26th Mar 2019 14:01
LONDON (Alliance News) -Anglo-American cruise operator Carnival PLC on Tuesday lowered its 2019 adjusted earnings per share estimate due to higher fuel prices and unfavourable currency exchange rates.
London-listed shares in Carnival were down 6.9% at 3,863.00 pence on Tuesday afternoon.
The company now forecasts adjusted earnings per share to be in the USD4.35 to USD4.55 range for its financial year to November, down from its December 2018 guidance of between USD4.50 and USD4.80 per share. In 2018, the company's adjusted earnings per share came to USD4.26.
In its first quarter ended February 28, the company's adjusted earnings per share totaled USD0.49, down from USD0.52 for the first quarter of 2018, hit by an 8.6% increase in gross cruise costs, including fuel.
First quarter net income totaled USD336 million, or USD0.48 diluted earnings per share, down from USD391 million, or USD0.54 per share, recorded in the year ago period. Adjusted net income amounted to USD338 million, or USD0.49 per share, compared with adjusted net income of USD375 million, or USD0.52 per share.
The adjusted figure excludes USD2 million of charges in the first quarter of its financial 2019 year and net gains of USD16 million for the first quarter of 2018 from unrealised gains.
The company said revenue increased in its first quarter to USD4.67 billion from USD4.23 billion due to higher capacity and improvements to onboard spending.
In its second quarter, the company expects its adjusted earnings per share to be in the USD0.56 to USD0.60 range, compared with USD0.68 recorded in the year ago quarter.
Carnival President & Chief Executive Arnold Donald said: "First quarter earnings included revenue growth from higher capacity and improved onboard spending, offset by the timing of cost increases and a drag from fuel price and currency compared to the prior year. First quarter adjusted earnings were better than the mid-point of December guidance by USD0.07 per share."
Aside from the adjusted earnings per share decrease, Carnival is predicting net cruise revenue to be up by 5.5% for financial 2019 and capacity growth of 4.6%. Net revenue yield is to rise around 1.0% at constant currency over its previous year.
Annual net cruise costs, excluding fuel per available lower berth day, is forecast to rise 0.5% at constant currency.
Donald said: "We believe we are on a path that includes delivering, over time, double-digit earnings growth and improving return on invested capital through a consistent strategy of creating demand in excess of measured capacity growth while leveraging our industry leading scale."
The company declared a USD0.50 per share dividend in the quarter, up from USD0.45 per share the year before.
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