Carnival Corporation & plc Announces Closing of
€500 Million 5.75% Senior Unsecured Notes Offering and Repricing of
Senior Secured First Lien Term Loan B Facilities as Part of Ongoing
Debt and Interest Expense
Reduction
Transaction included partial prepayment of
$800 million under Senior Secured
First Lien Term Loan B Facilities; Redemption of 2026 Euro Unsecured Notes to take place on
April 26,
2024
MIAMI, April 26, 2024 -- Carnival
Corporation & plc (NYSE/LSE: CCL; NYSE: CUK) today
announced that Carnival Corporation (the "Company") has closed its
previously announced private offering (the "Notes Offering") of
€500 million aggregate principal amount of 5.75% senior unsecured
notes due 2030 (the "Notes"). The Company will use the net proceeds
from the Notes Offering, together with cash on hand, to redeem its
€500 million 7.625% senior unsecured notes due 2026 (the
"2026 Euro Unsecured Notes"),
resulting in a reduction in interest expense of nearly 2%. The
redemption will occur on April 26,
2024, following the satisfaction of the redemption
condition.
In addition, the Company has closed its previously
announced repricing of approximately $1.75
billion of first-priority senior secured term loans (such
repriced loans, the "2028 Repriced Loans") under its first-priority
senior secured term loan facility maturing in 2028 (the "2028
Secured Term Loan Facility") and approximately $1 billion of first-priority senior secured term
loans (such repriced loans, the "2027 Repriced Loans") under its
first-priority senior secured term loan facility maturing in 2027
(the "2027 Secured Term Loan Facility" and, such transaction, the
"Repricing Transaction"). As part of the Repricing Transaction, the
Company has made a partial prepayment of $500 million under the 2028 Secured Term Loan
Facility and a partial prepayment of $300
million under the 2027 Secured Term Loan
Facility.
The Notes Offering, the redemption of the
2026 Euro Unsecured Notes and the
Repricing Transaction are a continuation of the Company's ongoing
debt and interest expense reduction and capital structure
simplification. Together, the reduction in both interest rates and
total debt is expected to result in a reduction of net interest
expense of over $30 million for the
remainder of 2024 and over $50
million on an annualized
basis.
The Notes will pay interest annually on January 15 of each year, beginning on
January 15, 2025, at a rate of 5.750%
per year. The Notes will be unsecured and will mature on
January 15, 2030. The Notes will be
guaranteed, on an unsecured basis, by Carnival plc and certain of
the Company's and Carnival plc's subsidiaries that also guarantee
our first-priority secured indebtedness, certain of our other
unsecured notes and our convertible
notes.
The 2028 Repriced Loans bear interest at a rate per
annum equal to SOFR with a 0.75% floor, plus a margin equal to
2.75%, and will mature in 2028. The 2027 Repriced Loans bear
interest at a rate per annum equal to SOFR with a 0.75% floor, plus
a margin equal to 2.75%, and will mature in
2027.
PJT Partners served as independent financial advisor
to Carnival Corporation &
plc.
This press release does not constitute a notice of
redemption with respect to the 2026 Euro Unsecured
Notes.
The Notes were offered only to persons reasonably
believed to be qualified institutional buyers in reliance on Rule
144A under the Securities Act of 1933, as amended (the "Securities
Act"), and outside the United
States, only to non-U.S. investors pursuant to Regulation S
under the Securities Act.
The Notes were not, and will not be, registered under
the Securities Act or any state securities laws and may not be
offered or sold in the United
States absent registration or an applicable exemption from
the registration requirements of the Securities Act and applicable
state laws.
This press release shall not constitute an offer to
sell or the solicitation of an offer to purchase the Notes or any
other securities and shall not constitute an offer, solicitation or
sale in any state or jurisdiction in which such offering,
solicitation or sale would be
unlawful.
About Carnival Corporation &
plc
Carnival Corporation & plc is the largest global
cruise company, and among the largest leisure travel companies,
with a portfolio of world-class cruise lines - AIDA Cruises,
Carnival Cruise Line, Costa Cruises, Cunard, Holland America Line,
P&O Cruises (Australia),
P&O Cruises (UK), Princess Cruises, and
Seabourn.
Cautionary Note Concerning Forward-Looking
Statements
Carnival Corporation and Carnival plc and their
respective subsidiaries are referred to collectively in this press
release, as "Carnival Corporation & plc," "our," "us" and "we."
Some of the statements, estimates or projections contained in this
press release are "forward-looking statements" that involve risks,
uncertainties and assumptions with respect to us, including some
statements concerning the financing transactions described herein,
future results, operations, outlooks, plans, goals, reputation,
cash flows, liquidity and other events which have not yet occurred.
These statements are intended to qualify for the safe harbors from
liability provided by Section 27A of the Securities Act and Section
21E of the Securities Exchange Act of 1934, as amended. All
statements other than statements of historical facts are statements
that could be deemed forward-looking. These statements are based on
current expectations, estimates, forecasts and projections about
our business and the industry in which we operate and the beliefs
and assumptions of our management. We have tried, whenever
possible, to identify these statements by using words like "will,"
"may," "could," "should," "would," "believe," "depends," "expect,"
"goal," "aspiration," "anticipate," "forecast," "project,"
"future," "intend," "plan," "estimate," "target," "indicate,"
"outlook," and similar expressions of future intent or the negative
of such terms.
Forward-looking statements include those statements
that relate to our outlook and financial position including, but
not limited to, statements
regarding:
• Pricing |
• Adjusted net income
(loss) |
• Booking
levels |
• Adjusted
EBITDA |
• Occupancy |
• Adjusted earnings per
share |
• Interest, tax and fuel
expenses |
• Adjusted free cash
flow |
• Currency exchange
rates |
• Net per
diems |
• Goodwill, ship and trademark fair
values |
• Net
yields |
• Liquidity and credit
ratings |
• Adjusted cruise costs per
ALBD |
• Investment grade leverage
metrics |
• Adjusted cruise costs excluding fuel per
ALBD |
• Estimates of ship depreciable lives and
residual values |
• Adjusted return on invested
capital |
• The transactions described
herein |
|
Because forward-looking statements involve risks and
uncertainties, there are many factors that could cause our actual
results, performance or achievements to differ materially from
those expressed or implied by our forward-looking statements. This
note contains important cautionary statements of the known factors
that we consider could materially affect the accuracy of our
forward-looking statements and adversely affect our business,
results of operations and financial position. Additionally, many of
these risks and uncertainties are currently, and in the future may
continue to be, amplified by our substantial debt balance incurred
during the pause of our guest cruise operations. There may be
additional risks that we consider immaterial or which are unknown.
These factors include, but are not limited to, the
following:
-
Events and conditions around the world, including
geopolitical uncertainty, war and other military actions,
inflation, higher fuel prices, higher interest rates and other
general concerns impacting the ability or desire of people to
travel have led, and may in the future lead, to a decline in demand
for cruises as well as negative impacts to our operating costs and
profitability.
-
Pandemics have in the past and may in the future have
a significant negative impact on our financial condition and
operations.
-
Incidents concerning our ships, guests or the cruise
industry have in the past and may, in the future, negatively impact
the satisfaction of our guests and crew and lead to reputational
damage.
-
Changes in and non-compliance with laws and
regulations under which we operate, such as those relating to
health, environment, safety and security, data privacy and
protection, anti-money laundering, anti-corruption, economic
sanctions, trade protection, labor and employment, and tax may be
costly and have in the past and may, in the future, lead to
litigation, enforcement actions, fines, penalties and reputational
damage.
-
Factors associated with climate change, including
evolving and increasing regulations, increasing global concern
about climate change and the shift in climate conscious consumerism
and stakeholder scrutiny, and increasing frequency and/or severity
of adverse weather conditions could adversely affect our
business.
-
Inability to meet or achieve our targets, goals,
aspirations, initiatives, and our public statements and disclosures
regarding them, including those that are related to sustainability
matters, may expose us to risks that may adversely impact our
business.
-
Breaches in data security and lapses in data privacy
as well as disruptions and other damages to our principal offices,
information technology operations and system networks and failure
to keep pace with developments in technology may adversely impact
our business operations, the satisfaction of our guests and crew
and may lead to reputational
damage.
-
The loss of key team members, our inability to
recruit or retain qualified shoreside and shipboard team members
and increased labor costs could have an adverse effect on our
business and results of
operations.
-
Increases in fuel prices, changes in the types of
fuel consumed and availability of fuel supply may adversely impact
our scheduled itineraries and
costs.
-
We rely on supply chain vendors who are integral to
the operations of our businesses. These vendors and service
providers may be unable to deliver on their commitments, which
could negatively impact our
business.
-
Fluctuations in foreign currency exchange rates may
adversely impact our financial
results.
-
Overcapacity and competition in the cruise and
land-based vacation industry may negatively impact our cruise
sales, pricing and destination
options.
-
Inability to implement our shipbuilding programs and
ship repairs, maintenance and refurbishments may adversely impact
our business operations and the satisfaction of our
guests.
-
We require a significant amount of cash to service
our debt and sustain our operations. Our ability to generate cash
depends on many factors, including those beyond our control, and we
may not be able to generate cash required to service our debt and
sustain our
operations.
-
Our substantial debt could adversely affect our
financial health and operating
flexibility.
-
The risk factors included in Carnival Corporation's
and Carnival plc's Annual Report on Form 10-K filed with the SEC on
January 26, 2024 and Carnival
Corporation's and Carnival plc's Quarterly Report on Form 10-Q
filed with the SEC on March 27,
2024.
The ordering of the risk factors set forth above is
not intended to reflect our indication of priority or
likelihood.
Forward-looking statements should not be relied upon
as a prediction of actual results. Subject to any continuing
obligations under applicable law or any relevant stock exchange
rules, we expressly disclaim any obligation to disseminate, after
the date of this document, any updates or revisions to any such
forward-looking statements to reflect any change in expectations or
events, conditions or circumstances on which any such statements
are based.
Forward-looking and other statements in this document
may also address our sustainability progress, plans, and goals
(including climate change and environmental-related matters). In
addition, historical, current, and forward-looking sustainability-
and climate-related statements may be based on standards and tools
for measuring progress that are still developing, internal controls
and processes that continue to evolve, and assumptions and
predictions that are subject to change in the future and may not be
generally shared.
CONTACT: Carnival Corporation & plc Media:
Jody Venturoni, Carnival
Corporation, jventuroni@carnival.com, (469) 797-6380; Investor
Relations: Beth Roberts, Carnival
Corporation, eroberts@carnival.com, (305)
406-4832