Carnival Corporation, the biggest cruise-ship operator in the world, reported a huge loss for the first quarter after its infamous Costa Concordia ship became grounded of the coast of Italy in an incident which killed 25 people.
For the three months to February 29th the firm plunged into the red with a loss of $139m, equal to a loss of 18 cents per share, against a profit of $152m during the same period a year ago.
Once extraordinaries are stripped out however, then earnings per share came in at 2 cents, comfortably above analysts' expectations for a loss of 6 cents.
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Sales during the period were actually on the up, gaining 4.8% to $3.58bn from $3.4bn, slightly higher than market expectations of $3.56bn. This was largely the result of increased capacity and higher ticket prices.
The firm suffered further trouble when another of its fleet, the Allegra, caught fire in the middle of the Indian Ocean and the ship had to be towed to the shore.
The firm incurred a $34m impairment charge related to Costa Allegra and $29m of Costa Concordia incident expenses.
Fuel prices during the period increased 30% to $707 per metric ton for the quarter versus $543 per metric ton for the same period the previous year.
Chairman and chief executive officer Micky Arison said: "our base of business for 2012 is solid and booking volumes have gradually improved, which we believe is a testament to consumer confidence in the cruise industry's long-standing record of exceptional safety.
"Despite the slowdown in bookings, all of our North American brands are still expecting a modest yield improvement in 2012 while our European brands, excluding Costa, are expecting to have slightly lower yields due in part to the slowing European economies. Overall, based on current pricing trends, any consumers holding out for deeper than normal discounts may be disappointed."
He added: "Our company is resilient and we will continue to work through this challenging period."
The financial problems brought about by the shipwreck are set to continue to hit the company throughout the rest of the calander year.
Full year 2012 diluted earnings per share are expected to be in the range of $1.40 to $1.70, compared to $2.42 for 2011.
The company's expectations for 2012 have been affected by the direct and indirect financial consequences of the Costa Concordia incident. Cumulative advance bookings, excluding Costa, and for the remainder of 2012, are around three occupancy points behind the prior year, with prices slightly higher than last year's levels.
Since the date of the Costa Concordia incident in mid-January through February 26, fleetwide booking volumes, excluding Costa, have shown improving trends, but are still running high single digits behind the prior year at slightly lower prices.
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