12th Feb 2020 14:41
(Alliance News) - Cruise ship operator Carnival PLC on Wednesday warned its financial 2020 earnings will suffer due to travel restrictions and trip cancellations amid the outbreak of the coronavirus in China.
Shares in the company were 1.7% higher at 3,180.00 pence each in London on Wednesday afternoon.
Carnival said it has been forced to suspend cruise operations from ports in China, which has resulted in the cancellation of trips in other parts of Asia.
The company said: "Significant events affecting travel typically have an impact on booking patterns, with the full extent of the impact generally determined by the length of time the event influences travel decisions.
"As a result of coronavirus, the company believes the impact on its global bookings and cancelled voyages will have a material impact on its financial results which was not anticipated in the company's previous 2020 earnings guidance."
The company said that if it were to suspend all operations in Asia through to the end of April, its earnings per share will be hurt by up to USD0.65.
In the 12 months to November 30, 2019, basic earnings per share were 2.5% lower year-on-year at USD4.34.
The firm has already been rocked by the spread of the contagion, which has killed more than 1,000 people in China.
The number of coronavirus cases at a Carnival cruise ship off Japan's coast rose to 174 – the biggest cluster outside the Chinese mainland.
"The company is currently unable to determine the full financial impact on its fiscal year 2020. However, while not currently planned, if the company had to suspend all of its operations in Asia through the end of April, this would impact its fiscal 2020 financial performance by USD0.55 to USD0.65 per share, which includes guest compensation," Carnival explained.
Carnival added: "The company is currently evaluating contingency plans to mitigate the impact and will provide an update with its first quarter 2020 earnings release in late March."
The company said its medical experts are working with the US Centers for Disease Control & Prevention and the World Health Organization to implement more rigorous screening procedures for its guests and crew members.
By Eric Cunha; [email protected]
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