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High fuel costs fail to dent Carnival Corp profits
Global cruise giant Carnival Corporation achieved record 2005 net profits of $2.3 billion despite a $180 million rise in fuel costs.
Profits were up from $1.9 billion last year on revenues of more than $11 billion, up from $9.7 billion. The company’s 79 ships carried 6.8 million passengers, up from 6.3 million in 2004.
Results of the fourth quarter ending November 30 saw Carnival – which includes the UK brands P&O Cruises, Cunard, Ocean Village and Swan Hellenic – make net profits of $353 million against $294 million the same period last year.
Chairman and CEO Micky Arison said: “It is a testament to the resilience of our cruise business that despite an approximate 50% increase in fuel costs for the quarter and the worst hurricane season in our history, we were still able to grow earnings by 20% to achieve record fourth quarter results.”
Increased prices and a “continued sharp focus on cost controls” more than offset the $180 million year-on-year rise in fuel costs, he added.
Looking forward to next year, fuel is expected to cost $322 per metric ton, which is $175 million higher than average prices for 2005.
Arison said: “We expect continued revenue yield growth in 2006 although probably not at the levels experienced during the last two years. As it stands today, advance booking levels for 2006 are ahead of the prior year on a capacity adjusted basis, with average pricing also higher than last year.”
Carnival, which announced a four ship deal earlier this week, has three vessels due for delivery in 2006 – 1,918-passenger Noordam for Holland America Line in January, 3,100-passenger Crown Princess for Princess Cruises in May and 3,000-passenger Costa Concordia for Costa Cruises in June.
Report by Phil Davies
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