Carnival agrees construction of three new cruise ships

Carnival Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) says that it has reached agreements for the construction of three new cruise ships – one 132,500-ton vessel for its Costa Cruises brand and two 125,000-ton ships for its AIDA Cruises brand. The ships will be the largest ever constructed for these two cruise lines.

A contract has been signed with Italian shipbuilder Fincantieri for the construction of a 3,700-passenger ship for Costa that is scheduled for delivery in October 2014. The all-in cost for this vessel will be approximately euro 150,000 per lower berth.

A memorandum of agreement has been signed with Japan’s Mitsubishi Heavy Industries to build two 3,250-passenger ships for AIDA which are scheduled for delivery in March 2015 and March 2016. The all-in cost for these vessels will be approximately euro 140,000 per lower berth.

The order for the two AIDA ships marks a return by Carnival Corporation & plc to Mitsubishi Heavy Industries which built two highly successful ships for Princess Cruises, both of which were delivered in 2004. The contract with Fincantieri continues the company’s longstanding and successful relationship with the Italian shipbuilder, which dates back nearly 20 years.

The new Costa ship order is subject to financing. The memorandum of agreement with Mitsubishi Heavy Industries is subject to customary closing conditions, including execution of shipbuilding contracts and financing. Additional design and itinerary details for the three new vessels will be announced at a later date by Costa and AIDA.

Today’s AIDA order marks Carnival Corporation & plc’s first new ship delivery for 2016 and continues the company’s strategy of introducing two to three ships per year. Including the new orders for Costa and AIDA, Carnival Corporation & plc currently has 10 ships on order – three for 2012, two for 2013, two for 2014, two for 2015 and one for 2016.

The delivery of the new Costa ship in fall 2014 is expected to replace capacity from the sale of certain older Costa ships beginning with the sale of Costa Marina, which will leave the fleet in November 2011. In the third quarter of 2011, the company will record a loss on the sale of approximately $0.02 per share.

August 3, 2011