01—Abstract
Summary
Summary of the 10-Q filed June 27, 2024. Cited figures are marked; the original filing is the authoritative source.
Carnival Corporation & plc reported a significant improvement in financial performance for the six months ended May 31, 2024, compared to the same period in the prior year, driven by strong demand and increased occupancy across its cruise operations, particularly in the North America and Europe segments.
Total revenues rose by 19.7% to $11.2 billiona, with passenger ticket revenues and onboard spending showing robust growth. The company achieved a consolidated operating income of $836 million, a substantial turnaround from a loss of $52 million in the prior year's comparable period. Operationally, Carnival saw a 4.8% increase in Available Lower Berth Days (ALBDs) for the six-month period, coupled with an 8.2 percentage point increase in occupancy, reaching 103%.
This improved utilization, along with higher ticket prices and increased onboard spending per guest, contributed to the revenue surge. While operating expenses also increased due to higher capacity and associated costs, the revenue growth outpaced expense increases, leading to improved profitability. The company's liquidity remains strong, with $4.6 billionb in available resources, including cash and undrawn credit facilities, enabling it to manage its debt obligations and fund capital expenditures.
02—Key points
Key Highlights
- Total revenues increased by 19.7% to $11.2 billion for the six months ended May 31, 2024, compared to $9.3 billion in the prior year.
- Consolidated operating income turned positive, reaching $836 million for the six months ended May 31, 2024, a significant improvement from an operating loss of $52 million in the same period last year.
- Occupancy rates improved substantially, reaching 103% for the six months ended May 31, 2024, up from 95% in the prior year, reflecting strong consumer demand for cruises.
- Passenger ticket revenues grew by 23% to $7.4 billion, and onboard and other revenues increased by 15% to $3.8 billion for the six months ended May 31, 2024.
- The company's liquidity position remains strong with $4.6 billion in total available resources as of May 31, 2024, including $1.6 billion in cash and cash equivalents and $3.0 billion in available borrowings.
- Interest expense decreased by 15% to $0.9 billion for the six months ended May 31, 2024, due to a reduction in total debt and lower interest rates.
- Capacity (ALBDs) increased by 4.8% for the six months ended May 31, 2024, primarily driven by fleet additions and optimizations, particularly in the North America segment.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2024, Carnival Corp kept $0.02.
- Revenue$5.78B100.0%
- Cost of revenue−$3.80B65.7%
- Gross profit$1.98B34.3%
- Operating costs−$1.42B24.6%
- Operating income$560.0M9.7%
- Interest, other & tax−$468.0M8.1%
- Net income$92.0M1.6%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2024filed June 27, 2024Financial Statements
Q2 FY2024 against Q2 FY2023
| Line item | Q2 FY2024Q2 FY2023 | Change |
|---|---|---|
| Revenue | $5.78B$4.91B | +17.7% |
| Cost of Revenue | $3.80B$3.46B | +9.9% |
| Gross Profit | $1.98B$1.45B | +36.4% |
| SG&A Expenses | $789.00M$736.00M | +7.2% |
| Operating Expenses | $5.22B$4.79B | +9.0% |
| Operating Income | $560.00M$120.00M | +366.7% |
| Net Income | $92.00M-$407.00M | +122.6% |
| EPS (Basic) | $0.07$-0.32 | +121.9% |
| EPS (Diluted) | $0.07$-0.32 | +121.9% |
| Shares Outstanding (Basic) | 1.27B1.26B | +0.3% |
| Shares Outstanding (Diluted) | 1.27B1.26B | +0.6% |
05—Questions
Frequently Asked Questions
What was Carnival's net income for the six months ended May 31, 2024?
Carnival Corporation & plc reported a net loss of $123 million for the six months ended May 31, 2024. While this is an improvement from a net loss of $1,100 million in the prior year's comparable period, the company is not yet profitable on a net income basis.
How has Carnival's debt situation evolved?
Carnival has actively managed its debt, reducing total debt to $30.15 billion as of May 31, 2024, down from $31.34 billion as of November 30, 2023. Interest expenses have decreased due to lower debt levels and interest rates. The company also issued $3.0 billion in long-term debt and repaid $4.1 billion during the six months ended May 31, 2024, indicating a focus on debt management and refinancing.
What is the outlook for future capacity and revenue growth?
Carnival saw a 4.8% increase in capacity (ALBDs) for the six months ended May 31, 2024, driven by new ship deliveries and fleet optimizations. The company expects continued strength in demand, which, coupled with higher occupancy and pricing power, should support further revenue growth. The realignment of P&O Cruises Australia into Carnival Cruise Line is not expected to have a material impact, suggesting a focus on operational integration and efficiency.
What are the main factors contributing to the improvement in operating income?
The significant increase in operating income is primarily attributed to a strong rebound in demand leading to higher occupancy (8.2 percentage point increase for six months), increased ticket prices, and higher onboard spending. These revenue drivers outpaced the rise in operating costs, which were also impacted by increased capacity and higher commissions.
06—Continue