kansas49er
New Member
Is a bad economy reality overall, or just local? This news release seems to paint a different picture.
Carnival Corporation had record revenues, record earnings and a record number of passengers in 2004, vice president and COO Howard Frank said during the Carnival Corporation shareholders’ meeting in Southampton, England, last week.
The company had a 45% increase in revenues year on year to $9.7 billion, with net income rising from $1.2 billion to $1.9 billion.
About half the world’s cruise passengers, 6.3 million, sailed on Carnival Corporation ships, it was reported at the meeting.
Frank told shareholders that the rest of 2005 looks very good, with bookings and pricing both up. “Demand is growing stronger and stronger,” he noted.
According to Carnival Corp. executives, Carnival Cruise Lines and Princess Cruises are by far the company’s two strongest brands in North America. They said Windstar Cruises and Seabourn Cruise Line are doing well, but are “not part of major earnings growth.”
Building the Market
Since 44% of the passengers carried by the company’s cruise brands last year were first-time cruisers, the company feels it is building the market substantially.
Frank said Carnival Corporation has about 48% of the capacity in the North American market, with Royal Caribbean next at 31% and the rest of the industry accounting for 21%.
“We will have 49% of the capacity for North America in 2008, based on what we know today,” he added.
In Europe the company calculates that it holds 40% of current capacity and expects to have 46% in 2008.
Frank noted that eight ships, representing a 17% capacity increase, were delivered during 2004 and another eight have been ordered. He said Carnival tries to stay very disciplined in ship orders and was able to use its scale to keep construction costs to $168,000 per berth, well below usual costs.
The euro-based order for the eight additional newbuilds, at 163,000 euros, is similarly below the norm.
The six ships on order for the North American market represent $2.9 billion in spending.
Focused on Europe
The company is “very focused on the European market,” with eight new ships scheduled to debut in that market in the next few years. The two unassigned ships on order are likely to go to P&O and Costa, although a definite decision will come at the end of this year, Frank said.
Following the unprecedented capacity growth of seven new ships in 2003 and eight in 2004, Carnival Corporation expects to grow 8.5% this year, 6.3% in 2006, 7.5% in 2007 and 6.6% in 2008, based on the current order book.
The company is predicting revenue yields of 5%-6%, with net costs “flattish,” except for fuel, which is driving a 3%-4% increase in costs.
“Despite $7 billion-plus spent for cash purchase of ships, we expect to have excess cash,” Frank told shareholders. He said the company was unlikely to use the money to repay debt unless interest rates spike worldwide, and that it might have a share buyback, or pay increased and/or bonus dividends to shareholders.
Carnival Corporation had record revenues, record earnings and a record number of passengers in 2004, vice president and COO Howard Frank said during the Carnival Corporation shareholders’ meeting in Southampton, England, last week.
The company had a 45% increase in revenues year on year to $9.7 billion, with net income rising from $1.2 billion to $1.9 billion.
About half the world’s cruise passengers, 6.3 million, sailed on Carnival Corporation ships, it was reported at the meeting.
Frank told shareholders that the rest of 2005 looks very good, with bookings and pricing both up. “Demand is growing stronger and stronger,” he noted.
According to Carnival Corp. executives, Carnival Cruise Lines and Princess Cruises are by far the company’s two strongest brands in North America. They said Windstar Cruises and Seabourn Cruise Line are doing well, but are “not part of major earnings growth.”
Building the Market
Since 44% of the passengers carried by the company’s cruise brands last year were first-time cruisers, the company feels it is building the market substantially.
Frank said Carnival Corporation has about 48% of the capacity in the North American market, with Royal Caribbean next at 31% and the rest of the industry accounting for 21%.
“We will have 49% of the capacity for North America in 2008, based on what we know today,” he added.
In Europe the company calculates that it holds 40% of current capacity and expects to have 46% in 2008.
Frank noted that eight ships, representing a 17% capacity increase, were delivered during 2004 and another eight have been ordered. He said Carnival tries to stay very disciplined in ship orders and was able to use its scale to keep construction costs to $168,000 per berth, well below usual costs.
The euro-based order for the eight additional newbuilds, at 163,000 euros, is similarly below the norm.
The six ships on order for the North American market represent $2.9 billion in spending.
Focused on Europe
The company is “very focused on the European market,” with eight new ships scheduled to debut in that market in the next few years. The two unassigned ships on order are likely to go to P&O and Costa, although a definite decision will come at the end of this year, Frank said.
Following the unprecedented capacity growth of seven new ships in 2003 and eight in 2004, Carnival Corporation expects to grow 8.5% this year, 6.3% in 2006, 7.5% in 2007 and 6.6% in 2008, based on the current order book.
The company is predicting revenue yields of 5%-6%, with net costs “flattish,” except for fuel, which is driving a 3%-4% increase in costs.
“Despite $7 billion-plus spent for cash purchase of ships, we expect to have excess cash,” Frank told shareholders. He said the company was unlikely to use the money to repay debt unless interest rates spike worldwide, and that it might have a share buyback, or pay increased and/or bonus dividends to shareholders.
