01—Abstract
Summary
Summary of the 10-Q filed September 30, 2016. Cited figures are marked; the original filing is the authoritative source.
Carnival Corporation & plc reported strong financial results for the nine months ended August 31, 2016, with net income increasing significantly to $2,171 milliona from $1,487 million in the prior year period.
This growth was driven by a 3.2% increase in capacity (ALBDs) and a notable decrease in fuel costs. Revenue also saw a healthy increase, with cruise passenger ticket revenues rising 3.7% and onboard and other revenues up 4.4% year-over-year. Despite a decrease in cash and cash equivalents from $1,395 million to $462 millionb over the nine-month period, the company maintained a strong liquidity position.
Investing activities showed substantial capital expenditures, primarily for new shipbuilding and ship improvements. Financing activities involved debt repayments and issuances, dividend payments, and significant share repurchases, indicating a focus on returning capital to shareholders while managing its debt structure. Overall, the company demonstrated robust operational performance and a solid financial foundation.
02—Key points
Key Highlights
- Net income increased by 46% to $2,171 million for the nine months ended August 31, 2016, compared to $1,487 million in the same period last year.
- Total revenues grew by 3.9% to $12.3 billion for the nine months ended August 31, 2016.
- Fuel costs decreased by 35% to $648 million for the nine months ended August 31, 2016, driven by lower fuel prices.
- Capacity, measured in Available Lower Berth Days (ALBDs), increased by 3.2% for the nine months ended August 31, 2016.
- The company invested heavily in its fleet, with capital expenditures of $2.6 billion for the nine months ended August 31, 2016, including new shipbuilding and ship improvements.
- Shareholders benefited from dividends paid ($721 million) and significant share repurchases ($2.1 billion of Carnival Corporation common stock) during the nine months ended August 31, 2016.
- The company maintained a strong liquidity position with $10.8 billion available as of August 31, 2016, including cash, revolving credit facilities, and committed future financings.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2016, Carnival Corp kept $0.28.
- Revenue$5.10B100.0%
- Cost of revenue−$2.56B50.3%
- Gross profit$2.53B49.7%
- Operating costs−$972.0M19.1%
- Operating income$1.56B30.6%
- Interest, other & tax−$138.0M2.7%
- Net income$1.42B27.9%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2016filed September 30, 2016Financial Statements
Q3 FY2016 against Q3 FY2015
| Line item | Q3 FY2016Q3 FY2015 | Change |
|---|---|---|
| Revenue | $5.10B$4.88B | +4.4% |
| Cost of Revenue | $2.56B$2.49B | +2.9% |
| Gross Profit | $2.53B$2.39B | +5.9% |
| SG&A Expenses | $529.00M$484.00M | +9.3% |
| Operating Expenses | $3.54B$3.37B | +4.8% |
| Operating Income | $1.56B$1.51B | +3.4% |
| Interest Expense | $61.00M$53.00M | +15.1% |
| Net Income | $1.42B$1.22B | +17.1% |
| EPS (Basic) | $1.93$1.56 | +23.7% |
| EPS (Diluted) | $1.93$1.56 | +23.7% |
| Shares Outstanding (Basic) | 737.00M778.00M | −5.3% |
| Shares Outstanding (Diluted) | 739.00M781.00M | −5.4% |
05—Questions
Frequently Asked Questions
How did Carnival Corporation's revenue perform in the nine months ended August 31, 2016?
Carnival Corporation's total revenues increased by 3.9% to $12.3 billion for the nine months ended August 31, 2016, compared to $11.8 billion in the same period of 2015. This growth was primarily driven by a 3.2% increase in capacity (ALBDs) and higher onboard and other cruise revenues.
What was the impact of fuel costs on Carnival's profitability?
Fuel costs significantly decreased by 35% to $648 million for the nine months ended August 31, 2016, down from $996 million in the prior year. This reduction, largely due to lower fuel prices, contributed positively to the company's profitability and net income growth.
How is Carnival Corporation managing its cash and debt?
Carnival Corporation maintained a strong liquidity position with $10.8 billion available as of August 31, 2016. The company used cash from operations to fund investing activities, primarily for fleet expansion and improvements. Financing activities included repaying and issuing debt, paying dividends, and undertaking substantial share repurchases, indicating a strategy to balance debt management with returning value to shareholders.
What is the outlook for Carnival Corporation's capacity growth?
Carnival Corporation expects year-over-year capacity increases, with approximately 3.6% for the full year 2016 and projected increases ranging from 2.6% in 2017 to 8.0% in 2020, driven by new ship deliveries. These projections are subject to various factors and may be revised.
06—Continue