01—Abstract
Summary
Summary of the 10-K filed January 28, 2020. Cited figures are marked; the original filing is the authoritative source.
Carnival Corporation & plc, the world's largest leisure travel company, generated significant revenue and carried over 12.8 million guests in 2019 across its diverse portfolio of 104 cruise ships.
The company's strategy centers on delivering exceptional guest experiences, maintaining a strong balance sheet, and driving profitable growth through innovation, operational efficiency, and expansion into developing markets, particularly Asia. Key initiatives include investing in new, larger, and more fuel-efficient ships powered by Liquefied Natural Gas (LNG), enhancing onboard offerings, and leveraging technology like the OceanMedallion platform for personalized guest experiences. Financially, the company has demonstrated a commitment to shareholder returns through substantial dividend payments and share repurchases.
While the cruise industry is characterized by high guest satisfaction and positive demand trends driven by demographics like Baby Boomers and Millennials, Carnival also faces risks including global events impacting travel, potential incidents, regulatory changes, cybersecurity threats, and competition. The company is actively addressing environmental concerns by investing in sustainable technologies like LNG and Advanced Air Quality Systems, aiming to reduce its environmental footprint.
02—Key points
Key Highlights
- Carnival Corporation & plc is the world's largest cruise operator with a fleet of 104 ships across multiple brands, carrying approximately 45% of global cruise guests.
- The company reported carrying 12.87 million guests in 2019, with plans to introduce 17 new ships by 2025, including LNG-powered vessels.
- Revenue is generated from cruise tickets and onboard activities (30% in 2019), with a focus on enhancing guest experiences through technology like the OceanMedallion platform.
- Significant investment in sustainability is evident, with a commitment to reducing CO2e emissions and expanding the use of LNG across its fleet.
- The company prioritizes Health, Environment, Safety, Security (HESS) and ethics, with enhanced compliance frameworks and board-level oversight committees.
- Geographic diversification is key, with strong presence in North America and Europe, and strategic growth initiatives in Asia, particularly China.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2019, Carnival Corp kept $0.14.
- Revenue$20.82B100.0%
- Cost of revenue−$12.91B62.0%
- Gross profit$7.92B38.0%
- Operating costs−$4.64B22.3%
- Operating income$3.28B15.7%
- Interest, other & tax−$286.0M1.4%
- Net income$2.99B14.4%
Where FY2019 revenue went
$20.82B- Cost of revenue: $12.91B, 62% of revenue
- Net income: $2.99B, 14% of revenue
- SG&A: $2.48B, 12% of revenue
- Other operating costs: $2.16B, 10% of revenue
- Interest, other & tax: $286.0M, 1.4% of revenue
Kept 14% as net incomeInterest, other & tax $286.0M · 1.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2019filed January 28, 2020Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $20.82B$18.88B | +10.3% |
| Cost of Revenue | $12.91B$11.09B | +16.4% |
| Gross Profit | $7.92B$7.79B | +1.6% |
| SG&A Expenses | $2.48B$2.45B | +1.2% |
| Operating Expenses | $17.55B$15.56B | +12.8% |
| Operating Income | $3.28B$3.33B | −1.5% |
| Interest Expense | $206.00M$194.00M | +6.2% |
| Net Income | $2.99B$3.15B | −5.1% |
| EPS (Basic) | $4.34$4.45 | −2.5% |
| EPS (Diluted) | $4.32$4.44 | −2.7% |
| Shares Outstanding (Basic) | 690.00M709.00M | −2.7% |
| Shares Outstanding (Diluted) | 692.00M710.00M | −2.5% |
05—Questions
Frequently Asked Questions
What is Carnival Corporation & plc's overall business strategy?
Carnival Corporation & plc's strategy focuses on delivering unmatched joyful vacations, exceeding guest expectations, and driving outstanding shareholder value. This is achieved through a portfolio of leading cruise brands, a commitment to safety, environmental protection, and compliance, continuous investment in new and efficient ships, innovation in guest experiences (like the OceanMedallion platform), and growth in both established and developing markets, especially in Asia.
How is Carnival Corporation & plc addressing environmental concerns and sustainability?
Carnival is committed to sustainability through several initiatives. They are investing in low-carbon fuels, particularly LNG, with multiple new ships designed to use it. They are also deploying Advanced Air Quality Systems, aiming to reduce CO2e emissions, improve air quality, and increase ship-to-shore power connection capabilities. Environmental management systems are certified to ISO 14001 standards, and they have set specific goals for emission reduction, waste management, and water use.
What are the main risks facing Carnival Corporation & plc?
Key risks include global events impacting travel demand (health concerns, political instability, economic downturns), incidents involving ships or guests that could damage reputation, changes in and non-compliance with regulations (health, environment, safety, data privacy), cybersecurity breaches, increasing fuel prices and availability challenges, competition from other cruise lines and land-based vacations, and potential overcapacity in the industry.
How does Carnival Corporation & plc manage its diverse fleet and brands?
Carnival manages its diverse fleet and brands through a dual-listed company (DLC) structure, operating as a single economic enterprise with a unified senior executive team and identical boards. They leverage their scale for purchasing volumes and common technologies while maintaining the unique identities of individual brands. Operational support is provided through centralized functions like maritime, procurement, and IT, alongside brand-specific marketing and sales efforts.
06—Continue