In This Article:
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Revenue: Achieved first-quarter high-water marks for revenue.
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EBITDA: Reached $1.2 billion, a near 40% year-over-year increase.
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Net Income: Exceeded guidance by more than $170 million.
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Yield Increase: 7.3% increase, surpassing yield guidance.
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Operating Income: Nearly doubled for the quarter.
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Operating and EBITDA Margins: Improved over 400 basis points year over year.
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Customer Deposits: Up over $300 million versus the prior year.
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Interest Expense: Favorability of $13 million due to refinancing efforts.
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Debt Refinancing: Refinanced $5.5 billion of debt, reducing interest expense by $145 million annually.
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Total Debt: Reduced by $0.5 billion, ending the quarter with $27 billion.
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Cash Interest Rate: Reduced to 4.6%.
Release Date: March 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Carnival PLC (NYSE:CUK) achieved a robust 7.3% yield increase, surpassing their yield guidance.
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Operating income nearly doubled for the quarter, with EBITDA reaching $1.2 billion, marking a 40% year-over-year increase.
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The company raised its full-year earnings guidance by $185 million due to strong first-quarter results.
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Carnival PLC (NYSE:CUK) is on track to meet its 2026 financial targets a year early, with ROIC expected to hit 12%.
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The company has successfully refinanced $5.5 billion of debt, reducing interest expenses and improving leverage metrics.
Negative Points
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Despite strong performance, Carnival PLC (NYSE:CUK) acknowledges heightened macroeconomic and geopolitical volatility.
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There are increased dry-dock costs due to unplanned dry docks, impacting cruise costs.
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The company faces challenges in maintaining yield improvements amidst global economic uncertainties.
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Carnival PLC (NYSE:CUK) has limited capacity growth, which could constrain future revenue expansion.
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The sale of Seabourn Sojourn, while financially beneficial, reduces the fleet size of the Seabourn brand.
Q & A Highlights
Q: Can you provide more color on consumer demand trends since the 4Q period? A: Josh Weinstein, CEO, noted that wave season was a success, setting a record for bookings for future years. They entered wave season with historic occupancy and pricing, which they used to their advantage, resulting in strong Q1 yields and maintaining yield guidance for the rest of the year over 4%.
Q: You beat Q1 by $165 million but raised guidance by only $100 million. Can you clarify the impact of ALBDs and dry docks on this? A: David Bernstein, CFO, explained that the flow-through to the year was due to yield improvements and $100 million in interest expense savings. The cost was mostly timing-related, with some permanent savings offset by reduced ALBDs due to extra dry docks.