Carnival Corporation announced financial results for the first quarter 2024 and provided an outlook for the full year and second quarter 2024.

• Record first quarter revenues of $5.4 billion with record net yields (in constant currency) and record net per diems (in constant currency) both significantly exceeding 2023 levels.
• The company improved its first quarter bottom line by nearly $500 million compared to 2023 and adjusted net loss was better than December guidance, with continued strength in demand driving ticket prices higher (see “Non-GAAP Financial Measures” below).
• During the first quarter, booking volumes hit an all-time high with prices considerably higher year over year.
• Following a successful wave season (peak booking period), the company raised its full year 2024 net yield guidance (in constant currency) by over a point to approximately 9.5 percent compared to 2023 based on continued strength in demand and also improved its adjusted cruise costs excluding fuel guidance (in constant currency) by $35 million as compared to its December guidance.
• Total customer deposits reached a first quarter record of $7.0 billion, surpassing the previous first quarter record by $1.3 billion.
• The company redeemed its remaining second lien debt (9.875% second-priority secured notes), upsized its forward starting revolving facility by $400 million and extended its availability by two years.
• The company ordered its first newbuilds in five years, the tenth and eleventh in its highly successful excel-class, scheduled to be delivered to Carnival Cruise Line in 2027 and 2028.

“This has been a fantastic start to the year. We delivered another strong quarter that outperformed guidance on every measure, while concluding a monumental wave season that achieved all-time high booking volumes at considerably higher prices,” commented Carnival Corporation & plc’s Chief Executive Officer Josh Weinstein.

“These results are a continuation of the strong demand we have been generating across our brands and all core deployments, leading to an upward revision of full year expectations by more than a point of incremental yield improvement and setting us up nicely to deliver a nearly double-digit improvement in net yields,” Weinstein added.

“With much of this year on the books, we have even greater conviction in delivering record revenues and EBITDA, along with a step change improvement in operating performance, and have begun turning more of our attention to delivering an even stronger 2025,” Weinstein noted.

First Quarter 2024 Results

• Cash from operations was $1.8 billion and operating income was $276 million.
• Adjusted net loss was better than December guidance. U.S. GAAP net loss of $214 million, or $(0.17) diluted EPS, and adjusted net loss of $180 million, or $(0.14) adjusted EPS (see “Non-GAAP Financial Measures” below).
• Adjusted EBITDA of $871 million exceeded December guidance by over $70 million (see “Non-GAAP Financial Measures” below).
• Record first quarter revenues of $5.4 billion, with record net yields (in constant currency) and record net per diems (in constant currency) both significantly exceeding 2023 levels.
• Gross margin yields nearly doubled compared to 2023 and net yields (in constant currency) significantly exceeded 2023 levels by over 17 percent.
  • Gross margin per diems increased 73 percent compared to 2023 levels and net per diems (in constant currency) were up nearly five percent, significantly exceeding strong prior year levels.
  • Onboard revenue per diems were higher than 2023 for the company’s North America and Australia (“NAA”) segment as well as its Europe segment. On a consolidated basis, onboard revenue per diems reflected a mix impact due to the increased weighting of its Europe segment driven by its higher occupancy growth.
• Cruise costs per available lower berth day (“ALBD”) increased 7.9 percent compared to 2023. Adjusted cruise costs excluding fuel per ALBD (in constant currency) were better than December guidance due to the timing of expenses between the quarters and up 7.3 percent compared to 2023 (see “Non-GAAP Financial Measures” below).
• Total customer deposits reached a first quarter record of $7.0 billion, surpassing the previous first quarter record by $1.3 billion ($5.7 billion as of February 28, 2023).

Bookings

The company experienced an early start to a robust wave season with record booking volumes for all future sailings that exceeded expectations, the company said in a statement.

The company achieved considerably higher prices (in constant currency) than last year on first quarter booking volumes, having entered 2024 with less inventory remaining for sale, in line with the company’s strategy to pull the booking curve forward. In fact, pricing (in constant currency) on bookings for the remainder of the year for the company’s NAA segment was considerably higher compared to the prior year, with its Europe segment up double digits.

“We are enjoying a phenomenal wave season with strength across all major deployments and brands. Even with less inventory available for the remainder of the year, booking volumes hit an all-time high, driven by demand for 2025 sailings and beyond. Our brands have demonstrated continued success creating demand that outstrips available capacity translating into higher prices (in constant currency) and a further elongation in the booking curve,” Weinstein noted.

The company’s booked position for the remainder of the year continues to be the best on record, with both pricing (in constant currency) and occupancy considerably higher than 2023.

2024 Outlook

Francis Scott Key Bridge in Baltimore:

• Given the timing of yesterday’s event in Baltimore and the temporary change in homeport, our guidance does not include the current estimated impact of up to $10 million on both adjusted EBITDA and adjusted net income for the full year 2024.

For the full year 2024, the company expects:

• Net yields (in constant currency) up approximately 9.5 percent compared to 2023, over a point better than December guidance, based on continued strength in demand and with occupancy at historical levels.
• Adjusted cruise costs excluding fuel (in constant currency) are $35 million better than December guidance, with adjusted cruise costs excluding fuel per ALBD (in constant currency) 0.5 percentage points higher than December guidance as a result of lower ALBD’s from the Red Sea rerouting as certain ships reposition without guests.
• Adjusted EBITDA of approximately $5.63 billion, over 30 percent growth compared to 2023, and better than December guidance, despite the impact of the Red Sea rerouting of approximately $130 million or $0.09 adjusted EPS through November 2024.

For the second quarter of 2024, the company expects:

• Net yields (in constant currency) up approximately 10.5 percent compared to 2023 levels, including the unfavorable impact from the Red Sea rerouting of 0.5 percentage points, with occupancy at historical levels.
• Adjusted cruise costs excluding fuel per ALBD (in constant currency) up approximately 3.0 percent compared to the second quarter of 2023, including the unfavorable impact of 1.3 percentage points as a result of lower ALBD’s from the Red Sea rerouting as certain ships reposition without guests.
• Adjusted EBITDA of approximately $1.05 billion, over 50 percent growth compared to the second quarter of 2023.

Financing and Capital Activity

“Continued execution coupled with strengthening demand for our brands is driving increased confidence in our ongoing performance. We are pleased this has been recognized by S&P and Moody’s with their recent upgrades, as well as the recent upsizing and two-year extension of our revolving credit facility,” noted Carnival Corporation & plc’s Chief Financial Officer David Bernstein.

“Looking forward over the next several years, we expect our robust revenue growth, responsible approach to capital investment, and ongoing efforts to refinance debt at favorable rates to deliver substantial free cash flow which will significantly reduce our leverage and build shareholder value,” Bernstein added.

The company continues its efforts to proactively manage its debt profile. During the first quarter, it redeemed and retired nearly $1 billion of debt with original maturities in 2027, including all of the remaining second lien debt outstanding.

The company successfully extended the maturity of its forward starting revolving credit facility (“New Revolving Facility”) to August 2027 and upsized its borrowing capacity by $400 million, bringing its total commitment to $2.5 billion.

The company ended the quarter with $5.2 billion of liquidity. On March 26, 2024, the company prepaid its $837 million euro term loan, saving interest expense and continuing to simplify its capital structure by removing secured debt.

The first quarter generated cash from operations of $1.8 billion and adjusted free cash flow of $1.4 billion. The company took delivery of two spectacular new ships and drew down on two export credit facilities, continuing its strategy to finance its newbuild program at preferential interest rates.

The company ordered its first newbuilds in five years. These newbuilds, the tenth and eleventh in the highly successful excel-class across four different brands, are scheduled to be delivered in 2027 and 2028, which is consistent with the company’s measured capacity growth strategy. These new ships will join the Carnival Cruise Line fleet, helping to meet the brand’s outsized demand and drive further revenue growth.