Carnival Corp sees fuel prices ‘skyrocket’ by 59%
Carnival Corporation managed to peg second quarter profits to the same level as the equivalent three months last year despite a 59% rise in fuel costs.
The US cruise conglomerate – parent company of UK brands such as P&O Cruises, Cunard Line and Ocean Village – achieved a net profit of $390 million on revenues of $3.4 billion in the three months ending May 31.
Rising fuel prices cost the company almost $160 million in the three months.
The profit figure was identical to the same period in 2007 when revenues came in at $2.9 billion.
Fuel prices in the most recent quarter were up by 59% to $530 per metric ton from $333 but was in line with guidance from the company in March of $528.
Fuel costs have increased by $224 million since the company’s previous guidance in March, resulting in an expected increased annual fuel bill of $752 million over 2007.
Chairman and CEO Micky Arison said: “Our North American and European brands continue to perform well in the current difficult economic environment and we are pleased with our second quarter results.
“We enjoyed strong revenue growth supported by sold cost controls, however higher fuel prices cost the company $158 million, or $0.19 per share, during the quarter.â€
Looking forward, Arison said booking trends continue to be “solidâ€.
“Consumers continue to plan leisure travel but appear more cost conscious placing greater emphasis on finding more economical options,†he said.
“A cruise vacation is an attractive alternative for those seeking the most value from their vacation dollar.
“However, the impact of skyrocketing fuel prices on our operating results has overshadowed the revenue yield improvement we have experienced.â€
by Phil Davies
Phil Davies
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