Shares of the cruise liner, Carnival Corp. (NYSE: CCL) sank in morning trading on Monday even as the company’s adjusted loss in the fiscal second quarter narrowed to $0.31 per share versus a loss of $1.64 per share in the same period last year. Analysts expected the company to report a loss of $0.34 per share.
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The cruise liner company posted record second-quarter revenues of $4.9 billion, above consensus estimates of $4.8 billion. In fiscal Q2, the company has seen rising demand and total bookings reached an all-time high.
CCL stated in its press release that “total customer deposits reached an all-time high of $7.2 billion (as of May 31, 2023), surpassing the previous record of $6.0 billion (as of May 31, 2019) by over $1 billion, driven by strong demand, bundled package offerings and pre-cruise sales, and a 26% increase compared to the prior quarter.”
Carnival Corp.’s CEO, Josh Weinstein commented, “Based on continued strength in pricing, we delivered outperformance in the second quarter and raised our expectation for revenue in the second half, which coupled with the interest expense benefit we are capturing from deleveraging will bring another $275 million dollars to the bottom line for the year.”
Looking forward, the company now expects adjusted EBITDA in the range of $2.05 billion to $2.15 billion in Q3 and adjusted net income between $0.95 billion and $1.05 billion. For FY23, CCL has projected adjusted EBITDA of $4.10 billion to $4.25 billion, above its guidance range given in March and with a midpoint rise of $175 million. However, adjusted cruise costs in FY23 are also expected to increase with adjusted cruise costs (excluding fuel) per
Looking forward, the company now expects adjusted EBITDA in the range of $2.05 billion to $2.15 billion in Q3 and adjusted net income between $0.95 billion and $1.05 billion. For FY23, CCL has projected adjusted EBITDA of $4.10 billion to $4.25 billion, above its guidance range given in March and with a midpoint rise of $175 million. However, adjusted cruise costs in FY23 are also expected to increase with adjusted cruise costs (excluding fuel) per available lower berth day (ALBD) likely to rise by one and a half points than its March guidance as inflationary pressures continue to increase and a jump in incentive compensation.
Analysts are cautiously optimistic about CCL stock with a Moderate Buy consensus rating based on nine Buys, two Holds, and two Sells.
