20th Jun 2019 12:22
(Alliance News) - Anglo-American cruise operator Carnival PLC on Thursday reported a sharp decrease in interim income and guided for lower full-year adjusted earnings.
Shares in Carnival plunged to the bottom of London's blue chip index in midday trading, slipping 7.1% to 3,735.00 pence each.
In the first half, which covers the six months to May 31, Carnival recorded net income of USD787 million, 17% lower than USD951 million reported a year before.
The company's total revenue in the first half increased 11% to USD9.51 billion from USD8.59 billion.
In the second quarter, which covers the thee months to the end of May, Carnival saw its net income slip 20% to USD451 million from USD561 million a year before.
Carnival's second quarter total revenue increased 11% to USD4.84 billion from USD4.36 billion.
"Second quarter earnings included revenue growth from higher capacity and improved onboard spending, more than offset by a drag from fuel and currency compared to the prior year," said President & Chief Executive Arnold Donald.
Donald added: "Recent booking trends have been impacted by ongoing geopolitical and macroeconomic headwinds affecting our Continental European brands. We continue to expect higher yields in our North America and Australia brands offset by lower yields in our Europe and Asia brands for the remainder of the year."
In the first half, Carnival recorded adjusted earnings per share of USD1.15, 5.0% behind the USD1.21 seen the year before.
Looking ahead, Carnival said it expects its financial 2019 full-year adjusted earnings per share to be between USD4.25 and USD4.35, which is lower than the previously guided USD4.35 to USD4.55.
The lowered guidance is due to an "unfavourable impact" from disruptions with the company's US cruise line Carnival Vista. Carnival also attributed the lower earnings outlook to the US government's policy change on travel to Cuba.
Donald said: "Over the past five years we have demonstrated our ability to overcome multiple headwinds and deliver strong operational improvement. This year our growth has been hampered by a confluence of events, which we are focused on mitigating. Generating over USD5 billion of cash flow and with a robust business model, our business is strong and we remain confident over time we will deliver double-digit earnings growth and growth in return on invested capital."
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