Carnival Cruises 2008 Annual Report Download - page 94

F-35
Gross and net cruise costs per ALBD were computed by dividing the gross or net cruise
costs, without rounding, by ALBDs as follows:
Years Ended November 30, ___
2008 2008 2007 2007 2006
Constant Constant
Dollar Dollar
(in millions, except ALBDs and costs per ALBD)
Cruise operating expenses $ 8,746 $ 8,667 $ 7,332 $ 7,116 $ 6,477
Cruise selling and
administrative expenses 1,594 1,576 1,547 1,500 1,405
Gross cruise costs 10,340 10,243 8,879 8,616 7,882
Less cruise costs included in
net cruise revenues
Commissions, transportation
and other (2,232) (2,201) (1,941) (1,872) (1,749)
Onboard and other (501) (498) (495) (485) (453)
Net cruise costs $ 7,607 $ 7,544 $ 6,443 $ 6,259 $ 5,680
ALBDs 58,942,864 58,942,864 54,132,927 54,132,927 49,945,184
Gross cruise costs per ALBD $175.43 $173.78 $164.02 $159.17 $157.81
Net cruise costs per ALBD $129.06 $127.98 $119.03 $115.63 $113.73
Net cruise revenues increased $1.3 billion, or 12.9%, to $11.5 billion in 2008 from $10.2
billion in 2007. The 8.9% increase in ALBDs between 2008 and 2007 accounted for $907 million
of the increase, and the remaining $412 million was from increased net revenue yields, which
increased 3.7% in 2008 compared to 2007 (gross revenue yields increased by 3.6%). Net revenue
yields increased in 2008 primarily due to higher North American ticket prices and the weaker
U.S. dollar relative to the euro, partially offset by lower ticket pricing in Europe. Net
revenue yields as measured on a constant dollar basis increased 2.4% in 2008 compared to 2007,
which was comprised of a 3.7% increase in passenger ticket yields, partially offset by a 1.6%
decrease in onboard and other revenue yields. The decrease in onboard and other revenue
yields was the result of the significant increase in our European brands' capacity, as they
typically have lower onboard and other revenue yields, and lower onboard spending by our
guests. Gross cruise revenues increased $1.6 billion, or 12.8%, to $14.3 billion in 2008 from
$12.6 billion in 2007 for largely the same reasons as discussed above for net cruise revenues.
Net cruise costs increased $1.2 million, or 18.1%, to $7.6 billion in 2008 from $6.4
billion in 2007. The 8.9% increase in ALBDs between 2008 and 2007 accounted for $573 million
of the increase. The balance of $591 million was from increased net cruise costs per ALBD,
which increased 8.4% in 2008 compared to 2007 (gross cruise costs per ALBD increased 7.0%).
This 8.4% increase was driven by a 54.6% per metric ton increase in fuel cost to $558 per
metric ton in 2008, which resulted in an increase in fuel expense of $626 million compared to
2007. This increase was partially offset by a $31 million gain from Cunard's sale of the
Queen Elizabeth 2 ("QE2"), a $26 million gain from a hurricane insurance settlement for
damages to our Cozumel, Mexico port facilities in 2005 and lower selling and administrative
expenses achieved primarily through economies of scale and tight cost controls. Net cruise
costs per ALBD as measured on a constant dollar basis increased 7.5% in 2008 compared to
2007. On a constant dollar basis, net cruise costs per ALBD excluding fuel were flat. Gross
cruise costs increased $1.5 billion, or 16.5%, in 2008 to $10.3 billion from $8.9 billion in
2007 for largely the same reasons as discussed above for net cruise costs.
Fiscal 2007 ("2007") Compared to Fiscal 2006 ("2006")
Revenues
Our total revenues increased $1.2 billion, or 10.1%, from $11.8 billion in 2006 to $13.0
billion in 2007. Of this increase, $957 million was capacity driven by our 8.4% increase in
ALBDs and the remaining increase of $237 million was primarily due to the weaker U.S. dollar