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Carnival third quarter EPS of $1.69 exceeds forecast

Carnival Corporation & plc reported net income of $1.3 billion, or $1.69 diluted EPS, on revenues of $5.1 billion for its third quarter ended August 31, 2011. Net income for the third quarter of 2010 was $1.3 billion, or $1.62 diluted EPS, on revenues of $4.5 billion.

Analysts had on average  forecast EPS of $1.62. 

Carnival Corporation & plc Chairman and CEO Micky Arison noted that earnings were better than anticipated in the company's June guidance due to the combination of higher than expected revenue yields and lower than expected costs in the third quarter. 

Commenting on the third quarter, Arison said, "Cruise ticket prices for our peak summer season remained strong close to sailing driving a 2.6 percent yield improvement (constant dollars). Our North American brands performed well, achieving an almost six percent yield increase, while our European, Australian and Asian brand yields fell two percent (constant dollars) due primarily to the geo-political unrest in the Middle East and North Africa. Higher revenue yields helped offset a 45 percent increase in fuel prices, leading to improved quarterly profits."

Key metrics for the third quarter 2011 compared to the prior year were as follows: Third quarter results included a charge of $0.02 per share related to the sale of Costa Marina, which was not anticipated in the company's June guidance.

On a constant dollar basis net revenue yields (net revenue per available lower berth day-"ALBD") increased 2.6 percent for 3Q 2011, which was better than the company's June guidance, up 1.0 to 2.0 percent. Net revenue yields in current dollars increased 7.2 percent due, in part, to favorable currency exchange rates. Gross revenue yields increased 6.8 percent in current dollars.

Net cruise costs excluding the Costa Marina charge and fuel per ALBD increased 1.9 percent in constant dollars, and was better than June guidance, up 2.5 to 3.5 percent, partly due to the timing of expenses. Gross cruise costs including fuel per ALBD in current dollars increased 11.7 percent.

Fuel prices increased 45 percent to $686 per metric ton for 3Q 2011 from $473 per metric ton in 3Q 2010 and was higher than June guidance of $670 per metric ton.

Continuing with its strategic growth initiatives, during the third quarter the company announced it had reached agreements for the construction of three new cruise ships - one 132,500-ton vessel for its Costa Cruises brand and two 125,000-ton ships for its AIDA Cruises brand. The ships will be the largest ever constructed for these two cruise lines.

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