Carnival (NYSE:CCL) shares gave up knee-jerk gains on fiscal first-quarter results and are in the red as Wall Street reacts to the company’s announcement that full-year guidance does not reflect the impact of the collapse of Baltimore’s Francis Scott Bridge of Keys.
“It was a fantastic start to the year,” said CEO Josh Weinstein. “We delivered another strong quarter that outperformed forecasts on every measure, while capping off a monumental wave season that achieved all-time high booking volumes at significantly higher prices.”
But while shares were launched higher based on the latest quarterly results, lower-than-consensus 2024 EPS guidance, combined with the impact of the bridge collapse, reversed gains and sent shares down 3% .
For the second quarter, Carnival (CCL) expects capacity growth to increase 5.4% and an adjusted loss of $0.03 per share, in line with the Street consensus estimate.
For 2024, the company expects capacity growth of 4.5% and adjusted earnings of $0.98 per share, up from $0.93 previously, but below the Street consensus of $1.00 .
For 2024, the company said that given the timing of the Baltimore Bridge collapse and the temporary change of departure port for Baltimore-based cruises, the 2024 forecast does not include the current estimated impact of up to 10 million dollars on both adjusted EBITDA and adjusted net income for FY24.
Carnival added that the company requires “a significant amount of liquidity to service debt and support operations,” warning that the company may not be able to generate sufficient cash to service that debt and support operations.
“Our significant debt could adversely affect our financial health and operational flexibility,” Carnival said.
Carnival (CCL) shares fell 3% and touched support at the 50-day and 100-day moving averages.