Higher fuel prices
have bedeviled the stock of Carnival Corp. & PLC, even though the
company is otherwise doing pretty well, Carnival Chairman Micky
Arison told stockholders Monday.
Asked about why shares have fallen about 20 percent since early
2005, Arison said traders have been focused on changes in fuel
prices. He also said at the annual meeting, held in Southhampton,
England, that the strength of the pound sterling has affected U.K.
shareholders whose investments are mainly through Carnival PLC and
are denominated in pounds.
"Those are things well beyond our control," Arison said.
Fuel accounts for about 8 percent of cruise ship operating costs, up
from 3 to 4 percent several years ago. One shareholder asked if it
was practical to build nuclear-powered cruise ships, but Arison said
nuclear plants are very expensive and take a long time to load their
fuel. "I don't think you'll see it in my lifetime," he said.
Several shareholders questioned Arison at length about how the stock
price could be improved.
"We are seeing what may be the beginning of a trend and we are
expressing concern," said one investor at the meeting, which was
aired on Carnival's Web site.
Arison said the $12 billion cruise company is managed for profit
growth, but not quarter-to-quarter stock price improvements.
"Over the long term, we believe that share prices will reflect
that," he said. "If not, you can fire us."
Arison and his family control about 29 percent of the voting power
of Carnival Corp. & PLC shares.
Carnival boosted total shareholder return on Monday by raising the
quarterly dividend 27 percent. The new quarterly payout is 35 cents
a share, up from 27.5 cents previously.
"I'm delighted to hear of the increase in the dividend," commented
one shareholder. "Hopefully, this will drive up the share price."
Later in the meeting, Arison assured the audience that he had heard
their stock price concerns. "Higher, better. Lower, not so good." he
said.
Carnival Corp. stock closed on Monday up $1.53, or 3.4 percent, to
$46.78 in U.S. trading. Carnival PLC shares rose 55 pence or 2.3
percent to 2,440 pence on the London Stock Exchange. |
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A new strain of
norovirus emerged in 2006, prompting a sharp jump in illness on
cruise ships, as well as more outbreaks on land.
Cruise ships were hit with 38 outbreaks of the gastrointestinal
illness last year, up from 21 in 2005, officials of the federal
Vessel Sanitation Program said at their annual meeting in Fort
Lauderdale on Tuesday.
Historically, the median number of passengers sickened with
norovirus is 100 per outbreak, said Dr. Elaine Cramer, an
epidemiologist with the U.S. Centers for Disease Control.
For passengers, the only defense against the highly communicable
virus is to wash their hands, Cramer said.
"They need to practice good hygiene whenever they're in an enclosed
environment with a high number of other people," she said.
Norovirus is a common bug that results in diarrhea and vomiting for
48 to 72 hours, but is not fatal to healthy adults. Outbreaks occur
in nursing homes, day-care centers, military bases and other places
where people gather.
The government requires cruise ships to report to the CDC whenever
gastrointestinal illness cases exceed 2 percent of a ship's
population, irrespective of whether they're caused by bacteria or
viral sources.
On land, public health authorities vary in whether or not they
require norovirus outbreaks to be reported. In Florida, reporting is
not required.
Cramer said the new strain of norovirus, called GII-4, may have
emerged in Europe.
"It's not unique to vessels," she said. Anecdotal evidence suggests
that some people who catch it recover and then relapse, Cramer said.
Of the 38 outbreaks last year, at least a half dozen affected
back-to-back cruises on the same ship, CDC figures show.
Dr. Jan Vinje, head of the CDC's gastroenteritis and respiratory
viruses lab, said the norovirus seems to develop a more virulent
strain periodically. Cases jumped in the mid-1990s, and again in
2002. "There is a pattern, but we don't understand it," Vinje said.
For the cruise industry, the virus is a nightmare.
When an outbreak occurs, crews have to scour the ship nonstop to
disinfect common areas. Since the virus spreads by personal contact,
salt and pepper shakers get stowed. Self-service at buffets is
suspended.
"Our members are absolutely rabid in their desire to be proactive
about this thing," said Ted Thompson, vice president of the Cruise
Lines International Association, a trade group for 21 lines,
including such major ones as Carnival and Royal Caribbean.
Still, chances are small an individual passenger will get sick.
Cramer said that only 9 voyages per 1,000 had a norovirus outbreak
in 2006. |