Carnival FY 3Q15 Earnings Call Notes

Arnold W. Donald – President and CEO

Public relations effort is outperforming

“Our public relations effort continues to outperform. We generated positive media impressions in the first half of this year that almost equalled our positive impressions for all of 2014, which were already well above the historical highs. In the first half, our brands generated 75% of the entire cruise industry’s positive coverage, and as that even includes the recent announcement regarding Cuba, another industry first by our Company.”

Brands separate but synergistic

“So the reality here is, our brands are very different from each other, they compete in different typographic markets, but they can learn from each other and common itineraries and common regions of the world and intelligence in terms of what’s happening with booking curves and reactions, especially since they all tend to extend chasing newer cruise than chasing different newer cruise individuals because of the typographic profile, but they are all chasing newer cruise. So we’ve had benefit to date which is why we have had some of the outstanding operating results we’ve had and this too will allow us to capture even more benefit, regardless of the environment.”

Book now if you are thinking about booking a cruise for next year

“I think the simplest statement we can make is for those who are considering cruising next year is, better to book now, because this is the best time for them to book.”

China yields may be down, but we’re growing our capacity

“China yields may come down a bit but they’re going to be return accretive because of the significant increase in capacity.”

No falloff in demand related to the stock market

“We did not see any falloff in demand related to stock market or general economic fluctuations, none whatsoever.”

No plans to change energy hedging practices

“At this point in time we have seen no advantage to unwinding those collars or anything to that effect. When we looked at it once earlier this year, we would take them and then if we had done it, we would have lost on both ends, unwinding and then setting new collars. And so at this point wouldn’t have any particular plans to change but we review it constantly.”

David Bernstein – CFO

Expecting a good year in 2016

“I want to provide you with some color on 2016. Although it’s early, 2016 appears to be shaping up to be another good year. We are forecasting capacity to increase 3.7%. For 2016, we are expecting to see constant currency net revenue yield improvement. I will provide guidance on the December call when we have more visibility.”

Europe is probably the most challenging region currently

“Overall, Continental Europe is probably more challenging. When you think about all of the economic difficulties and the geopolitical issues and the growing refugee concerns, that’s the area that has had the most challenges in terms of pricing for 2016”