If any company was going to be hit by the combination of rising fuel prices and turmoil in the Middle East and Libya, it would be cruise company Carnival.
And so it has proved. The company, which is the largest cruise holiday group in the world and operates a fleet of 98 ships, said first quarter earnings per share reached $0.19, the top end of its previous guidance.
But the good news pretty much ends there. Fuel prices have soared since its last 2011 full year guidance was given in December, partly on the unrest in the oil producing regions of the Middle East and Africa. And of course, holidaymakers are less likely to want to cruise blissfully in those areas, thanks to the eruptions of violence and political unrest.
So instead of full year earnings per share of between $2.90 and $3.10, Carnival now expects the range to be $2.50 to $2.60. This includes a hit of $0.40 from fuel prices and exchange rates, and $0.05 from the impact of itinerary changes in the Middle East and North Africa.
The news has sent the company's shares down 108p to £25.64, a drop of more than 4% which makes it the biggest faller in the FTSE 100 at the moment.
