Carnival Corp. (NYSE: CCL): Q2 Earnings Preview 2011

Carnival Corporation (NYSE: CCL) is scheduled to release its fiscal first-quarter earnings before the opening bell on Tuesday, June 21, 2011. Analysts, on average, expect the company to report earnings of 23 cents per share on revenue of $3.52 billion. In the year ago period, the company reported earnings of 32 cents per share on revenue of $3.52 billion.

Carnival Corporation operates as a cruise and vacation company in the United States and internationally. The Company has a portfolio of cruise brands and is a provider of cruises to all vacation destinations.

In the preceding fiscal first-quarter, the Miami, Florida based company's net income wwas $152 million or 19 cents per share, compared to $175 million, or 22 cents per share, in the year-ago period. Revenue grew 8 percent to $3.42 billion from $3.18 billion in the same quarter last year. Analysts, on average, expected the company to report earnings of $0.19 per share on revenue of $3.31 billion. 

The company recently announced that it expects additional costs for the second half of fiscal 2011, due to the conflicts in the Middle East and North Africa region, as well as the earthquake and nuclear disaster in Japan. The company noted that it will cost the company an additional $0.15 per share for the second half of 2011 as a result of over 300 deployment changes due to the tensions in these regions. Further, the increases in fuel prices, net of currency exchange rates, will cost the company about $0.05 per share for the same period. The company also noted that it will bear an additional $0.05 per share in costs to reflect the reduction in revenues due to the softness in bookings for the Southern Europe and UK markets. However, it expects to offset the effect of this cost in other cost areas of the business with the revenue performance for the North American brands remaining strong.

The cruise sector has also been struggling with currency fluctuations lately. With an increasingly international customer base, companies have become more susceptible to foreign currencies and an improving dollar which hurts their revenues.  Carnival does not hedge its exposure to rising fuel costs and more than half of its revenues come from passengers outside the U.S. As a result, the company’s result will be more negatively impacted by fluctuation in fuel expenses and currency exchange rates.

Looking ahead, the company is likely to benefit from a strong booking and pricing trend. Historically, demand for cruises has been the greatest during the third fiscal quarter, which includes the Northern Hemisphere summer months. Higher demand during the third quarter leads to increased net revenue yields. Accordingly, the company typically generates the highest earnings at this time of the year. 

Full Disclosure: None.

Carnival Corp. (NYSE: CCL): Q1 Earnings Preview 2011

Carnival Corporation (NYSE: CCL) is scheduled to release its fiscal first-quarter earnings before the opening bell on Tuesday, March 22, 2010. Analysts, on average, expect the company to report earnings of $0.19 per share on revenue of $3.31 billion. In the year ago period, the company reported earnings of $0.22 per share on revenue of $3.10 billion.

Carnival Corporation operates as a cruise and vacation company in the United States and internationally. The Company has a portfolio of cruise brands and is a provider of cruises to all vacation destinations.

In the preceding fiscal fourth-quarter, the Miami, Florida based company's net income was $248 million, or 31 cents a share, compared with a profit of $193 million, or 24 cents a share, in the year-ago period. Revenue grew to $3.50 billion from $3.28 billion in the same quarter last year. Analysts, on average, expected the company to report earnings of $0.32 per share on revenue of $3.36 billion. 

Early in March, the company said that earnings per share for the first quarter ended February 28, 2011 was $0.19, at the high end of its previous guidance range of $0.15 to $0.19. Adjusted earnings per share for the first quarter of 2010 was $0.12 before the favorable impact of $0.10 per share of unusual items, resulting in a reported earnings per share of $0.22. The company also slashed its earnings forecast for the full-year 2011, noting that fuel prices have soared since it had provided initial guidance back in December. The company expects the current fuel prices and the currency exchange rates to negatively impact earnings for the full-year 2011 by about $0.40 per share. Further, the company estimates the impact of itinerary changes in the Middle East and North Africa to have a negative impact of about $0.05 on earnings for the remainder of the year. Based on the above factors, the company now forecasts full year 2011 fully diluted earnings per share to be in the range of $2.50 to $2.60, compared to its December guidance range of $2.90 to $3.10 and fiscal 2010 of $2.47. 

The company has benefited from a strong booking and pricing trend. However, surging fuel prices, a greater exposure to sluggish European markets, lower Caribbean prices in the first half of 2011 and the overall economic uncertainty will likely hurt Carnival’s growth in the near term. 

However, the cruise sector has been struggling with currency fluctuations lately. . With an increasingly international customer base, companies have become more susceptible to foreign currencies and an improving dollar which hurts their revenues.  Carnival does not hedge its exposure to rising fuel costs and more than half of its revenues come from passengers outside the U.S. As a result, the company’s result will be more negatively impacted by fluctuation in fuel expenses and currency exchange rates.

In January, the company sharply boosted its regular quarterly dividend to $0.25 per share from the $0.10 per share it announced when it reinstated the dividend in early 2010. 

The company's stock currently trades at a forward P/E (fye November 30, 2012) of 11.70 and PEG Ratio (5 yr expected) of 0.86. In terms of stock performance, Carnival shares have gained nearly 3% over the past year.

Full Disclosure: None.

Carnival Corp. (NYSE: CCL): Q4 Earnings Preview 2010

Carnival Corporation (NYSE: CCL) is scheduled to release fiscal fourth-quarter earnings before the market open on Tuesday, December 21, 2010. Analysts, on average, expect the company to report earnings of 32 cents per share on revenue of $3.36 billion. In the year-ago period, the company reported earnings of 24 cents per share on revenue of $3.21 billion.

Carnival Corporation operates as a cruise and vacation company in the United States and internationally. The Company has a portfolio of cruise brands and is a provider of cruises to all vacation destinations.

In the preceding fiscal third-quarter, the Miami, Florida based company's net income was $1.30 billion, or $1.62 per share, compared to $1.07 billion, or $1.33 per share, in the year-ago quarter. Revenue grew to $4.43 billion from $4.14 billion. Analysts, on average, expected the company to report earnings of $1.47 per share on revenue of $4.42 billion. 

At its last earnings call in September, the company said that it expects fiscal fourth quarter earnings in the range of 32 cents to 36 cents per share. This includes the impact of unfavorable currency and fuel costs of $0.07 per share in the fourth quarter, and also compares to the $0.24 per share in the fourth quarter of 2009. Net revenue yields are expected to be up 2.5% to 3.5% (decline 1–2% on a constant dollar basis). Net cruise costs -- excluding fuel -- are expected to be down 1% to 2%, compared with the prior-year quarter, on a constant-dollar basis.In addition, the company also raised its earnings estimates for full-year 2010 in the range of $2.48 to $2.52 from $2.25 to $2.35, based on strong booking for the rest of 2010. Carnival Corporation reiterated its net revenue yields guidance of up 2% to 3% on a constant dollar basis.

Recently, the company announced that it has cancelled additional departures of the Carnival Splendor including the January 16, 23, 30 and February 6 and 13, 2011 voyages to allow for additional repair time following an engine room fire aboard the vessel in November.  The ship is now scheduled to re-enter service February 20, 2011. Earlier, when the Splendor incident took place, the company estimated that the voyage disruption and related repair costs will negatively impact fourth quarter earnings by 7 cents a share, but will have minimal impact on first-quarter 2011 earnings. However, now that the Carnival Splendor voyage is cancelled through January and most of February, the first quarter results will also be hurt significantly.

The company has benefited from a strong booking and pricing trend. However, surging fuel prices, a greater exposure to sluggish European markets, lower Caribbean prices in the first half of 2011 and the overall economic uncertainty will likely hurt Carnival’s growth in the near term. 

In terms of stock performance, CCL shares have gained nearly 32% since the beginning of the year. 

Full Disclosure: None.