Carnival Cruises 2003 Annual Report Download - page 32

29Carnival Corporation & plc
Cautionary Note Concerning Factors That May Affect
Future Results
Some of the statements contained in this 2003 Annual
Report are “forward-looking statements” that involve
risks, uncertainties and assumptions with respect to us,
including some statements concerning future results,
plans, outlook, goals and other events which have not
yet occurred. These statements are intended to qualify
for the safe harbors from liability provided by Section
27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934.
You can find many, but not all, of these statements
by looking for words like “will,” “may,” “believes,”
“expects,” “anticipates,” “forecast,” “future,” “intends,”
“plans,” and “estimates” and for similar expressions.
Because forward-looking statements involve risks
and uncertainties, there are many factors that could
cause our actual results, performance or achievements
to differ materially from those expressed or implied in
this 2003 Annual Report. Forward-looking statements
include those statements which may impact the fore-
casting of our earnings per share, net revenue yields,
booking levels, pricing, occupancy, operating, financing
and tax costs, costs per available lower berth day, esti-
mates of ship depreciable lives and residual values, out-
look or business prospects. These factors include, but
are not limited to, the following:
• achievement of expected benefits from the
DLC transaction;
• risks associated with the DLC structure;
• risks associated with the uncertainty of the tax
status of the DLC structure;
• general economic and business conditions, which
may impact levels of disposable income of con-
sumers and net revenue yields for our cruise brands;
• conditions in the cruise and land-based vacation
industries, including competition from other cruise
ship operators and providers of other vacation
alternatives and increases in capacity offered by
cruise ship and land-based vacation alternatives;
• the impact of operating internationally;
• the international political and economic climate,
armed conflicts, terrorist attacks, availability of air
service and other world events and adverse public-
ity, and their impact on the demand for cruises;
• accidents and other incidents affecting the
health, safety, security and vacation satisfaction
of passengers;
• our ability to implement our shipbuilding programs
and brand strategies and to continue to expand
our business worldwide;
• our ability to attract and retain qualified ship-
board crew and maintain good relations with
employee unions;
• our ability to obtain financing on terms that are
favorable or consistent with our expectations;
• the impact of changes in operating and financing
costs, including changes in foreign currency and
interest rates and fuel, food, payroll, insurance and
security costs;
• changes in the tax, environmental, health, safety,
security and other regulatory regimes under which
we operate;
• continued availability of attractive port destinations;
• our ability to successfully implement cost improve-
ment plans and to integrate business acquisitions;
• continuing financial viability of our travel agent dis-
tribution system;
• weather patterns or natural disasters; and
• the ability of a small group of shareholders to effec-
tively control the outcome of shareholder voting.
Forward-looking statements should not be relied
upon as a prediction of actual results. Subject to any
continuing obligations under applicable law or any rele-
vant listing rules, we expressly disclaim any obligation
to disseminate, after the date of this 2003 Annual
Report, any updates or revisions to any such forward-
looking statements to reflect any change in expecta-
tions or events, conditions or circumstances on which
any such statements are based.
Executive Overview
Over the past three years our net revenue yields
have declined (see “Key Performance Indicators”
below). We believe this decline has been a result of
a number of factors affecting consumers’ vacation
demand including, among other things, armed conflicts
in the Middle East and elsewhere, terrorist attacks in
the U.S. and elsewhere, minor passenger and crew ill-
nesses, the uncertain worldwide economy and adverse
publicity surrounding these and other events. In addi-
tion to these concerns, the recent large increase in new
ship capacity in the cruise industry over this period has
intensified competition to attract customers from land-
based vacation alternatives, which has also contributed
to lower cruise ticket prices.
In addition to the lower pricing trends over this period,
the cruise industry has also experienced historically high
fuel costs; significant increases in insurance and security
costs, precipitated by the events of September 11, 2001;
and higher environmental costs, resulting primarily from
upgrading environmental compliance programs. It is
Management’s Discussion and Analysis of Financial Condition and
Results of Operations