Exhibit 99.1
------------------Press Release, dated September 19, 2005------------------
FOR IMMEDIATE RELEASE
CARNIVAL CORPORATION & PLC REPORTS RECORD THIRD QUARTER EARNINGS
MIAMI (September 19, 2005) - Carnival Corporation & plc (NYSE/LSE: CCL;
NYSE: CUK) reported record net income of $1.15 billion, or $1.36 diluted EPS, on
revenues of $3.61 billion for its third quarter ended August 31, 2005. Net
income for the third quarter of 2004 was $1.03 billion, or $1.22 diluted EPS, on
revenues of $3.25 billion. Third quarter 2005 earnings were reduced by two
unusual charges totaling $45 million ($0.05 per share) - a $23 million charge to
operating expense related to a billing from the British Merchant Navy Officers
Pension Fund ("MNOPF") and a $22 million investment write-down charged to
nonoperating expense. The MNOPF billing represents the fund's estimate of
Carnival's share of the fund's total unfunded pension liabilities, and
substantially all relates to service by British officers for P&O Princess prior
to its acquisition by Carnival Corporation.
Net income for the nine months ended August 31, 2005 was $1.90 billion, or
$2.27 diluted EPS, on revenues of $8.52 billion, compared to net income of $1.56
billion, or $1.88 diluted EPS, on revenues of $7.49 billion for the same period
in 2004.
Third quarter revenues increased by 11 percent driven by both a 5.2
percent increase in cruise capacity and a significant growth in cruise net
revenue yields (revenue per available berth day). Net revenue yields for the
third quarter of 2005 increased 6.2 percent compared to the prior year,
primarily due to higher cruise ticket prices and onboard revenues, and, to a
lesser extent, higher occupancy. Gross revenue yields increased 5.4 percent.
Net cruise costs per available lower berth day ("ALBD") for the third
quarter of 2005 increased 7.4 percent compared to last year. The increase in
costs per ALBD was primarily due to a 36 percent increase in fuel prices and the
$23 million MNOPF contribution. Gross cruise costs per ALBD increased 5.6
percent. Excluding higher fuel costs and the MNOPF contribution, the company's
2005 third quarter net cruise cost per ALBD increased 1.4 percent compared to
the same period last year, mostly due to higher dry-dock amortization expense.
Carnival Corporation & plc Chairman and CEO Micky Arison said that he was
happy with the company's results for the quarter. "Robust demand for cruise
vacations continued into our seasonally strong summer period. Significant
improvements in pricing, particularly for our North American brands, more than
compensated for increases in fuel costs, resulting in higher profits and another
record third quarter," Arison said.
Forward Outlook
Regarding the fourth quarter of 2005, Arison noted that Hurricane Katrina,
which caused extensive devastation to Gulf Coast areas, will also have some
impact on the company's fourth quarter results. Hurricane Katrina resulted in
the cancellation of one voyage, the shortening of two other voyages, changes in
homeports for two ships and other disruptions and related costs.
"The people of the Gulf Coast region have suffered horribly as a result of
this storm and we have tried to help in some small way by chartering three ships
to the U.S. government to be used in the recovery effort," Arison said.
"I am especially proud that Carnival Cruise Lines' Ecstasy and Sensation,
which since early last week have been docked in New Orleans, are serving as
housing for first responders and other relief workers. Many of these people,
particularly the police officers and fire fighters now housed aboard, have been
living in terrible conditions, as they themselves were victimized by this
hurricane and suffered tremendous personal losses. They continue to endure
unbelievable hardships as they endeavor to perform their daily duties. We are
very pleased that our ships are making a difference in their lives and
contributing to the recovery of New Orleans. There are many people in our
organization, both ashore and afloat, who have been working around the clock to
make sure that this effort is successful and I thank them for that," Arison
said.
Arison said that a third vessel, the Holiday, is docked in Mobile, Ala.,
where it is initially providing housing for evacuees from both Alabama and
Mississippi.
Despite these events, recent bookings remain strong. Advance booking
levels for the fourth quarter are slightly ahead of last year at this time, on a
capacity adjusted basis, with average pricing above last year. As a result, the
company continues to expect that net revenue yields for the fourth quarter of
2005 will increase approximately 4.5 to 5.5 percent, compared to last year's
fourth quarter.
Net cruise costs per ALBD in the fourth quarter of 2005 are expected to
increase between 4 to 5 percent, compared to 2004, because of higher fuel costs.
The company's cost guidance for fuel is based on recent forward prices for the
balance of the year, which is 44 percent higher than the average prices for the
fourth quarter of 2004. Excluding fuel, the company's cost guidance for the
fourth quarter of 2005 is for costs per ALBD to be down slightly.
Based on these estimates, the company expects diluted earnings per share
for the fourth quarter of 2005 to be in the range of $0.39 to $0.41.
Arison also noted that the company is currently on track to post an
approximate 20 percent increase in earnings per share for the year 2005. "That's
quite a remarkable accomplishment considering that fuel price increases are
estimated to cost the company an additional $170 million, or $0.20 a share, in
2005," he said.
Looking to early 2006, Arison said that both booking levels, on a capacity
adjusted basis, and pricing for the first half of 2006 are ahead of the
comparable period in 2005. "Given booking trends to date and a continuing strong
demand for travel, we are optimistic that we will be able to achieve continued
growth in revenue yields in 2006," Arison said. However, he also indicated that
fuel costs could continue to impact 2006 earnings. If fuel prices follow the
current forward curve for all of 2006, fuel costs would be higher by
approximately $200 million, or $0.23 per share, over 2005.
Carnival has scheduled a conference call with analysts at 10 a.m. EST
(15.00 London time) today to discuss its 2005 third quarter 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 vacation group in the
world, with a portfolio of 12 cruise brands in North America, Europe and
Australia, comprised of Carnival Cruise Lines, Holland America Line, Princess
Cruises, Seabourn Cruise Line, Windstar Cruises, AIDA Cruises, Costa Cruises,
Cunard Line, Ocean Village, P&O Cruises, Swan Hellenic, and P&O Cruises
Australia.
Together, these brands operate 79 ships totaling more than 137,000 lower
berths with 12 new ships scheduled for delivery between January 2006 and April
2009. Carnival Corporation & plc also operates the leading tour companies in
Alaska and the Canadian Yukon, Holland America Tours and Princess Tours. 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
Some of the statements contained in this earnings release are "forward-looking
statements" that involve risks, uncertainties and assumptions with respect to
Carnival Corporation & plc, including some statements concerning future results,
outlook, 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. You can find many, but not all, of these statements by
looking for words like "will," "may," "believes," "expects," "anticipates,"
"forecast," "future," "intends," "plans," and "estimates" and for similar
expressions. Because forward-looking statements involve risks and uncertainties,
there are many factors that could cause Carnival Corporation & plc's actual
results, performance or achievements to differ materially from those expressed
or implied in this earnings release. Forward-looking statements include those
statements which may impact the forecasting of earnings per share, net revenue
yields, booking levels, pricing, occupancy, operating, financing and/or tax
costs, costs per ALBD, estimates of ship depreciable lives and residual values,
outlook or business prospects. These factors include, but are not limited to,
the following: risks associated with the DLC structure, including the
uncertainty of its tax status; general economic and business conditions, which
may impact levels of disposable income of consumers and the net revenue yields
for cruise brands of Carnival Corporation & plc; conditions in the cruise and
land-based vacation industries, including competition from other cruise ship
operators and providers of other vacation alternatives and increases in capacity
offered by cruise ship and land-based vacation alternatives; risks associated
with operating internationally; the implementation of U.S. regulations requiring
U.S. citizens to obtain passports for travel to or from additional foreign
destinations; the international political and economic climate, armed conflicts,
terrorist attacks and threats thereof, availability of air service, other world
events and adverse publicity, and their impact on the demand for cruises;
accidents and other incidents affecting the health, safety, security and
vacation satisfaction of passengers, including machinery and equipment failures,
which could cause the alteration of itineraries or cancellation of a cruise or a
series of cruises; changing public and consumer tastes and preferences, which
may, among other things, adversely impact the demand for cruises; the ability of
Carnival Corporation & plc to implement its shipbuilding programs and brand
strategies and to continue to expand its business worldwide; the ability of
Carnival Corporation & plc to attract and retain qualified shipboard crew and
maintain good relations with employee unions; the ability to obtain financing on
terms that are favorable or consistent with Carnival Corporation & plc's
expectations; the impact of changes in
operating and financing costs, including changes in foreign currency and
interest rates and fuel, food, payroll, insurance and security costs; changes in
the tax, environmental, health, safety, security and other regulatory regimes
under which Carnival Corporation & plc operates; continued availability of
attractive port destinations; the ability to successfully implement cost
improvement plans and to integrate business acquisitions; continuing financial
viability of Carnival Corporation & plc's travel agent distribution system and
air service providers; and unusual weather patterns or natural disasters, such
as hurricanes and earthquakes.
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 listing rules, Carnival Corporation & plc expressly disclaims 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.
MEDIA CONTACTS INVESTOR RELATIONS CONTACT
US US/UK
Carnival Corporation & plc Carnival Corporation & plc
Tim Gallagher Beth Roberts
1 305 599 2600, ext. 16000 1 305 406 4832
44 7956 436 104
UK
Brunswick Group
Sophie Fitton/Sarah Tovey
44 (0) 20 7404 5959
2005 Third Quarter Earnings -
CARNIVAL CORPORATION & PLC
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended August 31, Nine Months Ended August 31,
----------------------------- ----------------------------
2005 2004(1) 2005 2004
---- ---- ---- ----
(in millions, except per share data)
Revenues
Cruise
Passenger tickets $ 2,692 $ 2,444 $ 6,432 $ 5,663
Onboard and other 666 584 1,783 1,555
Other 247 222 305 267
-------- -------- -------- --------
3,605 3,250 8,520 7,485
-------- -------- -------- --------
Costs and Expenses
Operating
Cruise
Commissions, transportation and other 483 467 1,297 1,227
Onboard and other 116 92 307 270
Payroll and related 303(2) 253 861(2) 739
Food 160 149 465 412
Other ship operating 570 473 1,542 1,285
Other 158 140 212 183
-------- -------- -------- --------
Total 1,790 1,574 4,684 4,116
Selling and administrative 298 306 973 944
Depreciation and amortization 226 210 672 599
-------- -------- -------- --------
2,314 2,090 6,329 5,659
-------- -------- -------- --------
Operating Income 1,291 1,160 2,191 1,826
-------- -------- -------- --------
Nonoperating(Expense) Income
Interest income 10 3 19 12
Interest expense, net of capitalized interest (82) (76) (250) (212)
Other expense, net (23)(3) (2) (13)(3)(4) (9)
-------- -------- -------- --------
(95) (75) (244) (209)
-------- -------- -------- --------
Income Before Income Taxes 1,196 1,085 1,947 1,617
Income Tax Expense, Net (45) (60) (43) (56)
-------- -------- -------- --------
Net Income $ 1,151 $ 1,025 $ 1,904 $ 1,561
======== ======== ======== ========
Earnings Per Share
Basic $ 1.43 $ 1.28 $ 2.36 $ 1.95
======== ======== ======== ========
Diluted $ 1.36 $ 1.22 $ 2.27 $ 1.88
======== ======== ======== ========
Dividends Per Share $ 0.20 $ 0.125 $ 0.55 $ 0.375
======== ======== ======== ========
Weighted-Average Shares Outstanding - Basic 806 803 805 802
======== ======== ======== ========
Weighted-Average Shares Outstanding - Diluted 854 851(5) 854 850(5)
======== ======== ======== ========
(1) Reclassifications have been made to certain 2004 amounts to conform to the
current period presentation.
(2) Includes a $23 million expense related to the British Merchant Navy
Officers Pension Fund contribution.
(3) Includes a $22 million expense for an investment write-down.
(4) Includes a $7 million gain from the settlement of litigation.
(5) Restated for the adoption in the fourth quarter of 2004 of EITF No. 04-08.
2005 Third Quarter Earnings -
CARNIVAL CORPORATION & PLC
SELECTED STATISTICAL AND SEGMENT INFORMATION
Three Months Ended August 31, Nine Months Ended August 31,
----------------------------- ----------------------------
2005 2004 (1) 2005 2004
---- ---- ---- ----
(in millions, except statistical information)
STATISTICAL INFORMATION
Passengers carried 1,953,493 1,849,447 5,259,825 4,762,315
Available lower berth days (2) 12,297,220 11,684,117 35,595,494 32,867,217
Occupancy percentage 110.9% 110.2% 106.6% 105.2%
SEGMENT INFORMATION
Revenues
Cruise $ 3,358 $ 3,028 $ 8,215 $ 7,218
Other 333 301 406 355
Intersegment elimination (86) (79) (101) (88)
------------ ------------ ------------ ------------
$ 3,605 $ 3,250 $ 8,520 $ 7,485
============ ============ ============ ============
Operating expenses
Cruise $ 1,632 $ 1,434 $ 4,472 $ 3,933
Other 244 219 313 271
Intersegment elimination (86) (79) (101) (88)
------------ ------------ ------------ ------------
$ 1,790 $ 1,574 $ 4,684 $ 4,116
============ ============ ============ ============
Selling and administrative expenses
Cruise $ 286 $ 292 $ 932 $ 902
Other 12 14 41 42
------------ ------------ ------------ ------------
$ 298 $ 306 $ 973 $ 944
============ ============ ============ ============
Operating income
Cruise $ 1,222 $ 1,098 $ 2,161 $ 1,800
Other 69 62 30 26
------------ ------------ ------------ ------------
$ 1,291 $ 1,160 $ 2,191 $ 1,826
============ ============ ============ ============
(1) Reclassifications have been made to certain 2004 amounts to conform to the
current period presentation.
(2) Available lower berth days is the total passenger capacity for the period,
assuming two passengers per cabin, that we offer for sale, which is
computed by multiplying passenger capacity by revenue-producing ship
operating days in the period.
2005 Third Quarter Earnings -
CARNIVAL CORPORATION & PLC
GAAP TO NON-GAAP RECONCILING INFORMATION
Gross and net revenue yields were computed by dividing the gross or net
revenues, without rounding, by ALBDs as follows:
Three Months Ended August 31, Nine Months Ended August 31,
----------------------------- ----------------------------
2005 2004 2005 2004
---- ---- ---- ----
(in millions, except ALBDs and yields)
Cruise revenues
Passenger tickets $ 2,692 $ 2,444 $ 6,432 $ 5,663
Onboard and other 666 584 1,783 1,555
------------ ------------ ------------ ------------
Gross cruise revenues 3,358 3,028 8,215 7,218
Less cruise costs
Commissions, transportation and other (483) (467) (1,297) (1,227)
Onboard and other (116) (92) (307) (270)
------------ ------------ ------------ ------------
Net cruise revenues (1) $ 2,759 $ 2,469 $ 6,611 $ 5,721
============ ============ ============ ============
ALBDs 12,297,220 11,684,117 35,595,494 32,867,217
============ ============ ============ ============
Gross revenue yields (1) $ 273.07 $ 259.18 $ 230.78 $ 219.61
============ ============ ============ ============
Net revenue yields (1) $ 224.35 $ 211.29 $ 185.71 $ 174.05
============ ============ ============ ============
Gross and net cruise costs per ALBD were computed by dividing the gross or net
cruise costs, without rounding, by ALBDs as follows:
Three Months Ended August 31, Nine Months Ended August 31,
---------------------------- ---------------------------
2005 2004 2005 2004
---- ---- ---- ----
(in millions, except ALBDs and costs per ALBD)
Cruise operating expenses $ 1,632 $ 1,434 $ 4,472 $ 3,933
Cruise selling and administrative expenses 286 292 932 902
------------ ------------ ------------ ------------
Gross cruise costs 1,918 1,726 5,404 4,835
Less cruise costs included in net cruise revenues
Commissions, transportation and other (483) (467) (1,297) (1,227)
Onboard and other (116) (92) (307) (270)
------------ ------------ ------------ ------------
Net cruise costs (1) $ 1,319 $ 1,167 $ 3,800 $ 3,338
============ ============ ============ ============
ALBDs 12,297,220 11,684,117 35,595,494 32,867,217
============ ============ ============ ============
Gross cruise costs per ALBD (1) $ 155.92 $ 147.67 $ 151.83 $ 147.12
============ ============ ============ ============
Net cruise costs per ALBD (1) $ 107.21 $ 99.79 $ 106.77 $ 101.56
============ ============ ============ ============
2005 Third Quarter Earnings -
NOTE TO GAAP TO NON-GAAP RECONCILING INFORMATION
(1) We use net cruise revenues per ALBD ("net revenue yields") and net cruise
costs per ALBD as significant non-GAAP financial measures of our cruise
segment financial performance. We believe that net revenue yields are
commonly used in the cruise industry to measure a company's cruise segment
revenue performance. This measure is also used for revenue management
purposes. In calculating net revenue yields, we use "net cruise revenues"
rather than "gross cruise revenues." 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 by us net
of our most significant variable costs, which are travel agent
commissions, cost of air transportation and certain other variable direct
costs associated with onboard revenues. Substantially all of our remaining
cruise costs are largely fixed once our ship capacity levels have been
determined.
Net cruise costs per ALBD is the most significant measure we use to
monitor our ability to control our cruise segment costs rather than gross
cruise costs per ALBD. In calculating net cruise costs, we exclude the
same variable costs as described above, which are included in the
calculation of net cruise revenues. This is done to avoid duplicating
these variable costs in these two non-GAAP financial measures.
We have not provided estimates of future gross revenue yields or future
gross cruise costs per ALBD because the reconciliations of forecasted net
cruise revenues to forecasted gross cruise revenues or forecasted net
cruise costs to forecasted cruise operating expenses would require us to
forecast, with reasonable accuracy, the amount of air and other
transportation costs that our forecasted cruise passengers would elect to
purchase from us (the "air/sea mix"). Since the forecasting of future
air/sea mix involves several significant variables that are relatively
difficult to forecast and the revenues from the sale of air and other
transportation approximate the costs of providing that transportation,
management focuses primarily on forecasts of net cruise revenues and costs
rather than gross cruise revenues and costs. This does not impact, in any
material respect, our ability to forecast our future results, as any
variation in the air/sea mix has no material impact on our forecasted net
cruise revenues or forecasted net cruise costs. As such, management does
not believe that this reconciling information would be meaningful.
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