Carnival Corporation & plc (CCL) 24 Jun 222022 Q2 Earnings call transcript

Good morning, and welcome to our business update conference call. I am Arnold Donald, President and CEO of Carnival Corporation & plc. I'm joined today telephonically by our Chairman, Micky Arison, who is in Europe. And here with me in Miami. David Bernstein, our Chief Financial Officer; Beth Roberts, Senior Vice President, Investor Relations; and as part of our previously announced transition, our Chief Operations Officer, Josh Weinstein. joining morning. for all you us this Thank

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

in positive of and the we on over price am forward reflects proud confident future. the that years. fact, are With a of continuous cash current disappointingly, headed from well excited also the I'm X very I conditions, I market how of accomplished trajectory. and and years. our last very turned company, enjoying about I'm in proud collectively I this reached And operations now at While turning and, seemed we corner unfortunately I a transition. positive, only the have our especially all smooth team future insurmountable are team share very our have remain success. like few the am believe looking excited not in times overcome am I about, very we has strongly nonetheless last its these what point an to inflection obstacles

With played current driven throughout well in number leadership tenure. this strong key anyone our strong Josh Chairman, in that vision, far pandemic. our intensity is core those role of management integral the Josh's He and the to is He's business and truly to think phase responsibility he As company's He the his of Vice values and to company. company industry, during suited next a executive. respected away, a I one momentum. lead strategy business Josh work his served be on Josh. tuning journey. better roles. cannot with part our operations puts of our for through build and my thorough proven aligned understanding characterize And his support will our company, global team the they of him results than in position an the as

business It the continued demand see to strength is results. reinforcing turning cruise. Now our for and to

thoughtfully, of fleet operations, levels. to We now are at full been in And ramping the driving on that up improving time, the to we over sailing pre-COVID XX% those we yet have service. with compared pricing aggressively, and are occupancy higher focused on ships are same

XX% that the occupancy As quarter, we said, had ships also indicated, to XX%. constrained. XX% increased this while occupancy quarter, That XX increased the last from last restarted over capacity been quarter intentionally for has by available we

the drove improvement over combination in sequential passengers an XX% Now carried.

and, partly fact, And are over on occupancy guests X.X June, million In carried again, in approaching this we capacity. XX% quarter. the month we already higher even of past

portions of even makes is given what uncertainty, and were were than impressive in restrictive frequently the those far achieve changing more that that found that an more Now other able broader and even society including sector. those in restrictive of we to environment more that were those than leisure protocols, travel far in

able places. are face to due starting to continue, we of ongoing potential progress. constraints the meaningful of in vaccination pool the of very we and guests to in Yet, requirements state have While virus, make given requirements thankfully, the in nonetheless, number a test the improvement relax to been

are expect friction and and for lead in lifted associated benefit North some typically brands from flight, times. air XXXX a to embarkation beyond. duration Europe we longer the of requirements know, you requiring for the American forward, going Consequently, CDC realized to the testing due reentry Canadian longer Alaska. real itineraries the Usually be with these the clearly As deployment our U.S. in which, both recently travel removes into

increased customer in billion. $X.X second Importantly, billion topping the quarter, deposits $X by

we build virus. be business we managing further and continue while not protocols again. expect seen has recession-proof, see to of threat relaxed recession-resilient express proven are our that a Concerning to the recession, demand demand, comfortable in becomes time as the increasingly Now global have and increase continued and as society to

its take As seen on close-to-home achieving on land-based less prioritize which have above in environment a downturns, sailings employed where international in friction to relative demand pent-up during Currently, with or vacation especially Also, cycles, seeing even things. we XXX%, compelling prior there option powerful over is is more guests appealing cruises, for alternatives. today's where an globally for And than people because occupancy embarkations. spending remains proposition true that's even downturns many Cruise at people travel with spending far vacations. in are of value success tailwind. we perceive experiences

In our occupancy during Carnival quarter. its our sailing brand, to Line XXX% fact, third is fleet, expected reach Cruise entire nearly

support ramp help We price to also first-time advertising pricing. in have up remain on saw to focused an Concerning second selectively improvement new-to-cruise we improving efforts quarter, year. next We begun in the cruisers. attracting our through and guests

the and we preserving have unavailability, we coast focused current protocols In environment use OPay health on near-term demand. are this promotions long-term of and capitalize where We while pricing. optimizing to channels occupancy on limited travel restrictions

fleet on our building efforts. We aggressive optimization are

reallocated there Europe, to Given is we on challenges capacity where capitalize of stronger in demand. parts markets have

spring the creative guests. guests. Australian beginning represent to Carnival Costa will Costa style for beauty This Carnival offer and for Venezia, especially capitalizing we the and brand new In guests design Line guests. choose respectively. also holds of by November to in XXXX Italy Italian 'XX introduced new both be of and to will approach Costa we Luminosa we option Firenze, a unique to elements. launch managed Carnival Carnival will the Cruise think fun, while the of Carnival guest Carnival. Carnival, experience to catering newly an spectacular, by itinerary shortly Costa's in Cruise great transfer Line, Italian of both concept Venezia announced for Separately, XXXX, catering Costa announced beautiful be the on a beginning and Carnival's promise-, will base ambience announced by fact, just Costa bring we With that Deployment

Carnival brand with on will the been recent invested on enable contribute across portfolio. these to for ship Carnival among These product growth our and capitalize changes, from exits Now us capacity that new and Line offerings removed have return brand. strengthen and to replenish manage demand the differentiated Cruise guests capital

platform delivery higher in an peaked In X XX% addition, ships costs, we excluding reduction aggressively onboard the invested less XXXX and to fleet ships, recent of effects delivered in efficient actually fuel premium prices, we the efforts and as we the time X% fuel consumption to of priced intensity fleet profitability fuel, continue achieve our X/X enabling to to well ships we and full in operations, of to bottom improving smaller, have manage a return efficient The reduce percentage moderating capital. and year, X% efficient consumption, with returning to concentrated more since XX compared a compared anticipate our revenues footprint removal on consumption. over XXXX, the the we less X these capacity our through Moreover, deliver larger, more fuel coupled ships, through be bringing expected delivered announced since XXXX of revenue continue growth removed cabins generating that's inflation that removal to accelerated reaching even total reduction newly XXXX. Upon consist further our point full fleet of capacity increase better balcony level an proactive an fuel optimize our XXXX. operations, carbon revenue to a ship, over unit a opportunities With next additional our of for in fosters expediting returns. Upon is from as will to our line. Concerning reduction brands increase us in of unit XXXX. and capacity the mix ship to and will return despite further nearly in our to XX% as in our highest carbon with

on reaffirmed achieve XXXX designing in and have we itineraries efforts, in an fact, them strengthened goals for projects optimization destination our energy to and path investing through reduction accelerated investing drive port intensity efficiency, In carbon that projects. fleet and our are energy-efficient and

Line quarter, Grand an on will This project, exciting guests a offer expected During Bahamian is Bahama many to features destination Carnival broke ground Carnival Cruise open exciting uniquely XXXX with and new destination experience port. Cruise the late amenities. and in

destination strong foothold this will Mahogany Cozumel, experience Princess the Now Grand guest private Caribbean. Bay, our Cay, securing Moon Cove Half Amber Turk, in join and Cay,

right direction inflection In fact, positive Again, port and operationally and facilities, cash reached or operations this total I are from benefit Tenerife point terminals Cruz quarter. we of we operated owned Santa Barcelona. have private an X the de including in destinations heading and in we from turning believe with a

$X.X maturity We our billion and have already towers of a strong managed have liquidity XXXX. down position through debt

while challenge work and calls to after our also honor deeply help our and other truly face that, forward. compliance, among so than of success the at for protocols story valued as our have adequately and XX% port now for challenges, you you of successfully stood become extreme Once environment them. and stewarding and the creative safety a become communities an to to increasingly us our workable restrictive of challenge time. and to the to contributions helping an have of fleet of be continues of are the good health, Thank positioning of well shoreside of I us the help in and travelers which challenge, of thousands lobbying vaccines Thank tens ever loyalty you you and our to to who everyone levels, constantly generation. more countless execution while to less perceive pricing us society should comfortable of date, of while and future letters export cruise. headwind And the And enough dedication, And ongoing to We hard how uncertainty to partners, shareholders' and own. with constraints, their support suppliers great providing our of cash going who course, bodes it's again, continues X continued Lines support. the our agent expect to our we and protocols. and more shipboard the honoring stood a for barriers improving course, operating friction world-leading occupancy today, team, commitment, a us for many virus, protection changing our credit destination Cruise and commitment don't have and world build, shareholders, and rewarding the to brands alternatives, Board Chairman, simply onboard banks, the the our Thank been. is great by stakeholders Their to appreciated. our throughout our by home to and relative the the phenomenal convey travel closer-to-home In and for includes in critical highest to them deliver Directors. tackled around of greater Carnival words and and as Thank cruises. attractive we guests. the privilege to our are the strength for our our continuous worked and these already momentum bondholders, facing Carnival seen accelerate uncertainty, who the personally assets have continued confidence Micky land-based has for should The meet environment managing foster our you other proposition needs and Arison, and environmental see inspiring thank value the which in I the agencies priority strength and team over with can't of revenues challenges after and well-being to demand even ingenuity continue thank of to global rest

so poised call because him chance Josh? I to before say great back to of that, the take the of efforts David. turning opportunity We the a and introduce are Josh would a indeed to the like to for With contributions give future and words many. few

our company strongly X and I for all And in more for Micky This to current and delivering the thanks in important much-needed experiences that guests. Directors family. and we Arnold. our entire you, happiness environment and unforgettable this with create of even by past given great on our the value shared Thank need the of place the to the ability believe vacations years opportunity. friends is stresses again and Board

X really plan meeting our that revenue. their are we on reaches Now efforts target positioning this cruise with brands, base, resonate will optimize their providing effectively with a drive deliver to our its alongside and each achieve guests' each to placed uniquely aspirations audience. through yield on leading to on and and each needs clarity renewing This, specific ensure wants. focus growth help their brand of experiences cruise We guest distinct brand

revitalized optimization also and the portfolio expect our unparalleled our in continued particularly our fleet, We capitalize footprint, to on efforts Alaska. destination Caribbean and

In exciting positive sustainability again gives they also map our What addition, anything efforts. Carnival X.X the last underlies culture. collective time years staying while it team confidence proven we for do have road achieve is our that to determined They've and they of an and the resilient can and Corporation's me that and values all around time absolutely tremendous true world.

of accelerate durable drive revenues us this help improve balance will earnings sheet. returns, All the and and growth

gained roles bright XX we stakeholders. here multiple Arnold, of and other ahead. As have you forward an to benefit the in putting I've and my work our in shareholders the to a I'm point future our perspectives at looking said, for years are clearly many inflection

looking to leadership. We're your David? forward Josh. Thanks,

Thank a operations, of second cash of start with our I'll guest with Arnold. flow. quarter along you, review a today summary cruise

will mandatory I touch and financial Next, I'll our provide finish EBITDA Then on on booking an and adjusted current trends our with expectations auditor up rotation. update position. XXXX

guest to operations. cruise Turning

quarter increase in resulting XX a the During from cruise of the quarter. our XX% substantial was ships, during we guest additional of XXXX, XX% in total second fleet the XXXX. This second first whole restarted operations quarter the capacity for

quarter of quarter continued compared guest We XXXX, our pleased increased is XX% first sequential operations. cruise nearly to today, revenue reflecting capacity of As improvement. XX% fleet that in the to by see second XXXX were

increase quarter. we quarter quarter during quarter, slightly a quarter second passenger For second quarter the nearly the experienced trend significant first in Revenue per versus day had for across occupancy the service, was in strong the by second the double XXXX resulting the second close-in the in encouraged ships anticipated. a the quarter, from gains XXXX very the from occupancy were a for XX% XX% second demand in second We we XXXX. decreased XXXX, close-in

pricing. As optimizing long-term we on focused Arnold are indicated, preserving while occupancy

not XXXX couple quarter forget to points the versus or second commonly let's FCC cruise us are due they cost of However, more XXXX. second as called, percentage credit, impact in which the future a quarter

onboard the diems second quarter second FCC's guests of to in would passenger other and a impact up in again, revenue per the as cruise bundled significantly well credits quarter cruises the the XXXX, Excluding revenue packages strong than due from been day, per have higher second XXXX. were Once canceled versus as quarter past. the part during onboard our by XXXX utilized

bundled We have to recently to us changes make given offering accounting new expanded their allocation. popularity. The require our the offerings package bundled

for revenue of allocated the a unless comparisons to quarter. third you quarter revenue impacting in As onboard, per PCD left the onboard will the see to more in compared ticket, and other result, the the as third quarter, second

total list the add to best is our another revenue performance cruise of the our to reference reasons judge by reason to way to Just why metrics.

adjusted ALBD driven cost more The ALBD fuel XX% second portion it available XXXX. called, or for quarter X as without without the of status. fuel First, side, was On cruise of XXXX essentially our in quarter per by increase the is fleet lower up the berth the per adjusted day, being cost versus cost pause in things: second a cost commonly cruise is

Second, for restart-related ships. XX expenses

dry-dock ALBDs. during number days, was a costs dock the inflation. the dry portion Remember the during protocols. that Fourth, of quarter, quarter the status second of we in and number the the fleet second ships spread in dry-dock over quarter XX in second over pause And being days maintaining higher resulted Third, of during finally, less the health quarter because and double versus safety enhanced of cost XXXX. which the

of and first an first the board. back welcome of were our on The the number as not service dry guess resumption part cruising ensuring while of and they ships are when had half XXXX large ships their that ramp-up, dock ships in optimizing great dry-dock unusually great of schedule work in our

costs half driving anticipate end reoccur expenses dry-dock fuel will not cruise However, of higher We and schedule that per ALBD and costs these during by adjusted more normal in XXXX many XXXX standards. the will looks second XXXX. historical without

result all we the to costs, excluding second adjusted fuel XXXX. cruise of increase of the XXXX improvement see of with compared expected for XXXX from above, ALBD, expect in to a the As to half a the XXXX, significant year half of per mid-teens a first full

things: second was first the flow. ended operations, First, of billion with a our the cash redemption provide quarter due $X.X the quarter. driven of change the of end by summary XXXX adjusted Next, of $XXX essentially in first approximately billion quarter ongoing the in quarter. We versus negative an I'll our million liquidity $X.X The quarter cruise X from to at liquidity guest during EBITDA improvement second

in our investment million $XXX Second, of capital expenditures.

of debt principal the of million $XXX interest Third, $XXX million expense payments. quarter. fourth, during And

which by billion with the of unsecured more we was of principal during quarter, a deposits in notes than customer $X All last amount $X.X billion the along increase offset month. senior issued

touch subject take of will listed which fiscal Therefore, competitive as law must which of Carnival entity, auditor the Carnival for we & well consolidated Carnival XXXX audit the the mandatory most called, from is EU. listed I at independent as mandatory latest. outside a plc audit Therefore, as RFP plc, to PricewaterhouseCoopers, moment as to more commonly they our is auditor requires conducted company a the plc. plc's are be situation changed the wanted I auditor rotation. publicly company, the rotation. or process PwC for Corporation our companies U.K. U.K. to part U.K. Now our different dualistic Carnival explain and as publicly on it very our is structure, XXXX

Directors independent appointed recently of remainder U.K. ensure for result law. the process, the We services independence the of ensure under As yesterday, by an as XXXX XXXX our completed transition in for to fiscal of the auditor XXXX, as in half the Deloitte RFP company's Deloitte to RFP process of XXXX. Board required first of completed a nonaudit orderly and

I would I continued auditor. Board company's for Before Corporation PricewaterhouseCoopers Directors and continue, independent to like thank of as the the service of would to that its add like management plc Carnival &

future second Now quarter on first booking the during The talked volumes March the sailings throughout trip. nearly continued higher volumes we during double the resulted let's for booking the XXXX. about update look This in quarter. weekly being our business all last booking booking at quarter XXXX volumes

Second sailings for to report best we XXXX level. volumes booking booking that been volumes of level. for beginning since the they although quarter have the I happy XXXX the am booking all beginning of of than higher volumes second sailings have the the still half future the were seen XXXX quarterly below pandemic, since XXXX were April

by this during the the of XXXX, had season. very quarter were for before, All versus demand previously XXXX second second I expected second quarter, the double we a anticipated. close-in reflects said as the in we second quarter gain encouraged occupancy wave in resulting closing extended And quarter we trend experienced the nearly

for second current situated patterns. While given half we book XXXX the book believe the second of cumulative XXXX coupled range, our position volume, with booking the well with current is closer-in booking half we are position below historical

compared lower, will XXXX cumulative and without second FCC, was of to sailing. We build XXXX that book Pricing for position as for continue half to bundled with the or our packages historical return XXXX to expect normalized in levels XXXX. throughout on occupancy

FCC, watermark higher or sailings the full and a as tough for normalize as XXXX comparison compared sailings. to cumulative at the end historical for bookings higher historical is yield. XXXX range that our a the on XXXX, be given year is advanced continues achievement packages was without of for book at high great with a bundled to prices, This For pricing position

second quarter the increase cruise again being capacity the full XXXX, compared quarter During anticipation expense our guest XXXX X% operations XXXX. our advertising once versus of for in first XXXX we increased our to and in fleet

was booking clearly current indicator was business. expectations adjusted XXXX all trends advertising first expense level. with quarter trends XXXX. during XXXX We pandemic health leading sights. above our our half higher, first our financial Second spending leading finish dry-dock of EBITDA up in since our over impacted positive recent dry improved position. will are and the the of Adjusted of EBITDA and of were restart-related XX% adjusted dock EBITDA XX that I With fleet, the first a deposits way, that expenses half know was as booking is time of the ships, driving fiscal our XXXX by the within customer nearly the

the our ship operations level XX% quarter, grow. we cash in of cruise expect with building, guest For occupancy percentages capacity and contribution third to over back

over XXXX As managed that we XXXX, last we've worth positive, quarter a expect have quarter, now everything positive I be something maturities towers been portion to for more refinanced do call have after already With to third liquidity well our result, we And the Arnold. of EBITDA will a will been XXXX and which, time. rest over maturity adjusted be EBITDA through turn through, than we debt back the the celebrating. turning will

Thank call please questions. you, open David. to Operator, the

[Operator Instructions].

comes question Stifel. with line from of first Steven Wieczynski Our the

Arnold, run. a congratulations, great it and was

service. thanks for So your

So first strengthen. here would patterns, be are question continuing booking which to the clearly around

load current to to side you past, factors And things, steep if next investors would as you disciplined other be wouldn't guess, to point, side? do of guys peers uncertain in are on where time they're to would think the on guys factors? cut going come do your the keep they're be typically you But you going I or stay prices and recovery the question is, see macro and in going this booking on the high. order able will past what booking could so focus -- is, your at a bookings guess patterns to, given In how you look I more bookings pricing based slowdown slow, stock have load an this However, my backdrop. on attack around,

comments. quick of couple A

all, I wouldn't others on do. comment the of what would First

them directly. to can You talk

mind have different been keep other to demand. that. forward time, capacity For and invasion of because think done that more positive right to board, in we've consider things the there Ukraine variants all move us, here and point have, hit And with of of this we strong and pent-up right that's largely we've thing trying had going now. in is at we The is everything on bringing our pricing we as

there so this the past recession, global to. historically. if are, the is not comments, demand, a tremendous was case wanted a recession, in recession-resilient of necessarily couple years the to there's there even I the reality was travel And been said have we which time, if And way people in wasn't as a able my pent-up they where because it's been

So a combination things. recession-resilient. we One of is naturally somewhat are

can We ultimately pent-up we we're doing demand. but, And pricing manner on need David focused have where yes, can in comment. at do we may strength. maintain have a the cash a the what we time, of added drive same tailwind to

Yes.

and a Just they're labor very that. comfortable we given no feel one today's in And recession currently in have need thing jobs, likely are market. world. vacations I'd necessity a luxury, every Remember, the they're add that, in And longer a a to And vacation. strong are remember, if jobs same. to is they not Steve, people their

we very do well. will think I So

recession-resilient recessionary we well are As and we'll environment. in Arnold very do said, a

are high. there's then really now. a right -- Savings And if we'll comes see recession

employment out, really rates pointed As David low. are

strength the see what We'll And so there's happens. time economic being. for

I would there recent guys around about is drove you forward the out to chance is of the raise an reason moving we at underlying debt from to why lot investors those go this got questions to why you David, was Or and Okay. are And I second probably here, be, where opportunity going debt Got rates what you, and enough Or raise. is point? you. refinance? there And given north you. from maybe debt to as question XX% what maybe at refinance And of levels. had for then a question, guess, guess maybe the raise to

Yes.

$X and interest refinance to, maturities, a a said looking that were we conference we rate over we if the took you that. -- were So call, the in focused as time, believe XXXX rising on environment. billion on we of we're I And look and last

at market. able wanted $X so about was market, in in. to the the that in felt And do we have despite said the good on out happen We're my But billion overall to over backdrop, very we could looking that. would just raised day in $X we and refinance and billion we we It nobody XX.X%. raise market what's notes, But remaining within $X predicted billion what were averaging the portion, that did interesting a is the go price to time. I talk as difficulty we're

look you If ago at so they when or offering. interest a did were bond than month it today, rates higher actually are we our

ahead. interest And other Keep just a what good our over ensuing say average $X rate adding I'd the we're we our We good the were So And of despite, X.X%. will if XX.X%, at portfolio in. averaging you feel months in position. that today refinance I about in we say, did. we'll mind, billion debt, to look is look

minor portfolio. done a in we've the whole So the just portfolio. is this And one job piece great managing

the line Robin UBS. from question Farley, Next of

call joining since the luck Good be best Arnold, you'll everything. with earnings Had this Great. question a wishes, last for. is on it occupancy.

into of kind you be think give detail. And/or I maybe level something QX, now. which know that sort the normally normally little sequential in investors try much QX at Omicron build struggle if service for And a if on us just that level occupancy occupancy, booked the of you think kind I going specifically. of how visibility, comment sort And is levels. relative with don't to by ships and new like lower the much visibility through with how and lower more temporary, of of price color on to occupancy with of -- XX% 'XX to there, are of in QX, could other kind demand words, I of XX% can wonder know of little you give wouldn't see ticket in you I you path cancellations a bit I the your to would seeing,

comment we occupancy. Yes, share ships details. places you in brought have in had because of be bet, that protocols back and But on overarching constrained I'll real Robin. we the strength we different some some intentionally And David have online would as so on. occupancy

occupancy also is mentioned, we improved the We third where with were as crew capacity for in our up -- but around the some quarter. those staffing we're had occupancy as at reasons overall, have temporarily occupancy here. we constrained brand isolated really we And Carnival moving crew and as shared, our well. situations time over But XXX% as rates, looking

we more have Carnival become and restrictions things the some is the David? moving and capacity into as still normalized things world occupancy brand right virus see we nicely. continues So more even direction comfortable And restrictions relaxed, now. though where of are rising they more relax sailing have the are managing and to the

Yes.

I XX% XX% from that So during quarter. mean, variance which is the with the to quarter, went the second it occupancy up overall why XX%, the we between wound months, for

build. So with good, -- the to we XX% of said, trends And June. month continue approaching and as Arnold for booking we're

cruises, we're there practice that and the So XX -- time. ensure constrain had of have mind, great of I keep second occupancy on, started to And but the early a in guests ships are as in we number we course, a indicated, quarter. we

when ships, those And can the and on to build so that of June. see got we you benefit we

positive. very feel overall about we good trend. It the So is

quarter trend And the an and we see the in to right direction. into do XXXX. expect third in Moving improving

expense follow-up And on as Great. the a commentary. Okay. just maybe question

year bit increase. other much I of in where the about back costs, in In service? little sort Just -- terms you could buckets by per dry a passenger end will to the of per fleet of how was dock, know mentioned of think other XX as part get just pause all safety. factors -- And status, could pause that you much increase away restart go having automatically of status, about sort quantify how that somewhat of of you lot the mentioned temporary, being wonder those being dock, words, year-end. the can the significantly se. all of put kind so in those You of restart points by XX% I of -- a just dry improve the inflation are expense we health if you and that your the by cost, ship of

Yes.

your best you -- for do and it's own you the think quantification pretty to can way easy. I

of half. for XX% for per were the sort to you If the do more for is dry docks up we that like half, you think out the second terms the year about, status, say we first number if the you're did all the of year, in Because days. back to mid-teens the And the be dry into back where the dry-dock of of normal pause half going were taking were I have sort in you docks. can ALBD full of the restart,

number, back the into half is which of you half. the reflection the see the be year, to we you'll able a back better for if than So first where are overall

do other Now And working there's still are noise and we in chain that that. down. disruption hard manage supply that because will we And things. really to

way best to the So that's -- back probably into it. but

the would get you was to I what second of I the maybe how know would for digit wondering kind thinking of go sort that's looking But year, the average mid-single of for guess end a pieces kind I really that half. about of by XXXX, to... I simple was

give I I'm trying understand. to for position cost I XXXX this was But some directional. to point. give you in guidance not at a just And

do X at point, to the better. see I effectively But what you be half always manage and to we'll cost guidance. is, back me like items all this for can And premature those give through it months. hope say, over the would of You next we

Our from of Morningstar. with Jaime line comes the next Katz question

I'd being consumers, because Costa transition of whether signaling this and guys this or ship, rebranding international domestic Carnival seeing particularly and be that's how are of maybe you with in between interested differences anything? hearing not

transfer has I invasion to of And challenged for COVID and is seeing by part somewhat see Ukraine, by from in consumer also but environment Yes, generally, complicated extent Europe invasion Luminosa of rightsizing to macroeconomic as not than Costa conditions, of of triggered travel as North only the Australia Carnival a you're Ukraine. the a we of America. just to European more with what in Carnival by in think many demand Costa standpoint which move an it and ways relates obviously, is what the the

European impacting market And the so things sector. of are those all

things, stronger are position. So the we're reallocating that beautiful That's a in of to one brands have assets demand, stronger our are mobile. that

And Europe, particular. but U.K. still Europe. overall, of what and strength continuing demand portions So -- in in have the we see some strong see there are Also of we in you. portions Germany

And to and North maximize our across the see us in America. Europe, good term. and portfolio the market market brands we just the position for reallocating we're optimize a cash generation so a And long in strong

did little can the they about bit. in so were that I to point in second a bookings quarter out, I we nearly -- quarter. talked doubling first If what the our the on build want

doing, brands. is a were is little better to the over which little than like was But Because in than about brands I'd right mind, big in NAA Carnival. comments, the are Costa's direction. heading brands, keep a double China. point by book, less There Arnold's from the the out, all the in EA bit good, in chunk brands EA solid, brands. XXXX bit in includes than strong NAA little double also booking everything we're bit Costa the capacity perspective, demand Costa, add mean a a a So of trend I to

guests the the put here And market a we'll Carnival so take and with created be towards in Europe, North new closed, in in moment of it and all market market expand we rather we overall. much the at than a that better will capacity America position think that which we

the and and the managing of of you direction Arnold about could the all feel what about we appropriately brands we moves good are as ships. it So our talked see, very

to I that? explicitly you it pointed business Okay. the I the XXXX the in don't noted, tracking but And you then XXXX David, direction like do guys is had to right was think in feel And achieve still think past, EBITDA levels. above

a I So of number quite times. that said

have in potential greater has to EBITDA course, a be price what the we in fuel for months. the we is of is risen always last wildcard, one I've big I are the bit of think -- said which quite few XXXX than That XXXX.

is, over potential. But occupancy improving So that just is that time, the there there with in keep mind. certainly

the comes from next of Patrick line Scholes with question Truist. Our

willingness Arnold, can best or up more is, first -- comment your shore wishes brands help potential to Well, the sell as to question well. one brands balance you to on sheet?

Well, an what's we're very the pleased keep shareholders. always brands. with and job is said open our of mind best for our that, Having portfolio to do

sense shareholders we're to going any of our opportunity what we But the given evaluate all again, portfolio and projections only do makes would And the so have. absolutely, for we options. given

And now the it the where text is the end. in bit Fair Okay. a said for cumulative bookings clarification enough. you then of lowered a question my the release was which are noted that implies at second from historical range, advanced earnings -- of half of second 'XX some where was on below previous you obviously the lower it

you expected means? is Specifically, 'XX. you more levels half little quite second improving this mean consistent bit understanding a I'm explain last with occupancy not what Can levels. noted phrase consistent here, improving what you its the expected position for of that occupancy with by

Yes.

of Arnold his is, the remarks, trying So trying there that like in June, occupancy to we're approaching what XX%. just -- yes, to he in month said what was were indicated, prepared we say

XXXX indicate so range, really fact XX% of nature the we that's were patterns, And be of because second were all that the of people in we the expect, trying to the booking historical below occupancy than what to statement. we half do see despite say with And were that to to trying to closer-in is quarter. in the the back we higher the

James question Next Hardiman the with of Citi. from line

of the good to passenger reiterate cruise per on and day. wanted Wanted to next. bit a in particularly some the luck revenue I what's Arnold, little with congratulations hone pricing commentary,

there's was growing down ships. number little the that headwind to bit north same to But you Maybe little said a an of think was the in push a concern There little a fill to X% some I that price last number this quarter. that idea. bit. need think to industry of I was Obviously, FCC bit -- speak going that up these is there.

get occupancy? number down we to As passenger ships the going some sort raise how per But to the day third we revenue go and think that should to further? about continue that expect of back up should And pricing of obviously, that excluding FCC we cruise impact. to beyond, fill as piece, then we down, in quarter we're to continue

So -- okay.

on in think, maximizing overall, long about preserving talked Arnold that in price occupancy fact I his while notes the focused were the term. we

to did on expense demand. We create very keen in that. quarter we for the purpose are second that increase so more And advertising

mentioned seeing timers. more the had fact We in significant saw We first we a are timers. that first improvement

do here historical towards with So building is to in occupancy trying levels what we're pricing. better XXXX we're

shorter indicated, the are the cash we from booking pricing the and the to of for the is of As driving flow optimize order with and promotions, and use OPay the EBITDA XXXX term the in in But we short business. limited operations window up. use the of channels occupancy

will and you if while way, fourths one fourth and don't bottom lower thirds spend add third also revenue, the they the The quarter. you the to those than of either. be both the think we're much remember to the for on of quarter, them But will about basis they and to board. PCD, all So not generally, they berths, on to ticket kids add just on quarter the the we on things onboard. kids lot third lower also a is third guidance have happy gross as the to line. board But PCD hope by have board generally per prepared the I'm in give which, on the revenue And per to a

you you fourth that quarter per are third factors PCD have and about there to there in from as beyond. consider think the to trend So

second also And decline. even capacity increase not with in the FCCs, when second did the the increase our the quarter, normalize the quarter, with you occupancy we in experienced had in pricing we that

to for been that. I return We concern change the these some pandemic importance a thinking maybe ships just pre-pandemic, your to any positive is zoom the metrics, color. And fill if we'll more if like of were long-term really with getting Historically, cash Maybe a we speak to pre and filling out of place, already largely -- seemed philosophy better these were -- some to in think helpful sort That's to flow. up this to answered used degree, I pricing it minute. you opportunity. has that this of here the price there's industry given about paradigm. but And in now free

reducing. friction over So is of think but seeing we things that have this -- of time, all one the we about to protocol is, are you already the in it,

bring are get we Just dropped testing we -- recently, the are international to reduce the people and U.S. us to will protocols back friction. from better from price. the starting get into they occupancy demand the allow that ability to for will back think to and better see reduce the I additional sidelines And requirements -- at our And the people us U.S. seeing dropped which places. will for create a

next few very first So good on in about directionally, timers board future coming with feel the reduced protocols, more over XXXX. the we the and quarters

as in in this, you all of here, are keep track And mind, there mix issues too. that

you. itinerary as available as itineraries Just portfolio brand what specific and -- positioning and have well overall mix

carefully the average And what and an us managing time we business is, we back, of market in position lot message as the and it, the we're encouragement a a the pent-up strong cash noise there's managing that. are sending that, for well the create -- and of same future. is the price experiencing demand at overall thoughtfully the coming So

Next Politzer, question Wells Fargo. from the line of Dan

Josh, And the Arnold, position. And best on congratulations of new luck.

deposits it I mean, quarter. I of for the customer Obviously, very second So decline on should year. question think in had this a a the how about we there's typically sequentially. the and strong was rest

given and recover that there's be sequential positive? you cash to to that the customer extent continue the quarter the safe guys that year of Or how it given should to -- rest of bookings deposits flow third that continue flow just decline? -- quarter going is or the for flow the your think about we say through, positive could not cash operations, in as just and terms be is cash So to flow third

that. to hundred a dollars. that's They're tell -- trying deposits the will a to you end great I million have continued So increase. up last answer we've since the May, been question few of customer in and that

is So what of there the least it year in seasonal that we reduction we're not, expect mitigating there occupancies, customer With Whether where factors ships would factors it online see. back there coming this we directionally reach deposits. end this May. at. more that point. predict any to the the normal completely me X.X to the third it's -- are because during of and seasonalization. that's mitigate at normal or some higher mitigates been, it to a But hard should are quarter, that has weeks, high the Normally, very for peak But last at at offsetting seasonalization

this the any a One able have refreshed. cruise Yes. a capture what On been you could the more weird quick of in. environment. pricing? metrics you if has price able of just product fleet if way been capture to extent is it your kind I lot quantify And kind to squeeze of been To gets Have newer or so, that? product, just that? but Typically, a that one, to newer premium a

to mean things, so but... many we Yes. It's I look tell. very hard at

many now. so There's variables right

XXXX. many tell to just going very, comparison So variables to is right now, very back it in difficult a

as high there. performing are we levels look indicated our average or of think X new down X/X And cash not, be move age went or that at XXXX, calls, those of years, will will manage fleet, one able the passage a believe from of be the we suspect year. I very fleet maybe flows. previous Arnold will newly this delivered. to significant in to tell generate I nearly I we X the on I So premium ships our but total, before XXXX we it occupancy, The of fleet despite age our average generating of forward, continue you, to it XXXX the new appropriately. said of well,

the new on and lot a on an efficiency very both the which and got well revenue fuel better perspective should consumption. side that So we've help capacity of from cost side

future delivering as XXXX occupancy and So probably about we very to for in people the go experiences vacation XX we million historical are levels. excited memorable

question from the Assia line Research. Infinity of comes Georgieva, Our next

missed. happy But Josh, triple promotion. that Arnold, you'll and be very responsibility this position received you great

good I have for a question hopefully. So you, do

continue that Carnival expanded? something something moving And in the deliveries season. in long-term concept, been not With would of Costa the fuel just We're believe X Costa LNG is what in or that South next the We that that guess, be with around join could Europe. last actually fixture. Costa this ships Do I play a had to somewhat have X obviously you is any ships issues difficult, does role by concept? terms new be years. the winter for America might

what how key are it? So actually that you the parameters concept? see And of play the do into would development the

the burning also the emissions, I'm as question. Josh and have shifts XX% in we fossil But cetera. they brand go a forward. et the are burn LNG, stuff reduction going on comment can But quickly fuel. to the positioning know, LNG so on overall fuel It gives us carbon real MGO. you as is cleanest dual,

of share the be brand. unto And the majority ships. think so, will it wouldn't so of future we Go LNG We'll impact sense the which the let new of Josh. whenever Costa MGO. in the life makes positioning, thoughts to a burn do of that, Carnival burn obviously But itself, and I'll by Josh Costa there opt the to we'll are times his on ahead, it. where But terms it's concept,

the ships. LNG going thing by are that to Obviously, one talking umbrella we're ships not this clarify. about Carnival are Costa under X Just that

at obviously So enter that didn't into all. mindset our

try leverage in States does And this guest could this them opportunity those ships, the great everything taken the United market corporation. to Because is beautiful So introduce Carnival solely the its and think point. of of done under leveraging into we and But the to to on to basis. respect this I Arnold's scale so new is a name that reiterate North ships, with is just the American for Costa a actually the here positioning, example stand-alone well Canada what have base.

Costa's ability experiences, creating onboard that special. up and of make a go we to tonnage best along that with and something marrying So have by beautiful marry really the

So something upon. term. we the can answer this build short expect But be we is, as absolutely we to and don't ideally, be works look that at this will it short successful and something

Okay.

you've plans. Obviously, currently, XXXX. for So made no further and XXXX plans

So that's X in coming plenty time the and of capacity ships.

So become would brand to this its early sort a at mini too point, own. of this discuss on it's whether

Yes.

we I that's see out we'll think how let's for it and it try But two then do. with ships, now.

Thank everyone. sorry. Go you, ahead. Go I'm ahead.

hearing these Okay. Really Thank forward the And forward you, our everyone. it. listening go appreciate from team. great Josh to coming as and and looking we news to

thank all have very much, a and day. So great you

today's to concludes We you your ask disconnect That your thank you and for participation please lines. call.