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| Analyst Robin Farley believes demand for European cruises will rise in 2015. Cruisers are shown above on a self-guided walking tour of Messina, Sicily. // Photo by Susan J. Young |
It looks as though Carnival Corporation (CCL), the world’s largest cruise company, can look ahead to 2015 with happy thoughts, according to a report issued on Friday by Robin Farley, a financial analyst with UBS Investment Research, who covers the cruise industry.
Farley said the company's initial net yield guidance to analysts for 2015 is +2 percent. While that’s a bit less than what Farley (+3.4 percent) and the financial community as a whole (+3.5 percent) had estimated, “we fully expected CCL to guide below our expectation, as it is still early in the booking stages for 2015, with Wave [Season] to begin in January.”
The really good news? “Booking volumes for the first three quarters are ahead of last year and at slightly higher prices,” Farley said.
“Caribbean pricing is -- in line with occupancy -- up, and bookings in the last three months are down in volume because they are ahead in load," she added. In addition, Farley says it appears Carnival Corp. prices on the books after the first quarter are up year-over-year in the Caribbean.
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| Analyst Robin Farley believes Costa's yield growth could be 4 percent this year and 4 percent next year. // Photo of Costa Mediterranea by Susan J. Young |
In addition, “Europe will be up in 2015 in both demand from North American passengers as well as demand from European-sourcing brands,” she added.
Farley reported that Carnival Corp. believes Costa Cruises is on pace for a three- to four-year recovery. Given the 12 percent decline in yields at that brand, Farley believes that means the line expects a 4 percent in yield growth this past year and another 4 percent likely next year.
Other pluses? Carnival Corp is seeing higher ticket prices and onboard spending, including a double-digit yield growth in Asia.
Also, for the Carnival Cruise Lines brand specifically, yields are up significantly despite a “still tough Caribbean.”