Carnival Corporation Gets New CEO

June 25, 2013

(10 a.m. EDT) -- On the same day Carnival Corporation has released its second-quarter earnings, it has also announced that it will put a new CEO in place, effective July 3. The company -- which owns Carnival Cruise Lines, Holland America, Princess, P&O, Seabourn, Cunard and Costa, among others -- plans to replace Micky Arison, who currently fills the roles of both CEO and chairman.

Arison will continue to serve as chairman of Carnival Corp.'s board of directors -- and remain the company's largest shareholder -- after businessman Arnold W. Donald takes over the position of CEO.

According to a press release from Carnival Corp., Donald, who has served with Arison on Carnival's board for the past 12 years, has held leadership roles within both publicly traded companies and private equity firms, as well as government appointments and not-for-profits. He also currently serves on Bank of America Corporation's board of directors.

"I have a first-hand appreciation of what it has taken to develop this highly successful business, an understanding for the dynamics and challenges we face, and a great deal of confidence in the company's management team and their ability to execute," Donald said in a statement.

Donald will continue with his duties on Carnival Corp.'s board of directors, but he will relinquish his committee roles.

During an earnings call with the board on Tuesday morning, Donald had this to say: "I'm personally honored and very enthused. ...Carnival has a strong team and excellent fundamentals of the business."

Howard Frank, vice chairman of Carnival Corp.'s board of directors, went on to note that the Carnival Cruises brand is likely to lose about 50 cents per share as a result of lower revenue yields, lost sailings and repairs, investment programs and higher marketing spend.

"This brand will come back stronger than ever," Frank said, adding that he believes the reintroduction of Carnival Triumph will be responsible for that. "It will be gradual, and it will take two or three years. It's disappointing to our company, but we believe the worst is over."

--by Ashley Kosciolek, Associate Editor