Carnival Cruise Lines

Syndicate 5 : Ria Agustriana 29111321 Agung Mahendra 29111324 Rangga Tri Raeros 29111314 Joseph Enrico 29111349 Karina Soedjati 29111309

Exhibit 1 Annual Passengers

Year Carnival CLIA Lines

Passegers Carried

Anual Growth

Passegers Carried

Anual Growth

1994 1035037 15,33% 4448000 -0,71%

1995 1185588 14,55% 4378000 -1,57%

1996 1343356 13,31% 4656000 6,35%

1997 1517330 12,95% 5051000 8,48%

1998 1535359 1,19% 5428000 7,46%

1999 1837764 19,7% 5894000 8,59%

2000 2044563 11,25% 6882000 16,76%

2001 2290801 12,04% 6906000 0,35%

2002 2482231 8,36% 7640000 10,63%

2003 2854476 15% 8300000 8,64%

2004 3037948 6,43% 8980000 8,19%

Exhibit 2 The Fleet

Ship  Class of

ShipYear

LaunchedGross

Tonnage StateroomsDouble

Occupancy1 Holiday Holiday 1985 46052 743 14522 Celebration Holiday 1987 47262 743 14863 Fantasy Fantasy 1990 70367 1026 20564 Ecstasy Fantasy 1991 70367 1026 20525 Sensation Fantasy 1993 70367 1026 20526 Fascination Fantasy 1994 70367 1026 20527 Imagination Fantasy 1995 70367 1026 20528 Inspiration Fantasy 1996 70367 1026 20529 Carnival Destiny Destiny 1996 101353 1321 2642

10 Elation Fantasy 1998 70367 1021 205211 Paradise Fantasy 1998 70367 1026 205212 Carnival Triumph Triumph 1999 101509 1379 275813 Carnival Victory Triumph 2000 101509 1379 275814 Carnival Spirit Spirit 2001 88500 1062 212415 Carnival Pride Spirit 2002 88500 1062 212416 Carnival Legend Spirit 2002 88500 1062 212417 Carnival Conquest Conquest 2002 110000 1487 297418 Carnival Glory Conquest 2003 110000 1487 297419 Carnival Miracle Spirit 2004 88500 1062 212420 Carnival Valor Conquest 2004 110000 1487 2974

From the exhibit 1& 2 :In winter 2004, more than 3

million passengers would sail with Carnival

Carnival, launch 110.000 ton, 2974 passenger Carnival Valor, the 20th ship.

2005, Carnival Liberty joined the fleet, Carnival’s capacity lead the industry.

Buyback, $1 billion stock and 20% quarterly dividen increase to $0,15 / share

The Cruise Industry

1970, carried 500.000

passengers

2004, projected more than 10 million guest

Dickinson : 300 millions person trips/year. We

carried 3 million guest

Dickinson noted, only 16% of the North American market had ever

cruised

Industry EvolutionMid 1960s, shifted to pleasure cruisingThe ships carried 1800 to 3800

passengers.70 brands serving the North American

market since 1960s.Carnival Corporation, Royal Carribean

International Ltd, Star Cruise dominate nearly 95% of the market.

Carnival Corporation became the largest cruise company in the world

Exhibit 3 North American Cruise Capacity & Market Positioning, 2004

ShipsDouble

OccupancyMarket Share

Market Positioning

Carnival CorporationCarnival Cruise Lines 20 44934 23,20% Contemporary

Princess 14 28050 14,50% PremiumHolland America Line 12 16937 8,80% Premium

Costa Cruises 2 4224 2,20% ContemporaryCunard Line 2 4411 2,30% Luxury

Womdstar Cruises 3 604 0,30% DestinationYachts of Seabourn 3 624 0,30% Luxury

Total: 56 99784 51,60%

Royal Caribbean International

Royal Caribbean International 19 45570 23,50% Contemporary

Celebrity Cruises 10 16116 8,30% PremiumTotal: 29 61686 31,90%

Star CruisesNorwegian Cruise Line 10 17890 9,20% Contemporary

Orient Lines 1 845 0,40% DestinationTotal: 11 18735 9,70%

Other CLIA-affiliated brands

Crystal Cruises 3 2960 1,50% LuxuryDisney Cruises Line 2 1754 0,90% Contemporary

MSC Cruise 2 3180 1,60% ContemporaryOceania Cruise 2 1368 0,70% Premium

Radisson Seven Seas Cruises 6 2764 1,40% LuxurySilversea Cruises 4 1356 0,70% Luxury

Total 19 13382 6,90%Grand Total 115 193587

Target :- Contemporary (Mass Market)- Premium- Destination (Specialty)- Luxury

• Since 1990, more than 130 ships were launched, increase the industry 20%.

Carnival Cruise LineThe Carnival Corporation portfolio of 12

cruiselines and 75 ships covered each of the four North America market segment.

Carried 60000 passengers. Seabourn, 21000 passenger/year.

Ted Arison was launching Carnival in 1972.

Carnival “Fun Ships” started because they want everybody had fun. It were designed to include a wide range of activities and options for guests.

Overall Cruiser Customer

According Cruise Lines International Association (CLIA) :

Average cruiser was 50 years old, income $99000/year.

78% already married and sailed with their spouses

54% had taken their first cruise within 5 years and took 2,6 cruises in this period

The Carnival Customer

According Cruise Lines International Association (CLIA) :

The age : 55 (24%), 35 & 55 (40%), 35 or younger (36%)

The Product : Families, singles, honeymooners & multigenerational families.

Income cruiser : $65000

Carried 55% of married passenger

Promotion : TV, newspapers & direct marketing

Distributing The Carnival Product

Travel AgentsThe vital external sales but also the

expensive (Commison of 10%)

The agent’s commision one of the largest individual line

items on a cruise’s profit and loss

statement

Direct

Inbound :- 1-800-Carnival and

carnival.com- Only few customer

booked online,

Outbound :- Personal Vacation Planners (PVPs), is a

separate division- Proven to be an

effective sales

Delivering the Carnival ExperienceGuest typical booking time:

◦3-5 months before◦Last-minute

Information source for guests:◦Web◦Travel agents

Delivering the Carnival ExperienceCarnival didn’t get complete guest

information from travel agentsCarnival get guest information from the

Fun PassCarnival’s vision is to provide quality

service that exceed the expectations of the guests

Average cruiser spend $30-$50 per day on board, excluding gratituities

E-commerce applications includes precruise online sign-up for shore excursions and spa appointments

Sail & Sign CardPass to board / debark the shipSign-up for excursionsAs a credit card on the board

Carnival’s Information Systems275 employees shoreside and 45

shipboard IS managersAccumulated 2 years of

individual voyage dataUse data for pricing decisions

and measure travel agents’ performance

On-board applications:◦Property Management System (PMS)◦Point of Sale (POS) Fun Sales

System (FSS)

The Potential Value of Customer DataLoyalty programs:

◦Redeemable cruise points◦Recognition card

Fear that loyalty spending may yield low return

Consumer Response System (CRS) to track service recovery efforts for complains

Partial Organizational Chart(from exhibit 5)

Bob DickinsonPresident and

CEO

Roberta Jacoby

Senior VP Corp Training

Paul ZacharskySenior VP Finance

Vicki FreedSenior VP

Marketing&Sales

Natko NincevicSenior VP

Hotel Operations

Brendan CorriganSenior VP

Cruise Operations

Myles CyrVP & Chief Information

Officer

Onboard Hotel

Directors

Onboard Captains, Pursars

Dwayne Warner

VP Strategic Automation

Edie Bornstein

VP Business Development

Brenda Yester

VP Revenue Managemen

t

Maurice ZarmatiVP Sales

Terry Thornton

VP Marketing Planning

Christine Arnholt

VP Marketing Services

Shannon Balliet-Antorcha

Manager Revenue Enhancement

Mike HunssingerManager Revenue

Enhancement

Diana Rodriguez-Velazquez

Director Database and Internet Marketing

Carnival Corporation and PLC Cruise Brands(from exhibit 6)

North Amer-icaEuropeUnited KingdomAustraliaGermany

Double Occupancy Amount

Typical Activities Available on a Carnival Cruise(from exhibit 7)

Photo GalleryTravelogFormalitiesShore ExcursionsShops on BoardShogun Club

CasinoPark West Art

AuctionCarnival Golf.com

The Web Internet Cafe

Funship Airbrushed Tattoos

Spa CarnivalGymTheatreMusic and DancingActivities Schedule

Principal Shoreside Software Systems(from exhibit 8)

Oracle FinancialsReservationsRevenue AccountingCornerstoneLawsonI2Carnival.com

Principal Shipboard Software Systems(from exhibit 8)

Shipboard Property Management System (SPMS) Fun Ship Sales (FSS) Silverware Iverson Ocean Player Club Concession Systems Consumer Response System (CRS) Interactive Television Crew Personal System (CPS) Crew Pay Gratuity (CPG) Fun Time Info SHIPsql VingCard Door Lock

Financial Analysis(from exhibit 4)

Summary of Balance Sheets (millions of US$)  2004 2003Current Assets 643 610Total Assets 27,635 24,491Current Liabilities 5,034 3,310Total Liabilities 11,876 10,698Total Equity 15,760 13,793Total Equity and Liabilities 27,636 24,491

Summary of Income Statements (millions of US$) 2004 2003 2002 2001 2000

Revenue 9,729

6,718

4,383

4,549

3,779

Gross Profit 5,483

3,838

2,619

2,661

1,720

EBIT 2,168

1,391

1,038

1,001

991

NAT 1,854

1,194

1,016

926

965

Summary of Statement of Cash flows (millions of US$)  2004 2003 2002CF from Operating activity 3,216 1,933 1,469CF from Investing activity -3,089 -2,433 -2,061CF from Financing activity -79 826 -198

Financial Analysis(from exhibit 4)

Ratio Analysis

  2004 2003 2002 2001 2000Comment

Current Ratio 0.127731 0.18429 OK

Total Asset turnover 0.351981 0.274305 GoodDebt to Total Asset ratio 0.429745 0.436814 OK

Debt to Equity ratio 0.753553 0.775611 OK

Gross Income Margin 0.563573 0.5713010.59753

6 0.584964 0.455147 OKOperation Income Margin 0.222839 0.207056

0.236824 0.220048 0.262239 OK

Net Income Margin 0.190564 0.1777310.23180

5 0.203561 0.255359 OK

EPS 2.31 1.66 1.76 1.82 1.61 Good

DPS 0.53 0.44 0.42 0.42 0.42 Good

ROE 0.11764 0.086566 Good

ROA 0.067089 0.048753       Good

SWOT Analysis

Strengths

• Carnival is the largest cruise line in the world• Higher market share than its competitors• It is the most popular choice among customers who

think of a cruise vacation• 98% guest satisfaction rating• Carnival has acquired several companies in different

market segments of the cruise industry• Has a good relationship with many travel agents• Offer many interesting facilities and entertainment

programs on board• E-commerce application and Sail & Sign card to

facilitate the guests

SWOT Analysis

Weaknesses

• Customer loyalty was low• Relied heavily on travel agents• Aggresive direct marketing could affect relationship

with travel agents• Less effort to create customer’s loyalty• Didn’t have enough consumer data

SWOT Analysis

Opportunities

• The cruise industry appeals to a broad range of demographic groups

• Large untapped market of people that have not cruised of 84%

• Many of the potential passengers have expressed interest in taking a cruise as a vacation alternative

• Strong annual growth• Offer more destinations• Expand to other countries like Asia

SWOT Analysis

Threats

• There are threats from diseases like SARS and other epidemic health concerns in areas where the company does business

• Hurricane and bad weather• Seasonal demand• Changes in Government regulations (in areas of ports,

customs, labor, immigration, gambling, security etc)could impact the company’s financial position negatively

• Tight competition

Recommendation The customer data could be used to enhance the customer's

experience by doing the following: Based on age and marital status of customers, special suitable

activities can be offered, like excursions and spa services for couple For repeat guests, offer special discount on their favorite drinks

from the previous visit Customer feedback from Customer Response System can be useful

to make the necessary adjustments to the quality of service, and to retain the customer

Offer a birthday or anniversary package, with special discount or special gift

Create a seasonal themed cruise vacation like Haloween, Valentine, Christmas, etc

Create a special embarkation line for repeat guests Send informational or promotional e-mail based on the guests’

travel pattern, preferences, and on-board purchases Add new on-board facility and entertainment to attract more guest