Published January 30, 2012
Carnival Corp (CCL) on Monday said it would take a $155 million to $175 million hit against net income in fiscal 2012, blaming the Costa Concordia cruise ship catastrophe.
The Costa Concordia-related hit against earnings could be higher because of lower net revenue yields. But Carnival said in a U.S. regulatory filing that it has not yet determined that impact.
The accident and loss of the ship off the coast of Italy will hurt net income by $85 million to $95 million in fiscal 2012, Carnival said in an annual report filing. Insurance deductibles will reduce net income by another $40 million and other incident-related costs are pegged between $30 million and $40 million.
Carnival also said it significantly reduced its marketing activities after the disaster. Excluding its Costa European subsidiary, Carnival said fleet-wide booking volumes, from after the ship wrecked through January 25, declined in the "mid teens" compared with the previous year.
"Costa's booking activity is difficult to interpret because of the significant rebooking activity stemming from the loss of the ship's use and related re-deployments," the company said. "However, we believe it to be down significantly. Despite these recent trends, we believe the incident will not have a significant long-term impact on our business."