Carnival beats forecasts, guides higher despite impact of hurricanes

It was calm seas for Carnival during the third quarter as stronger demand drove a five per cent improvement in cruise tiket pricing and the company guided towards the upper end of its previous guidance for profits.

That was despite the recent hurricanes in the Caribbean.

For the three months to 31 August, the cruise ship operator reported an 8% increase in total revenues to reach $5.5bn, which resulted in a nearly 20% jump in adjusted earnings per share to $2.29.

Analysts had expected the company to clock-in with sales of $5.39 for three-month EPS of $2.20.

In the company's results statement, chief Arnold Donald highlighted the company's record earnings on an adjusted basis, attributing them to Carnival's efforts "to create demand well in excess of measured supply."

That saw sales from passenger tickets grow from the year-ago figure of $3.80bn to $4.12bn over the latest three-month stretch.

In parallel, net cruise costs per available lower berth day, excluding fuel, rose by just 0.2% on a constant currency basis, in-line with the company's own guidance.

However, for the full financial year cost increases on that same basis were now seen accelerating to a 2.5% clip, up from its June guidance of 1.5%.

Furthermore, the recent hurricanes in the Carribean were expected to subtract between 10 and 12 cents from the company's fourth quarter EPS as a result of multiple temporary port closures.

Despite that, Donald said the company was positioned to hit the upper end of its earnings guidance.

For the full financial year 2017, Carnival guided towards EPS in a range of between $3.64 to $3.70, against last year's $3.45. Fourth quarter EPS guidance was for between 44 and 50 cents, against he 67 cent result achieved in the last quarter of financial year 2016.

He also reiterated his confidence in Carnival's ability to deliver double-digit returns on its invested capital, alongside record cash from operations of $5bn in the current year and steadily increasing dividends.