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Carnival Cuts 2011 Outlook Amid Rising Fuel Prices

CNBC.com with AP
Friday, 11 Mar 2011 | 11:18 AM ET

Carnival said Friday its first-quarter earnings will fall short of Wall Street expectations and the cruise operator is cutting its full-year earnings outlook.

Carnival Cruise ship
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Carnival Cruise ship

The Miami company blamed rising fuel prices and some itinerary changes in the Middle East and North Africa for the reduction to its 2011 guidance.

Carnival's stock fell 54 cents to $39.91 in morning trading.

Separately, Carnival spokeswoman Jennifer Delacruz told CNBC that the earthquake and tsunami that struck Japan is not having any impact on its West Coast ships.

She said three ships on the West Coast would be returning to port later Friday.

Carnival expects its first-quarter adjusted earnings will be 19 cents per share. Analysts surveyed by FactSet were expecting for earnings of 20 cents per share. (Correction: see below).

Carnival now anticipates full-year earnings of $2.50 to $2.60 per share. That's down from a prior range of $2.90 to $3.10 per share.

Analysts expect earnings of $2.94 per share for the year.

Carnival said its full-year earnings would be lowered by about 40 cents when using current spot fuel prices and currency exchange rates. Itinerary changes in the Middle East and North Africa will trim the company's earnings for the rest of the year by about 5 cents per share.

Carnival, which said in January that it was more than doubling its quarterly dividend, is set to report its first-quarter earnings on March 22.

On Thursday, the company said it would be repositioning a cruise shipthat from Mobile to New Orleans in November. After that, the company will no longer offer trips out of Mobile.

The cruise operator runs 98 ships under brands including Holland America Line, Princess Cruises, Carnival Cruise Lines and Costa Cruises.

Correction: An earlier version of this story listed an incorrect outlook for adjusted earnings per share.

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