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Carnival Blames Higher Fuel Costs For 2nd Qtr. Drop In Earnings

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(Source: Carnival Cruise Lines) Carnival Breeze

(Source: Carnival Cruise Lines) Carnival Breeze

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MIAMI (CBS4) –  Higher fuel costs, unrest in the Middle East and the aftermath of Japan’s earthquake and nuclear disaster caused some rough seas for Carnival Cruise Corp.

On Tuesday the Miami based company reported its second quarter net income dropped 18 percent; the company reported earnings of $206 million, or 26 cents per share. However, the performance was better than the 23 cents per share that analysts surveyed by FactSet predicted.

In early morning trading Carnival’s stock gained 92 cents, or 2.6 percent, to $36.65; shares have traded in a range of $29.68 to $48.14 over the past year.

Higher fuel prices cost Carnival about $150 million, or 19 cents per share, in the quarter.

Revenue rose 11 percent to $3.62 billion, besting Wall Street’s estimate of $3.51 billion.

Carnival, whose brands include Carnival Cruise Lines, Holland America Line and Princess Cruises, now expects 2011 earnings of $2.40 to $2.50 per share. Previously, it expected between $2.55 and $2.65 per share.

For the third quarter, Carnival anticipates earnings of $1.60 to $1.64 per share.

The cruise operator said advance bookings for the rest of 2011 are at higher prices and lower occupancies than last year.

 

(©2011 CBS Local Media, a division of CBS Radio Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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