Carnival Corporation & plc Reports Record-Setting Second Quarter Earnings and Outlines Focus on 2026 SEA Change Program
By Donald Wood
Last updated: 1:40 pm ET, Monday, June 26, 2023
Carnival Corporation & plc announced on Monday its second-quarter 2023 earnings, adjusted third-quarter forecast, and the company’s focus on the 2026 SEA Change Program. The cruise company reported impressive financial results for the second quarter, and its plans for the future show a commitment to sustainability and profitability.
Second Quarter Earnings
Carnival Corporation & plc reported an adjusted EBITDA of $681 million and revenue of $4.9 billion for the second quarter, setting a new record for the company. The cruise company also experienced a significant increase in demand, with total bookings reaching an all-time high for future travel.
Total client deposits during the quarter reached $7.2 billion, surpassing the previous record of $6 billion by more than $1 billion. This represents a 26 percent increase compared to the previous quarter. Carnival ended the second quarter with $7.3 billion in liquidity, following the prepayment of over $1 billion in short-term variable rate debt.
Adjusted Third Quarter Forecast
Carnival Corporation & plc’s adjusted third-quarter forecast projects that profit will be slightly below estimates. The cruise operator is facing higher labor and fuel costs, as well as increased spending on marketing, according to CEO Josh Weinstein. The company has also raised its third-quarter cost forecast due to higher labor costs, port expenses, and a slower-than-expected drop in inflation. However, Carnival has lowered its annual loss forecast due to higher ticket prices.
Weinstein remains optimistic about the company’s future despite the challenges. He said, “We are gaining momentum with continued strength in demand. We are excited about all the opportunities ahead and the potential to create outsized value for our shareholders as we work toward our 2026 goals.”
2026 SEA Change Program
In addition to its quarterly earnings, Carnival Corporation & plc introduced its 2026 SEA Change Program. This program outlines key performance objectives for the company to achieve over the next three years. The program focuses on milestones in sustainability, EBITDA, and adjusted return on invested capital (RoIC). By the end of 2026, Carnival aims to approach investment-grade leverage metrics.
The SEA Change Program demonstrates Carnival’s commitment to sustainable practices and long-term profitability. By setting goals and targets for the next three years, Carnival aims to make significant progress in reducing its environmental impact and improving its financial performance.
Looking Ahead
Carnival Corporation & plc’s second-quarter earnings and adjusted third-quarter forecast show the company’s resilience in the face of challenges. While labor and fuel costs, as well as inflation, pose obstacles for the cruise operator, Carnival remains optimistic about its future prospects. The introduction of the 2026 SEA Change Program further highlights the company’s commitment to sustainable growth and profitability.
As Carnival continues to navigate the recovery from the pandemic, it is essential to monitor its progress and how it adapts to changing market conditions. By focusing on cost management, demand growth, and sustainability, the cruise company aims to overcome challenges and deliver value to its shareholders.
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Themes of this article to explore:
– Carnival Corporation & plc’s strong financial performance in the second quarter of 2023.
– The challenges faced by the cruise operator, including higher labor and fuel costs.
– Carnival’s revised third-quarter forecast and lower annual loss forecast.
– The introduction of the 2026 SEA Change Program and its objectives.
– Carnival’s commitment to sustainability and long-term profitability.
– The company’s plans to approach investment-grade leverage metrics by the end of 2026.
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