Carnival Corp Reports Record 2023 Revenue and Fourth Quarter Earnings

Table Of Content

• Carnival Corporation & plc (CCL) Q4 2023 Earnings Call Transcript
• Rudi's Seagrill price
• CARNIVAL CORPORATION & PLC REPORTS ALL-TIME RECORD REVENUE AND DEMONSTRATES STRONG THIRD QUARTER 2023 EARNINGS MOMENTUM
• Carnival (CCL) Q1 Earnings & Revenues Top Estimates, Rise Y/Y
• CCL: What are Zacks experts saying now?

So, keep in mind that 2019 was the high watermark for occupancy, and we look back to like 2005, and the historical occupancy levels were in the range of 104% to 107%. So what we're saying is we will be solidly back to historical occupancy levels, but we weren't saying we're going to be back to the high watermark of 2019. Now clearly a lot of new-to-cruise will over index on the shorter cruises because they're trying it out for the first time and that lends itself to maybe also a younger crowd which is more comfortable just playing around on the net and doing things direct. But I mean, frankly speaking, historically, and I expect this to continue, our trade partners are absolutely critical in driving new-to-cruise to us. And we will rely on them for decades more and they have done a great job of really catching up to where we've been in the curve and year-over-year they're showing great strength as well.

Carnival Corporation & plc (CCL) Q4 2023 Earnings Call Transcript

So, that's why it's a net decline of about $100 million in interest expense on a year-over-year basis. Sometimes you should listen to us, sometimes not but here we are, I want to hear from you. You know what plans of late - especially around Black Friday, Cyber Monday you've seen with new-to-cruise. And if so, what would be the impact on your margins.

Rudi's Seagrill price

The uptrend can be attributed to improved booking trends, courtesy of solid demand and increased advertising activities. Also, focus on strategic investments and fleet expansion bode well.The Zacks Consensus Estimate for this Zacks Rank #3 (Hold) company’s fiscal 2025 earnings per share (EPS) is pegged at $1.44, indicating 41.7% growth from the prior year’s reported levels. The earnings estimate for second-quarter fiscal 2024 suggests 96.8% growth from the year-ago reported figure. CCL delivered a trailing four-quarter earnings surprise of 21.9%, on average. Booking volumes during the fourth quarter continued at significantly elevated levels, above both prior year and 2019 comparable periods, while recent booking volumes for the two weeks around Black Friday and Cyber Monday reached an all-time high for that period.

CARNIVAL CORPORATION & PLC REPORTS ALL-TIME RECORD REVENUE AND DEMONSTRATES STRONG THIRD QUARTER 2023 EARNINGS MOMENTUM

We are well positioned to drive 2024 ticket prices higher with significantly less inventory remaining to shell and the same time last year, despite a capacity increase of over 5%. Occupancy for the full year 2024 is on track to return to historical level. Next, I will provide a recap of our refinancing and deleveraging efforts during 2023. As Josh indicated, our full year 2023 strong EBITDA of $4.2 billion and strong cash from operations of $4.3 billion, propelled us on our journey to pay down debt and reduce the debt burden necessitated by the pause in guest cruise operations. Our fourth quarter bottom line exceeded the better end of our guidance range as we outperformed our September guidance. The $85 million improvement was driven by favorability in revenue from higher ticket prices as net per diems were up over 10%, 3-points better than the midpoint of our September guidance range.

Carnival (CCL) Q1 Earnings & Revenues Top Estimates, Rise Y/Y

Carnival has been bearing the brunt of high expenses for quite some time. During the fiscal first quarter, operating costs and expenses increased 12% year over year to $3.7 billion. Several factors drove this uptick, including a 4.2% capacity rise in Available Lower Berth Days (ALBDs), elevated commissions, transportation costs and other expenses linked to higher ticket pricing and increased guest numbers. Additionally, higher onboard revenues led to a $43 million increase in onboard and other cost of sales, while repair and maintenance expenses, including dry-dock costs, rose by $30 million. Furthermore, a net unfavorable foreign currency translational impact and increased port expenses each contributed $25 million to the overall rise in expenses.

For the full year, thanks to the tremendous efforts of our team members, ship and shore, we closed the books on 2023 with positive adjusted net income. That is a far cry from our March guidance as we delivered over $550 million to the bottom-line, which was partially offset by a drag from fuel price and currency exchange rates of over $100 million. The book position for our North American brands remains as far out as we have ever seen and well ahead of last year, and pricing that is considerably higher. Our European brands just delivered record fourth quarter booking volume at considerably higher prices and with a booking window now fully back to historical norms.

It is wonderful that Carnival is attracting customers who have never been on a cruise before. It improves the outlook for future performance since those customers can become repeat cruisers. But investors need to take this company's talking point with a grain of salt. The numbers are impressive today, but they probably won't remain this impressive for very long. It is just too hard a growth rate to sustain given the economic sensitivity of the industry, the inherent constraints of ships and, well, the way basic math works.

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And on top of that, we predict price - we estimate pricing to be up low to mid-single digits every year 2024, 2025, 2026. And so, we feel like we are - we entered the year a little bit ahead, given how we ended the second half of 2023 and we’ll keep pushing forward. In summary, putting all these factors together our net income guidance for the full year 2024 is approximately 1.2 billion with EBITDA forecasted at 5.6 billion, a significant improvement from 2023. In 2023, we effectively stretched out the 2025 maturity on favorable terms by replacing it with a $1.3 billion term loan B facility in 2027 and a $500 million offering of senior secured notes in 2029.

In 2023, we captured over 3.5 million new-to-cruise guests and remain well-positioned to continue to take share from land-based alternatives. In other words, we are gaining momentum in our ability to close the unwarranted value gap to land-based alternatives. And to aid in that effort, we can further champion the fact that while many land-based alternatives have pulled back on service levels, we still deliver incredible service to our guests, thanks to our amazing crew.

So it seems like, you might be taking a somewhat conservative view around onboard trends and then potentially underestimating the opportunity around, taking close in pricing. But nonetheless inflation with an average 3.5% increase across all our cost categories globally. Second, with occupancy returning to historical levels, the impact on costs should be 1.5 to 2 percentage points higher in 2024 as compared to 2023. The strong improvement in 2024 net yields is a result of the increase in all the component parts, higher ticket prices, higher onboard spending and higher occupancy with all three components improving on both sides of the Atlantic. Now turning toward 2024 full year, December guidance. We are forecasting a capacity increase of about 5.5% compared to 2023.

The stock has increased 39.8% in the past year.The Zacks Consensus Estimate for LVS’ 2023 sales and EPS indicates a rise of 108.4% and 217.5%, respectively, from the year-ago period’s estimated levels. Hilton Grand Vacations currently sports a Zacks Rank #1. HGV has a trailing four-quarter earnings surprise of 12.1%, on average. The Zacks Consensus Estimate for HGV’s 2023 sales and EPS indicates a rise of 7.1% and 10.8%, respectively, from the year-ago period’s levels.Crocs carries a Zacks Rank #2 (Buy). The company has a trailing four-quarter earnings surprise of 21.8%, on average. Shares of Crocs have increased 49.4% in the past year.The Zacks Consensus Estimate for CROX’s 2023 sales and EPS indicates a rise of 12.5% and 2.5%, respectively, from the year-ago period’s levels.

Carnival Corp. Reports Record 2023 Revenue and Fourth Quarter Earnings - Cruise Industry News

Carnival Corp. Reports Record 2023 Revenue and Fourth Quarter Earnings.

Posted: Thu, 21 Dec 2023 08:00:00 GMT [source]

Future capital expenditures will fluctuate with foreign currency movements relative to the U.S. These figures do not include potential ship orders (stage payments and final delivery payments) that the company may place in the future. One thing to stress, right, we just came up with a fourth quarter, which everybody's loss over real quick but it was up 10.5 in price. That's what we're going to lap you know when we get through 2024. If you think about our booked business, we have the most to go in the fourth quarter. I wanted to circle back to your yield guidance and just looking at the recovery and occupancy to normal - to previous levels being maybe 600 to 700 basis points kind of implies that your per diem guidance is maybe less than 2% growth.

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Three new ships are in development, poised to generate heightened interest and demand for their respective brands. This includes Carnival Jubilee (Carnival Cruise Line's third Excel-class ship), Sun Princess and Queen Anne (a new flagship for Cunard).Also, the company emphasizes investments toward enhancing the existing fleet, such as the AIDA evolution program. The planned improvements aim to elevate the guest experience significantly, resulting in a substantial revenue boost across the brand while simultaneously reducing its environmental impact and enhancing the performance. 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.