From the Newsletter, 10/2/2009
Carnival Q3 and Outlook
Carnival Corporation expects each quarter going forward to be sequentially better, and bookings for the remainder of 2009 and the first half of 2010 are running 19 percent ahead of last year, but at lower ticket prices. However, Carnival does not foresee a dramatic up tick, but slow improvement, that will take several years. 2010 should get better, but executives noted there are still many unresolved challenges, including high unemployment and housing issues in the North American economy. Carnival reported net income of $1.1 billion, or $1.33 per share, on earnings of $4.1 billion for its third quarter ended Aug. 31, 2009, compared to net income of $1.3 billion, or $1.65 per share, on revenues of $4.8 billion for the same quarter last year. Carnival’s revised guidance for the full year 2009 is for earnings in the range of $2.16 to $2.20 per share, compared to its previous guidance of $2.00 to $2.10, and actual earnings last year of $2.90.
European Focus
Is Europe the cruise industry’s new center of gravity? According to David Dingle, CEO of Carnival UK and chairman of the European Cruise Council, it is. Dingle attributed this to the faster growth rate of the European markets, the new ships that European brands are putting into service, and the ships that American-based brands are dedicating to European markets.
Alaska 2010 – 2011
Next year, Alaska capacity will be down 13 percent, according to estimates by Cruise Industry News. The decline next year is mainly due to three ships being pulled out, said to be due to the increasing conflict between the industry and Alaska over the infamous $50 head tax, corporate taxes on onboard sales revenue generated in Alaskan waters, and increasingly restrictive environmental regulations. Meanwhile, two cruise lines will be joining the Alaska fleet in 2011, Disney for the first time, and Crystal returning after a six year hiatus.
St. Maarten is Ready
St. Maarten has built a new pier and upland support area that is ready for the Oasis of the Seas, according to Mark Mingo, CEO of the St. Maarten Port Authority. “Passenger distribution has also been carefully planned,” he said, “via water taxis and land-based transportation.” The $50 million project is intended to accommodate the bigger ships of Royal Caribbean International as well as Carnival Corporation. The upland development will cover an area from about 16,000 to 18,000 square meters when it is fully developed. A new trolley transportation system for the piers has also been installed.
And there is more: Guadeloupe supports homeported cruise ships with locally-sourced passengers; Hamburg’s new Altona terminal will be ready next summer; Cruise Atlantic Europe is selling five countries — Portugal, Spain, France, Ireland and England; P&O Cruises is selling the Artemis; Ambassadors International is selling the Queen of the West; and the drawbacks of shorepower may outweigh the benefits.
