Carnival results show cruise industry is recovering
(Reuters) - Carnival Corp & Plc on Tuesday reported stronger-than-expected quarterly earnings, helped by a revival in the cruise industry, which had suffered because of a deadly January accident involving one of its cruiseliners.
Carnival, whose Costa Concordia ran aground off the coast of Italy in January, said its cabins had generated more revenue than it had anticipated and that it was able to contain costs, allowing it to beat its forecasts.
After the Costa accident, bookings slowed, and Carnival had to offer discounts to lure passengers.
But the company, whose lines also include Carnival Cruises, Princess Cruises and Holland America, said pricing was improving and should strengthen in 2013.
"These results demonstrate that the cruise industry has proven more resilient than investors had expected following the accident and is likely recovering at a faster pace than expected," ITG analyst Matthew Jacob told Reuters.
Carnival shares were up 1.3 percent at $37.49 in afternoon trading after hitting a 52-week high earlier in the day, while rival Royal Caribbean Cruises Ltd's stock rose 1.8 percent to $30.97.
Carnival said that in the last six weeks, bookings excluding the Costa line, which operates mostly in Europe, had risen 9 percent from a year earlier. Prices remained about the same, suggesting less of a need for discounting.
The company reported net income of $1.33 billion, or $1.71 per share, for the third quarter ended August 31. That compares to net income of $1.34 billion, or $1.69 per share, on revenue of a year earlier.
Excluding unrealized unrealized gains on fuel derivatives, earnings were $1.53 per share. Analysts on average had expected $1.43, according to Thomson Reuters I/B/E/S.
Revenue fell 7.4 percent to $4.68 billion from $5.06 billion.
Excluding the impact of currency fluctuations, net revenue yield, which reflects what each cabin generates, fell 5.3 percent, less sharply than the 6 percent to 7 percent decline that the company had forecast in June.
Carnival narrowed its full-year profit forecast. It now expects earnings of $1.83 to $1.87 per share, excluding special items, compared with an earlier range of $1.80 to $1.90.
(Reporting by Phil Wahba in New York; Editing by Prudence Crowther and Lisa Von Ahn)