Miami-based Carnival Corp. & PLC posted better-than-expected first-quarter profit, buoyed by higher ticket prices and lower fuel costs.
The worlds largest cruise operator on Wednesday announced profit of $142 million, or 18 cents a share, in the quarter ending Feb. 29. That compared with profit of $49 million, or 6 cents a share, in the first quarter of 2015.
Results included $159 million in unrealized losses on fuel derivatives and other charges, Carnival said. Adjusted net income was $301 million, or 39 cents a share.
Revenue rose 3.4 percent to $3.65 billion, up from $3.53 billion a year ago.
Both adjusted earnings per share and revenue beat analysts estimates of 35 cents and $3.63 billion, respectively.
In response, Carnivals shares rose nearly 4 percent to $51.47 in morning trading on the New York Stock Exchange.
Our company is off to a strong start this year, Carnival Corp. President and CEO Arnold Donald told analysts during a conference call.
Fuel costs in the quarter fell to $187 million versus $318 million a year ago.
The company increased ticket prices in North America and Europe, Asia and Australia, with particularly large increases in its core Caribbean itineraries, which accounted for 47 percent of cruises during the period, Donald said.
Looking to the remainder of 2016, Carnival said bookings are ahead of 2015s historic highs and at higher prices.
Our ongoing guest experience innovations coupled with our increasingly effective marketing and communication efforts have driven additional demand for our brands, resulting in a strong booked position, Donald said.
Revenue from onboard spending on items such as beverages, gambling and communications services rose to $923 million from $889 million in 2015.
With fewer cabins left to be filled during the rest of year, particularly in the peak summer period, the companys cruise brands should continue to see growing revenue, Donald said.
For the second quarter, Carnival Corp. forecasts adjusted earnings per share in the range of 34 to 38 cents, compared with 25 cents a share in 2015. For all of 2016, it now forecasts adjusted earnings per share in the range of $3.20 to $3.40, compared with its December guidance of $3.10 to $3.40. That compares with adjusted earnings of $2.70 per share in 2015.
The cruise companys brands are Carnival Cruise Line, Princess Cruises, Holland America Line, Fathom, Seabourn, Cunard, Costa Cruises, AIDA Cruises, P&O Cruises (UK) and P&O Cruises (Australia).
During the conference call, Donald also reiterated the companys excitement over being granted Cuban government approval as the first U.S.-based cruise operator in more than 50 years to sail to Cuba with Americans.
Last week we made history, Donald said. We very much look forward to launching our historic Cuba inaugural season in May with Fathom.
Starting in early May, Fathom, the companys newest brand, will begin seven-day cruises to Cuba from Miami aboard the 700-passenger Adonia cruise ship, with stops planned in Havana, Cienfuegos and Santiago de Cuba.