Carnival Corporation presented a positive outlook for 2018 on today’s Q4 and year-end earnings call. 

The company expects adjusted earnings for next year to be in the range of $4.00 to $4.30, compared to 2017 adjusted earnings per share of $3.82.

That would translate into adjusted net income from approximately $2.9 billion to $3.1 billion based on outstanding shares as of today.

The market reacted by boosting Carnival’s share price by about 2 percent, or $1.35, to $67.95 at press time.

According to CEO and president Arnold Donald, cumulative bookings and pricing for 2018 is head of the prior year.

On a market basis, David Bernstein, CFO and senior vice president, said that for the North American brands, occupancy for the Caribbean was behind, but at higher prices. Alaska was ahead on occupancy at lower prices, and the seasonal European deployment was ahead on occupancy and pricing.

For the European brands, he said that occupancy and pricing were ahead for European and Caribbean deployment, offset by decreases in China. Australia was not mentioned.

Responding to concerns about the growing cruise fleet, Donald set that Carnival is committed to disciplined growth and will only see a 1.9 percent capacity increase in 2018, with the introduction of four new and more efficient ships, and the withdrawal of two older ships. Over time, however, he said the cumulative capacity increase would be about 5 percent annually through 2023.

Donald added that his focus is on growing revenues and that he will accelerate the retirement of older ships if he has to.  And as for China, he added that he has no hesitation to relocate ships if necessary.

While growing revenues, Carnival is also focused on reducing costs, and saw more than $100 million in savings gained in 2017, Donald said, expecting another $80 million in 2018.

While adjusted earnings for 2017 were up, U.S. GAAP reported earnings were down at $2.6 billion from $2.8 billion last year. Gross revenues were up with higher ticket prices and onboard spending offset by higher operating costs, including a $304 million impairment cost, leading to operating income of $2.8 billion for 2017 down from $3.1 billion for 2017.

With fewer outstanding shares year-over-year, due to Carnival’s buy-back program, earnings per share were up for 2017 at $1.60 compared to $1.35 for 2016.