Carnival has once again reinvested hundreds of millions of dollars in its own stock by refreshing its $1bn share repurchase programme for the sixth time in three years.
The cruise juggernaut's third-quarter authorisation covers New York-listed Carnival Corp's common stock and London-traded Carnival plc's ordinary shares.
"Our strong cash flow and balance sheet enabled us to accelerate our opportunistic share repurchase programme, investing almost $750m in Carnival stock since the beginning of the third quarter," chief executive Arnold Donald said.
He said the latest repurchase round brought total share reinvestment to $4.4bn and marked the second recharge of the programme in 2018.
In April, Carnival plc rebought 50,000 shares at $1.66 per share, bringing the company's number of shares in treasury to 19.2 million and the number of outstanding shares to 198 million.
Prior to that, in April 2017, a repurchase authorisation scooped up $754m in shares.
Carnival plans to rebuy up to 20.9 million shares by 10 July 2019 through the programme in an arrangement with brokers.
Driven by 'historic' quarterly results
Donald said the company has been able to continue the share repurchase initiative to near completion thanks in part to posting the best quarterly results so far.
"Strong execution delivered the highest quarterly performance in our company's history, overcoming fuel and currency headwinds," he said.
The latest rebuy effort comes as the company's adjusted net income for the quarter stayed at the $1.7bn recorded a year ago. Revenue edged up 5.5% to $5.8bn, based on higher bookings.
Adjusted earnings per share (EPS), which excludes fuel costs and other charges, improved to $2.36 from $2.29, in part due to more passengers coming onboard.
"We're seeing good strong bookings on both sides of the Atlantic in terms of sourcing," chief financial officer David Bernstein said during an earnings call.
Full steam ahead
Based on the record earnings, Carnival expects to finish the repurchase programme on schedule and realise adjusted EPS in the $4.21 to $4.25 range for this year, compared with 2017 results of $3.82 per share.
Changes in fuel prices, including fuel derivatives, however, are expected to trim EPS expectations by $0.11 for the fourth quarter to between $0.65 and $0.69, by $0.06 for the second half and by $0.18 for all of 2018.
Despite the fuel headwind, Donald is optimistic.
"We remain committed to returning cash to shareholders as evidenced by the growth in our recurring dividend, currently distributing $1.4bn annually, accompanied by our recently replenished share repurchase programme," he said.
