Carnival PLC (LSE:CCL, Financial) released its 8-K filing on June 25, 2024, reporting record-breaking financial results for the second quarter of 2024. Carnival, the largest global cruise company, operates 92 ships across various brands, including Carnival Cruise Lines, Holland America, Princess Cruises, and Seabourn, among others. The company has successfully rebounded to pre-pandemic levels, attracting nearly 13 million guests in 2023.
Performance and Challenges
Carnival PLC (LSE:CCL, Financial) reported a significant improvement in net income, which increased by nearly $500 million compared to 2023. The company achieved a record second quarter operating income of $560 million, nearly five times the level of 2023, on record revenues of $5.8 billion. This performance is crucial as it demonstrates the company's ability to recover and grow in a post-pandemic environment, despite challenges such as rising fuel costs and geopolitical uncertainties.
Financial Achievements
The company raised its full-year 2024 net yield guidance to approximately 10.25% due to continued strong demand. Additionally, Carnival increased its full-year adjusted net income guidance by approximately $275 million. The cumulative booked position for the remainder of 2024 is the best on record in both price and occupancy, indicating robust future performance.
Key Financial Metrics
Second quarter net income was $92 million, or $0.07 diluted EPS, an increase of nearly $500 million compared to 2023. Adjusted net income of $134 million, or $0.11 adjusted EPS, outperformed March guidance by nearly $170 million. The company also reported record second quarter adjusted EBITDA of $1.2 billion, increasing over 75% compared to 2023.
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Income | $92 million | -$408 million |
| Adjusted Net Income | $134 million | -$36 million |
| Operating Income | $560 million | $112 million |
| Revenues | $5.8 billion | $4.2 billion |
Bookings and Outlook
The company continues to experience strong bookings momentum, with record booking volumes for 2025 sailings. The cumulative advanced booked position for full year 2025 is even higher than 2024 in both price and occupancy. For the full year 2024, Carnival expects net yields to be up approximately 10.25% compared to 2023, with adjusted EBITDA of approximately $5.83 billion, up nearly 40% compared to 2023.
"We have made incredible strides in improving our commercial operations, strategically reallocating our portfolio composition and formulating growth plans, while strengthening even further our global team, the best in the business," commented Carnival Corporation & plc’s Chief Executive Officer Josh Weinstein.
Strategic Portfolio Optimization
Carnival announced the sunset of the P&O Cruises (Australia) brand, with operations to be folded into Carnival Cruise Line in March 2025. This realignment aims to optimize the company's global brand portfolio and strengthen its performance in the South Pacific.
Financing and Capital Activity
The company continues to manage its debt profile proactively. Since February 29, 2024, Carnival has prepaid $1.6 billion of its first-priority senior secured term loans and repriced approximately $2.75 billion of its senior secured term loan facilities. These actions are expected to reduce net interest expense by $55 million in 2024 and $85 million on an annualized basis.
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Explore the complete 8-K earnings release (here) from Carnival PLC for further details.
