Carnival Corporation & plc. reports that fuel costs decreased by US$36 million, or 6.4 percent, during the three months ended February 28, 2014 compared to the previous year.
Bunker fuel expenses amounted to $523 million between December and February, having been $559 million during the corresponding period last year.
Fuel prices declined by 3.4 percent to $654 per metric tonne in the first quarter of 2014, down from $677 per metric tonne in the prior year period, but were higher than the December guidance of $643 per metric tonne.
Fuel consumption per available lower berth day (ALBD) decreased by 4.8 percent in the first quarter of 2014 compared to the previous year.
Please find below Carnival's fuel price and fuel consumption forecast for 2014.
2014 Fuel Price and Fuel Consumption Forecast
Second quarter 2014:
Fuel price per metric tonne: $649
Fuel consumption (metric tonnes): 815,000
Full Year 2014
Fuel price per metric tonne: $653
Fuel consumption (metric tonnes): 3,230,000
In its overall results for the first quarter of 2014, Carnival posted a non-GAAP net income of $2 million, or $0.00 diluted earnings per share (EPS) for the first quarter of 2014 compared to non-GAAP net income for the first quarter of 2013 of $67 million, or $0.08 diluted EPS.
U.S. GAAP net loss, which included net unrealized losses on fuel derivatives of $17 million, was $15 million, or $0.02 diluted loss per share. For the first quarter of 2013, U.S. GAAP net income was $37 million, or $0.05 diluted EPS.
Revenues for the first quarter of 2014 were $3.6 billion in line with the prior year.
Commenting on the results, Carnival Corporation & plc President and Chief Executive Officer
Arnold Donald noted that first quarter non-GAAP earnings were better than anticipated in the company's December guidance due to better-than-expected ticket prices for Carnival Cruise Lines and continental European brands, as well as the timing of certain expenses.
Donald said: "We see progress with our continental European brands and continue to be pleased with Carnival Cruise Lines' pace of improvement. Exciting product innovations and strategic marketing initiatives at Carnival Cruise Lines have driven strong close-in demand resulting in sequential improvement in year-over-year quarterly ticket prices for the brand."
2014 Outlook
Carnival said that booking volumes for the remainder of the year are running well ahead of last year at lower prices. At this time, cumulative advance bookings for the remainder of 2014 are ahead of the prior year at prices below prior year levels.
Donald noted: "We have experienced a solid wave season, with booking volumes up almost 20 percent globally surpassing last year's cumulative advance booking levels, albeit at lower prices. Many guests are booking further in advance, which increases visibility and builds confidence that yield comparisons will turn positive in the second half of 2014. Increased interest across our brands is an encouraging indication that our message is resonating as consumers recognize the strong value proposition and exceptional vacation experiences we provide."
The company continues to expect full year 2014 net revenue yields, on a constant dollar basis, to be down slightly compared to the prior year (in line with the prior year on a current dollar basis). The company also continues to expect net cruise costs excluding fuel per ALBD for full year 2014 to be slightly higher than the prior year on a constant dollar basis.
Taking the above factors into consideration, the company forecasts full year 2014 non-GAAP diluted earnings per share to be in the range of $1.50 to $1.70, compared to 2013 non-GAAP diluted earnings of $1.58 per share.
Looking forward, Donald stated: "We are on the path toward improved financial performance. We are working hard to maintain the momentum with additional product initiatives, continuous improvement in our already high guest satisfaction levels and greater utilization of our global scale."
Second Quarter 2014 Outlook
Second quarter constant dollar net revenue yields are expected to decrease by 3 to 4 percent compared to the previous year. Net cruise costs excluding fuel per ALBD for the second quarter are expected to be up 2.5 to 3.5 percent on a constant dollar basis compared to the prior year, mostly due to higher selling and administrative costs.
Based on the above factors, the company expects non-GAAP diluted earnings (loss) for the second quarter 2014 to be in the range of $(0.02) to $0.02 per share versus 2013 non-GAAP earnings of $0.07 per share.
