Carnival Earnings Call Insights: First Half Outlook and Fourth Quarter
Carnival Corporation (NYSE:CCL) recently reported its third quarter earnings and discussed the following topics in its earnings conference call.
First Half Outlook
Felicia Hendrix – Barclays Capital: Howard, starting with you. If we could just talk about your outlook for next year, you gave us good color for the first half, I appreciate that. And also appreciate your comments on the second half. What I’m wondering where you said that the yields would turn positive, I’m just wondering if overall do you think you could look forward to 2014 yields increase that’s better than flat year-over-year, and I know it’s early, but I am asking.
Howard S. Frank – Vice Chairman and COO: It’s early. I feel that’s some risk, I think we kind of gave first half yield outlook because it was going to be down. We do expect to see a churn in the third and fourth quarters to a positive yield, but I would hesitate to put any kind of numbers on it right now. I think we need to go through next couple of months, going through the business plans and we’ll have a much better feel for – this is based on, as David said at the start of his comments, it’s based very, very – all the information from the brand. So we need to refine it and get it better, but we wanted to get to guidance on the first half, that at least from a yield standpoint because we were concerned that people didn’t understand what was happening in the business.
Felicia Hendrix – Barclays Capital: The first half lower yields – the first half yields which are going to be lower year-over-year similar to the second half of ’13. Is that mainly just driven by still Carnival or is there anything else that’s driving that?
Howard S. Frank – Vice Chairman and COO: Well, it certainly is driven largely by Carnival, yes. We expect positive yields on the EAA side. So – the other two brands are solid, so we expect most of it to be a Carnival challenge and maybe a little bit – I can’t recall exactly, but I think there maybe a little bit from some of the other brands, but not much…