Tag Archives: Economy

Carnival CEO Steps Down and Carnivals Recovery Period.

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Arison steps down as CEO of Carnival Corp.; remains chairman

By Tom Stieghorst
Arnold Donald will take over from Micky Arison as CEO of Carnival Corp.Micky Arison will give up the job as CEO of Carnival Corp., but remain chairman of the cruise company his father founded 40 years ago.

Carnival said Arnold Donald, a board member for the past 12 years, will become CEO effective July 3.

“I have been discussing this with the board for sometime now and feel the timing is right to align our company with corporate governance best practices and turn over the reins after 34 years as CEO,” Arison said. “Arnold is an exceptional professional with extensive experience in organizational leadership who will bring a fresh perspective to the company.”

Arnold has been an senior executive at Monsanto Corp., and founded and led Merisant, a company whose products include tabletop sweetener brands Equal and Canderel.

He also is former president and CEO of the Executive Leadership Council, a professional network and leadership forum for African-American executives of Fortune 500 companies.

Carnival Corp.’s Frank talks recovery period for Carnival brand

By Tom Stieghorst
Howard FrankA full recovery at the Carnival Cruise Lines (CCL) brand will take two to three years, Carnival Corp. Vice Chairman Howard Frank said in a call with Wall Street analysts.

In discussing Q2 results, Frank presented an analysis of yields both including CCL and excluding CCL, the way Carnival had previously done for Costa Cruises after the Costa Concordia accident. In answering a later question, however, Frank said the two were different situations and markets.

He said the two- to three-year full recovery period was based on consultants who looked at two negative events outside the cruise industry as models. “Their view is that although we’re a very different industry, it’s likely we will follow the same pattern.”

The impact of the Carnival Triumph and subsequent incidents tied to CCL ships will reduce Carnival Corp.’s 2013 results by about $388 million, Frank said, including $124 million for canceled sailings, $210 million in lower revenue yields, and about $54 million in vessel enhancements and extra marketing.

Frank said the extra marketing would come in three areas: funds directed at travel agents, including cooperative advertising; social media; and possibly more TV ads. In the fall, Carnival will look at marketing for particular brands, he said.

Frank explicitly thanked travel agents during the call. “Many of our travel agent partners have been very supportive during this challenging period, and for that we are very grateful,” he said.

Thomas Cook job cuts are necessary, says expert

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Thomas Cook job cuts are necessary, says expert

By Melanie Hall

Thomas Cook job cuts are necessary, says expertThomas Cook Group’s decision to cut 2,500 jobs and close 195 stores has gone down well in the City as a much-needed restructuring following its “dismal” financial performance, said a leading analyst.

Douglas McNeill, investment director at stockbrokers Charles Stanley, told Travel Weeklythat the move, although sad for those at risk of losing their jobs, was necessary.

“The City is pleased to see restructuring taking place,” said McNeill. “No-one is ever keen to see other people losing jobs so the restructuring that is underway is tempered by thoughts about those losing jobs, but it’s beyond question that things needed to change at Thomas Cook.

“I would say that the City has thought something like this was on the cards for quite some time. The management has led the City to expect cost savings without being particularly specific.”

“lt hasn’t required much imagination to realise that a lot of reductions was on the way,” said McNeill, as it is doing less business than it used to.

“Capacity is down this summer season, 4% down at the last count,” he said. “That’s not the first such reduction. Reduction in the winter season was greater than that. Sooner or later, you are going to conclude that you are going to need fewer staff.”

McNeill said that Thomas Cook’s chief executive Harriet Green was instilling confidence because of her plans to cut costs.

“Financial performance has been dismal for quite some time and the share price tells you that the City is confident in Harriet Green’s ability to restructure,” he said.

Thomas Cook saw its share price drop by more than 4% yesterday in the wake of the travel group’s mass jobs cut announcement a day earlier.

Shares in the company were down 3.5p to 82.5p but this was more than 15% below its 52-week high of 97.38. At yesterday’s rate, the group’s market capitalisation was £787.92 million.

Cook is to cut 2,500 jobs and close almost 200 agency branches as part of a financial turn around plan. An update on the business transformation plan and new strategy for the group is due to be given by chief executive Harriet Green on Wednesday.

A brief trading update will be given ahead of first half results to be announced in May.

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‘Toughest trading in 40 years’ leaves Co-op 12% down

By Ian Taylor  |  Aug 26, 2011 08:00AM GMT

'Toughest trading in 40 years' leaves Co-op 12% down

The Co-operative Group reported the worst retail trading conditions “in 40 years” as it recorded a 12% drop in underlying profits for the first half of this year.

Co-op group chief executive Peter Marks said: “We do not see signs of any real improvement in the economy and are planning accordingly.”

The group reported an underlying profit of £230 million for the six months. The business division that includes The Co-operative Travel contributed an underlying operating profit of £70 million.

However, the group gave no figures on the performance of its travel division which will merge with Thomas Cook and the Midlands Co-operative over the next month followingCompetition Commission clearance.

The Co-operative Travel made an operating profit of just £100,000 last year. It is part of a business division that includes the Co-operative Pharmacy, Funeralcare, Legal Services, car dealerships and clothing.

In a statement, the group said: “The UK and the world economy remain in a highly fragile state. Our customers are feeling the squeeze and, inevitably, we are seeing an impact on sales. The economic environment is particularly challenging for those businesses that rely on ever-tightening discretionary spend.”

Marks said: “We warned that the downturn was biting deeper than anyone had expected and predicted challenging trading conditions would continue into 2012. This has clearly proved to be the case. Indeed, it is the worst I have seen in 40 years of retailing.”

The deal with Thomas Cook guarantees the Co-operative Group a minimum dividend from the travel retail business of £10 million a year for the next four years, with a subsequent option for either partner to buy out the other.