Carnival Corporation Orders Fourth Excel-Class Ship for Carnival Cruise Line, 10th Excel-Class Ship Across Global Fleet

Rhea-AI Summary

Carnival Corporation & plc finalizes an agreement with Meyer Werft to build a new Excel-class cruise ship for Carnival Cruise Line, expected to be delivered in 2027. The 180,000-ton ship will accommodate over 6,400 guests and run on LNG technology. This marks the first newbuild order by Carnival Corporation in five years, showcasing a strategic growth move.

Market Research Analyst

The announcement of Carnival Corporation's agreement with Meyer Werft to build a new Excel-class cruise ship is a strategic move that signals confidence in the cruise industry's recovery and future growth. The Excel-class ships are known for their large size and use of LNG technology, which is a cleaner-burning fuel, indicating an industry shift towards more sustainable practices. This decision to expand the fleet with advanced technology can be seen as an attempt to cater to the growing environmental consciousness among consumers.

Moreover, the company's deliberate pace of expansion with one to two ships per year from 2027 suggests a cautious yet optimistic outlook. This approach allows Carnival to manage capital expenditures while potentially increasing its market share. Investors should note the emphasis on a 'responsible capital approach' and the aim to 'strategically improve the balance sheet,' which could lead to improved financial health and shareholder value over time.

Financial Analyst

Carnival Corporation's financial strategy as outlined by CEO Josh Weinstein focuses on balancing growth with financial prudence. The mention of using 'substantial free cash flow' over the coming years to 'reduce leverage levels' indicates a commitment to debt reduction and improving financial ratios. This is a positive signal for investors concerned about the company's long-term financial sustainability, especially given the heavy impact of the pandemic on the cruise industry.

However, investors should also consider the risks associated with the cruise industry, such as sensitivity to economic downturns and geopolitical events. The delivery timeline of the new ship in 2027 provides a long-term perspective but also introduces elements of uncertainty regarding future market conditions and consumer preferences.

Environmental Sustainability Expert

The adoption of LNG technology in the new Excel-class ship is noteworthy from an environmental perspective. LNG is considered one of the cleanest fuels currently available for maritime transportation, significantly reducing emissions of sulfur oxides, nitrogen oxides and particulate matter. Carnival's investment in this technology may enhance its reputation and appeal to eco-conscious travelers, potentially leading to increased demand and market differentiation.

However, the environmental impact of cruising extends beyond fuel emissions, including waste management and impacts on marine ecosystems. Stakeholders interested in the company's environmental commitments will be looking for comprehensive sustainability strategies that address these broader concerns.

World's largest cruise company finalizes agreement with Meyer Werft for
new world-class cruise ship scheduled for delivery in 2027

MIAMI, Feb. 13, 2024 /PRNewswire/ -- Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK), the world's largest cruise company, today announced it has signed an agreement with leading German shipbuilder Meyer Werft to build a fourth Excel-class cruise ship for its namesake Carnival Cruise Line brand. The ship, the 10th Excel-class ship in the corporation's fleet across four of its world-class brands, is expected to enter service in Spring 2027.

Joining current Carnival Cruise Line Excel-class ships Mardi Gras, Carnival Celebration and Carnival Jubilee, the new 180,000-ton ship will carry over 6,400 guests and be powered on a liquefied natural gas (LNG) technology platform. This new ship is the first newbuild order placed by Carnival Corporation in five years.

"Our Excel-class ships have been a tremendous addition to the Carnival fleet and proven very popular with our guests," said Christine Duffy, president of Carnival Cruise Line. "As the world's most popular cruise line, this new ship enables us to continue the growth of our incredible fleet as we welcome our loyal guests back to cruise more frequently and attract new-to-cruise guests to experience all that a Carnival cruise has to offer."

"Building on our strong performance and growing momentum around the world, we are excited to resume our newbuild program and further enhance our global fleet with yet another state-of-the-art ship that will wow Carnival Cruise Line's guests," said Josh Weinstein, CEO of Carnival Corporation. "With one newbuild scheduled for delivery in 2025, none for 2026, and this order being our only expected newbuild in 2027, our responsible capital approach will support utilizing our substantial free cash flow over the next several years to strategically improve our balance sheet, significantly reduce our leverage levels and continue to transfer value from debt holders to shareholders.

"We are following through on our measured capacity growth strategy with the addition of one to two ships per year beginning in 2027, which will be allocated to our cruise lines that most need the capacity to satisfy outsized demand, delivering an attractive payback period. We also remain focused on driving revenue growth throughout our portfolio of world-class cruise lines by continuing to improve execution across all aspects of our operation, yielding higher return on invested capital," said Weinstein.

"We are very pleased that the partnership between the MEYER Group and Carnival Corporation will continue with this new order," said Bernd Eikens, CEO MEYER Group.

About Carnival Corporation & plc
Carnival Corporation & plc is the largest global cruise company, and among the largest leisure travel companies, with a portfolio of world-class cruise lines – AIDA Cruises, Carnival Cruise Line, Costa Cruises, Cunard, Holland America Line, P&O Cruises (Australia), P&O Cruises (UK), Princess Cruises, and Seabourn.

Additional information can be found on www.carnivalcorp.com, www.aida.de, www.carnival.com, www.costacruise.com, www.cunard.com, www.hollandamerica.com, www.pocruises.com.au, www.pocruises.com, www.princess.com, and www.seabourn.com.

For information on Carnival Corporation's industry-leading sustainability initiatives, visit www.carnivalsustainability.com.

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SOURCE Carnival Corporation & plc

When is the new Excel-class cruise ship expected to be delivered?

The new Excel-class cruise ship is scheduled for delivery in Spring 2027.

How many guests will the new cruise ship accommodate?

The new cruise ship will carry over 6,400 guests.

What technology platform will power the new cruise ship?

The new cruise ship will be powered by a liquefied natural gas (LNG) technology platform.

How many Excel-class ships does Carnival Corporation currently have in its fleet?

Carnival Corporation has 10 Excel-class ships in its fleet across four world-class brands.

When was the last newbuild order placed by Carnival Corporation?

The last newbuild order by Carnival Corporation was placed five years ago.