MIAMI, March 27,
2023 /PRNewswire/ -- Carnival Corporation & plc
(NYSE/LSE: CCL; NYSE: CUK) provides first quarter 2023 business
update.
- U.S. GAAP net loss of $693
million, or $(0.55) diluted
EPS, and adjusted net loss of $690
million, or $(0.55) adjusted
EPS, better than the December guidance range of $750 to $850
million net loss for the first quarter of 2023 (see
"Non-GAAP Financial Measures" below).
- Adjusted EBITDA for the first quarter of 2023
was $382 million, better than the
December guidance range of $250
million to $350 million,
despite a $31 million unfavorable
impact from fuel price and currency rates since December
guidance.
- Revenue in the first quarter of 2023 was $4.4 billion, representing 95% of 2019
levels.
- The company experienced the highest booking volumes for any
quarter in its history, breaking booking records for both the
North America and Australia ("NAA") and Europe segments.
- Total customer deposits reached a first quarter record of
$5.7 billion (as of February 28, 2023), surpassing the previous first
quarter record of $4.9 billion (as of
February 28, 2019) by 16%.
- Cash from operations turned positive in the first quarter of
2023. The company expects continued growth in cash from operations
to be the driver for paying down debt over time.
- First quarter 2023 ended with $8.1
billion of liquidity.
Carnival Corporation & plc's Chief Executive Officer
Josh Weinstein commented, "In the
first quarter, we outperformed our guidance on all measures. We
achieved record first quarter net per diems, exceeding the high end
of our guidance, driven by improving ticket prices and sustained
growth in onboard revenue, while delivering an additional seven
points of occupancy on higher capacity compared to the prior
quarter." (See "Non-GAAP Financial Measures" below)
Weinstein continued, "We are enjoying a phenomenal wave season,
achieving our highest ever quarterly booking volumes and breaking
records in both North America and
Europe. Our strong performance has
extended into March and we expect this favorable trend to continue
based on the success of our efforts to drive demand."
Weinstein added, "We remain focused on executing our overarching
strategy of driving net yield growth, while maintaining our
industry-leading cost base. With adjusted free cash flow for the
year expected to be positive, our revolver renewal behind us, more
committed export credit financings in hand, a reduced capex profile
going forward and over $8 billion of
liquidity, we believe we are well positioned to pay down near term
debt maturities from excess liquidity and therefore have no
intention to sell equity (except in connection with our
advantageous and non-dilutive stock swap program)."
First Quarter 2023 Results and Statistical
Information
First quarter 2023 results exceeded the company's guidance due
to stronger pricing and onboard spending, higher occupancy and
favorable timing of operating costs.
- Adjusted EBITDA (see "Non-GAAP Financial Measures" below) for
the first quarter of 2023 was $382
million, better than the December guidance range of
$250 million to $350 million, despite a $31 million unfavorable impact from fuel price
and currency rates since December guidance.
- Continuing to close the gap to a strong 2019:
-
- Revenue in the first quarter of 2023 was $4.4 billion, representing 95% of 2019 levels.
This was better than the fourth quarter of 2022, which was 80% of
2019 levels, an improvement of 15 percentage points.
- Occupancy in the first quarter of 2023 was 91%, higher than
December guidance. Occupancy increased by seven percentage points
compared to the prior quarter, on higher capacity.
- Cruise costs per available lower berth day ("ALBD") increased
3.3% as compared to the first quarter of 2019.
- In constant currency, adjusted cruise costs excluding fuel per
ALBD (see "Non-GAAP Financial Measures" below) increased 5.9%
compared to the first quarter of 2019, continuing its sequential
quarterly improvement and better than the December guidance of up
to 6.5% to 7.5%. Costs remain higher as compared to 2019 as a
result of higher advertising investments to drive 2023 revenue as
well as partially mitigating the impacts of a high inflation
environment.
- Total customer deposits reached a first quarter record of
$5.7 billion (as of February 28, 2023), surpassing the previous first
quarter record of $4.9 billion (as of
February 28, 2019) by 16%, driven by
strong demand, bundled package offerings and pre-cruise sales.
Bookings
Weinstein noted, "We are well booked for the remainder of the
year at higher prices (normalized for FCCs), which coupled with
continued strength in onboard revenue, supports our improving
outlook for the remainder of the year. We expect the extension of
booking lead times, combined with our investment in advertising, to
position us even better in 2024 and beyond."
The company is very encouraged with the improving demand
environment, kicked off by an early start to wave season (peak
booking period) on very strong Black Friday and Cyber Monday
booking volumes. The company experienced the highest booking
volumes for all future sailings for any quarter in its history.
Both the company's NAA and Europe
segments broke records, contributing to the company's
record-breaking quarter. Consistent with previous comments, during
the first quarter of 2023 the company continued its increased
advertising activities, supporting its booking volumes.
The booking window has continued to return to historical
patterns, providing further confidence in the continued
strengthening of the demand environment and facilitating improving
revenue yields over time. The company's NAA segment's booking curve
mirrored peak 2019 levels, while the company's Europe segment continued to see an extension
of its booking curve, which is over 80% recovered compared to 2019
levels.
The company's cumulative advanced booked position for the
remainder of 2023 is at higher ticket prices in constant currency,
normalized for future cruise credits ("FCCs"), as compared to
strong 2019 pricing and a booked occupancy position that is solidly
in the higher end of the historical range. (The company's current
booking trends are compared to booking trends for 2019 as it is the
most recent full year of guest cruise operations.)
2023 Outlook
For the full year 2023, the company expects:
- Adjusted EBITDA of $3.9 billion
to $4.1 billion
-
- Includes approximately $0.5
billion unfavorable impact from fuel price and currency
compared to 2019
- Sequential improvement in each quarter in adjusted EBITDA per
ALBD compared to 2019, driven by closing the gap in occupancy to
2019 levels while achieving net per diems above 2019 levels
- Occupancy of 100% or higher, returning to historical levels
this summer
- Adjusted cruise costs excluding fuel per ALBD (in constant
currency) one point higher than December guidance, reflecting an
expected increase in occupancy levels and strategic decisions taken
during the quarter
For the second quarter of 2023, the company expects:
- Adjusted EBITDA of $600 million
to $700 million, a significant
improvement compared to the first quarter of 2023
- Occupancy of 98% or higher
-
- A seven percentage point gap (or less) from 2019
- An improvement from a 13 percentage point gap for the first
quarter of 2023 compared to 2019
- Net per diems of 2.5% to 3.5% (in constant currency) above 2019
levels
-
- Net per diems reflect the changing brand mix and cabin mix as
compared to the first quarter
- Net yields (see "Non-GAAP Financial Measures" below) of
$160, higher than first quarter of
$149, which reflects continuing net
yield improvement
- Adjusted cruise costs excluding fuel per ALBD higher than first
quarter of 2023, reflecting an expected increase in occupancy
levels and higher dry-dock related expenses
See "Guidance" for additional information on the company's 2023
outlook.
Financing and Capital Activity
Carnival Corporation & plc Chief Financial Officer
David Bernstein noted, "We believe
our debt balance has peaked this quarter and will reduce over time
based on our ample liquidity position of $8.1 billion and the expected cash flow strength
of our business."
Cash from operations turned positive in the first quarter of
2023. The company expects continued growth in cash from operations
to be the driver for paying down debt over time.
During the quarter, the company obtained two new export credit
facilities, bringing the total committed financing related to ship
deliveries scheduled for delivery through 2025 to $3.2 billion. These export credit facilities
provide the company with the ability to finance its newbuild
program at preferential interest rates.
(in
billions)
|
|
2023
|
|
2024
|
|
2025
|
Future export credit
facilities at February 28, 2023
|
|
$
0.3
|
|
$
2.2
|
|
$
0.7
|
The company continues its efforts to proactively address its
debt profile. The company successfully arranged a new $2.1 billion multi-currency revolving credit
facility (the "New Revolver"). The New Revolver will replace the
existing $2.9 billion multi-currency
revolving credit facility upon its maturity in August 2024. The New Revolver has an initial term
of one year, commencing in August
2024, with two one-year extension options. The New Revolver
also contains an accordion feature, allowing for additional
commitments up to an aggregate of $2.9
billion.
During the first quarter the company invested $1.1 billion in capital expenditures, repaid
$0.7 billion of debt principal and
incurred $0.5 billion of interest
expense, net. The company ended the first quarter of 2023 with
$8.1 billion of liquidity, including
cash and borrowings available under the revolving credit
facility.
Environmental, Social and Governance ("ESG")
Piloting the use of alternative fuels and biofuels
The company continues to focus on innovation in its commitment
to decarbonization by evaluating and piloting the use of
alternative fuels and biofuels. During the quarter, Costa Cruises
and AIDA Cruises announced a partnership with a leading methanol
producer which aims to enhance the supply of and necessary
infrastructure for methanol. Suitably sourced green methanol is
considered a lower-carbon fuel which virtually eliminates
particulate matter and sulfur oxides. This partnership builds on
the company's progress throughout 2022, which included the
completion of two successful pilots using a blend of marine biofuel
made from 100% sustainable raw materials. These biofuels can be
used in existing ship engines without modifications to the engine
or fuel infrastructure, including on ships already in service.
Laura Weil appointed Chair of
the Audit Committees
As of February 1, 2023,
Laura Weil became the Chair of the
Audit Committees. Ms. Weil has extensive financial, strategic
information technology and operating skills, which make her highly
qualified to lead the Audit Committees. She will serve as the
successor of Richard J. Glasier, who
will not seek re-election to the Boards of Directors at the 2023
Annual Meetings of Shareholders and will retire from the Boards
with effect from the conclusion of the 2023 Annual Meetings of
Shareholders. As of April 2023, the
company's Boards will be comprised of eleven members, nine of whom
are independent directors, four of whom are female and one of whom
is ethnically diverse.
Other Recent Highlights
- The company sold Seabourn Odyssey and expects to record
a gain on the sale.
- Carnival Corporation & plc was named by Newsweek as One of
America's Greatest Workplaces for Diversity 2023.
- Carnival Cruise Line was recognized as one of the 25 Best
Companies for Latinos to Work in 2023 by Latino Leaders
Magazine.
- Costa Cruises was honored at the Excellence Cruise Awards as
Best Cruise Line for a First Cruise, Best Value for Money and
Excellence in Sustainability.
Guidance
(See "Reconciliation
of Forecasted Data")
|
|
|
2Q
2023
|
|
Full Year
2023
|
Change compared to
2019
|
|
Current
Dollars
|
|
Constant
Currency
|
|
Current
Dollars
|
|
Constant
Currency
|
Net per
diems
|
|
0.0% to 1.0%
|
|
2.5% to 3.5%
|
|
1.0% to 2.0%
|
|
3.0% to 4.0%
|
Adjusted cruise costs
excluding fuel per ALBD
|
|
8.0% to 9.0%
|
|
10.5% to
11.5%
|
|
6.5% to 7.5%
|
|
8.5% to 9.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2Q
2023
|
|
Full Year
2023
|
ALBDs (in
millions) (a)
|
|
|
|
|
|
22.3
|
|
91.3
|
Capacity growth vs
2019
|
|
|
|
|
|
3.1 %
|
|
4.5 %
|
Occupancy percentage
(a)
|
|
|
|
|
|
98% or
higher
|
|
100% or
higher
|
|
|
|
|
|
|
|
|
|
Fuel
consumption in metric tons (in millions)
|
|
|
|
|
|
0.7
|
|
2.9
|
Fuel cost per metric
ton consumed
|
|
|
|
|
|
$
645
|
|
$
650
|
Fuel expense (in
billions)
|
|
|
|
|
|
$
0.5
|
|
$
1.9
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization (in billions)
|
|
|
|
|
|
$
0.6
|
|
$
2.4
|
Interest expense, net
of capitalized interest and interest income (in
billions)
|
|
$
0.5
|
|
$
2.0
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (in
millions)
|
|
|
|
|
|
$600 to $700
|
|
$3,900 to
$4,100
|
Adjusted net income
(loss) (in millions)
|
|
|
|
|
|
$(525) to
$(425)
|
|
$(550) to
$(350)
|
Adjusted earnings per
share
|
|
|
|
|
|
$(0.42) to
$(0.34)
|
|
$(0.44) to
$(0.28)
|
|
|
|
|
|
|
|
|
|
Currencies (USD to
1)
|
|
|
|
|
|
|
|
|
AUD
|
|
|
|
|
|
$
0.67
|
|
$
0.67
|
CAD
|
|
|
|
|
|
$
0.73
|
|
$
0.73
|
EUR
|
|
|
|
|
|
$
1.07
|
|
$
1.07
|
GBP
|
|
|
|
|
|
$
1.22
|
|
$
1.22
|
|
|
|
|
|
|
|
|
|
(a) See
"Notes to Statistical Information"
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sensitivities
(impact to adjusted net income (loss) in
millions)
|
|
2Q
2023
|
|
Remainder of
2023
|
1% change in net per
diems
|
|
|
|
|
|
$
38
|
|
$
127
|
1% change in adjusted
cruise costs excluding fuel per ALBD
|
|
$
23
|
|
$
68
|
1% change in currency
exchange rates
|
|
|
|
|
|
$
2
|
|
$
14
|
10% change in fuel
price
|
|
|
|
|
|
$
50
|
|
$
146
|
100 basis point change
in variable rate debt (including derivatives)
|
|
—
|
|
$
67
|
Capital Expenditures
The company's annual capital expenditure forecast, which
includes year-to-date actuals for 2023, is as follows:
(in
billions)
|
2023
|
|
2024
|
|
2025
|
|
2026
|
Contracted
newbuild
|
$
1.7
|
|
$
2.4
|
|
$
0.9
|
|
$
—
|
Non-newbuild
|
1.5
|
|
1.7
|
|
1.7
|
|
1.7
|
Total (a)
|
$
3.2
|
|
$
4.1
|
|
$
2.6
|
|
$
1.7
|
|
|
(a)
|
Forecasted capital
expenditures will fluctuate with foreign currency movements
relative to the U.S. Dollar.
|
Outstanding Debt Maturities
As of February 28, 2023, the
company's outstanding debt maturities are as follows:
(in
billions)
|
|
2023
|
|
2024
|
|
2025
|
|
2026
|
First Lien
|
|
$
0.0
|
|
$
0.1
|
|
$
2.6
|
|
$
0.0
|
Second Lien
|
|
—
|
|
—
|
|
—
|
|
1.2
|
Export
Credits
|
|
1.1
|
|
1.5
|
|
1.4
|
|
1.3
|
All other
|
|
0.6
|
|
1.0
|
|
0.5
|
|
2.1
|
Total Principal
payments on outstanding debt (a)
|
|
$
1.8
|
|
$
2.5
|
|
$
4.5
|
|
$
4.6
|
|
|
(a)
|
Excludes borrowings of
$0.2 billion under the $2.9 billion multi-currency revolving credit
facility at February 28, 2023, which matures in August
2024.
|
Refer to Financial Information within the Investor Relations
section of the corporate website for further details on the
company's Debt Maturities, which will be available upon filing the
Form 10-Q:
https://www.carnivalcorp.com/financial-information/supplemental-schedules
Conference Call
The company has scheduled a conference call with analysts at
10:00 a.m. EDT (3:00 p.m. BST) today to discuss its business
update. This call can be listened to live, and additional
information can be obtained, via Carnival Corporation & plc's
website at
www.carnivalcorp.com and www.carnivalplc.com.
Carnival Corporation & plc is the largest global cruise
company, and among the largest leisure travel companies, with a
portfolio of world-class cruise lines – AIDA Cruises, Carnival
Cruise Line, Costa Cruises, Cunard, Holland America Line, P&O
Cruises (Australia), P&O
Cruises (UK), Princess Cruises, and Seabourn.
Additional information can be found on www.carnivalcorp.com,
www.aida.de, www.carnival.com, www.costacruise.com, www.cunard.com,
www.hollandamerica.com, www.pocruises.com.au, www.pocruises.com,
www.princess.com and www.seabourn.com. For more information on
Carnival Corporation's industry-leading sustainability initiatives,
visit www.carnivalsustainability.com.
Cautionary Note Concerning Factors That May Affect Future
Results
Some of the statements, estimates or projections contained in
this document are "forward-looking statements" that involve risks,
uncertainties and assumptions with respect to us, including some
statements concerning future results, operations, outlooks, plans,
goals, reputation, cash flows, liquidity 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, as amended. All statements other than statements of
historical facts are statements that could be deemed
forward-looking. These statements are based on current
expectations, estimates, forecasts and projections about our
business and the industry in which we operate and the beliefs and
assumptions of our management. We have tried, whenever possible, to
identify these statements by using words like "will," "may,"
"could," "should," "would," "believe," "depends," "expect," "goal,"
"aspiration," "anticipate," "forecast," "project," "future,"
"intend," "plan," "estimate," "target," "indicate," "outlook," and
similar expressions of future intent or the negative of such
terms.
Forward-looking statements include those statements that relate
to our outlook and financial position including, but not limited
to, statements regarding:
·
|
Pricing
|
·
|
Adjusted net income
(loss)
|
·
|
Booking
levels
|
·
|
Adjusted
EBITDA
|
·
|
Occupancy
|
·
|
Adjusted earnings per
share
|
·
|
Interest, tax and fuel
expenses
|
·
|
Adjusted free cash
flow
|
·
|
Currency exchange
rates
|
·
|
Net per
diems
|
·
|
Goodwill, ship and
trademark fair values
|
·
|
Net yields
|
·
|
Liquidity and credit
ratings
|
·
|
Adjusted cruise costs
per ALBD
|
·
|
Estimates of ship
depreciable lives and residual values
|
·
|
Adjusted cruise costs
excluding fuel per ALBD
|
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 by our forward-looking statements. This
note contains important cautionary statements of the known factors
that we consider could materially affect the accuracy of our
forward-looking statements and adversely affect our business,
results of operations and financial position. Additionally, many of
these risks and uncertainties are currently, and in the future may
continue to be, amplified by our substantial debt balance as a
result of the pause of our guest cruise operations. There may be
additional risks that we consider immaterial or which are unknown.
These factors include, but are not limited to, the
following:
- Events and conditions around the world, including war and
other military actions, such as the invasion of Ukraine, inflation, higher fuel prices, higher
interest rates and other general concerns impacting the ability or
desire of people to travel have led, and may in the future lead, to
a decline in demand for cruises, impacting our operating costs and
profitability.
- Pandemics have in the past and may in the future have a
significant negative impact on our financial condition and
operations.
- Incidents concerning our ships, guests or the cruise
industry have in the past and may, in the future, negatively impact
the satisfaction of our guests and crew and lead to reputational
damage.
- Changes in and non-compliance with laws and regulations
under which we operate, such as those relating to health,
environment, safety and security, data privacy and protection,
anti-corruption, economic sanctions, trade protection, labor and
employment, and tax have in the past and may, in the future, lead
to litigation, enforcement actions, fines, penalties and
reputational damage.
- Factors associated with climate change, including evolving
and increasing regulations, increasing global concern about climate
change and the shift in climate conscious consumerism and
stakeholder scrutiny, and increasing frequency and/or severity of
adverse weather conditions could adversely affect our
business.
- Inability to meet or achieve our sustainability related
goals, aspirations, initiatives, and our public statements and
disclosures regarding them, may expose us to risks that may
adversely impact our business.
- Breaches in data security and lapses in data privacy as well
as disruptions and other damages to our principal offices,
information technology operations and system networks and failure
to keep pace with developments in technology may adversely impact
our business operations, the satisfaction of our guests and crew
and may lead to reputational damage.
- The loss of key team members, our inability to recruit or
retain qualified shoreside and shipboard team members and increased
labor costs could have an adverse effect on our business and
results of operations.
- Increases in fuel prices, changes in the types of fuel
consumed and availability of fuel supply may adversely impact our
scheduled itineraries and costs.
- We rely on supply chain vendors who are integral to the
operations of our businesses. These vendors and service providers
are also affected by COVID-19 and may be unable to deliver on their
commitments which could negatively impact our business.
- Fluctuations in foreign currency exchange rates may
adversely impact our financial results.
- Overcapacity and competition in the cruise and land-based
vacation industry may negatively impact our cruise sales, pricing
and destination options.
- Inability to implement our shipbuilding programs and ship
repairs, maintenance and refurbishments may adversely impact our
business operations and the satisfaction of our
guests.
- Failure to successfully implement our business strategy
following our resumption of guest cruise operations would
negatively impact the occupancy levels and pricing of our cruises
and could have a material adverse effect on our business. We
require a significant amount of cash to service our debt and
sustain our operations. Our ability to generate cash depends on
many factors, including those beyond our control, and we may not be
able to generate cash required to service our debt and sustain our
operations.
The ordering of the risk factors set forth above is not intended
to reflect our indication of priority or likelihood.
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 document, 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.
Forward-looking and other statements in this document may also
address our sustainability progress, plans and goals (including
climate change and environmental-related matters). In addition,
historical, current and forward-looking sustainability- and
climate-related statements may be based on standards and tools for
measuring progress that are still developing, internal controls and
processes that continue to evolve, and assumptions and predictions
that are subject to change in the future and may not be generally
shared.
CARNIVAL
CORPORATION & PLC
|
CONSOLIDATED
STATEMENTS OF INCOME (LOSS)
|
(UNAUDITED)
|
(in millions, except
per share data)
|
|
|
Three Months
Ended
February
28,
|
|
2023
|
|
2022
|
Revenues
|
|
|
|
Passenger
ticket
|
$
2,870
|
|
$
873
|
Onboard and
other
|
1,563
|
|
750
|
|
4,432
|
|
1,623
|
Operating
Expenses
|
|
|
|
Commissions,
transportation and other
|
655
|
|
251
|
Onboard and
other
|
484
|
|
209
|
Payroll and
related
|
582
|
|
506
|
Fuel
|
535
|
|
365
|
Food
|
311
|
|
136
|
Ship and other
impairments
|
—
|
|
8
|
Other
operating
|
743
|
|
557
|
Cruise and tour
operating expenses
|
3,311
|
|
2,030
|
Selling and
administrative
|
712
|
|
530
|
Depreciation and
amortization
|
582
|
|
554
|
|
4,604
|
|
3,114
|
Operating Income
(Loss)
|
(172)
|
|
(1,491)
|
Nonoperating Income
(Expense)
|
|
|
|
Interest
income
|
56
|
|
3
|
Interest
expense, net of capitalized interest
|
(539)
|
|
(368)
|
Other income
(expense), net
|
(30)
|
|
(32)
|
|
(514)
|
|
(397)
|
Income (Loss) Before
Income Taxes
|
(686)
|
|
(1,888)
|
Income Tax Benefit
(Expense), Net
|
(7)
|
|
(3)
|
Net Income
(Loss)
|
$
(693)
|
|
$
(1,891)
|
|
|
|
|
Earnings Per
Share
|
|
|
|
Basic
|
$
(0.55)
|
|
$
(1.66)
|
Diluted
|
$
(0.55)
|
|
$
(1.66)
|
Weighted-Average
Shares Outstanding - Basic
|
1,260
|
|
1,137
|
Weighted-Average
Shares Outstanding - Diluted
|
1,260
|
|
1,137
|
CARNIVAL
CORPORATION & PLC
|
CONSOLIDATED BALANCE
SHEETS
|
(UNAUDITED)
|
(in millions, except
par values)
|
|
|
February 28,
2023
|
|
November 30,
2022
|
ASSETS
|
|
|
|
Current
Assets
|
|
|
|
Cash and cash
equivalents
|
$
5,455
|
|
$
4,029
|
Restricted
cash
|
15
|
|
1,988
|
Trade and other
receivables, net
|
514
|
|
395
|
Inventories
|
448
|
|
428
|
Prepaid expenses and
other
|
710
|
|
652
|
Total current
assets
|
7,144
|
|
7,492
|
Property and
Equipment, Net
|
39,359
|
|
38,687
|
Operating Lease
Right-of-Use Assets, Net
|
1,246
|
|
1,274
|
Goodwill
|
579
|
|
579
|
Other
Intangibles
|
1,158
|
|
1,156
|
Other
Assets
|
2,501
|
|
2,515
|
|
$
51,985
|
|
$
51,703
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
Liabilities
|
|
|
|
Short-term
borrowings
|
$
200
|
|
$
200
|
Current portion of
long-term debt
|
2,264
|
|
2,393
|
Current portion of
operating lease liabilities
|
156
|
|
146
|
Accounts
payable
|
1,022
|
|
1,050
|
Accrued liabilities
and other
|
1,951
|
|
1,942
|
Customer
deposits
|
5,495
|
|
4,874
|
Total current
liabilities
|
11,088
|
|
10,605
|
Long-Term
Debt
|
32,672
|
|
31,953
|
Long-Term Operating
Lease Liabilities
|
1,148
|
|
1,189
|
Other Long-Term
Liabilities
|
908
|
|
891
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
Common stock of
Carnival Corporation, $0.01 par value; 1,960 shares authorized;
1,246
shares at 2023 and
1,244 shares at 2022 issued
|
12
|
|
12
|
Ordinary shares of
Carnival plc, $1.66 par value; 217 shares at 2023 and 2022
issued
|
361
|
|
361
|
Additional paid-in
capital
|
16,635
|
|
16,872
|
Retained earnings
(accumulated deficit)
|
(434)
|
|
269
|
Accumulated other
comprehensive income (loss)
|
(1,972)
|
|
(1,982)
|
Treasury stock, 130
shares at 2023 and 2022 of Carnival Corporation and 71 shares
at
2023 and 72 shares at 2022 of Carnival plc, at cost
|
(8,433)
|
|
(8,468)
|
Total
shareholders' equity
|
6,170
|
|
7,065
|
|
$
51,985
|
|
$
51,703
|
CARNIVAL CORPORATION
& PLC
|
OTHER
INFORMATION
|
|
OTHER BALANCE SHEET
INFORMATION (in millions)
|
February 28,
2023
|
|
November 30,
2022
|
Liquidity
(a)
|
$
8,105
|
|
$
8,635
|
Debt (current and
long-term)
|
$
35,135
|
|
$
34,546
|
Customer deposits
(current and long-term)
|
$
5,696
|
|
$
5,089
|
|
|
|
|
(a)
|
November 30, 2022
liquidity includes cash, restricted cash from the 2028 Senior
Priority Notes which became unrestricted in December, and
borrowings available under the revolving credit
facility.
|
|
Three Months
Ended
February
28,
|
STATISTICAL
INFORMATION
|
2023
|
|
2022
|
Passenger cruise days
("PCDs") (in millions) (a)
|
20.2
|
|
7.2
|
ALBDs (in
millions) (b)
|
22.1
|
|
13.3
|
Occupancy percentage
(c)
|
91 %
|
|
54 %
|
Passengers carried
(in millions)
|
2.7
|
|
1.0
|
|
|
|
|
Fuel consumption in
metric tons (in millions)
|
0.7
|
|
0.6
|
Fuel consumption in
metric tons per thousand ALBDs
|
33.4
|
|
42.5
|
Fuel cost per metric
ton consumed
|
$
730
|
|
$
648
|
|
|
|
|
Currencies (USD to
1)
|
|
|
|
AUD
|
$
0.69
|
|
$
0.72
|
CAD
|
$
0.74
|
|
$
0.79
|
EUR
|
$
1.07
|
|
$
1.13
|
GBP
|
$
1.22
|
|
$
1.35
|
|
Notes to
Statistical Information
|
(a)
|
PCD represents the
number of cruise passengers on a voyage multiplied by the number of
revenue-producing ship operating days for that voyage.
|
(b)
|
ALBD is a standard
measure of passenger capacity for the period that we use to
approximate rate and capacity variances, based on consistently
applied formulas that we use to perform 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.
|
(c)
|
Occupancy, in
accordance with cruise industry practice, is calculated using a
numerator of PCDs and a denominator of ALBDs, which assumes 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.
|
CARNIVAL CORPORATION
& PLC
|
NON-GAAP FINANCIAL
MEASURES
|
|
|
Three Months
Ended
February
28,
|
(in
millions)
|
2023
|
|
2022
|
Net income
(loss)
|
$
(693)
|
|
$
(1,891)
|
(Gains) losses on ship
sales and impairments
|
(9)
|
|
7
|
(Gains) losses on debt
extinguishment, net
|
—
|
|
—
|
Restructuring
expenses
|
—
|
|
—
|
Other
|
12
|
|
—
|
Adjusted net income
(loss)
|
$
(690)
|
|
$
(1,884)
|
Interest expense, net
of capitalized interest
|
539
|
|
368
|
Interest
income
|
(56)
|
|
(3)
|
Income tax
(expense), benefit
|
7
|
|
3
|
Depreciation and
amortization
|
582
|
|
554
|
Adjusted
EBITDA
|
$
382
|
|
(962)
|
|
|
|
Three Months
Ended
February
28,
|
|
2023
|
|
2022
|
Earnings per
share
|
$
(0.55)
|
|
$
(1.66)
|
(Gains) losses on ship
sales and impairments
|
(0.01)
|
|
0.01
|
(Gains) losses on debt
extinguishment, net
|
—
|
|
—
|
Restructuring
expenses
|
—
|
|
—
|
Other
|
0.01
|
|
—
|
Adjusted earnings
per share
|
$
(0.55)
|
|
$
(1.66)
|
|
|
|
|
Weighted-average
shares outstanding - diluted (in millions)
|
1,260
|
|
1,137
|
|
|
|
Three Months
Ended
February
28,
|
(in
millions)
|
2023
|
|
2022
|
Cash from (used in)
operations
|
$
388
|
|
$
(1,212)
|
Capital expenditures
(Purchases of Property and Equipment)
|
(1,075)
|
|
(2,730)
|
Proceeds from export
credits
|
830
|
|
2,343
|
Adjusted free cash
flow
|
$
144
|
|
$
(1,598)
|
|
(See Non-GAAP
Financial Measures)
|
CARNIVAL CORPORATION &
PLC
NON-GAAP FINANCIAL MEASURES (CONTINUED)
Data in the below table is compared against 2019 as it is the
most recent year of full operations due to the pause and resumption
of guest cruise operations.
Gross margin per diems and net per diems were computed by
dividing the gross margin and adjusted gross margin by PCDs. Gross
margin yields and net yields were computed by dividing the gross
margin and adjusted gross margin by ALBDs as follows:
|
Three Months Ended
February 28,
|
(in millions, except
per diems and yields data)
|
2023
|
|
2023
Constant
Currency
|
|
2019
|
Total
revenues
|
$
4,432
|
|
|
|
$
4,673
|
Less: Cruise and tour
operating expenses
|
(3,311)
|
|
|
|
(3,142)
|
Depreciation and
amortization
|
(582)
|
|
|
|
(516)
|
Gross
margin
|
540
|
|
|
|
1,015
|
Less: Tour and other
revenues
|
(9)
|
|
|
|
(29)
|
Add: Payroll and
related
|
582
|
|
|
|
557
|
Fuel
|
535
|
|
|
|
381
|
Food
|
311
|
|
|
|
268
|
Ship and other
impairments
|
—
|
|
|
|
—
|
Other
operating
|
743
|
|
|
|
759
|
Depreciation and
amortization
|
582
|
|
|
|
516
|
Adjusted gross
margin
|
3,284
|
|
$
3,366
|
|
$
3,468
|
|
|
|
|
|
|
PCDs
|
20.2
|
|
20.2
|
|
22.3
|
|
|
|
|
|
|
Gross margin per
diems (per PCD)
|
$
26.81
|
|
|
|
$
45.49
|
Net per diems
(per PCD)
|
$ 162.96
|
|
$
167.04
|
|
$
155.37
|
|
|
|
|
|
|
ALBDs
|
22.1
|
|
22.1
|
|
21.3
|
|
|
|
|
|
|
Gross margin
yields (per ALBD)
|
$
24.49
|
|
|
|
$
47.68
|
Net yields (per
ALBD)
|
$ 148.87
|
|
$
152.59
|
|
$
162.82
|
|
|
|
|
|
|
(See Non-GAAP
Financial Measures)
|
CARNIVAL CORPORATION &
PLC
NON-GAAP FINANCIAL MEASURES (CONTINUED)
Data in the below table is compared against 2019 as it is the
most recent year of full operations due to the pause and resumption
of guest cruise operations.
Cruise costs per ALBD, adjusted cruise costs per ALBD and
adjusted cruise costs excluding fuel per ALBD were computed by
dividing cruise costs, adjusted cruise costs and adjusted cruise
costs excluding fuel by ALBDs as follows:
|
Three Months Ended
February 28,
|
(in millions, except
costs per ALBD data)
|
2023
|
|
2023
Constant
Currency
|
|
2019
|
Cruise and tour
operating expenses
|
$
3,311
|
|
|
|
$
3,142
|
Selling and
administrative expenses
|
712
|
|
|
|
629
|
Less: Tour and other
expenses
|
(23)
|
|
|
|
(35)
|
Cruise
costs
|
3,999
|
|
|
|
3,736
|
Less: Commissions,
transportation and other
|
(655)
|
|
|
|
(709)
|
Onboard and
other costs
|
(484)
|
|
|
|
(467)
|
Gains (losses) on ship
sales and impairments
|
9
|
|
|
|
(2)
|
Restructuring
expenses
|
—
|
|
|
|
—
|
Other
|
—
|
|
|
|
—
|
Adjusted cruise
costs
|
2,869
|
|
|
|
2,558
|
Less: Fuel
|
(535)
|
|
|
|
(381)
|
Adjusted cruise
costs excluding fuel
|
$
2,334
|
|
$
2,388
|
|
$
2,177
|
|
|
|
|
|
|
ALBDs
|
22.1
|
|
22.1
|
|
21.3
|
|
|
|
|
|
|
Cruise costs per
ALBD
|
$ 181.25
|
|
|
|
$ 175.40
|
% increase (decrease)
vs 2019
|
3.3 %
|
|
|
|
|
Adjusted cruise
costs per ALBD
|
$ 130.04
|
|
|
|
$ 120.08
|
% increase (decrease)
vs 2019
|
8.3 %
|
|
|
|
|
Adjusted cruise
costs excluding fuel per ALBD
|
$ 105.78
|
|
$ 108.22
|
|
$ 102.21
|
% increase (decrease)
vs 2019
|
3.5 %
|
|
5.9 %
|
|
|
|
|
|
|
|
|
(See Non-GAAP
Financial Measures)
|
Non-GAAP Financial Measures
We use non-GAAP financial measures and they are provided along
with their most comparative U.S. GAAP financial measure:
Non-GAAP
Measure
|
|
U.S. GAAP
Measure
|
|
Use Non-GAAP Measure
to Assess
|
•
Adjusted net income (loss) and adjusted
EBITDA
|
|
•
Net income (loss)
|
|
•
Company Performance
|
•
Adjusted earnings per share
|
|
•
Earnings per share
|
|
•
Company Performance
|
•
Adjusted free cash flow
|
|
•
Cash from (used in) operations
|
|
•
Impact on Liquidity Level
|
•
Net per diems
|
|
•
Gross margin per diems
|
|
•
Cruise Segments Performance
|
•
Net yields
|
|
•
Gross margin yields
|
|
•
Cruise Segments Performance
|
•
Adjusted cruise costs per ALBD and
adjusted cruise costs
excluding fuel per ALBD
|
|
•
Gross cruise costs per ALBD
|
|
•
Cruise Segments Performance
|
The presentation of our non-GAAP financial information is not
intended to be considered in isolation from, as substitute for, or
superior to the financial information prepared in accordance with
U.S. GAAP. It is possible that our non-GAAP financial measures 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.
Adjusted net income (loss) and adjusted earnings per share
provide additional information to us and investors about our future
earnings performance by excluding certain gains, losses and
expenses that we believe are not part of our core operating
business and are not an indication of our future earnings
performance. We believe that gains and losses on ship sales,
impairment charges, gains and losses on debt extinguishments,
restructuring costs and certain other gains and losses are not part
of our core operating business and are not an indication of our
future earnings performance.
Adjusted EBITDA provides additional information to us and
investors about our core operating profitability by excluding
certain gains, losses and expenses that we believe are not part of
our core operating business and are not an indication of our future
earnings performance as well as excluding interest, taxes and
depreciation and amortization. In addition, we believe that the
presentation of adjusted EBITDA provides additional information to
us and investors about our ability to operate our business in
compliance with the covenants set forth in our debt agreements. We
define adjusted EBITDA as adjusted net income (loss) adjusted for
(i) interest, (ii) taxes and (iii) depreciation and amortization.
There are material limitations to using adjusted EBITDA. Adjusted
EBITDA does not take into account certain significant items that
directly affect our net income (loss). These limitations are best
addressed by considering the economic effects of the excluded items
independently and by considering adjusted EBITDA in conjunction
with net income (loss) as calculated in accordance with U.S.
GAAP.
Adjusted free cash flow provides additional information to
us and investors to assess our ability to repay our debt after
making the capital investments required to support ongoing business
operations and value creation as well as the impact on the
company's liquidity level. Adjusted free cash flow represents net
cash provided by operating activities adjusted for capital
expenditures (purchases of property and equipment) and proceeds
from export credits that are provided for related capital
expenditures. Adjusted free cash flow does not represent the
residual cash flow available for discretionary expenditures as it
excludes certain mandatory expenditures such as repayment of
maturing debt.
Net per diems and net yields enable us and investors to
measure the performance of our cruise segments on a per PCD and per
ALBD basis. We use adjusted gross margin rather than gross margin
to calculate net per diems and net yields. We believe that adjusted
gross margin is a more meaningful measure in determining net per
diems and net yields than gross margin because it reflects the
cruise revenues earned net of only 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 and debit card fees.
Adjusted cruise costs per ALBD and adjusted cruise costs
excluding fuel per ALBD enable us and investors to separate the
impact of predictable capacity or ALBD changes from price and other
changes that affect our business. We believe these non-GAAP
measures provide useful information to us and investors and
expanded insight to measure our cost performance. Adjusted cruise
costs per ALBD and adjusted cruise costs excluding fuel per ALBD
are the measures we use to monitor our ability to control our
cruise segments' costs rather than cruise costs per ALBD. We
exclude gains and losses on ship sales, impairment charges,
restructuring costs and certain other gains and losses that we
believe are not part of our core operating business as well as
excluding 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 and debit card fees. We exclude fuel expense to
calculate adjusted cruise costs without fuel. The price of fuel,
over which we have no control, impacts the comparability of
period-to-period cost performance. The adjustment to exclude fuel
provides us and investors with supplemental information to
understand and assess the company's non-fuel adjusted cruise cost
performance. Substantially all of our adjusted cruise costs
excluding fuel are largely fixed, except for the impact of changing
prices once the number of ALBDs has been determined.
Reconciliation of Forecasted Data
We have not provided a reconciliation of forecasted non-GAAP
financial measures to the most comparable U.S. GAAP financial
measures because preparation of meaningful U.S. GAAP forecasts
would require unreasonable effort. We are unable to predict,
without unreasonable effort, the future movement of foreign
exchange rates and fuel prices. We are unable to determine the
future impact of gains and losses on ship sales, impairment
charges, gains and losses on debt extinguishments, restructuring
costs and certain other non-core gains and losses.
Constant Currency
Our operations primarily utilize the U.S. dollar, Australian
dollar, euro and sterling as functional currencies to measure
results and financial condition. Functional currencies other than
the U.S. dollar subject us to foreign currency translational risk.
Our operations also have revenues and expenses that are in
currencies other than their functional currency, which subject us
to foreign currency transactional risk.
Constant currency reporting removes the impact of changes in
exchange rates on the translation of our operations plus the
transactional impact of changes in exchange rates from revenues and
expenses that are denominated in a currency other than the
functional currency.
We report adjusted gross margin, net per diems, adjusted cruise
costs excluding fuel and adjusted cruise costs excluding fuel per
ALBD on a "constant currency" basis assuming the 2023 periods'
currency exchange rates have remained constant with the 2019
periods' rates. These metrics facilitate a comparative view for the
changes in our business in an environment with fluctuating exchange
rates.
Examples:
- The translation of our operations with functional currencies
other than U.S. dollar 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.
- Our operations have revenue and expense transactions in
currencies other than their functional currency. If their
functional currency strengthens against these other currencies, it
reduces the functional currency revenues and expenses. If the
functional currency weakens against these other currencies, it
increases the functional currency revenues and expenses.
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SOURCE Carnival Corporation & plc