Carnival's Shares Plummet 40 Percent

Carnival Corporation reported net income of $116.3 million ($0.20 Diluted EPS) on revenues of $959.1 million for its fourth quarter ended November 30, 2001, compared to net income of $193.8 million ($0.33 Diluted EPS) on revenues of $850.3 million for the same quarter in 2000.

Net income for the year ended November 30, 2001, was $926.2 million ($1.58 Diluted EPS) on revenues of $4.54 billion, compared to net income of $965.5 million ($1.60 Diluted EPS) on revenues of $3.78 billion for the same period in 2000.

Fourth quarter 2001 net income was reduced by $33 million, comprised of an impairment charge of $39 million, primarily related to a write-down in the carrying value of two ships, net of a Costa tax benefit of $6 million. Fourth quarter 2000 included a Costa tax benefit of $27 million.

The company's fourth quarter comparable cruise results were also adversely affected by the September 11 terrorist attacks, which impacted all leisure travel. The significant reduction in demand for travel following the tragic events of September 11 resulted in the company reporting lower occupancies and prices during the 2001 fourth quarter. Comparable net revenue yields (net revenue per available berth day) for the quarter were down by approximately 7 percent compared to the fourth quarter of 2000.

Commenting on fourth quarter 2001 results, Carnival Corporation Chairman and CEO Micky Arison said that, "In light of the significant impact of the September 11 events on the vacation market, the achievement of quarterly net income of more than $116 million with occupancies of 98 percent is a testament to the strength of our vacation products."

Looking to 2002, Arison indicated that booking levels have started to recover from the significant slowdown in bookings experienced in the two months following September 11. During the last five weeks, net booking levels have been 45 percent above prior year levels, although cumulative advance bookings for 2002 still remain well behind last year's levels at this time.

Arison also noted that 2002 pricing has improved but is still below last year's levels.

Carnival currently has more than $2.4 billion of cash, short-term investments and undrawn credit lines, and also relatively low debt levels. As a result of its financial strength and operating results, the company believes that it maintains the highest credit ratings in the leisure industry.