Profits fall as Carnival cuts guidance for financial 2019

Carnival Corporation has announced an adjusted net income of $457 million for the three months to the end of May 31st.

The figure is a slight fall from that of $489 million reported in the same period last year.

Carnival Corporation chief executive, Arnold Donald, stated: “Second quarter earnings included revenue growth from higher capacity and improved onboard spending, more than offset by a drag from fuel and currency compared to the prior year.

“Second quarter adjusted earnings were better than March guidance by $0.08 per share substantially due to the timing of expenses between quarters.”

In a statement to markets Carnival said profits had been hit by repairs to Carnival Vista, which was recently taken out of service for more than two weeks for repairs.

Three sailings have currently been cancelled.

There was also disruption on trips to Cuba.

The Trump administration recently changed its policy on visiting the destination, making it harder for Americans to holiday there.

“While the company was able to quickly adjust its itineraries to provide guests with attractive alternative vacation experiences, the suddenness of the regulatory change to this high yielding destination has led to a near-term impact on revenue yields,” Carnival explained.

Looking ahead, the cruise line also cut its financial guidance for the rest of the year.

Carnival cut earnings guidance for financial 2019 to US$4.25-US$4.35, down from a previous estimate of US$4.35-US$4.55.

This was mainly due to lower ticket prices forecasted in the second half of the year, resulting primarily from ongoing headwinds faced by the its European brands.

Shares in Carnival dropped ten per cent shortly after the statement was released, to 3,646 pence per share.

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