CARNIVAL PLC - Carnival Corp & plc Second Quarter Results

Carnival Corporation & plc Reports Significantly Higher Second Quarter Earnings

MIAMI, June 23, 2015 -- Carnival Corporation & plc today reported its results for the second quarter ended May 31, 2015.  The results of Carnival Corporation and Carnival plc have been consolidated and include results on a U.S. GAAP and non-U.S. GAAP basis.

2Q Highlights

• 2Q net revenue yields (net revenue per available lower berth day or “ALBD”) in constant dollars increased 4.1% compared to the prior year, which was better than the company’s guidance of up 2 to 3 percent
• 2Q net cruise costs excluding fuel per ALBD in constant dollars increased 6.1% compared to the prior year primarily due to an increase in dry dock days and were better than March guidance, up 6.5 to 7.5% due to the timing of expenses between quarters
• 2Q non-GAAP earnings per share (diluted) of $0.25, compared to $0.09 for the prior year

Outlook

• At this time, cumulative advance bookings for the next three quarters are well ahead of the prior year at slightly lower prices due to transactional currency impacts
• FY 2015 net revenue yields on a constant currency basis are expected to be up 3 to 4% compared to the prior year (up 2 to 3 % in constant dollars)
• FY 2015 net cruise costs excluding fuel per ALBD in constant dollars are expected to be up approximately 3% compared to the prior year
• FY 2015 non-GAAP earnings per share (diluted) expected to be in the range of $2.35 to $2.50, compared to $1.93 for 2014
• 3Q 2015 non-GAAP earnings per share (diluted) expected to be in the range of $1.56 to $1.60, compared to $1.58 for 3Q 2014

President and Chief Executive Officer Arnold Donald commenting on these results:

“We more than doubled our second quarter earnings versus the comparable period a year ago and significantly exceeded our quarterly earnings guidance. Our initiatives to create demand and leverage our scale benefited both cruise ticket prices and onboard revenues contributing to 5% revenue yield improvement (constant currency) this quarter. While all of our North American brands enjoyed strong revenue yield improvement, our Carnival Cruise Line brand performed particularly well again this quarter. We thank our teams around the globe for their consistent delivery of exceptional guest experiences as well as our travel agent partners for their strong support, both of which are critical to our success.”

“These milestones further demonstrate our ongoing focus on effective strategic actions, technological development and innovation, laying the foundation for future growth and continued global expansion.”

“Current strength in booking volumes clearly demonstrates strong consumer demand for our brands, leaving less inventory remaining for sale and building confidence in achieving significant revenue yield improvement this year. We are stepping up our marketing investment for the remainder of the year to further solidify our base of business for 2016 and drive continued yield improvement as we progress on our path toward double digit return on invested capital.”

MEDIA CONTACT                                      INVESTOR RELATIONS CONTACT
Roger Frizzell                                             Beth Roberts
001 305 406 7862                                      001 305 406 4832

Conference Call

The company has scheduled a conference call with analysts at 3:00 p.m. BST (10:00 a.m. EDT) today to discuss its 2015 second quarter results.  This call can be listened to live, and additional information can be obtained, via Carnival Corporation & plc’s Web site at http://www.carnivalcorp.com/ and http://www.carnivalplc.com/.

Carnival Corporation & plc is the largest cruise company in the world, with a portfolio of 10 cruise brands in North America, Europe, Australia and Asia, comprised of Carnival Cruise Line, Holland America Line, Princess Cruises, Seabourn, AIDA Cruises, Costa Cruises, Cunard, P&O Cruises ( Australia), P&O Cruises (UK) and fathom.

Together, these brands will operate 100 ships in 2015 totaling 219,000 lower berths with eight new ships scheduled to be delivered between 2016 and 2018, along with four additional new ships on order between 2019 through 2022. Carnival Corporation & plc also operates Holland America Princess Alaska Tours, the leading tour companies in Alaska and the Canadian Yukon. Traded on both the New York and London Stock Exchanges, Carnival Corporation & plc is the only group in the world to be included in both the S&P 500 and the FTSE 100 indices.

Additional information can be found on http://www.carnival.com/, http://www.hollandamerica.com/, http://www.princess.com/, http://www.seabourn.com/, http://www.aida.de/, http://www.costacruise.com/, http://www.cunard.com/, http://www.pocruises.com.au/, http://www.pocruises.com/ and http://www.fathom.org/.

CARNIVAL CORPORATION & PLC REPORTS SIGNIFICANTLY HIGHER SECOND QUARTER EARNINGS

Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) announced non-GAAP net income of $193 million, or $0.25 diluted EPS for the second quarter of 2015 compared to non-GAAP net income for the second quarter of 2014 of $73 million, or $0.09 diluted EPS. For the second quarter of 2015, U.S. GAAP net income, which included unrealized gains on fuel derivatives of $34 million and $7 million of restructuring expenses, was $222 million, or $0.29 diluted EPS. For the second quarter of 2014, U.S. GAAP net income was $98 million, or $0.13 diluted EPS. Revenues for the second quarter of 2015 were $3.6 billion, in line with the prior year.

Carnival Corporation & plc President and CEO Arnold Donald noted, "We more than doubled our second quarter earnings versus the comparable period a year ago and significantly exceeded our quarterly earnings guidance. Our initiatives to create demand and leverage our scale benefited both cruise ticket prices and onboard revenues contributing to 5% revenue yield improvement (constant currency) this quarter. While all of our North American brands enjoyed strong revenue yield improvement, our Carnival Cruise Line brand performed particularly well again this quarter. We thank our teams around the globe for their consistent delivery of exceptional guest experiences as well as our travel agent partners for their strong support, both of which are critical to our success."

Significant milestones during the second quarter included the launch of "fathom", the tenth brand in the Carnival Corporation family. Beginning in April 2016, "fathom" will introduce a new cruise category offering travelers authentic and meaningful experiences to targeted destinations, beginning with the Dominican Republic, to work alongside locals for transformational community impact.

Additionally, Costa began year-round service from Shanghai on Costa Serena in April and announced the deployment of Costa Fortuna to China in 2016 bringing the total to four Costa ships dedicated to Chinese guests. Princess Cruises also announced that it will expand its presence in Asia with a new ship scheduled to enter service in mid-2017 to be based in China year-round and custom-designed specifically for Chinese guests. Already the industry leader in passenger cruise days home ported in China, these developments will further the company's leading presence in this rapidly expanding market and attract new cruisers to the company's brands.

Also, earlier this month Carnival Corporation finalized a contract with Meyer Werft shipyard to build four next-generation ships that will feature the largest guest capacity in the world as well as the first cruise ships to be powered at sea by Liquefied Natural Gas, which is the world's cleanest-burning fossil fuel.

"These milestones further demonstrate our ongoing focus on effective strategic actions, technological development and innovation, laying the foundation for future growth and continued global expansion," said Donald.

Key metrics for the second quarter 2015 compared to the prior year were as follows:

• On a constant dollar basis, net revenue yields (net revenue per available lower berth day or "ALBD") increased 4.1 percent for 2Q 2015, which was better than the company's guidance of up 2 to 3 percent. Gross revenue yields decreased 3.5 percent in current dollars due to changes in currency exchange rates.
• Net cruise costs excluding fuel per ALBD increased 6.1 percent in constant dollars, primarily due to an increase in dry-dock days. Costs were better than March guidance, up 6.5 to 7.5 percent due to the timing of expenses between quarters. Gross cruise costs including fuel per ALBD in current dollars decreased 8.0 percent due to changes in fuel prices and currency exchange rates.
• Fuel prices declined 37 percent to $411 per metric ton for 2Q 2015 from $657 per metric ton in 2Q 2014 but were higher than March guidance of $402 per metric ton.
• Changes in currency exchange rates reduced earnings by $0.10 per share (constant currency).

2015 Outlook

During the last thirteen weeks, fleetwide booking volumes for the next three quarters were running well ahead of last year at slightly lower prices due to transactional currency impacts. At this time, cumulative advance bookings for the next three quarters are well ahead of the prior year at slightly lower prices again due to transactional currency impacts.

Donald noted, "Current strength in booking volumes clearly demonstrates strong consumer demand for our brands, leaving less inventory remaining for sale and building confidence in achieving significant revenue yield improvement this year. We are stepping up our marketing investment for the remainder of the year to further solidify our base of business for 2016 and drive continued yield improvement as we progress on our path toward double digit return on invested capital."

The company continues to expect full year 2015 net revenue yields on a constant currency basis to be up 3 to 4 percent, which excludes translational and transactional currency impacts, compared to the prior year (up 2 to 3 percent on a constant dollar basis compared to the prior year). The company now expects full year 2015 net cruise costs excluding fuel per ALBD to be up approximately 3 percent compared to the prior year on a constant dollar basis, which is slightly higher than had been anticipated in the March guidance mainly due to increased investment in advertising.

Taking the above factors into consideration, the company has increased its full year 2015 non-GAAP diluted earnings per share guidance to be in the range of $2.35 to $2.50, compared to 2014 non-GAAP diluted earnings of $1.93 per share.

Third Quarter 2015 Outlook

Third quarter constant currency net revenue yields are expected to be up 3 to 4 percent compared to the prior year (up 2 to 3 percent in constant dollars). Net cruise costs excluding fuel per ALBD for the third quarter are expected to be 2 to 3 percent higher on a constant dollar basis compared to the prior year. Changes in fuel prices net of derivatives, and currency is expected to reduce third quarter earnings by $0.06 per share.

Based on the above factors, the company expects non-GAAP diluted earnings for the third quarter 2015 to be in the range of $1.56 to $1.60 per share versus 2014 non-GAAP earnings of $1.58 per share.

Selected Key Forecast Metrics

Conference Call

The company has scheduled a conference call with analysts at 10:00 a.m. EDT (3:00 p.m. BST) today to discuss its 2015 second quarter results.  This call can be listened to live, and additional information can be obtained, via Carnival Corporation & plc's Web site at http://www.carnivalcorp.com/ and http://www.carnivalplc.com/.

Carnival Corporation & plc is the largest cruise company in the world, with a portfolio of 10 cruise brands in North America, Europe, Australia and Asia, comprised of Carnival Cruise Line, Holland America Line, Princess Cruises, Seabourn, AIDA Cruises, Costa Cruises, Cunard, P&O Cruises ( Australia), P&O Cruises (UK) and fathom.

Together, these brands will operate 100 ships in 2015 totaling 219,000 lower berths with eight new ships scheduled to be delivered between 2016 and 2018, along with four additional new ships on order between 2019 through 2022. Carnival Corporation & plc also operates Holland America Princess Alaska Tours, the leading tour companies in Alaska and the Canadian Yukon. Traded on both the New York and London Stock Exchanges, Carnival Corporation & plc is the only group in the world to be included in both the S&P 500 and the FTSE 100 indices.

Additional information can be found on http://www.carnival.com/, http://www.hollandamerica.com/, http://www.princess.com/, http://www.seabourn.com/, http://www.aida.de/, http://www.costacruise.com/, http://www.cunard.com/, http://www.pocruises.com.au/, http://www.pocruises.com/ and http://www.fathom.org/.

Cautionary Note Concerning Factors That May Affect Future Results

Carnival Corporation and Carnival plc and their respective subsidiaries are referred to collectively in this release as "Carnival Corporation & plc," "our," "us" and "we." Some of the statements, estimates or projections contained in this release are "forward-looking statements" that involve risks, uncertainties and assumptions with respect to us, including some statements concerning future results, outlooks, plans, goals and other events which have not yet occurred. These statements are intended to qualify for the safe harbors from liability provided by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts are statements that could be deemed forward-looking. These statements are based on current expectations, estimates, forecasts and projections about our business and the industry in which we operate and the beliefs and assumptions of our management. We have tried, whenever possible, to identify these statements by using words like "will," "may," "could," "should," "would," "believe," "depends," "expect," "goal," "anticipate," "forecast," "project," "future," "intend," "plan," "estimate," "target," "indicate" and similar expressions of future intent or the negative of such terms.

Forward-looking statements include those statements that may impact, among other things, the forecasting of our non-GAAP earnings per share; net revenue yields; booking levels; pricing; occupancy; operating, financing and tax costs, including fuel expenses; net cruise costs per available lower berth day; estimates of ship depreciable lives and residual values; liquidity; goodwill, ship and trademark fair values and outlook. Because forward-looking statements involve risks and uncertainties, there are many factors that could cause our actual results, performance or achievements to differ materially from those expressed or implied in this release. This note contains important cautionary statements of the known factors that we consider could materially affect the accuracy of our forward-looking statements and adversely affect our business, results of operations and financial position. It is not possible to predict or identify all such risks. There may be additional risks that we consider immaterial or which are unknown. These factors include, but are not limited to, the following:

• general economic and business conditions;
• increases in fuel prices;
• incidents, the spread of contagious diseases and threats thereof, adverse weather conditions or other natural disasters and other incidents affecting the health, safety, security and satisfaction of guests and crew;
• the international political climate, armed conflicts, terrorist and pirate attacks, vessel seizures, and threats thereof, and other world events affecting the safety and security of travel;
• negative publicity concerning the cruise industry in general or us in particular, including any adverse environmental impacts of cruising;
• geographic regions in which we try to expand our business may be slow to develop and ultimately not develop how we expect;
• economic, market and political factors that are beyond our control, which could increase our operating, financing and other costs;
• changes in and compliance with laws and regulations relating to the protection of persons with disabilities, employment, environment, health, safety, security, tax and other regulations under which we operate;
• our inability to implement our shipbuilding programs and ship repairs, maintenance and refurbishments on terms that are favorable or consistent with our expectations;
• increases to our repairs and maintenance expenses and refurbishment costs as our fleet ages;
• lack of continuing availability of attractive, convenient and safe port destinations on terms that are favorable or consistent with our expectations;
• continuing financial viability of our travel agent distribution system, air service providers and other key vendors in our supply chain and reductions in the availability of, and increases in the prices for, the services and products provided by these vendors;
• disruptions and other damages to our information technology and other networks and operations, and breaches in data security;
• failure to keep pace with developments in technology;
• competition from and overcapacity in the cruise ship and land-based vacation industry;
• loss of key personnel or our ability to recruit or retain qualified personnel;
• union disputes and other employee relationship issues;
• disruptions in the global financial markets or other events that may negatively affect the ability of our counterparties and others to perform their obligations to us;
• the continued strength of our cruise brands and our ability to implement our strategies;
• additional risks to our international operations not generally applicable to our U.S. operations;
• our decisions to self-insure against various risks or our inability to obtain insurance for certain risks at reasonable rates;
• litigation, enforcement actions, fines or penalties;
• fluctuations in foreign currency exchange rates;
• whether our future operating cash flow will be sufficient to fund future obligations and whether we will be able to obtain financing, if necessary, in sufficient amounts and on terms that are favorable or consistent with our expectations;
• risks associated with our DLC arrangement;
• uncertainties of a foreign legal system as Carnival Corporation and Carnival plc are not U.S. corporations and
• the ability of a small group of shareholders to effectively control the outcome of shareholder voting.

Forward-looking statements should not be relied upon as a prediction of actual results. Subject to any continuing obligations under applicable law or any relevant stock exchange rules, we expressly disclaim any obligation to disseminate, after the date of this release, any updates or revisions to any such forward-looking statements to reflect any change in expectations or events, conditions or circumstances on which any such statements are based.

CONTACT: MEDIA CONTACT: Roger Frizzell, 1 305 406 7862; INVESTOR RELATIONS CONTACT: Beth Roberts, 1 305 406 4832