NEW YORK (AP) — Passengers remain hesitant to book cruises, despite deep discounts. But that didn’t stop Carnival Corp. from eking out a $41 million second-quarter profit thanks to lower fuel costs and the timing of some administrative expenses.
The Miami-based company also announced Tuesday that Micky Arison, who has been CEO since 1979 and is the son of Carnival co-founder Ted Arison, is being replaced by Arnold W. Donald, who has served on the company’s board for the past 12 years. Arison will continue to serve as chairman of the board.
The profit was nearly triple the $14 million the world’s largest cruise company earned during same period last year, a quarter which it suffered from steep losses on fuel prices bets known as derivatives.
Earnings totaled of 5 cents per share this quarter, up from 2 cents a share last year at this time. Revenue fell 1.7 percent to $3.48 billion.
Excluding one-time items, Carnival’s earnings were 9 cents per share. Analysts polled by FactSet had expected earnings of 6 cents per share on revenue of $3.56 billion.
Shares of Carnival rose $1.67, or 5 percent, to close at $34.89 Tuesday.
Arison led the company through an aggressive expansion that included the acquisition of several brands, including Holland America, Costa Cruises, Cunard and Seabourn. In 2003, he oversaw a merger between Carnival Corp. and P&O Princess Cruises. Today, Carnival runs cruises under 10 brands.
However, Arison came under fire during Carnival’s bad publicity earlier in the year when a string of its cruise ships suffered through mechanical problems and fires. The most dramatic of them was the Carnival Triumph where passengers were stranded at sea for five days as toilets backed up and air conditioners failed. There were media reports of raw sewage seeping through walls and carpets.
Arison, who also owns the Miami Heat basketball team, took some heat of his own for attending a game while the crisis was ongoing.