10-QPeriod: Q1 FY2017

CARNIVAL CORP Quarterly Report for Q1 Ended Feb 28, 2017

Filed March 30, 2017For Securities:CCL

Summary

Carnival Corporation & plc reported strong top-line growth for the three months ended February 28, 2017, with total revenues increasing by 3.8% year-over-year to $3.79 billion. This growth was primarily driven by a 3.2% increase in passenger ticket revenues and a 6.0% rise in onboard and other revenues. The company also saw a significant improvement in net income, which more than doubled to $352 million from $142 million in the prior year period. This was aided by a substantial positive swing in gains from fuel derivatives, which moved from a large loss to a net gain. Despite the revenue and net income increases, operating income saw a slight decrease due to higher operating costs, particularly fuel expenses which nearly doubled compared to the prior year. However, the company's cash flow from operations remained robust, increasing by 17% to $932 million, largely driven by higher customer deposits, indicating strong future booking activity. Carnival also reaffirmed its full-year earnings per share guidance, signaling confidence in its ongoing performance.

Financial Highlights

51 data points
Beta

Revenue

$3.79B

35.8% Gross Margin

Net Income

$352.00M

9.3% Net Margin

EPS (Diluted)

$0.48

Total Assets

$38.70B

Cash & Equivalents

$597.00M

Free Cash Flow

$520.00M

Financial Statements
Beta
Revenue$3.79B
Cost of Revenue$2.44B
Gross Profit$1.36B
SG&A Expenses$549.00M
Operating Expenses$3.42B
Operating Income$368.00M
Interest Expense$51.00M
Net Income$352.00M
EPS (Basic)$0.48
EPS (Diluted)$0.48
Shares Outstanding (Basic)725.00M
Shares Outstanding (Diluted)728.00M

Key Highlights

  • 1Total revenues increased by 3.8% to $3.79 billion for the three months ended February 28, 2017.
  • 2Net income more than doubled to $352 million, compared to $142 million in the prior year period.
  • 3Diluted earnings per share (EPS) rose to $0.48 from $0.18.
  • 4Operating costs increased by 8.6% to $2.44 billion, primarily due to higher fuel costs.
  • 5Fuel prices per metric ton nearly doubled to $362 in the current period compared to $229 in the prior year.
  • 6Cash flow from operating activities increased by 17% to $932 million.
  • 7The company reaffirmed its 2017 full-year adjusted diluted EPS guidance of $3.50 to $3.70.

Frequently Asked Questions

Carnival Corporation & plc reported a 3.8% increase in total revenues, reaching $3.79 billion for the three months ended February 28, 2017. This growth was driven by higher passenger ticket revenues and a significant increase in onboard and other revenue spending by guests.

The net income more than doubled to $352 million primarily due to a substantial swing in the gains on fuel derivatives, moving from a large loss of $236 million in the prior year period to a net gain of $27 million in the current period. Additionally, strong revenue growth contributed to the improved profitability.

Operating costs and expenses increased by 8.6% to $2.44 billion. The most significant factor was the substantial increase in fuel costs, which rose due to higher fuel prices per metric ton, nearly doubling from $229 to $362 year-over-year.

Carnival reaffirmed its previously issued guidance for the full fiscal year 2017, expecting adjusted diluted earnings per share to be in the range of $3.50 to $3.70. This outlook reflects confidence in continued performance despite rising operating costs, particularly fuel.