Carnival Corporation & plc (CCL) 20 Dec 192019 Q4 Earnings call transcript

Good morning everyone. And welcome to our Fourth Quarter 2019 Earnings Conference Call. I'm Arnold Donald, President and CEO of Carnival Corporation & plc. Today, I'm joined by our Chairman, Micky Arison, as well as David Bernstein, our Chief Financial Officer; and Beth Roberts, Senior Vice President, Investor Relations. Thank you all for joining us this morning.

please will some be begin, on our I call this forward-looking. before note of that remarks Now Therefore, I must in today's refer you to release. the press cautionary statement

First, as still per shareholders. deliver the cruise experiences adjusted members work the earnings XX share offset another memorable I million year our who records guests, to and our family as collectively of headwinds numerous for sincerely thank well for Carnival XXX,XXX of

plethora $X.XX, the midpoint than achieved year negative circumstances. new last share of than in We events earnings record better quarter that's per high $X.XX of adjusted historical EPS, a with adjusted and the broadly our per X% $X.XX of capacity share. a of fourth earnings year is year's our line per and for which ended with by share guidance adjusted despite growth, higher We full

the We we doing inherently our for working share earnings ensure With very After more to achieve that level shipyard Dorian, Hurricane adjusted dry the it are and XXXX of unscheduled hard said, travel dock, than Cuba, of change time. regulatory of multiple brought our years we five deliver delays. better. were do fact in strong we in are plan to we of challenges, and not with company, believe our business Arabian Gulf, preventing growth growth even earnings to including to abrupt events fair geopolitical disappointed a over capable costly is

of in impacting shorter cruises windows many and instances, of yield. in All booking necessitated the resulted negatively cancellation which

events beyond in credits purchase. cost share. their providing the approximately always, were per control, events them with guests unusual we who cruise company to unusual are direct these convenience, as though our we next total, these and go above accommodate our $X.XX estimated to In generous towards Even outside

unanticipated decline especially tail broadly continental these do leisure affecting was in events an travel have a source impact from consumer XXXX. in effect Germany. events markets, course, compounded of into the attitudes by these going our Now And European

from achieved impact have European the the was would per revenue for downturn, this difficult, we quantifying conditions Continental without $X.XX double the worth in our share yield Clearly approximately continental macro fiscal XXXX. in scale number face always growth unusual earnings brands the environment into we is a XXXX. per that share in events. While decline adjusted digit for even continuation and of Unfortunately, do see of of Europe higher

uneven XX% the our As the around a world. from global are economies with source company guest subject we're of nearly to outside U.S.,

of challenged, overall percentage regions compared over our year Germany, period. will weighted portfolio are the decline we the a guests, in market cruise to large same last a revenue client travel overall more that AIDA up in outperformed that all mid-teens have with half currently a for In remain in than We headwind overall carry to of and XXXX. this revenue

Looking the forward, industry slower AIDA is quarter. in Germany second in entering of a supply cruise beginning growth period

team for leisure cruise the outstanding expect among invested yield year, our XX% the that's remains we is to on difficult capital ongoing travel Despite XXXX. category We an return and portfolio growing demand of brands environment, challenge Germany. for capacity job, in highest headwinds, that our which our in has AIDA X% given there environment. done brand expect and That the AIDA given down entire are just similar XXXX from in impacting next said growth

to more already programs, the growth convenient performance taken what home, the actions cruises our travel components. costly replacing with These itineraries challenge to changes XX% In Southern adapt environment. by We've also is of Europe, eliminating is them air we proving closer to include there. exotic actions affordable optimize and to reducing to a a what to have difficult be in persistent capacity face

is for much new capacity larger for three we previously smaller by five action these of the be Costa more vessels, right followed efficient ship The we capacity removing replace offset ships Europe implemented will strategy to ships return and two market. Costa in invested in the been size Smeralda. the received improve for years, our Southern Europe of long by term the somewhat delivery fleet can by efficient XXXX. a more from As and Costa XXXX from an Smeralda Europe to in overtime. with the on first Costa delivered demand plan capital capacity has accelerate accelerating announced, fiscal well sourced and existing by By also third

Iona, book comparable In the cruises. five and U.K the yields our years largest we ever a and the despite ships for premium travel U.K. the XXXX around first the a continues to And are at Brexit. for new brand ship for again Iona profits U.K and XXXX in revenue demand outperformed to strong brands uncertainty have our UK, overall market purpose-built other on leisure particularly experiencing shift also the our have in grown ongoing significant

increasing due by been the tensions The Now somewhat yielding U.K Arabian Gulf the dry-dock in overhang to projected our a overall the this has high previously close-in plan muted announced and Brexit. an from Mary XXXX for in Queen performance deployment X. changes

change relative The be continuation and is yield capacity regulatory increase trades, Cuba. last in in drag continuing Alaska, stronger high positive of yields the XXXX the for overall XX% will a strong to seeing future in and absorbing in we're even the XX% on America, of remain and credits trends increase. growth industry the other In remains process top the without year's occupancy where XXXX. of Caribbean North yield from brands, our Turning in cruise

remains scale, we are Alaska challenge hard profitable address. to growing While year-to-year that working with a yield our and growth

demand Alaska communications focus efforts, well to travel creating our on approaches consumer as with partners, We targeted including others some continue there, as trades. to concerning specifically new new agent

countries our the operate. we stimulate spin marketing brands of demand the a deploying guest analysis to and Our conducted and further brands of activities dive number collectively are drive We've to innovative offerings all in demand. deep

leading we're impressions and demand combined, destinations And overall in brands beginning pleased quarter in in and while support and pockets support growth. to balance the to of increased future demand share around the XXXX, into including earned successful our yield to marketing rigor voice, brand and efforts. and promotion generate also end, with spend found marketing we and investments spin, drive increasing to world. to media better of with analytical purchased our To support XXXX been increase price of we've generation fourth that of and wave in opportunity our activities And we've marketing media

guest are towards the continue our end net scores side, experience many guest Both experience of the promoter and On highs. we to scores ranges, new with top prior our deliver. hitting

which guest We are peaks investments the stepping and six service this up even year with ships new XXXX in across six entering build further schedule, new through distinct experience markets.

the and a Princess, east to new the in we will Carnival ship for Enchanted The OceanMedallion. end the in the well the nearly Toward West Carnival Costa Panorama, second brand home Costa Gras Line and the and delivered welcome aforementioned on Iona for Asia. Smeralda, as Costa Europe Firenze new year round of XX Cruise Coast P&O UK, as to coast with first years ship Mardi fiscal Continental XXXX, the Carnival on

ships In in to and on including popular the already Carnival revenue facilitate of more with XXXX. across Radiance purchases. technology continues to OceanMedallion rollout growth, continues, our completed expansion And to other five pre-cruise onboard six be the completed existing app-based brands our be out in fleet by XXXX. Princess reimaginations roll the the Carnival recently significant with our joined like features most to fleet, continue Sunrise We introduced

Half Concerning Moon destination elevating in the development, guest underway; destinations experience we Grand dramatically and have operating we complementing two destination Cay, six we the the without Island Bahama Caribbean. increasing currently, developed had are already second major developments on And and costs. on the are operating

achieved total These global bringing million in and over And of excellence environmental cost we will efforts fact, therefore, and compliance. responsibility XXXX. priorities in XXXX million. savings of and to course, In continue protection, highest cumulative over are safety, $XXX the our sourcing, top through $XXX

we which front, the will consumption in we X% X% to sustainability achieved reduction per bring and another consumption cumulative fuel per reduction in the in expect XXXX, in On XX%. XXXX, ALBD unit fuel

the Coalition Getting joined and solutions. We infrastructure maritime, accelerating development sectors, organizations de-carbonization of the across continue to of We energy, lead finance environmentally Zero of committed the the industry alliance the in international to industry. to and friendly fuel shipping

Cruises to LNG cell significant propulsion announced investment cell groundbreaking time, this company the powered fuel will the ship first and storage the will Just to derived by friendly power, fossil be cruise AIDAperla, ethanol. ordered. electrical powered energy albeit pilot system also first technology the limited of the fuel storage world's month, solely We a XXXX, cruise environmentally our the as the on passenger We're of AIDA large battery we as lithium-ion just hydrogen to and a cells our delivered the And fuel this The early year, from making ships we've by ship. ship's in operations. periods most capabilities. first LNG, on delivered be test fuel in use be cruise second of XX for

increase XX% technologies industry capability and the of we've we quality in on Now at already air increased have also shore from and of which emissions, these wake to of advanced leading we IMO The the benefit power, have over will helps advanced types air fleet XX% to in systems complement we deployed investments nearly reduce quality systems costs, on made including in our for any fuel deployed our ironing mitigate already spread our and fleets. get cold XXXX.

digesters. advanced are environment Beyond wastewater additional concerning rollout focused of areas other carbon, bio- and with on treatment systems we food the

progress future reduce an our environmental part efforts, have Moreover, In also our society. on considerable ocean addition, use with goal significantly Cousteau, as Jean-Michel partnered we're of plastics. making we to single

more much at forefront our Of course, strategic of we efforts do remain the our goals. have to and work sustainability

can't one will fully environment years take is we given time recession XX-year in them supply is advance the we build timed, into. aware we appreciate see ship assets we the well than and in its many Europe the macro We summary, in every more assume in deliver unfolded. not decisions So Continental we XX-year that economic growth cycle that that Accordingly, fully that life.

I'd efforts dedicated again team like our members. acknowledge the to successful of

team experiences a For business a company with strong our and guest meaningful very our they and record adjusted to of proud the consumer every deliver is phenomenal earnings macro headwinds of this to day. exposed deliver portion I'm members accomplishment, significant

focused out X% just are we in overtime, peaking flows growth on X.X% capacity XXXX. growth capacity measured in Importantly, XXXX, to under after

bringing been ships We've just more with the years. announced ship month, to XX two total cumulative sales XX this accelerating in

addition, toward newbuilds towards fiscal in performance timing continuing XXXX moderating further of time, and of at to progress make shipbuilding. risk we're improve beyond, in working and delays the the our earnings the the We're same In mitigate to with shipyard growth. work double-digit to

$X.XX to we'll of likely level today achieve of of guidance However, relative that Europe in in our share $X.XX reflect growth, adjusted XXXX our to environment sourcing earnings given per earnings and take weighting portfolio. beyond that current the European the

past, believe the will high As value be levels satisfaction we've our we propositions low cruise, shown to cruise the given alternatives. based in of penetration relative and levels resilient, continue recession attractive brands to vacation land

Although, strongly controlling influence; demand, its do those control, of outside we there relatively at impact multiple control supply our are and managing can levers are or costs. external we least

We price demand marketing discipline. through relations maintain are to in investing efforts public stimulate and advertising, to

in cost. full while increase decisions without travel in leaving supply, the same growth In efficiencies and we the capacity best to best us achieve a to long-term leveraging and are efficient short-term, of investments additions And positioned moderate disciplined net less long-term. are at interest to our fund the to tourism the the optimize leaving For to working accelerate fleet. benefit global significant performance these over we and the scale are of shareholders, capture making our we capacity time,

With over the that, David. I to turn will call

Arnold. you, Thanks

with and be on Before all stated. today full our of will guidance. XXXX some an our of XXXX references constant trends, otherwise unless finish year results. in and provide with Then prices fourth my I revenue, I update December currency begin, color ticket will our year XXXX summary a please I'll quarter up to and on start booking note metrics, cost full

three for our quarter This by adjusted guidance. mid-point fourth EPS above $X.XX The things. September the $X.XX. As driven was improvement the of Arnold our indicated, was was

increased $X.XX. Atlantic benefited stronger net on yields the closing ticket both of on pricing from First, were sides bookings

worth we cruise net was fuel the improvements between worth timing $X.XX the driven from expenses cost of were quarters. price fuel benefited realized during currency impact net costs favorability the and were Second, penny. fuel of third, quarter And by by movements worth $X.XX, and a Lower $X.XX, currency. favorable in while without prices the

results operating quarter look the our at let's Now, versus prior fourth year.

Our capacity increased X.X%.

commonly brands, Our and essentially Australia as NAA flat. America known segment, North more our were

almost as and our segment, more our were up known commonly X%. EA brand, Asia While Europe

X.X%. net yields were revenue down total Our

Now of accounting ticket yields components let's break X.X%, for Net normalized yield. a small apart were net the two revenue down update.

down Our as and NAA tempered declines by season in improvements FCCs, driven European by the by brands were Caribbean, which X.X%, in programs, redemption more normalized, yield the year. which late earlier cruise the in in were known of offset future were issued commonly which also partially were credits, Alaska

While brands as our a economic Continental previously brands are facing. EA X.X% down challenges the result were our of discussed European

days for cost due quarter. Net Net increased sides per excluding ALBD, the higher to higher increases the yields onboard normalized of other same with accounting cruise X%, on up and expense advertising dry fuel update dock mainly X.X%, both and Atlantic. in almost also the were

forget down XXXX the year let's While full X.X%. not the was were fourth costs up,

our last worth line change approximately due $X.XX. delivery summary, government's would us currency and on ALBD $X.XX, currency Had the $X.XX yields, EPS a us Cuba, fuel lower adjusted of delayed it revenue for up policy U.S. been to which EPS were excluding the fuel in $X.XX weather, our the was announced ship partially not travel offset previously been $X.XX, result cost fuel, a which price movement quarter adjusted as us per net than while cruise Both by voyage which which disruptions fourth Lower net less of us XX%. of and were prices net fourth benefit quarter cost have cost with year In cost cost last were higher year. $X.XX. unfavorable to

we of down brands break our EA revenue were the ticker up capacity yield. total full our with for X.X%. NAA up net were apart revenue our Again, back to Looking X.X%, grow rising X.X% the yields brands X.X%; versus were let's yields prior year while increased components at XXXX, X.X%, the X%. earnings EPS Their net were our two down $X.XX our adjusted year; $X.XX

partially Our brands were by increases X.X%, in which NAA offset in were up by yield program. Alaska declines driven the Caribbean, our

indicated, Alaska previously increased our capacity the X% an had capacity XXXX, we As while XX%. in industry we during increase

European the a of previously were brands challenges are brands as EA Our facing. economic X.X% result Continental discussed our

with and on Arnold did Atlantic. As yields indicated, the uncertainty increased increases other brands ongoing sides we at Net both our despite yield UK the see Brexit. X% onboard around increases of

long list yield challenges events company We we of XXXX, about events estimate per in unfavorably impacted Arnold During by and summarized. net have fuel that to usually navigate revenues net a events a cost tenths usual of the cruise costs that XXXX four the without and These approximately point. both ALBD $X.XX.

impact impacts, the prices fuel stronger share also net and contributed us program the we us the $X.XX, each accretive XXXX, currency $X.XX. however, the of benefited while significant Fuel dollar repurchase impact Lower During from penny. worth year-over-year individual $X.XX. only cost had a cost gross prices

billion. operations XXXX. our was $X.X for by Cash to cash provided Turning flows

of quarterly to year, via million. were the billion our strong almost the shareholders of dividend result cash repurchases a share we the return to almost $XXX able our regularly $X As during and flows

Now turning booking to trends. XXXX

occupancy We our record prior which a for ahead with the a prices are does entering full full approximately year revenue the XXXX a at point point a increase the with in position. capacity mix of At last cumulative net headwinds yield of that year occupancy not advanced time, fiscal the than basis, year lower XXXX. on are year bookings XXXX for comparable this on year slightly X.X% are include half of slightly book

drill on prior Higher occupancy price. higher cumulative and lower by brands XXXX, the Caribbean, than prices the the offset pricing of advanced redemption down tempered year issue NAA for are which line the into Alaska. Cumulative by FCCs position. bookings in in let's are on Now book our are during in

advance cumulative brands, line lower are year EA occupancy our with for on at the While bookings prices. in prior

to expect booking revenue are to X.X%, XXXX want brands. on growth yields environment net with X% net trends, you decline capacity driven economic challenging by XXXX, current facing of expected is revenues or the revenue be some to we with X.X%. up while European approximately I decline Finally, to color yield XXXX Based on Similar XXXX. the approximately net cruise provide Continental

X.X% broken quarter X%, second quarter quarter is increase is X.X%. forecasted by follows; the X.X% X%, The also of first quarter capacity and quarter is down the is as third while is fourth

Given the the for XXXX have half capacity reported will mixed impact by approximately of yields year. full a net increase by a brand, revenue we headwind, point will which our

cost. XXXX. without there cost cost are to of the cruise ALBD to versus three be XXXX turning fuel is speaking, change. for Now main flat per Broadly Net drivers expected

is inflation cost for forecast of points all average globally. our an First, categories X across

able efficient the are than sourcing of more achieve economies of less delivery global we ships, further disposing more from well while to cost by of or inflation from as offset as scale. efficient we ships, the taking Second, this larger scale savings leveraging

to final as department, FX the we our investments The investments deployment, formed and small recently XXXX other in third our well and and advertising, areas other will IT in as point business. compliance of make relates

For expected $X.XX voyage half incremental estimated events of is These to $X.XX events unfavorably XXXX from to prior disruptions, ship earnings XXXX, to and by impact delays. include full point. previously announced yield almost delivery revenue net year including are impact year

impact instead would Net net these side, tenths have accounting guidance cost cruise fuel seven of per a point of difference per a of fuel down tenths are by to been without cost events the On an cost plus expected cruise point. unfavorably seven flat. ALBD without ALBD

depreciation billion around versus XXXX $X.XX for billion expect currently $X.XX be for XXXX. We to

full and net The XXXX impact by to $X.XX. our $XXX billion all $X.XX $X.XX billion interest versus guidance XXXX. mix, to forecasted XXXX is to of XXXX for $XXX to XXXX. XXXX is versus fuel around expectation the is $X.XX expense net now together, our for for $X.XX adjusted $X.XX For EPS year for these expected factors impact current currency be Fuel for price, is XXXX. for million fuel Putting expense, favorably for $X.XX versus million

call I'll now, to Arnold. over turn And the back

for Operator, open the line David. you, please Thank questions.

Felicia [Operator line of Instructions] with from comes the Please Hendrix Our first Barclays. proceed.

region gave there? really what remarks, you but issues besides bit your like and the program very get Arnold, concerned you trying And is basically, have stimulate prepared color, in to you to always do discounting helpful. are starting So What So mitigate been versus are demand sounds some I'm you in continuing good And that to which while can of out to Alaska, a guys this us challenges. to Europe demand of on a you moving and lot those ships touched it else promotions. in stimulate price tactical marketing Europe. would that use investors is

some just that you corporate hoping So management of demand and your if the response structural to of remind typical be your in I'm in change philosophy us your after of what doesn't terms set you start place? strategic could could are making changes

the enough, our how and Definitely, that a Europe, they done have And they Germany what can't pricing. is we job bias again environment as team have. the cost great have emphasize towards challenges discipline the in so well, given in has persistence I responding

effectively. with the trade all model quite have So and and Yoda, which marketing with also doing other our the digital things planning using the capacity is movement, obviously, And to of itinerary made teams the tool. with regards revenue and with management and more refining marketing bit a with moves are we

that particular put Yoda adapting and have we cost format. We additional as and management is talent revenue to AIDA

market robust from regard record We ships, the of in in at of the demand. nature it's there terms peak do the actual And the and that given the fill they of capacity so it's combination strong. bookings things, again, have so

stimulate could given what things just you Alaska to of do in And all strategic supply? the sort demands, there

others, on some and obviously overconcentration we there. very temporary they're as Caribbean us call, probably But in why Yes, us of we for have as there the to And supply people also of grow what our which yield which profitable Alaska. can is premium Alaska. is the also obviously would yield capacity challenge, a kind of price because drag, gives portion bit said we because the call for mix Alaska's is excursion portion a in land naturally little performance as the a and grow well, we

they good tools the very wave. We got We'll key results we've and have great are that. how digital marketing some and already see the enhance revisit we've and early initiatives before serving But But Alaska. our that play dramatically, techniques. out, to and some right aspect marketing from that they we're brands of since have

a time doing. We it we're is in things is capacity make there those because a growing market. a But really position So grow with want it's market, bad capacity. why guests. from And Alaska there. in make are yield great to put The good a money I sound it don't going lot of strong everything like the is demand we're reason the us to along market with over doing a is

full maybe how us would help the year? and D&A for could just first David those year, cadence first or full understand for you quarters. ex-fuel the Beth, kind us quarter in NCC cadence the if you then And the and us I interest Thanks. yield mean wondering was could and also for obviously given then guidance if you've just I better quarter for the and of understand the help the but

down to that costs So net X%. full year, cruise be the first on quarter say and did would is costs, for we flat the X%

and quarter, that why terms drive, down. some net the mentioned to days the in cost in back was obviously, guidance to cruise all to reluctant quarters very is close remaining that's were which seasonalization it's I had flat. to of something down by X% But days extent driving the of the quarter, So to say give some to three of dry-dock each I'm will average costs. quarter up I because it get does, and difficult. have dry-dock first the just

average giving second get math fall impact see in I'm to dry-dock the to higher X%. But guidance, the days dry-dock that's the flat. You lower days not in you that will just extent, which will, the and some to

yield the on side. Just

I to just even the you're first X% But the of half full kind that would of down you be will the mean just guidance. the worse color? I'm year? not quarter, kind than half, asking if and X.X%, the you're Do second X% first but down think through year, for cadence, in So be

it's early. very You know

go. You doing and of started the activities to is to lot know, left a wave marketing advertising Arnold number We're hasn't there end. that a the lot mentioned shape in

give I'd be to quarterly quarter. year to but the the is so And obviously guidance, reluctant you first full similar

something quarters. average So similar in on that included for all is three

And D&A the then interest?

Let me get back to you on that. I just don't have…

D&A $XXX for million to $XXX million million quarter $XX million. the to is is $XX for quarter the and interest

And the then year? for

the for billion $X.XX and for interest… $X.XX billion year

question The with of next comes Greg the proceed. Please line Badishkanian Citigroup.

same. first around year. pretty and the similar about net is full at year position QX? guidance. pricing full for guidance look is pricing yield it 'XX What's XXXX, cumulative of slightly had the midpoint the for the slightly in booked QX? bookings, You percent if the mid-term, roughly you higher that for higher In quarter X.X at of It's talked

XX% that's but So the last for gave position we might we in We've is the disclose. fact is aided first at and for quarter of talk always we're about in book been the position typically book just end of to our information at higher year, the time booked all point range for range. the that be is as quarters bound reasons couple competitive higher that at of much is and want the the the this about end that's

you're an at, that, you to certainty concluded. does around the overhang with you look Can just actions. that mentioned an is talk the Brexit looking nothing U.K, the happening greater you'd more that traditional trends improvement happen think like look It Brexit. in coming from it's you that see increasing just at maybe driving seeing about would months, likely if I And over what's maybe with

said definitely Anything monitor just be the uncertainty would we speculation too just say and to having the would know we'll it early now make attitudes, to consumer happened it for cautiousness, be but creates have do cautious certainly greater additional would historically -- there'll what we less the pure us comments. that, any be is

with line of Wolfe proceed. next The comes question Shojaian Please from Jared Research.

have what's from that time account have Going bookings you then last additional for year. some next marketing that effect for broad-based? the the election out Can And Thank in tried period? year weeks. XXXX back maybe the yield or about to you just eight your comment or you Dorian, from in the some changed more any the minus Is improved Bahamas the this and that over to to guidance contribution any negative spend positive more called talk specific post X.X%, going of into environment you of booking you. improvement Caribbean for

is it initiatives a just, concerning And have [pre-wave], guidance. we number of in our

We in historically, or factored consumer in know time. negative election have also create release attitude do positive dramatic not to uncertainty. elections shifts can We that and

made, perhaps obviously to they hopefully, with the And so, we've early. are. approach we're in our guidance way the intending change, it's made right now we've just taken investments but drive our that too trend, some things will But

just beginning were date, in mentioned out of concerning hurricane. the that the Again last by trends the is bookings, keep the we because we also booking pointed mind quarter impacted

we And see blip happened write back. of do during we've times, little bit that a it many that quarter. like a as result of a I that's happens something the when then said And think bounces basically so fourth what and

driving So you… or bookings is that that's primarily would Caribbean that Bahamas improved

number In a see Caribbean. period did volumes the of the up was during in driver that areas, terms of but volumes week we big

sizable of year then implying next fairly as with into year guidance earnings And I a next amount just, you're minimal CapEx. growth at for your look

ROIC would older the implication hardware. be is that that contract the think by going would seem in to I XXXX, driven to be

particularly ships getting that's what view your are you all of better to do is, they earning the be? of returns hardware the online cost capital and newer presumably, my obviously coming I question right now ones think your your capital older is are so cost in fleet

that would all have say their not be I those we to the we plans. in earning our ships and the exited are fleet about have either that are

bulk the of fleet earns well. the so And

we is But and cost a at our invested ROIC. differently you because Generally expectation weighted look is our do capital over on calculation speaking, average if return double-digit X.X%. elevated about capital of time for mathematical it very probably

look at rates our cap. when we hurdle of weighted So average higher cost investments, looking significantly at we're than

regard would might invested market; capital, itself weight source to to the return in had is market; them think with I the and so be age, if probably itinerary; I on third brand the primary secondarily driver the be source

age Yes, big driver. is a

mark guidance? you did date What your fuel

we release, in December As it Xth. the indicated press was

The from UBS. of Robin question next line proceed. comes Farley with the Please

challenge us performance bit see insight I because some give Continental that very you historically the it if I are, sort North to yield if don't the really just you can but we can see drag helpful industry. American have expectations what give by probably positive investors across for a easier some and guidance think around clear underlying the Can region, coming you European might by Continental your and you that? compare know wonder just you there about I or make maybe just for know yield know be into of brand been to more Thanks. You little we guys yields from Europe, that put color

ceta time forward As you know, and we don't at et give don't pre-wave, yield guidance we just they do and it. this we're going

we that to say to fair do EA brands. it's NAA brands the than do better mean I the expect

-- see down XXXX was could actuals, EA increase, NAA For as you X.X% the was it and X.X%.

sounds issues are to now positively what's things fair coming that in what's your suggest flat, and gave change following your terms like the price that the weeks sort from last weeks how had higher cruise last yield trending positive books volume with mean, is bookings the positive mean were eight you that we unless on if would obviously that, credits that I territory. now the you last and talked of the volume would are maybe in And directionally, in on there seems is that eight It is line. up in price weeks where color future mathematically like last -- and just, already. I are weeks be on there bookings and directionally, the Is I weeks the that from forward, But conclude? environment in by tempered eight fact mathematically the last missed that about before guess the few coming eight in Carnival being that and and you some of there

say left season go is lot even there's That's mathematically and eight started. fair, And I year, weeks in wave a will XX a weeks. to but hasn't that's

So hard just got with caution caution but you to positive, working lot results initiatives positive. impact take every we're will all a very just I I left to you, Arnold and mentioned go, that the we the

of proceed. question next Curtis The line Instinet. from comes Harry with Please

of, that see to up increase for XXXX, sense It that next that like in look on focus the get better trending is SG&A you do year, of like? How going So sense somewhat. trying marketing sounds for to a your that a lift I'm might year? was X.X%. And percentage what

actual notes, we David how it's call my you savings getting whether etc. I we just, percentage whether digital and and as up line have bottom spend, in we choose And that we we've mentioned invest is and very buyers, we've the to pass rigorous been at media the give efficient, What they I'll more some look real is done others. generate, the have sourcing quickly. the the

yes, our So increase without and increase we've But and spending more. able are been cost. actually correlated direct to of share a we voice

dollars, percentage up the answer in to give current know But you're has on probably digits I looking those 'XX double P&L your to in currency. constant when constant remember, advertising not And 'XX question currency. reported at you is, from advertising are was that

XXXX? well And in you would expect that as

that advertising - looking detailed I about and still at 'XX flat. your you. just for each Thank is to you And per check, on guidance billion Instinet net Harry CapEx, cost moving alone giving XXXX $X.X not Curtis the year? just to wanted then We're ALBD are on cruise

the the Costa timing Well, had -- a the So CapEx in of is to we there the $X.X that Smeralda. but billion Corp $X of being because Bernstein that over talked David of in shift XXXX a about result as originally delivery Carnival down schedule. late came delivery - billion

we're for XXXX to now what XXXX looking and XXXX at $X.X $X So billion $X.X billion. billion is in for

us give much how a sense of is CapEx? CapEx and you can that of And maintenance renovation

of take in renovation So development side X billion, or shore CapEx it's ports is that build the everything. roughly destination all give includes non-new

ahead constant and 'XX? fairly be to 'XX will that And looking

Yes.

next The Please line Wieczynski comes question proceed. of with Stifel. from Steve

to holidays happy guys. and of guys, morning all Good you

hardware then events? are about strip of you So some like-for-like if about go your thinking Meaning mix if something each guidance, basis fair that's you for maybe year talking with Is for talked been your kind you've potential some we this well? crazy of at that that guidance about but the start and have on out guys down X% I'm as going -- do other Obviously, other well. and delays about down embedded the impacts that there Am wrong. that of a shift guiding in X.X% for guys year, cushion things to of you as yield you're here, I like-for-like kind X.X%. typically for think have I

do barely And call in into this can of it as month would go already a number for that I a things we're our things we but you it see include wrong. like guidance cushion have. yes, year and

expectations always can and include the because of currency in since hit of for as unusual we all included from In as our missed in fuel heavy So well. 'XX unusual factor Europe, volume events. you from extraordinary haven't 'XX, do And see with unexpected, both the guidance we the guidance net events results happen. was we and and -- in things original number we which

changed three guidance like last is soft kind for then it your your gave looks And so in just guidance today back year. the want when delta to this over much there understand about ask there what months. I And of versus want $XXX September. you to fuel I around million guidance in fuel

would we and now as as is the prices current that pointing down else. a time So lower lot curve in were that September, for used in happen, of of we XX% not back happened that reflected well has was in we But our that consumption. it HFO MGO September, come our for than considerably. HFO as lot to talked at the has XX% And everything and forward that speculate the people but fact and price guidance, and a back current that represents in did HFO out current fuel

of XXXX stuff we other lot and with kind a And of like we questions sure gotten as about open a kind point versus you next guys feel then I like at into about around make you're one the we in and obviously as questions one just a get to closed out spot pretty loop there of or And head lot think year want that. is this just of I into concerns of technology of the technology. type scrubber this recently thing, is go good

at open-loop be Just to sure won't you forward? some a want guys make technology headwind that point comfortable feel moving pretty you're

technology open-loop our to of doing port First things in we an we terms than hard work earnings have with standpoint plus that are ports to in a even results. and in with more the quality importantly so use around that, educate of is system we're position open-loop few an as of environmental ensure only we at advanced XX% But real feel taken so that put talking world. strongly the from a air I'll that's positions and you're those all, what point just courts against context this immaterial open-loop, a

is happen. and if into about approach. So the that the use, quality the use available are to for not there XX% have But look is it even of bought ports fact excellent talking which if fuel going already many wasn't wasn't, is you're air even open-loop advanced it that

question line next Wedbush comes Please of Securities. from Hardiman proceed. James The with

back is how that circle about impact that of respect some about the that idea think that XX between maybe the to ship I underlying also through to be on if Gras number the guiding? the I impact I'm I'm to sort the course guessing actually growth brand. to think with about the does to would to wanted that what basis the to late year XXX the underlying that course basis a me I if of had respect assume headwinds over I over the Mardi of this is, trying Can brand of you about walk mix yields, based an way case points. accelerating would of delays, year so year? yields. you get that points So in with guess at you're think

So it quarter. by varies

So bit a numbers don't happen of first that quarter X% mix the gave the first mix guidance, we can Beth give detail. bit the still you than a if detail, than less numbers get in little is the but greater half have happen the the events for impact XQ turns for total have about the probably which because the be half, and little more full quarter is is to handy, impact I as impact unusual brand a to I year. for it to X% to but it out she XQ, back a you in

there little shipyards And more you then can the how done depth planned, and hoping be to was into some quickly commentary with of can the done? on what have you realistically a ships moderate be could bit get working maybe I

you to delivery future occasional to is yard have prototypes prototypes. with yard, obviously of what delays are we're that negotiating the we we're is had need the situation ensure conversations that time. do with with But process historically it When in in the and So we've Smeralda, with like have we with on working the the

I what more wrong? just of was did read the being guess ships environment that towards do speaking aiming the I that you're not of given to Is No, I slowing built. sort or

We ships so that Not being of be over slowing less to plans much, capacity. have going capacity the built. do time

this. when get have more of should lot But get the by with we us are January. discussions end shipyard it currently let so done and to you in back of discussions we we let the We'll get those announcements continue a us

about then consumer? exposure I that XX% obviously And think the think a bring a you are European the about talked still we quantify your of headwind cost, I as lastly number-ish to bit? consumer number that me, does moving the XXXX, just you being for about a here. Can think for down is is Or lot that movement that there XX%? is of XXXX, primary little for parts

handy. for numbers 'XX have I don't actually, the

think in our brands. of guess all I terms across sourcing was sourcing of

U.S. the outside source from XX% it's about think I

Europe is yes… 'XXs, low about

XXXX? changed that And hasn't XXXX versus

what actually exposure when it's XX%, the wise. say correct. revenue guests. wise revenue is revenue revenue and the I Yes, the I'm But But is talking, more

line proceed. Please question Research. Georgieva The with comes next from of Infinity Assia

having we and to again I QX, towards it markets at XXXX. has wondered whether relative looking the in QX? see increase better what Continental hopefully seasonal look of Europe Should in yield the and if QX slightly Europe are cadence coming we we than

coming in Alaska continuation guess big assuming. better, talked the and quarter Continental of I increase and not So still industry us the and in overconcentration third the your is as back of that… a Arnold Europe the in capacity a We're about for the and result we're supply and assuming current that just Continental there assumption in doing necessarily trends Europe of

is And why mentioned Alaska… David that I didn't

the our Yes, quarters. guidance in year we quarter as just, as full to yield the similar the of for before, you said could first is the three rest and year the total I see for

that working said, we're with Now hard.

season. remember And quarter We that have programs place. fourth lot a of also in is hurricane

two that given that, know years. every do it I experience we

having ship, the of both Smeralda some delay they of in incurred? something was and shipyards with of kind I you to that have suspect offset revenue now lost the QX provide the cost addition In the Gras in perfect Mardi Arnold for the delayed can capacity this where a do Gras wouldn't and compensation name additional you terms the new-build, segue. being XXXX Mardi being for

there wherever they go statement. balance into yard so they are, is our unfortunately settlements some in speaking, the sheet Generally the don't and up with those show income

standpoint income it in from the doesn't the operating a shareholder show to often up overall able So, income of the through value balance statement. the we're firm, hit but

with comes question Grambling Stephen Sachs. proceed. of Goldman next from line Please The

what asset and the gain two these positive? you do flow where to they quick the follow-up, expect expected cash from One on sales proceeds are

talked you in about say the sale we you announced two ships just the When XXXX?

Yes…

mean But flow, that's company a two with Yes, significantly needle will talking you're move sell not time. be to I -- you're I over billion about. not we $X.X if $X mean, billion cash those that's got announced to of the talking ships. going But

our speaking and/or we source to into effectively to to out But don't they generally of operators of tour those sold different products. brands operators company. And going and service, non-competing we go another go sell other them so types when selling different will cruise markets markets that and they have ships,

with they to belief their and the we newbuilds. our expand our is as do capacity So grow with hopefully, continue market

of question line Conder Tim next from Wells Fargo. Please comes The with proceed.

but has Germany of as also, I wanted capacity largely the predominantly capacity, the has that been price, of 'XX? all couple the mentioned circle been and next land had have that would and both of rate guess of doing, the of to again in are a the grow mid then know, I in Arnold. competitors back that challenge the question anticipate before mentioned a headwind, that of pricing Then your and you price, can to, you earnings but and you the pricing over great side. that's asset have, help yield Alaska, very as yet headwinds, it's to a do when What 'XX mix we bit in it in I maybe little a ability all you difficult kind to still answer, David stabilized know your taking you guess, kind should and that that Europe? the competitors grow you in yet kind ceded on appeared a little and see you I rate of years, I derivative gained a capacity to other the that growth growth some ability you

question we for next I to Yes, in want growth directly let return do earnings and But capacity on I'll I'll that. forward few plans your going on the through you David think talk then we focus years. just general, the you invested capital. answer give

ships. speaking build as growth collectively given a corporation capital a generally that ultimately us so to for we're need get to And new little the employing we'll yield these

capital elevated to to to so we yield the invested know growth, of earnings to a that but we And return need is capable model. and our have don't business growth we lot do in level inherently growth like get we yield of on the actually get need

trends in done to what we've guidance Europe, is that projected continue. the So with mind, if the you again, in simply at look

the Now of we if try efficient a in obvious. example, in going case then state cycles But an Costa capacity, our more to of obviously, headwind, a $X from example. that accelerated capacity, standpoint, from the environment; billion, know continued a -- replace we it's process what to for the we're marketing it's can tailwind; think would the changes, to of case have be which Smeralda the efficient that is that which it against of environment be doing much the to of that's with we're of environment clearly the and management there kind combination in if less worsens, standpoint, are I now as over-time macro Costa environment to doing a and you be everything going deliver for combination to

And so plan. that's the

invested on We're performance. give return accelerating a on that's overall highest a absorb is also brands We capital might what of travel in we we growing they're to to that going invested earnings to high have and is market elevated terms and very you strong return case able our AIDA's would capacity return earnings down a and growing confident Dave, our one feel be process give Costa believe color to to on of a about growth. market. capital although want invested for us now. ability which perform very in the and return over-time capital, the have already In and the of very amount substantial of otherwise AIDA, been

So at X.X%. our capacity year is increase next total looking just

is by segment segment that you X.X%. EA is up and X.X% break the If up NAA segment, out the

at double double digits; is up Europe markets flattish, X.X%. back look by the to of gets are the Alaska like digits. X%; up up you that of program; it is it's only the X% all almost If other is up and And kind Caribbean by

we with you'll continue see yield Again where we're profitably periods lift against out point probably in little there. markets we supply. Alaska, think I had to we've as We of eventually that over out and that to just settle also, other time we'll growing had And want and there over-time. I the expect overconcentration said, wall,

up on On side, mix? again, little should tour you given a anticipate, the also bulking how the and maybe side, we the help and Alaska your dominance should land there that

invest we we there Alaska. have with in with properties nature very We continue to for in the of venture example just with But limit because the are expansion, total happy railroads. of a Skagway, joint our

So yield to we grow help won't capacity our that ways at we've and profits, that, that the offerings would additional it but for grown look drive overall to rate be able expand overall .

on the XX% those timing changes, is of just ships, driving call, only a And it in on, of delays that those XX -- XX saying then that from delivery scrubbers on of given XX. that? questions the ports the then XXXX on closed loop, you're would third to IMO. last getting fuel of And up What's LNG on on little are anticipated MGO here color today, in that two XX, more you mix to -- area fuel, focused is maybe the some mentioned XX in gravitate the that the some quarter

Yes, the or replaying definitely not itinerary plan. not that. is ports XX% itinerary definitely it's of is plan simply it whatever,

range? of changes And maybe then or your just lastly leverage on any comfort remind leverage targeted just David us

to but do delivery the debt-to-EBITDA lower in call, that's finished X.XX% the earlier we on delayed probably bit Smeralda. but a So year quoted the I with at in Costa the ratio, of lot conference than had that a

of delay, you quarter at first times. the would times being range leverage debt-to-EBITDA the also in ship target the our given the the X had with in what is we drawn X.XX% end into X.X debt fall our the at and guidance, to and So of midpoint the be

Brandt proceed. The JPMorgan. Montour of from next comes question line with Please

looking seeing just you and a how And history and long takes one about on and to we on see European side troughing of rebound be we some a I particular kind experience are it of in So looking reasons. want start How later a local for of should those economies kind of I just in And lot into dig just sort usually demand about We've people impact Europe to think you those guess the these XXXX. your or how of of in seen to more more some economies? guys economies. think into bookings? back when your do think XXXX the that at from positive of

notes, of in every we all cetera, continue because speculate, business that case in over-time be plan for is decline that But would the periodically. I happens that travel, point I consumer to et And in turn ahead, a planned walk obviously we market in a travel confidence, tell travel this travel time, At I what particular and is many to in we as we're right could wouldn't been the grow. ahead or and still crisis over-time the is there said and years on market. pockets robust different. situation we have sudden you and many, into expect robust any

We ability guidance. in we overall just just is And travel a when just as assume continue again, we It our speculate the meanwhile point, trends of will I that continue adapt. some about an terms enough environment, pass have to at their to results will wouldn't market. people say versus can't decline it our grow on will I and that It in through so to continue. in turn produce in to

booked out P&L. I in turning does we're well delayed because -- ahead, obvious. the the impact want there just When to in start And point it in trends of actual that the booking the is the revenue

take when On well the of we're to advantage turn, it does other it. positioned hand

maybe an I and distribution just from to for XXXX, and on change then helpful. of sort curious, going all your if the game at update about And your just charter would there at China it's be talked year was plan we haven't -- all. model standpoint next

our Once small on again, capacity for very today. a venture. of We're focused joint is China percent really us our

great in pleased progress looking there and in But and for a very good done other this China had very newbuild ships are us well as job. that performing teams are market itself, The of a are is terms we XXXX. in in with there. forward with We year, to the our China the Venezia the year partners Costa

good for a this China And looking in so year year. we're

also of all but a model charter we to get more, and partners we direct kind and pleased very In with charter of that, business in so terms called China. our more are continue

you, Thank much assured be everyone. appreciate And the we you. Thank are you. looking elevate hard your that in Happy Thank interest our continued to performance. Very to holidays. company. forward working continuously

ask you you for please today. line. that conference We does That participation your the disconnect and your call thank conclude for