,312
----- -----
Property and Equipment, Net 32,137 32,054
Goodwill 3,174 3,322
Other Intangibles 1,314 1,330
Other Assets 715 619
--- ---
$ 39,161 $ 38,637
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term borrowings $ 56 $ 281
Current portion of long-term debt 1,678 1,019
Accounts payable 549 576
Dividends payable 583 194
Claims reserve 553 97
Accrued liabilities and other 845 832
Customer deposits 3,076 3,106
----- -----
Total current liabilities 7,340 6,105
----- -----
Long-Term Debt 7,168 8,053
Other Long-Term Liabilities 724 647
Shareholders' Equity
Common stock of Carnival Corporation, $0.01 par value; 1,960 shares
authorized; 649 shares at 2012 and 647 shares at 2011 issued 6 6
Ordinary shares of Carnival plc, $1.66 par value; 215 shares at 2012
and 2011 issued 357 357
Additional paid-in capital 8,252 8,180
Retained earnings 18,479 18,349
Accumulated other comprehensive loss (207) (209)
Treasury stock, 55 shares at 2012 and 52 shares at 2011 of
Carnival Corporation and 33 shares at 2012 and 2011 of
Carnival plc, at cost (2,958) (2,851)
------- -------
Total shareholders' equity 23,929 23,832
------ ------
$ 39,161 $ 38,637
======== ========
CARNIVAL CORPORATION & PLC
OTHER INFORMATION
Three Months Ended Twelve Months Ended
November 30, November 30,
-------------------- ---------------------
2012 2011 2012 2011
---- ---- ---- ----
STATISTICAL INFORMATION
Passengers carried (in thousands) 2,430 2,367 9,829 9,559
Occupancy percentage (a) 103.1% 103.2% 105.5% 106.2%
Fuel consumption (metric tons in thousands) 842 858 3,354 3,395
Fuel cost per metric ton consumed $ 716 $ 680 $ 710 $ 646
Currencies
U.S. dollar to EUR1 $ 1.29 $ 1.37 $ 1.28 $ 1.40
U.S. dollar to GBP1 $ 1.60 $ 1.58 $ 1.58 $ 1.60
U.S. dollar to Australian dollar $ 1.04 $ 1.02 $ 1.03 $ 1.03
CASH FLOW INFORMATION
Cash from operations $ 523 $ 749 $ 2,999 $3,766
Capital expenditures $ 168 $ 261 $ 2,332 $2,696
Dividends paid $ 195 $ 197 $ 779 $ 671
(a) In accordance with cruise business practice, occupancy is calculated
using a denominator of 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.
FUEL DERIVATIVES
At November 30, 2012, our outstanding fuel derivatives consisted of zero cost collars on
Brent crude oil to cover a portion of our estimated fuel consumption as follows:
Percent of Estimated
Transaction Barrels Weighted-Average Weighted-Average Fuel Consumption
Maturities (a) (b) Dates (in thousands) Floor Prices Ceiling Prices Covered
---------- ----- ------------ ------------ -------------- -------
Fiscal 2013
November 2011 2,112 $ 74 $ 132
February 2012 2,112 $ 98 $ 127
March 2012 4,224 $ 100 $ 130
-----
8,448 40%
=====
Fiscal 2014
November 2011 2,112 $ 71 $ 128
February 2012 2,112 $ 88 $ 125
June 2012 2,376 $ 71 $ 116
-----
6,600 32%
=====
Fiscal 2015
November 2011 2,160 $ 71 $ 125
February 2012 2,160 $ 80 $ 125
June 2012 1,236 $ 74 $ 110
-----
5,556 26%
=====
Fiscal 2016 June 2012 3,564 $ 75 $ 108 17%
=====
(a) Fuel derivatives mature evenly over each month within the above fiscal periods.
(b) We will not realize any economic gain or loss upon the monthly maturities of our zero
cost collars unless the average monthly price of Brent crude oil is above the ceiling
price or below the floor price.
CARNIVAL CORPORATION & PLC
NON-GAAP FINANCIAL MEASURES
Consolidated gross and net revenue yields were computed by dividing the gross and net
cruise revenues, without rounding, by ALBDs as follows (dollars in millions, except
yields) (a)(b):
Three Months Ended November 30, Twelve Months Ended November 30,
--------------------------------- ----------------------------------
2012 2012
Constant Constant
2012 Dollar 2011 2012 Dollar 2011
---- ------ ---- ---- ------ ----
Passenger ticket revenues $ 2,659 $ 2,696 $ 2,821 $ 11,658 $ 11,941 $ 12,158
Onboard and other revenues 894 903 847 3,513 3,570 3,357
--- --- --- ----- ----- -----
Gross cruise revenues 3,553 3,599 3,668 15,171 15,511 15,515
----- ----- ----- ------ ------ ------
Less cruise costs
Commissions, transportation and other (499) (509) (549) (2,292) (2,358) (2,461)
Onboard and other (155) (156) (128) (558) (566) (506)
----- ----- ----- ----- ----- -----
(654) (665) (677) (2,850) (2,924) (2,967)
----- ----- ----- ------- ------- -------
Net passenger ticket revenues 2,160 2,187 2,272 9,366 9,583 9,697
Net onboard and other revenues 739 747 719 2,955 3,004 2,851
--- --- --- ----- ----- -----
Net cruise revenues $ 2,899 $ 2,934 $ 2,991 $ 12,321 $ 12,587 $ 12,548
======= ======= ======= ======== ======== ========
ALBDs (c) 18,269,763 18,269,763 17,792,044 71,975,652 71,975,652 69,970,910
========== ========== ========== ========== ========== ==========
Gross revenue yields $ 194.47 $ 196.99 $ 206.19 $ 210.78 $ 215.50 $ 221.74
% decrease vs. 2011 (5.7)% (4.5)% (4.9)% (2.8)%
Net revenue yields $ 158.69 $ 160.60 $ 168.15 $ 171.18 $ 174.88 $ 179.35
% decrease vs. 2011 (5.6)% (4.5)% (4.6)% (2.5)%
Net passenger ticket revenue yields $ 118.21 $ 119.69 $ 127.72 $ 130.13 $ 133.14 $ 138.60
% decrease vs. 2011 (7.5)% (6.3)% (6.1)% (3.9)%
Net onboard and other revenue yields $ 40.49 $ 40.91 $ 40.43 $ 41.05 $ 41.74 $ 40.75
% increase vs. 2011 0.2% 1.2% 0.7% 2.4%
Consolidated gross and net cruise costs and net cruise costs excluding fuel per ALBD were
computed by dividing the gross and net cruise costs and net cruise costs excluding fuel,
without rounding, by ALBDs as follows (dollars in millions, except costs per ALBD) (a) (b):
Three Months Ended November 30, Twelve Months Ended November 30,
--------------------------------- ----------------------------------
2012 2012
Constant Constant
2012 Dollar 2011 2012 Dollar 2011
---- ------ ---- ---- ------ ----
Cruise operating expenses $ 2,524 $ 2,550 $ 2,544 $ 10,166 $ 10,338 $ 10,095
Cruise selling and administrative
expenses (d) 458 464 433 1,713 1,749 1,696
--- --- --- ----- ----- -----
Gross cruise costs 2,982 3,014 2,977 11,879 12,087 11,791
Less cruise costs included in net
cruise revenues
Commissions, transportation and other (499) (509) (549) (2,292) (2,358) (2,461)
Onboard and other (155) (156) (128) (558) (566) (506)
----- ----- ----- ----- ----- -----
Net cruise costs 2,328 2,349 2,300 9,029 9,163 8,824
Less fuel (603) (603) (583) (2,381) (2,381) (2,193)
----- ----- ----- ------- ------- -------
Net cruise costs excluding fuel $ 1,725 $ 1,746 $ 1,717 $ 6,648 $ 6,782 $ 6,631
======= ======= ======= ======= ======= =======
ALBDs (c) 18,269,763 18,269,763 17,792,044 71,975,652 71,975,652 69,970,910
========== ========== ========== ========== ========== ==========
Gross cruise costs per ALBD $ 163.17 $ 164.96 $ 167.28 $ 165.04 $ 167.94 $ 168.51
% decrease vs. 2011 (2.5)% (1.4)% (2.1)% (0.3)%
Net cruise costs per ALBD $ 127.40 $ 128.57 $ 129.24 $ 125.44 $ 127.32 $ 126.11
% (decrease) increase vs. 2011 (1.4)% (0.5)% (0.5)% 1.0%
Net cruise costs excluding fuel per ALBD $ 94.39 $ 95.56 $ 96.47 $ 92.36 $ 94.23 $ 94.76
% decrease vs. 2011 (2.2)% (0.9)% (2.5)% (0.6)%
(See next page for Notes to Non-GAAP Financial Measures.)
CARNIVAL CORPORATION & PLC
NON-GAAP FINANCIAL MEASURES (CONTINUED)
Non-GAAP fully diluted earnings per share was computed as follows (in millions, except
per share data) (b):
Three Months Ended Twelve Months Ended
November 30, November 30,
------------ ------------
2012 2011 2012 2011
---- ---- ---- ----
Net income - diluted
U.S. GAAP net income $ 93 $ 217 $ 1,298 $ 1,912
Ibero goodwill and trademark impairment charges (e) - - 173 -
Unrealized losses (gains) on fuel derivatives, net (f) 5 (1) (6) (1)
--- --- --- ---
Non-GAAP net income $ 98 $ 216 $ 1,465 $ 1,911
==== ===== ======= =======
Weighted-average shares outstanding - diluted 779 780 779 789
=== === === ===
Earnings per share - diluted
U.S. GAAP earnings per share $ 0.12 $ 0.28 $ 1.67 $ 2.42
Ibero goodwill and trademark impairment charges (e) - - 0.22 -
Unrealized losses (gains) on fuel derivatives, net (f) 0.01 - (0.01) -
---- --- ------ ---
Non-GAAP earnings per share $ 0.13 $ 0.28 $ 1.88 $ 2.42
====== ====== ====== ======
Notes to Non-GAAP Financial Measures
(a) We use net cruise revenues per ALBD ("net revenue yields"), net cruise costs per ALBD and
net cruise costs excluding fuel per ALBD as significant non-GAAP financial measures of our
cruise segment financial performance. These measures enable us to separate the impact of
predictable capacity changes from the more unpredictable rate changes that affect our
business. We believe these non-GAAP measures provide useful information to investors and
expanded insight to measure our revenue and cost performance as a supplement to our U.S.
generally accepted accounting principles ("U.S. GAAP") consolidated financial statements.
Net revenue yields are commonly used in the cruise business to measure a company's cruise
segment revenue performance and for revenue management purposes. We use "net cruise revenues"
rather than "gross cruise revenues" to calculate net revenue yields. We believe that net
cruise revenues is a more meaningful measure in determining revenue yield than gross cruise
revenues because it reflects the cruise revenues earned net of 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 card fees.
Substantially all of our remaining cruise costs are largely fixed, except for the impact of
changing prices, once our ship capacity levels have been determined.
Net passenger ticket revenues reflect gross cruise revenues, net of (1) onboard and other
revenues, (2) commissions, transportation and other costs and (3) onboard and other cruise
costs. Net onboard and other revenues reflect gross cruise revenues, net of (1) passenger
ticket revenues, (2) commissions, transportation and other costs and (3) onboard and other
cruise costs. Net passenger ticket revenue yields and net onboard and other revenue yields
are computed by dividing net passenger ticket revenues and net onboard and other revenues by
ALBDs.
Net cruise costs per ALBD and net cruise costs excluding fuel per ALBD are the most
significant measures we use to monitor our ability to control our cruise segment costs rather
than gross cruise costs per ALBD. We exclude the same variable costs that are included in the
calculation of net cruise revenues to calculate net cruise costs with and without fuel to
avoid duplicating these variable costs in our non-GAAP financial measures.
We have not provided estimates of future gross revenue yields or future gross cruise costs
per ALBD because the quantitative reconciliations of forecasted gross cruise revenues to
forecasted net cruise revenues or forecasted gross cruise costs to forecasted net cruise
costs would include a significant amount of uncertainty in projecting the costs deducted to
arrive at this measure. As such, management does not believe that this reconciling
information would be meaningful.
CARNIVAL CORPORATION & PLC
NON-GAAP FINANCIAL MEASURES (CONTINUED)
In addition, because our Europe, Australia & Asia cruise brands utilize the euro, sterling
and Australian dollar to measure their results and financial condition, the translation of
those operations 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. Accordingly, we also monitor and report these non-GAAP
financial measures assuming the 2012 periods' currency exchange rates have remained constant
with the 2011 periods' rates, or on a "constant dollar basis," in order to remove the impact
of changes in exchange rates on our non-U.S. dollar cruise operations. We believe that this
is a useful measure since it facilitates a comparative view of the growth of our business in
a fluctuating currency exchange rate environment.
(b) Our consolidated financial statements are prepared in accordance with U.S. GAAP. The
presentation of our non-GAAP financial information is not intended to be considered in
isolation or as substitute for, or superior to, the financial information prepared in
accordance with U.S. GAAP. There are no specific rules for determining our non-GAAP current
and constant dollar financial measures and, accordingly, they are susceptible to varying
calculations, and it is possible that they 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.
(c) ALBDs is a standard measure of passenger capacity for the period, which we use to perform
rate and capacity variance 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.
(d) For the three months and twelve months ended November 30, 2012, selling and
administrative expenses were $459 million ($434 million in 2011) and $1.7 billion ($1.7
billion in 2011), respectively. For the three and twelve months ended November 30, 2012,
selling and administrative expenses were comprised of cruise selling and administrative
expenses of $458 million ($433 million in 2011) and $1.7 billion ($1.7 billion in 2011) and
Tour and Other selling and administrative expenses of $1 million ($1 million in 2011) and $7
million ($21 million in 2011), respectively.
(e) We believe that the impairment charges recognized in the twelve months ended November 30,
2012 related to Ibero's goodwill and trademarks are nonrecurring and, therefore, are not an
indication of our future earnings performance. As such, we believe it is more meaningful for
the impairment charges to be excluded from our net income and earnings per share and,
accordingly, we present non-GAAP net income and non-GAAP EPS excluding these impairment
charges.
(f) Under U.S. GAAP, the realized and unrealized gains and losses on fuel derivatives not
qualifying as fuel hedges are immediately recognized in earnings. We believe that unrealized
gains and losses on fuel derivatives are not an indication of our future earnings performance
since they relate to future periods and may not ultimately be realized in our future earnings.
Therefore, we believe it is more meaningful for the unrealized gains and losses on fuel
derivatives to be excluded from our net income and earnings per share and, accordingly, we
present non-GAAP net income and non-GAAP EPS excluding these unrealized gains and losses.
We have not included in our earnings guidance the impact of unrealized gains and losses on
fuel derivatives because these unrealized amounts involve a significant amount of uncertainty
and we do not believe they are an indication of our future earnings performance. Accordingly,
our earnings guidance is presented on a non-GAAP basis only. As a result, we did not present
a reconciliation between forecasted non-GAAP diluted EPS guidance and forecasted U.S. GAAP
diluted EPS guidance, since we do not believe that the reconciliation information would be
meaningful.
SOURCE Carnival Plc
CONTACT: Media, Jennifer De La Cruz, +1-305-599-2600, ext. 16000, or Investor Relations, Beth
Roberts, +1-305-406-4832
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