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BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
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Carnival posts 20.3% rise in Q2 bunker costs... but still achieves $561m profit

Average price paid for marine fuel jumped 21.7% to $455 per tonne.



The Carnival Valor docked at Nassau, Bahamas. Image credit: Charles Pluta Flickr CC BY-SA 2.0


Updated on 26 Jun 2018 05:34 GMT

US cruise operator Carnival Corporation & plc reports that it recorded a 20.3 percent jump in bunker costs, year-on-year (YoY), during the company's second fiscal quarter (Q2) of 2018, which runs between March 1 and May 31.

Bunker fuel expenses in Q2 amounted to $373 million (up $63m, or 20.3 percent), having been $310m during the corresponding period the previous year.

The company paid an average of $455 per metric tonne (pmt) over the period, compared with $374 pmt in Q2 2017 - representing a rise of $81, or 21.7 percent.

Bunker fuel consumption was 819,000 mt - 11,000 mt lower than the 830,000 mt recorded during the same quarter last year.

Fuel consumption per thousand available lower berth days (ALBDs) was down to 39.6 mt from 40.7 mt in 2017.

Six-month results

For the first six months (H1) of the fiscal year (December 1 to May 31), Carnival saw bunker costs increase by $124m, or 20.4 percent, to $731m, up from last year's figure of $607m.

The average price paid for fuel jumped $78, or 21.2 percent, to $446 pmt, up from $368 pmt during the prior-year period.

The ferry operator's vessels burned 1,640,000 mt in H1, compared with 1,649,000 tonnes in 2017.

Fuel consumption per thousand available lower berth days (ALBDs) was 39.9 mt, down from 40.8 mt the year before.

2018 forecast

Below is Carnival's fuel price and fuel consumption forecast for 2018.

Third-quarter 2018 forecast

Fuel price pmt: $525
Fuel consumption (mt): 820,000

Full-year 2018 forecast

Fuel price pmt: $479
Fuel consumption (mt): 3,305,000

Key financial results

In its key results for Q2 2018, Carnival posted an increase in net income of $182m, or 48.0 percent, to $561m.

Q2 revenue amounted to $4,357m, which was $412m, or 10.4 percent, higher than the $3,945m achieved during the corresponding period in 2017.

Operating costs were also up - rising by $353m, or 10.2 percent, to $3,798m.

Commenting on the results, Carnival's president and CEO, Arnold Donald, stated: "We delivered another strong quarter, again achieving record adjusted earnings on record revenues and exceeding the high end of our guidance range. Strong operational execution drove a 30 percent increase in adjusted earnings affirming the strength of our core strategy to create demand that outpaces measured capacity growth through outstanding guest experience efforts coupled with innovative actions to increase consideration for cruising across all global markets."

On the company's outlook for 2018, Donald remarked: "Strong operational results coupled with sustained strength in booking trends have mitigated the unfavorable $0.19 per share impact of fuel and currency moving against us since our last update. We remain on track to deliver double digit return on invested capital in 2018. In addition, we have accelerated returns to shareholders through our recent dividend increase, with annual dividend distributions now over $1.4 billion and the reauthorization of up to $1 billion in share repurchases."






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