Carnival Cruises 2007 Annual Report Download - page 6

Asia and the Pacific Rim remain a vastly underserved region with
millions of potential cruise vacationers and may represent the next
great area of opportunity for expansion for our company. Recognizing
Asia’s tremendous market potential, in 2006 we deployed the Costa
Allegra on five-day cruises from Shanghai. We will bolster our presence
in the region in March 2009 with the Costa Classica, which will offer
four- to 14-day Asian cruises departing from the region’s most popular
homeports. With expansion plans for both P&O Australia and Princess
Cruises, we will also double our capacity in Australia, where our brands
already carry 80 percent of all Australian cruise passengers.
With many international economies thriving, more of the world’s
citizens have the financial freedom to participate in a greater variety of
leisure activities, including first-time travel. A cruise is a great opportunity
to see a variety of historic destinations for the first time. We continue
to position the company to maximize the tremendous potential that
these emerging economies provide.
As you can see, we’ve made significant progress taking the cruise
vacation concept, pioneered in North America, and successfully adapt-
ing it internationally. We continue to dedicate our efforts to expanding
our global reach, as cruising becomes a viable option for an increasing
percentage of the worldwide population.
OUR CORPORATE RESPONSIBILITY
Hand in hand with our operating performance is a continuing commit-
ment to be responsible corporate citizens, especially when it comes to
protecting the environment.
Our commitment to health, environment, safety and security starts
with actively maintaining our ISO14001 Environmental Management
System certifications and is demonstrated by a wide range of actions,
including deploying the first prototype exhaust gas scrubber system in
Alaska in an effort to reduce air emissions.
We have made great strides in this area and will continue to dedi-
cate our efforts toward even more progress. This year we will publish
our third annual Environmental Management Report as we endeavor to
improve our transparency in publicly reporting the details of our on going
commitment to the environment. We have also begun to broaden our
scope to include sustainability reporting. As an initial step, the corporate
responsibility reports published by two of our brands, Costa and AIDA,
will be used over time as models for similar reporting by all of our brands.
2008 OUTLOOK
As we face an uncertain economic environment in 2008, we believe
Carnival Corporation & plc is well positioned. Our geographically diverse
portfolio of brands is spread over multiple price points, offering con-
sumers worldwide an unparalleled variety of cruise products. Further,
our brands’ superior product quality and tremendous value provide
additional resiliency in uncertain economic times.
In today’s competitive economic climate, we continue to seek ways
to reduce costs, including extending economies of scale for our portfo-
lio of brands and achieving improved efficiency through shared services
and best practices.
And while we look for ways to enhance the bottom line, there is
one area that is beyond our control—the cost of fuel, which continues
to weigh heavily on our financial results. In 2008, higher fuel prices are
forecast to increase fuel expenses by approximately $400 million com-
pared to 2007, reducing earnings by $0.50 per share.
A WORD OF THANKS
In 2007, the managers of our various brands in North America and
Europe rose to meet many challenges and delivered exceptional results
while continuing to expand our global footprint. I take this opportunity
to thank them, along with all of our employees, both shipboard and
shoreside, for their hard work in delivering exceptional cruise experiences
for our guests. I also want to thank our board for their contributions in
meeting the increasing pressures and time commitments required to
fulfill their responsibilities.
I would like to recognize the contributions of two individuals—Bob
Dickinson and Peter Ratcliffe—who retired from their chief executive
officer posts at Carnival Cruise Lines and Princess Cruises, respectively.
Through dedicated service and hard work, these outstanding individu-
als guided our company to unprecedented heights. Their contributions
to the Carnival organization were immeasurable. Bob and Peter will
continue to provide guidance while serving on our board of directors.
We were saddened to learn of the recent passing of a long-time
board member, Maks Birnbach. Maks served on our board from 1990
to 2003. Our condolences and thoughts go to his family and many
friends as we remember Maks for his wit and wisdom.
And, finally, a word of thanks to our valued shareholders for their
continued support and, of course, the millions of guests worldwide
who choose a Carnival brand for their vacation. We look forward to
welcoming you aboard one of our ships soon.
Micky Arison
Chairman and CEO
CARNIVAL CORPORATION & PLC | 3
“Growing our business internationally is critical to
the company’s future. Clearly, our international
expansion efforts are working.”
—Micky Arison