Carnival (CCL) 10-K risk factor changes: FY2012 vs FY2011

Demand for cruises is in part dependent on the underlying perceived or actual economic [removed: strength] [added: condition] of the countries from which cruise companies source their guests.

Adverse changes in the perceived or actual economic climate, such as higher unemployment and underemployment [removed: rates,] [added: rates;] declines in income [removed: levels,] [added: levels;] securities, real estate and other market declines and [removed: volatility,] [added: volatility;] increasing [removed: taxation,] [added: taxation;] higher fuel prices and healthcare [removed: costs,] [added: costs;] more restrictive credit [removed: markets,] [added: markets;] higher interest rates and changes in governmental regulations, could reduce our potential vacationers’ discretionary incomes, net worth or their consumer confidence.

These ticket price reductions may result in a less affluent guest base, [removed: and] [added: which along with] decreases in discretionary income or consumer [removed: confidence, all of which] [added: confidence] could also result in lower onboard [removed: revenues, which] [added: revenues that] could also have a negative effect on our net revenue yields and profitability.

Economic, market and political conditions [removed: in certain parts of] [added: around] the [removed: world, including] [added: world such as] fuel [removed: demand and] [added: demand, regulatory requirements,] supply disruptions and related infrastructure needs, make it difficult to predict the future price and availability of fuel.

Fuel costs accounted for [removed: 21%, 18%] [added: 23%, 21%] and [removed: 14%] [added: 18%] of our cruise operating expenses in [removed: 2011, 2010] [added: 2012, 2011] and [removed: 2009,] [added: 2010,] respectively.

To mitigate a portion of our economic risk attributable to [removed: potentially significant] [added: potential] fuel price increases, we [removed: recently implemented] [added: have established] a fuel derivatives program.

To date under this program, we have bought Brent crude oil (“Brent”) call options and sold Brent put options, collectively referred to as zero cost [removed: collars] [added: collars,] that established ceiling and floor [removed: Brent] prices.

| _•_ | | [removed: _Accidents,] [added: _Incidents,] the spread of contagious diseases and threats thereof, adverse weather conditions or [added: other] natural disasters and other incidents affecting the health, safety, security and satisfaction of guests and crew could have an adverse effect on our sales and profitability._ |

The operation of cruise ships, hotels, land tours, port facilities and shore excursions involve the risk of [removed: accidents,] [added: incidents,] including those caused by the improper operation of our ships, motorcoaches and [removed: trains,] [added: trains;] guest and crew illnesses, such as from the spread of contagious [removed: diseases,] [added: diseases;] mechanical [removed: failures, fires, collisions, groundings,] [added: failures; fires and collisions; repair delays; groundings;] navigational [removed: errors,] [added: errors;] oil spills and other [added: maritime and] environmental [removed: mishaps,] [added: mishaps; missing passengers] and other incidents at sea or while in port or on land, which may cause injury and death, or the alteration of itineraries or cancellation of a cruise or series of cruises or tours.

Although we place guest and crew safety as the highest priority in all our operations, our ships have been involved in accidents and other incidents in the [removed: past (for example, the January 13, 2012 grounding of _Costa Concordia_).][added: past.]

We may experience similar [added: or other] incidents in the future.

In particular, our ability to effectively and efficiently operate shipboard and shoreside activities may be impacted by widespread public health issues/illnesses or health [removed: scares] [added: warnings] resulting in, among other things, reduced demand for cruises and cruise cancellations and employee absenteeism that could have an adverse affect on our sales and profitability.

Our cruise ships, hotels, land tours, port facilities, shore excursions and other service providers may be impacted by adverse weather patterns or [added: other] natural disasters, such as hurricanes, earthquakes, [added: floods, fires,] tornados, tsunamis and volcanic eruptions.

| _•_ | | _The international political climate, armed conflicts, terrorist and pirate attacks, vessel [removed: seizures] [added: seizures,] and threats thereof, and other world events affecting the safety and security of travel could adversely affect the demand for cruises and could harm our future sales and profitability._ |

Factors including, but not limited to, [removed: the September 11, 2001 terrorist attacks in the U.S.,] [added: past acts of terrorism,] threats of additional terrorist attacks, drug-related violence in Mexico, pirate attacks and vessel seizures off the [removed: coast] [added: coasts] of Africa, national government travel advisories, political instability in North Africa, the Middle East and elsewhere and general concerns over the safety and security aspects of traveling have had a significant adverse impact on demand and pricing in the travel and vacation industry in the past and may have an adverse impact in the future.

Decreases in demand [removed: could] [added: may] lead to price reductions, which in turn could reduce our profitability.

[removed: Accidents and incidents] [added: Incidents] involving cruise ships, and, in particular our cruise [removed: ships (including the January 13, 2012 grounding of _Costa Concordia_),] [added: ships,] media coverage thereof, as well as adverse media publicity concerning the cruise vacation industry in general, or unusual weather patterns or [added: other] natural disasters or disruptions, such as hurricanes and earthquakes, could impact demand for our cruises.

Reports [removed: of ship accidents (for example,] [added: and] media coverage of [removed: the January 13, 2012 grounding) and other] [added: ship] incidents at sea or while in port, including missing guests, improper conduct by our employees, guests or agents, crimes, crew and guest illnesses such as incidents of stomach flu, parasitic outbreaks or other contagious diseases, security breaches, terrorist threats and attacks and other adverse events can result in negative publicity, which could lead to a negative perception regarding the safety of our ships and the satisfaction of our guests.

[removed: Social] [added: The considerable expansion in the use of social] media [added: over recent years] has increased the ways in which our reputation can be impacted, and the speed with which it can occur.

| _•_ | | _Litigation, enforcement actions, fines or [removed: penalties, including those relating to Costa Concordia’s incident,] [added: penalties] could adversely impact our financial condition or results of operations and damage our reputation._ |

As a result of [removed: this accident,] [added: any ship or other incidents, such as the _Costa Concordia_ incident,] litigation claims, enforcement actions and regulatory actions and [removed: investigation, including] [added: investigations, including,] but not limited [removed: to] [added: to,] those arising from personal injury, loss of life, loss of or damage to personal property, business interruption losses or environmental damage to any affected coastal waters and the surrounding area, may be asserted or brought against various parties including [removed: us.][added: us and/or our cruise brands.]

Subject to applicable insurance coverage, we may also incur costs both in defending against any claims, [removed: action] [added: actions] and investigations and for any judgments, fines, civil or criminal penalties if such claims, actions or investigations are adversely determined.

Some of our operating [removed: costs,] [added: costs] including, but not limited to, food, payroll, port costs, repairs and maintenance, security and other commodity-based items are subject to increases because of market forces, economic or political instability or [added: other] circumstances beyond our control.

It is possible that jurisdictions or [removed: ports of call] [added: ports-of-call] that we regularly visit may also decide to assess new taxes or fees or change existing taxes or fees specifically targeted to the cruise business, its employees and guests, including, but not limited to, value added taxes on cruise tickets and onboard revenues and changes in the scope of income that is includable within tonnage tax regimes, which could increase our operating costs and could decrease the demand for cruises and ultimately decrease our net revenue yields and net income.

“Cruise [removed: Operations-] [added: Business-] Governmental [removed: Regulations - Maritime] [added: Regulations—Maritime] Regulations” for additional information regarding these risks.

As described in “Maritime Environmental Regulations” as referenced [removed: above,] [added: below,] these changes will result in reductions in ship sulfur oxide emissions by requiring progressive reductions in the sulfur content in fuel or the use of abatement [removed: techologies.][added: technologies.]

These limits will be further reduced in designated ECAs, including ECAs that have been or could be proposed in other prime cruising areas, such as around Australia, [added: Hong Kong,] Japan, the Mediterranean Sea and Mexico.

The increase in fuel prices impacts not only our fuel costs, but also some of our other expenses, including, but not limited to, crew and guest travel, [removed: freight,] [added: freight] and commodity prices and may have an adverse impact on our profitability.

Similarly, numerous [removed: other] bills related to climate change have been introduced in the U.S. Congress, which could adversely impact our business.

[removed: We believe that relevant government authorities in the U.S., Europe] [added: These issues are,] and [removed: elsewhere] [added: we believe] will continue to [added: be, an area of] focus [removed: on these areas.][added: by the relevant authorities throughout the world.]

In addition, training of crew may become more time consuming and may increase our operating costs due to increasing regulatory [removed: requirements applicable to our operations.][added: and other requirements.]

| _•_ | | _Changes in [added: and compliance with] income tax laws and regulations and income tax treaties may adversely affect the taxation of our shipping income and our profitability._ |

We believe that substantially all of the income earned by Carnival Corporation, Carnival plc and their ship owning or operating subsidiaries [removed: qualify] [added: qualifies] for taxation based on ship tonnage, [removed: is] [added: are] exempt [added: from taxation] or [removed: is] [added: are otherwise] subject to minimal taxes in the jurisdictions where the entities are incorporated or do business.

The applicable treaties may be revoked by either applicable country, replaced or modified with new agreements that treat income from international operation of ships differently [removed: that] [added: than] the agreements currently in force or may be interpreted by one of its countries differently from us.

In combination, these provisions would result in the taxation of our U.S. source shipping income, net of applicable deductions, at a [added: current] federal corporate income tax rate of up to 35%, state income tax rates would vary and our net after-tax income would be potentially subject to a further branch profits tax of 30%.

| _•_ | | _Our ability to implement our shipbuilding programs and ship repairs, maintenance and refurbishments on terms that are favorable or consistent with our expectations could reduce our profitability. In addition, we expect increases [removed: in] [added: to] our repairs and maintenance expenses and refurbishment costs as our fleet ages._ |

In addition, [added: other events, such as] work stoppages, [removed: insolvencies] [added: other labor actions, insolvencies, “force majeure” events] or other financial difficulties [added: experienced] at the shipyards and their subcontractors and suppliers who build, repair, maintain or refurbish our ships could also delay or prevent the delivery of our ships under construction and prevent or delay the completion of the refurbishment, repair and maintenance of existing ships in our fleet.

There is no assurance that such eligibility will be extended or renewed and, therefore, we may incur higher vessel purchase [removed: prices.][added: prices and financing costs.]

As of November 30, [removed: 2011,] [added: 2012,] we had [removed: not] entered into [removed: any] foreign currency [removed: forwards or options to fix] [added: zero cost collars for] a portion of the cost in U.S. dollars [removed: or in] [added: and] sterling of [removed: three] [added: two] of our euro-denominated shipbuilding contracts.

However, if [removed: we were to enter into these types of forwards or options in] the [removed: future, and if the shipyards] [added: shipyard] with which we have contracted [removed: are] [added: is] unable to [removed: perform, these] [added: perform under the related contracts, the] foreign currency [removed: forwards and options] [added: zero cost collars] related to the [removed: shipyards’] [added: shipyard’s] shipbuilding [removed: contracts] [added: contract payments] would still have to be honored.

See risks relating to environmental laws and regulations, continuing financial viability of air service providers and failures to keep pace with technology below for additional information regarding our fuel risks.

In addition, as mentioned above, our ships are subject to the risks of mechanical failures and accidents, for which we have had to incur repair expenses.

If these occur in the future, we may be unable to procure spare parts when needed or make repairs without incurring significant expense or suspension of service.

A significant performance deficiency or problem on any one of our ships could have an adverse effect on our financial condition and results of operations.

These types of events could also impact our ability to source qualified crew from throughout the world at competitive costs and, therefore, increase our shipboard crew costs.

The cost of shipbuilding orders that we may place in the future that is denominated in a different currency than our cruise brands’ or the shipyards’ functional currency is expected to be affected by foreign currency exchange rate fluctuations.

These foreign currency exchange rate fluctuations may affect our desire to order new cruise ships.

Travel agents may face increased pressure from our competitors, particularly in the North America market, to sell and market these competitor cruises exclusively.

If such exclusive arrangements were introduced, there can be no assurance that we will be able to find alternative distribution channels to ensure our customer base would not be affected.

Our Corporate and cruise brands’ principal offices are located in the U.S., Australia, Continental Europe and the UK.

Although we have developed disaster recovery and similar contingency plans, actual or threatened natural disasters (for example, hurricanes, earthquakes, tornados, fires and floods) or similar events in these locations may have a material impact on our business continuity, reputation and results of operations.

| _•_ | | _A failure to keep pace with developments in technology could impair our operations or competitive position._ |

Our business continues to demand the use of sophisticated systems and technology.

These systems and technologies must be refined, updated and replaced with more advanced systems on a regular basis.

If we are unable to do so on a timely basis or within reasonable cost parameters, our business could suffer.

We also may not achieve the benefits that we anticipate from any new system or technology, such as fuel abatement technologies, and a failure to do so could result in higher than anticipated costs or could impair our operating results.

Also, to the extent that we or our competitors deploy ships to a particular itinerary and the resulting capacity in that region exceeds the demand, we may lower pricing and profitability may be lower than anticipated.

For example, the recent severe economic downturn, including failures of financial service companies and the related liquidity crisis, disrupted the capital and credit markets.

Additional economic concerns from some of the countries in the EU continue to strain the financial markets both in the U.S. and internationally.

A recurrence of these disruptions could cause our counterparties and others to breach their obligations to us under our contracts with them.

This could include failures of banks or other financial service companies to fund required borrowings under our loan agreements or to pay us amounts that may become due under our derivative contracts for fuel, interest rates and foreign currencies or other agreements.

If any of the foregoing occurs it may have a negative impact on our cash flows, including our ability to meet our obligations, results of operations and financial condition.

Further, we report currency transactions in the functional currencies of our reporting units, excluding fuel which is always transacted and reported in U.S. dollars regardless of the functional currency of the reporting unit.

Our ability to maintain our credit facilities may also be impacted by material changes in our ownership.

More specifically, we may be required to prepay our debt facilities if a person or group of persons acting in concert gain control of Carnival Corporation & plc, other than the Arison family, including Micky Arison, our Chairman and Chief Executive Officer.

##### [Table of Contents](#toc)

| --- | --- | --- |

It is not possible to predict or identify all such risks.

There may be additional risks that we consider immaterial or which are not known.

##### [Table of Contents](#toc)

On January 13, 2012, _Costa Concordia_ grounded off the coast of Isola del Giglio, Italy and sustained significant damage.

There were 16 casualties, a number of injuries and 16 people remain missing, as of January 26, 2012.

The ship remains grounded and partially submerged off the coast.

The cause of the accident is currently under investigation by the Italian authorities.

For example, in 2010 Spain imposed a value-added tax on the sale of certain onboard goods and services.

Since substantially all our newbuild costs are priced in euros, the ability to purchase ships for our North America and UK brands at favorable U.S. dollar and sterling prices, respectively, is adversely impacted as a result of the weaker U.S. dollar and weaker sterling compared to the euro.

This can result in higher newbuild costs and reduced profitability for our North America and UK brands.

For example during 2011, certain European travel agents and tour operators have experienced liquidity concerns for a variety of reasons and, accordingly, it is possible that we could experience credit losses related to these and other agents and operators in the future.

Also, during the winter season ships that operate in the Caribbean face increased competition as our brands, as well as our competitors, redeploy vessels to the Caribbean, which results in a seasonal increase in passenger capacity that may adversely impact our profitability.

The leadership of our Chairman and Chief Executive Officer, Mr. Arison, and our Vice-Chairman and Chief Operating Officer, Mr. Frank, and other executive and senior officers has been a critical element of our success.

The death or disability of Mr. Arison or Mr. Frank or other extended or permanent loss of their services, or any negative market or industry perception with respect to them or arising from their loss, could have an adverse effect on our business.

Our other executive and senior officers and other members of management have substantial experience and expertise in our business and have made significant contributions to our growth and success.

The unexpected loss of services of one or more of these individuals could also adversely affect us.

For instance, the Chinese market, which we entered in 2006, is developing slower than originally expected.

We also report currency transactions in the functional currencies of our reporting units.

contracts in a manner inconsistent with the express provisions and intentions we included in such contracts.

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 in this Form 10-K.

The financial statements, together with the report thereon of PricewaterhouseCoopers LLP, dated January [removed: 30, 2012,] [added: 29, 2013,] and the Selected Quarterly Financial Data [removed: (Unaudited),] [added: (Unaudited)] are shown in Exhibit 13 and are incorporated by reference into this Form 10-K.

[removed: We] [added: With 100 cruise ships, we] are the largest cruise company and among the most profitable and financially [removed: strongest vacation] [added: strong leisure travel] companies in the world.

We have a portfolio of [removed: widely recognized] [added: many of the world’s best known] cruise brands that are sold in all the world’s major vacation markets and are a leading provider of vacations to all major cruise [removed: destinations.][added: destinations throughout the world (see Section III.]

We believe our multi-brand strategy is essential to [added: achieving] our [removed: cruise business] [added: mission and maintaining our] leadership [removed: position.][added: positions.]

“Cruise [removed: Operations”] [added: Business – Asia”] for additional [removed: information.][added: discussion of Costa’s operations in Asia.]

Each of our [added: ten] cruise brands is an operating segment that we aggregate into either the (1) North America or (2) Europe, Australia & Asia (“EAA”) reportable cruise segments based on the similarity of their economic and other characteristics.

[removed: Our North America segment cruise brands include] Carnival Cruise Lines, [added: Princess,] Holland America [removed: Line, Princess Cruises (“Princess”)] [added: Line] and [removed: Seabourn.][added: Seabourn source their guests principally from North America.]

See [removed: “Summary of Cruise Segments” below and] Note [removed: 11,] [added: 12,] “Segment Information” to our Consolidated Financial Statements in Exhibit 13 to this Form [removed: 10-K.][added: 10-K for additional segment and geographic information.]

In addition to our cruise operations, we own Holland America Princess Alaska Tours, the leading tour company in Alaska and the Canadian Yukon, which [removed: primarily] complements our Alaska cruise operations.

[removed: This] [added: Our] tour company owns and operates, among other things, [removed: 13] [added: 12] hotels or lodges, over 300 motorcoaches and 20 domed rail cars.

This tour company and two [removed: former] [added: cruise] ships [removed: (a 55,000-ton Costa ship and a 34,000-ton Holland America ship)] that we [added: own and] charter-out comprise our Tour and Other segment.

Following the [removed: tragic accident,] [added: _Costa Concordia_ incident (“the ship incident”) in January 2012,] we announced a comprehensive audit and review of all safety and emergency response procedures across [removed: all of] our [added: ten] brands to identify lessons learned and best [removed: practices] [added: practices, which reinforces our commitment] to [removed: further ensure] the safety of [removed: all of] our [removed: passengers] [added: guests] and crew.

| | III. | [removed: Summary of Cruise Segments] [added: Cruise Programs] |

| Cruise Brands | | Passenger Capacity (a) | | | | Number of Cruise Ships | | | | Primary [removed: Markets] [added: Markets (b)] |

| Carnival Cruise Lines | | | [removed: 58,274] [added: 61,968] | | | | [removed: 23] [added: 24] | | | North America |

| Princess [added: Cruises (“Princess”)] | | | [removed: 36,900] [added: 36,912] | | | | 16 | | | North America |

| Seabourn | | | [removed: 1,974] [added: 1,986] | | | | 6 | | | North America |

| North America Cruise Brands | | | [removed: 120,640] | | | | [removed: 60 | |] [added: 13,780] | |

| [added: | IV. |] Europe, Australia & Asia | [removed: | | | | | | | | | |]

| Costa [removed: (b)] | | | [removed: 29,286] [added: 31,720] | | | | 14 | | | Italy, France and Germany |

| [removed: P&O Cruises (UK)] | [removed: | | 14,610 | | | | 7 | |] [added: 1.] | [removed: United Kingdom (“UK”)] [added: United Kingdom] |

| AIDA [added: Cruises (“AIDA”)] | | | [removed: 14,248] [added: 16,442] | | | | [removed: 8] [added: 9] | | | Germany |

| Cunard | | | [removed: 6,670] [added: 6,672] | | | | 3 | | | UK and North America |

| P&O Cruises (Australia) [removed: (c)] | | | [removed: 6,242] [added: 4,780] | | | | [removed: 4] [added: 3] | | | Australia |

| Ibero [added: Cruises (“Ibero”)] | | | 4,176 | | | | 3 | | | Spain and South America |

| EAA Cruise Brands | | | [removed: 75,232] [added: 78,426] | | | | 39 | | | |

As of January [removed: 23, 2012,] [added: 22, 2013,] we had signed agreements with three shipyards providing for the construction of [removed: ten additional] [added: nine] cruise [removed: ships scheduled] [added: ships, with two] to [removed: enter service between May 2012] [added: be delivered in 2013, two in 2014, three in 2015] and [removed: March] [added: two in] 2016.

It is possible that some of our [removed: other] older ships may [removed: also] be sold, chartered or retired during the next few years.

Our North America cruise brands have [removed: three] [added: four] ships [added: with almost 13,800 lower berths] scheduled to enter service by [removed: June 2014] [added: February 2016] and our EAA cruise brands have [removed: seven] [added: five] ships [added: with over 16,000 lower berths] scheduled to enter service by March 2016.

These additions are expected to [removed: result in an] increase [removed: in North America and EAA brands’] [added: our] passenger capacity [removed: of approximately 10,800 and 21,200] [added: by over 29,800] lower [removed: berths, respectively.][added: berths.]

“Cruise [removed: Operations] [added: Business] – Ships Under Contract for Construction” and Note 6, “Commitments” and Note [removed: 10,] [added: 11,] “Fair Value Measurements, Derivative Instruments and Hedging Activities” to our Consolidated Financial Statements in Exhibit 13 to this Form 10-K for additional [removed: information regarding our] ship [removed: commitments.][added: commitment information.]

[removed: In addition to our cruise brands, we] [added: We also] have a Cruise Support segment that includes our cruise port and related facilities located in Cozumel, Mexico; Grand Turk, Turks and Caicos [removed: Islands; Long Beach, California] [added: Islands] and Roatán, Honduras, which are operated for the benefit of our cruise brands.

| | [removed: IV.] [added: II.] | [removed: Mission, Primary Financial Goal] [added: Mission] and Related Strategies |

Our mission is to take the world on vacation and deliver exceptional experiences [removed: through many of the world’s best-known cruise brands] that [removed: cater] [added: appeal] to a [added: large] variety of [removed: different geographic regions and lifestyles,] [added: consumers,] all at an outstanding [removed: value unrivaled on land or at sea.][added: value.]

Our primary financial [removed: goal is] [added: goals are] to profitably grow our cruise business, while maintaining a strong balance [removed: sheet, which allows us to return free cash flow to shareholders.][added: sheet.]

To achieve our [removed: goals] [added: mission and primary financial goals,] we build new and innovative ships and continue to invest in our existing ships to strengthen the leadership position of each of our brands.

Our newbuilding program is the primary platform for our [added: capacity] growth.

We currently have [removed: ten] [added: nine] cruise ships scheduled to enter service between [removed: May 2012] [added: March 2013] and March 2016, [removed: three] [added: two] of which will enter service in [removed: 2012.][added: 2013.]

Our current intention is to have an average of two to three new cruise ships enter service annually, some of which will replace existing capacity from [added: the] possible sales of [removed: older] [added: older, less efficient] ships.

Based on our current ship orders, our [added: capacity] growth rate [removed: for our North America cruise brands, which] is [removed: the most developed cruise region, is] expected to be [removed: 3%,] [added: 4%,] compounded annually through [removed: 2014.][added: 2016.]

We believe this approach results in delivering [removed: a product] [added: products and services] that [removed: is specifically] [added: are] tailored to [removed: identifiable] [added: specific] geographic [removed: regions] [added: markets] and lifestyles, which allows us to penetrate each market more effectively.

“Cruise Programs”).

“Europe, Australia & Asia.”

Our ten unique brands with worldwide sourcing of guests and diverse itinerary options allow us to expand our offerings to our past guests, while continuing to grow our business through the acquisition of new guests in established and emerging markets.

Our success also depends on, among other things, our ability to exceed the expectations of our guests by providing them with a wide variety of exceptional vacation experiences.

We strive to capture a greater share of consumers’ spending on vacations by providing extraordinary cruise products and services, all at an outstanding value.

Our ability to generate significant operating cash flows allows us to internally fund all of our capital investment program and still have a substantial amount of free cash flow, which we intend to return to shareholders in the form of dividends and opportune share buybacks.

We believe that adding newer, more efficient ships, as well as improving our existing fleet, will have a positive impact on our profitability.

We are strategically timing the introductions of additional ships to our brands to allow ample time for those lines to further grow their guest base and absorb the new capacity.

In addition, we will continue to focus on increasing our fleets’ onboard revenues by adding new products and services for our guests to enjoy.

Our rate of growth is slowing in the more established regions of North America and Western Europe.

We are committed to a measured pace of newbuilds to achieve an optimal balance of supply and demand to maximize our profitability in these established regions.

In addition, we believe that we have significant opportunities to grow our presence in the emerging Asian cruise region and will continue to redeploy some of our existing ships to that region.

The mobility of ships enables us to move them between regions to maximize our profitability.

Currently, our most important cross-brand initiatives are aimed at improving our safety training and reducing our fuel consumption.

We engaged outside industry-leading experts to assist in these audits and reviews.

As a result, we have and will continue to implement improvements to our already established procedures for bridge operations, quality assurance and auditing of ship operations, bridge officer training, safety and emergency response and crew training programs.

We are also improving the structure and organization of our existing Health, Environmental, Safety and Security (“HESS”)-related audit functions and our HESS-related management systems.

In addition, as members of Cruise Lines International Association (“CLIA”) and the European Cruise Council (“ECC”), we are also enhancing existing or implementing additional safety policies that are a result of the CLIA/ECC Cruise Industry Operational Safety Review that was initiated after the ship incident.

_Costa Concordia_ is expected to be removed from the coast of Italy during 2013.

We remain committed to minimizing any environmental impact from the ship incident.

As of January 22, 2013, we have settled with 93% and 62% of the crew and guests, respectively.

Substantially all of the ship removal costs and the costs of these and any future claims will be covered by our insurance.

We are committed to rebuilding Costa Cruises’ (“Costa”) reputation and strengthening its trust with guests and travel agents after the ship incident.

Accordingly, Costa has launched a number of initiatives, including enhancements to existing safety and security procedures, training and related processes.

In addition, Costa has initiated a major international advertising campaign called the “Real Costa” that targets consumers in its key markets.

The primary goal of the campaign is to enhance Costa’s image and describe its exceptional vacation experiences through the perspective of its guests and crew.

The Real Costa campaign focuses on Costa’s excellent products and services as reflected in Costa’s high guest satisfaction rates.

Over the next few years, we expect to fully recover from the ship incident and continue to build on our leadership positions.

Our 100 ships sail to all of the world’s major cruise destinations and the percentage of our passenger capacity deployed in each of these areas is as follows:

| Cruise Programs | | | | | | | | |

| Region | | 2013 | | | | 2012 | | |

| Caribbean | | | 33 | % | | | 35 | % |

| Europe | | | 31 | % | | | 29 | % |

| Alaska | | | 6 | % | | | 6 | % |

| Other | | | 20 | % | | | 22 | % |

| | | | 100 | % | | | 100 | % |

| B. | Cruise Business |

Cruising is at an earlier stage of development and has lower penetration rates in emerging markets within Asia.

Many international markets are experiencing a rapid growth in middle-class consumers, especially in Brazil, Russia, India and China.

As their earning power and disposable income increase, these middle-class consumers are becoming more eager to purchase entertainment, travel and luxury products and services.

| --- | --- |

See “Summary of Cruise Segments” below and Part I, Item 1.

Business.

B.

Our EAA segment cruise brands include AIDA Cruises (“AIDA”), Costa Cruises (“Costa”), Cunard, Ibero Cruises (“Ibero”), P&O Cruises (Australia) and P&O Cruises (UK).

See Note 11, “Segment Information” to our Consolidated Financial Statements in Exhibit 13 to this Form 10-K.

| | II. | Recent Development |

On January 13, 2012, _Costa Concordia_, a cruise ship owned and operated by Costa, grounded off the coast of Isola del Giglio, Italy and sustained significant damage.

Tragically, there were 16 casualties, a number of injuries and 16 people remain missing, as of January 26, 2012.

The ship remains grounded and partially submerged off the coast.

The cause of the accident is currently under investigation by the Italian authorities.

We are deeply saddened by this tragic event and our hearts go out to everyone affected, and especially to the families and loved ones of those who lost their lives or were injured.

They will remain in our thoughts.

We are committed to providing full support to the passengers, crew and families of those affected by the accident.

We are also working to secure the vessel and continue to use our best efforts to ensure there is no environmental impact.

Additionally, the Health, Environment, Safety & Security Committees of the Boards of Directors (“HESS Committees”) are engaging outside industry-leading experts in the fields of emergency response, organization, training and implementation to conduct an audit of all of our emergency response and safety procedures and to conduct a thorough review of the accident.

A damage assessment review of the ship is being undertaken to determine whether the ship can be repaired and what the total cost would be.

If the ship is repairable, it is expected to be out-of-service for the remainder of fiscal 2012 if not longer.

The net carrying value of this euro-denominated ship, including ship improvements, at December 31, 2011 was $490 million (at the December 31, 2011 exchange rate or €379 million).

We have euro-denominated insurance coverage of $510 million (at the December 31, 2011 exchange rate or €395 million) for damage to the ship with a potential deductible of approximately $30 million as well as insurance for third party personal injury liability subject to an additional deductible of approximately $10 million for this incident.

We self-insure for loss of use of the ship.

For further information see “Outlook for Fiscal 2012” in “Management Discussion and Analysis of Financial Condition and Results of Operations” in Exhibit 13 to this Form 10-K.

As of January 23, 2012, the summary by cruise brand of our passenger capacity, the number of cruise ships we operate and the primary areas or countries from where our guests are sourced are as follows:

| | | | 195,872 | | | | 99 | | | |

| (b) | Does not include the 2,978-passenger capacity _Costa Concordia._ |

| (c) | Includes the 1,460-passenger capacity _Pacific Sun,_ which was sold in December 2011 to an unrelated entity and is being operated under a bareboat charter agreement until July 2012. |

These additions, net of the above mentioned withdrawal, are expected to result in an approximate 32,000 lower berth increase in our passenger capacity.

The impact of these net additions is a 16% increase in passenger capacity compared to our January 23, 2012 passenger capacity, which is adjusted for the loss of service of _Costa Concordia_.

After adjusting for _Pacific Sun_ leaving the fleet, the impact on passenger capacity of these net additions is a 9.0% increase in our North America cruise brands and a 28% increase in our EAA cruise brands.

Our ability to generate significant operating cash flows has allowed us to internally fund all of our capital investment program.

For our European brands, which are in an earlier stage of market development, our growth is expected to be 4%, compounded annually through 2014.

We also currently intend to grow our presence in other markets, such as Australia, Asia and South America by redeploying some of our existing ships to these markets.

We believe the successful execution of these and other ongoing strategies has enabled us to be among the most profitable and financially strongest vacation companies in the world.

We also believe we are well-positioned to achieve increasing returns over time as the global economy recovers.

Since we have slowed down the pace of our newbuilding program, we currently believe this will lead to an increase in free cash flows.

| | V. | Health, Environment, Safety and Security Policy |

| --- | --- | --- | --- |

| B. | Cruise Operations |

| 2013 (a) | | | 474,000 | | | | 207,000 | |

| 2014 (a) | | | 486,000 | | | | 212,000 | |

On January 26, 2012, a purported class action was filed [removed: by Gary Lobaton] in the United States District Court for the Northern District of Illinois (Eastern Division) naming as defendants Costa [removed: Crociere,] [added: Crociere] S.p.A., Carnival Corporation and Carnival plc (Gary Lobaton [removed: v Carnival Corporation, Carnival plc and Costa Crociere S.p.A. et.][added: v.]

The plaintiff purports to represent an alleged class of the passengers and crew of _Costa Concordia_ who were [removed: onboard] [added: on board] the ship [removed: on] [added: during the ship incident in] January [removed: 13,] 2012.

The complaint alleges [removed: that] the defendants violated the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea, breached contracts with employees and passengers and acted negligently.

Carnival Corporation, Carnival plc and Costa Crociere S.p.A.).

The defendants have been served with the action.

On May 3, 2012, an action was filed in the United States District Court for the Southern District of Florida naming as defendants Carnival Corporation, Carnival plc, Costa Crociere S.p.A. and Costa Cruise Lines, Inc. (Giglio Sub v.

Carnival Corporation).

The defendants have been served with the action.

The plaintiffs are a purported class of business owners and wage earners on Giglio Island in Italy who claim they have been injured as a result of the ship incident in January 2012.

The plaintiffs allege negligence, gross negligence and nuisance against the defendants.

The complaint seeks monetary damages in the amount of $75 million, punitive damages, interests, costs and an injunction that future travel near Giglio Island will be conducted at safe distances.

On September 26, 2012, the court granted the defendants’ motion to dismiss the plaintiffs’ claims to Italy based on the _forum non conveniens_ doctrine.

The plaintiffs filed a notice of appeal to the U.S. Court of Appeals for the Eleventh Circuit, which is pending.

On June 25, 2012, an action was filed in the United States District Court for the Central District of California naming as defendants Carnival Corporation, Costa Crociere S.p.A., Micky Arison, Howard Frank, Arnold Donald, Joseph Farcus, and Joseph Farcus, Architect, P.A. (Sandoval v.

Carnival Corporation).

The defendants have been served with the action, although the plaintiffs voluntarily dismissed claims against Costa Crociere S.p.A.

The action was filed by two plaintiffs in connection with the ship incident in January 2012.

The case is scheduled for trial in June 2013.

##### [Table of Contents](#toc)

On July 5, 2012, an action was filed in the Circuit Court serving Miami-Dade County, Florida naming as defendants Carnival Corporation, Carnival Corporation & plc, Costa Cruise Lines, Inc., Costa Crociere S.p.A. and Joseph Farcus P.A. (Scimone v.

Carnival Corp.).

The defendants have been served with the action.

The plaintiffs filed the action in connection with the ship incident in January 2012.

The action contains claims for negligence, product liability, professional negligence and intentional tort.

The complaint seeks economic and compensatory damages, attorneys’ fees, costs and interest.

The plaintiffs state they will amend their complaint to state a claim for punitive damages.

The defendants removed the case to the United States District Court for the Southern District of Florida and moved to dismiss to Italy based on _forum non conveniens_ and the forum selection clauses in certain of the plaintiffs’ Passage Ticket Contracts.

The case is scheduled for trial in 2014.

On July 5, 2012, an action was filed in the Circuit Court serving Miami-Dade County, Florida naming as defendants Carnival Corporation, Carnival Corporation & plc, Costa Cruise Lines, Inc., Costa Crociere S.p.A. and Joseph Farcus P.A. (Abeid-Saba v.

Carnival Corp.).

The defendants have been served with the action.

The plaintiffs filed the action in connection with the ship incident in January 2012.

The action contains claims for maritime negligence, gross negligence, negligence-product defect as to Carnival Corporation, professional negligence in ship design, intentional failure to warn, intentional failure to abandon ship, intentional failure to notify authorities, corporate policies and practice, intentional infliction of emotional distress, negligent retention, fraudulent misrepresentation and fraud in the inducement.

The complaint seeks economic and compensatory damages, attorneys’ fees, costs and interest.

The plaintiffs state they will amend their complaint to state a claim for punitive damages.

The defendants removed the case to the United States District Court for the Southern District of Florida and moved to dismiss to Italy based on _forum non conveniens_ and the forum selection clauses in certain of the plaintiffs’ Passage Ticket Contracts.

On July 13, 2012, an action was filed in the United States District Court for the Southern District of Florida naming as defendants Carnival Corporation, Carnival Corporation & plc, Costa Cruise Lines, Inc., and Costa Crociere S.p.A (Warrick v.

Carnival Corp.).

The defendants have been served with the action.

The plaintiffs, consisting of five U.S. citizens, filed the action in connection with the ship incident in January 2012.

Three of the plaintiffs were passengers on the ship and they assert claims for fraudulent misrepresentation, maritime negligence, gross negligence, intentional infliction of emotional distress, negligent hiring, fraudulent inducement and deceptive trade practices arising out of the incident, as well as vicarious liability and actual and apparent agency.

The remaining two plaintiffs did not sail because one did not have the required visa and the other opted to also stay behind.

These two plaintiffs assert claims for breach of contract, fraudulent misrepresentation and unjust enrichment.

On January 13, 2012, _Costa Concordia_ grounded off the coast of Isola del Giglio, Italy and sustained significant damage.

There were 16 casualties, a number of injuries and 16 people remain missing, as of January 26, 2012.

The ship remains grounded and partially submerged off the coast.

The cause of the accident is currently under investigation by the Italian authorities.

As a result of this accident, litigation claims, enforcement actions and regulatory actions and investigations, including but not limited to those arising from personal injury, loss of life, loss of or damage to personal property, business interruption losses or environmental damage to any affected coastal waters and the surrounding area, may be asserted or brought against various parties including us.

al., No. 12-cv-00598).

[removed: UNITED STATES SECURITIES] [added: SECURITIES] AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] D.C. [removed: 20549][added: 20549]

For the fiscal year ended November 30, [removed: 2011][added: 2012 or]

| Republic of Panama [added: (State or other jurisdiction of incorporation or organization)] | | | England and Wales [added: (State or other jurisdiction of incorporation or organization)] | |

| (305) 599-2600 [added: (Registrant’s telephone number, including area code)] | | | [added: |] 011 44 20 7940 5381 [removed: |] [added: (Registrant’s telephone number, including area code)] |

| Securities registered pursuant [added: to Section 12(b) of the Act:] | | | [added: |] Securities registered pursuant [removed: |] [added: to Section 12(b) of the Act:] |

| Name of each exchange on which registered New York Stock Exchange, Inc. | | | [added: |] Name of each exchange on which registered New York Stock Exchange, Inc. | [removed: |]

| The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold was [removed: $15.3] [added: $12.3] billion as of the last business day of the registrant’s most recently completed second fiscal quarter. | | The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold was [removed: $7.4] [added: $5.9] billion as of the last business day of the registrant’s most [removed: recent] [added: recently] completed second fiscal quarter. |

| At January [removed: 23, 2012,] [added: 22, 2013,] Carnival Corporation had outstanding [removed: 595,964,160] [added: 592,310,060] shares of its Common Stock, $0.01 par value. | | At January [removed: 23, 2012,] [added: 22, 2013,] Carnival plc had outstanding [removed: 215,069,160] [added: 215,466,538] Ordinary Shares $1.66 par value, one Special Voting Share, GBP 1.00 par value and [removed: 595,964,160] [added: 592,310,060] Trust Shares of beneficial interest in the P&O Princess Special Voting Trust. |

FOR THE FISCAL YEAR ENDED NOVEMBER 30, [removed: 2011][added: 2012]

| Item 1. | | [removed: [Business](#tx254914_1)] [added: [Business](#tx387954_1)] | | | 4 | |

| Item 1A. | | [Risk [removed: Factors](#tx254914_2)] [added: Factors](#tx387954_2)] | | | [removed: 26] [added: 29] | |

| Item 1B. | | [Unresolved Staff [removed: Comments](#tx254914_3)] [added: Comments](#tx387954_3)] | | | [removed: 34] [added: 39] | |

| Item 2. | | [removed: [Properties](#tx254914_4)] [added: [Properties](#tx387954_4)] | | | [removed: 35] [added: 39] | |

| Item 3. | | [Legal [removed: Proceedings](#tx254914_5)] [added: Proceedings](#tx387954_5)] | | | [removed: 35] [added: 39] | |

| Item 5. | | [Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#tx254914_7)] [added: Securities](#tx387954_7)] | | | [removed: 37] [added: 42] | |

| Item 6. | | [Selected Financial [removed: Data](#tx254914_8)] [added: Data](#tx387954_8)] | | | [removed: 39] [added: 44] | |

| Item 7. | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#tx254914_9)] [added: Operations](#tx387954_9)] | | | [removed: 39] [added: 44] | |

| Item 7A. | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#tx254914_10)] [added: Risk](#tx387954_10)] | | | [removed: 39] [added: 44] | |

| Item 8. | | [Financial Statements and Supplementary [removed: Data](#tx254914_11)] [added: Data](#tx387954_11)] | | | [removed: 39] [added: 44] | |

| Item 9. | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#tx254914_12)] [added: Disclosure](#tx387954_12)] | | | [removed: 39] [added: 44] | |

| Item 9A. | | [Controls and [removed: Procedures](#tx254914_13)] [added: Procedures](#tx387954_13)] | | | [removed: 39] [added: 45] | |

| Item 9B. | | [Other [removed: Information](#tx254914_14)] [added: Information](#tx387954_14)] | | | [removed: 40] [added: 45] | |

| Item 10. | | [Directors, Executive Officers and Corporate [removed: Governance](#tx254914_15)] [added: Governance](#tx387954_15)] | | | [removed: 40] [added: 45] | |

| Item 11. | | [Executive [removed: Compensation](#tx254914_16)] [added: Compensation](#tx387954_16)] | | | [removed: 40] [added: 45] | |

| Item 12. | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#tx254914_17)] [added: Matters](#tx387954_17)] | | | [removed: 41] [added: 46] | |

| Item 13. | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#tx254914_18)] [added: Independence](#tx387954_18)] | | | [removed: 41] [added: 46] | |

| Item 14. | | [Principal [removed: Accounting] [added: Accountant] Fees and [removed: Services](#tx254914_19)] [added: Services](#tx387954_19)] | | | [removed: 41] [added: 46] | |

| Item 15. | | [removed: [Exhibits,] [added: [Exhibits and] Financial Statement [removed: Schedules](#tx254914_20)] [added: Schedules](#tx387954_20)] | | | [removed: 42] [added: 47] | |

The information described below and contained in the Registrants’ [removed: 2011] [added: 2012] annual report to shareholders to be furnished to the U.S. Securities and Exchange Commission pursuant to Rule 14a-3(b) of the Securities Exchange Act of 1934 is shown in Exhibit 13 and is incorporated by reference into this joint [added: 2012] Annual Report on Form 10-K (“Form 10-K”).

| Item 5(a). | | Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities—Market] [added: Securities – Market] Information, Holders and Performance Graph. |

10-K 1 d387954d10k.htm 10-K

UNITED STATES

| | | | | |

| Commission file number: 1-9610 | | | | Commission file number: 1-15136 |

| | | | | |

| Carnival Corporation (Exact name of registrant as specified in its charter) | |  | | Carnival plc (Exact name of registrant as specified in its charter) |

| | | | | |

| 59-1562976 (I.R.S. Employer Identification No.) | | | | 98-0357772 (I.R.S. Employer Identification No.) |

| | | | | |

| 3655 N.W. 87th Avenue Miami, Florida 33178-2428 (Address of principal executive offices and zip code) | | | | Carnival House, 5 Gainsford Street, London SE1 2NE, United Kingdom (Address of principal executive offices and zip code) |

| | | | | |

| | | | | |

| | | | | |

| Title of each class Common Stock ($0.01 par value) | | | | Title of each class Ordinary Shares each represented by American Depositary Shares ($1.66 par value), Special Voting Share, GBP 1.00 par value and Trust Shares of beneficial interest in the P&O Princess Special Voting Trust |

| | | | | |

| Item 4. | | [Mine Safety Disclosures](#tx387954_6) | | | 41 | |

| | | |

| | | |

| | | |

| | | |

10-K 1 d254914d10k.htm FORM 10-K

or

| Commission file number: 1-9610 | |  | | Commission file number: 1-15136 |

| Carnival Corporation | | | Carnival plc | |

| (Exact name of registrant as | | | (Exact name of registrant as | |

| specified in its charter) | | | specified in its charter) | |

| (State or other jurisdiction of | | | (State or other jurisdiction of | |

| incorporation or organization) | | | incorporation or organization) | |

| 59-1562976 | | | 98-0357772 | |

| (I.R.S. Employer | | | (I.R.S. Employer | |

| Identification No.) | | | Identification No.) | |

| 3655 N.W. 87th Avenue | | | Carnival House, 5 Gainsford Street, | |

| Miami, Florida 33178-2428 | | | London SE1 2NE, United Kingdom | |

| (Address of principal | | | (Address of principal | |

| executive offices and | | | executive offices and | |

| zip code) | | | zip code) | |

| (Registrant’s telephone number, | | | (Registrant’s telephone number, | |

| including area code) | | | including area code) | |

| to Section 12(b) of the Act: | | | to Section 12(b) of the Act: | |

| Title of each class | | | Title of each class | |

| Common Stock | | | Ordinary Shares each represented | |

| ($0.01 par value) | | | by American Depositary Shares | |

| | | | ($1.66 par value), Special Voting | |

| | | | Share, GBP 1.00 par value and Trust | |

| | | | Shares of beneficial interest in the | |

| | | | P&O Princess Special Voting Trust | |

| Item 4. | | [(Removed and Reserved)](#tx254914_6) | | | 35 | |

[added: |] Portions of the Registrants’ [removed: 2012] [added: 2013] joint definitive Proxy Statement, to be filed with the U.S. Securities and Exchange Commission, are incorporated by reference into this Form 10-K under the items described below. [added: | | |]

[added: |] Part and Item of the Form 10-K [added: | | |]

[added: |] Part III [added: | | |]

| | | |

| | | |

| | | |

| --- | --- | --- |

##### [Table of Contents](#toc)

As of January [removed: 23, 2012,] [added: 22, 2013,] the Carnival Corporation and Carnival plc [removed: corporate] headquarters and our larger shoreside locations are as follows:

| Carnival Corporation headquarters and Carnival Cruise Lines | | Miami, FL U.S.A. | | [removed: 463,000/24,000] [added: 463,000/12,000] | | Own/Lease |

| Princess | | Santa Clarita, CA U.S.A. | | [removed: 361,000] [added: 449,000] | | Lease |

| Holland America Line, Holland America Princess Alaska Tours and Seabourn | | Seattle, WA U.S.A. | | [removed: 172,000] [added: 237,000] | | Lease |

| AIDA | | Rostock, Germany | | [removed: 153,000] [added: 153,000/53,000] | | [removed: Own] [added: Own/Lease] |

| Carnival plc headquarters | | London, England | | [removed: 8,000] [added: 9,000] | | Lease |

In addition, we own, lease or have controlling interests in port facilities in Barcelona, Spain; Cozumel, Mexico; Grand Turk, Turks & Caicos Islands; Juneau, Alaska; Long Beach, [removed: California; Roatán, Honduras] [added: California] and [removed: Savona, Italy.][added: Roatán, Honduras.]

Our cruise ships in operation, headquarters, [removed: port] [added: ports, private islands] and other shoreside facilities and Holland America Princess Alaska Tours’ properties are all well maintained and in good condition.

“Cruise [removed: Operations.”] [added: Business.”] The hotel properties owned and operated by Holland America Princess Alaska Tours and the two cruise ships that we own and charter-out under long-term bareboat charter agreements are also briefly described in Part I, Item 1.

Information about our cruise ships, including the number each of our cruise brands [removed: operate,] [added: operates,] their passenger capacity and their primary [removed: areas] [added: regions] or countries [removed: in] [added: from] which they [removed: are marketed,] [added: source their guests,] as well as information regarding our cruise ships under construction may be found under Part I, Business.

[removed: “Overview,”] [added: “Cruise Business,”] and Note 6, “Commitments” and Note [removed: 10,] [added: 11,] “Fair Value Measurements, Derivative Instruments and Hedging Activities” to our Consolidated Financial Statements in Exhibit 13 to this Form [removed: 10-K for additional information regarding our ship commitments.][added: 10-K.]

Also, information about maritime regulations and issues that may affect our [removed: utilization and operation of] cruise ships [removed: may] [added: can] be found in Part I.

“Cruise Business.”

B.

B.

“Cruise Business.”

A.

“Overview.”

“Cruise Operations.”

| Name | | Age | | [removed: | |] Years of Service (a) | | Title |

| Micky Arison | | [removed: | 62 |] [added: 63] | | [removed: 40] [added: 41] | | Chairman of the Board of Directors and Chief Executive Officer |

| David Bernstein | | [removed: | 54 |] [added: 55] | | [removed: 13] [added: 14] | | Senior Vice President and Chief Financial Officer |

| Alan B. Buckelew | | [removed: | 63 |] [added: 64] | | [removed: 34] [added: 35] | | President and Chief Executive Officer of Princess |

| Gerald R. Cahill | | [removed: | 60 |] [added: 61] | | [removed: 17] [added: 18] | | President and Chief Executive Officer of Carnival Cruise Lines |

| David Dingle | | [removed: | 54 |] [added: 55] | | [removed: 33] [added: 34] | | Chief Executive Officer of Carnival UK |

| Pier Luigi Foschi | | [removed: | 65 |] [added: 66] | | [removed: 14] [added: 15] | | Chairman and Chief Executive Officer of [added: Carnival Asia and Chairman of] Costa Crociere, S.p.A. and Director |

| Howard S. Frank | | [removed: | 70 |] [added: 71] | | [removed: 22] [added: 23] | | Vice Chairman of the Board of Directors and Chief Operating Officer |

| Larry Freedman | | [removed: | 60 |] [added: 61] | | [removed: 13] [added: 14] | | Chief Accounting Officer and Vice President – Controller |

| Stein Kruse | | [removed: | 53 |] [added: 54] | | [removed: 12] [added: 13] | | Chairman, President and Chief Executive Officer of Holland America Line and Chairman of Seabourn |

| Arnaldo Perez | | [removed: | 51 |] [added: 52] | | [removed: 19] [added: 20] | | Senior Vice President, General Counsel and Secretary |

David Dingle has been Chief Executive Officer of Carnival [removed: UK, whose brands include P&O Cruises (UK) and Cunard,] [added: UK] since [added: June] 2007.

[removed: Pier Luigi Foschi] [added: He] has been a director since 2003.

[removed: He] [added: Michael Thamm] has been Chief Executive Officer of Costa [removed: Crociere,] [added: Crociere] S.p.A. since [removed: 1997 and Chairman of its Board since 2000.][added: July 2012.]

In [removed: this] [added: that] capacity, Mr. Foschi [removed: has] [added: also] had responsibility for AIDA [removed: since] [added: from] 2003 [added: to July 2012] and Ibero [removed: since 2007.][added: from 2007 to July 2012.]

Mr. Kruse also serves as Chairman of the Board of Seabourn, a role he has held since [removed: January] 2011.

None.

| | | | | | | |

| --- | --- | --- | --- | --- | --- | --- |

| Michael Thamm | | 49 | | 19 | | Chief Executive Officer of Costa Crociere, S.p.A |

In this capacity, he has full operating responsibility for the UK brands, P&O Cruises (UK) and Cunard.

Pier Luigi Foschi has been Chairman and Chief Executive Officer of Carnival Asia since September 2012.

He has been Chairman of the Board of Costa Crociere S.p.A since 2000.

He was Chief Executive Officer of Costa Crociere, S.p.A from 1997 to July 2012.

In this capacity, Mr. Thamm also has responsibility for AIDA and Ibero.

He was president of AIDA from 2004 to July 2012 and Senior Vice President Operations of AIDA from 1993 to 2004.

##### [Table of Contents](#toc)

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [removed: |] A. | Market Information |

| [removed: |] B. | Holders |

| [removed: |] C. | Dividends |

| | | February [removed: 28] [added: 28/29] | | | | May 31 | | | | August 31 | | | | November 30 | | |

| [removed: |] D. | Securities Authorized for Issuance under Equity Compensation Plans |

| [removed: |] E. | Performance Graph |

| [removed: |] F. | Issuer Purchases of Equity Securities; Use of Proceeds from Registered Securities |

In September 2007, our Boards of Directors authorized the repurchase of up to an aggregate of $1 billion of Carnival Corporation common stock and Carnival plc ordinary shares subject to certain [removed: restrictions,] [added: restrictions] (the “Repurchase Program”).

During the three months ended November 30, [removed: 2011,] [added: 2012,] purchases of Carnival Corporation common stock pursuant to the Repurchase Program were as follows:

| Period | | Total Number of [removed: Carnival Corporation] [added: Shares of Carnival Corporation] Common Stock Purchased (a) | | | | Average Price Paid per Share [removed: of Carnival Corporation Common] [added: of Carnival Corporation Common] Stock | | | | Maximum Dollar Value of Shares That [removed: May Yet] [added: May Yet] Be Purchased Under [removed: the Repurchase] [added: the Repurchase] Program (b) | | |

[removed: | (b) | During September 2011] [added: In addition, during 2011,] Carnival Investments Limited, a subsidiary of Carnival Corporation, [removed: purchased 1,097,990] [added: also repurchased 1.3 million] ordinary shares of Carnival plc [removed: at an average price of $30.85] [added: for $41 million] under the Repurchase Program. [removed: Carnival plc ordinary shares are listed on the London Stock Exchange. |]

During [removed: fiscal] [added: 2012 and] 2011, we repurchased [added: 2.6 million and] 13.5 million shares of Carnival Corporation common stock for [removed: $413] [added: $90] million [added: and $413 million, respectively] under the Repurchase Program.

During [removed: 2010 and 2009,] [added: 2010,] there were no repurchases of Carnival Corporation common stock [removed: or Carnival plc ordinary shares] under the Repurchase Program.

There were [removed: no repurchases] [added: 2.1 million shares of Carnival Corporation common stock repurchased for $78 million] under the Repurchase Program from December 1, [removed: 2011] [added: 2012] through January [removed: 23, 2012.][added: 16, 2013.]

In addition to the Repurchase Program, the Boards of Directors have authorized the repurchase of up to 19.2 million Carnival plc ordinary shares and up to [removed: 31.5] [added: 32.8] million shares of Carnival Corporation common stock under the [removed: “Stock Swap”] [added: Stock Swap] programs described below.

During [added: 2012 and] 2011, no Carnival Corporation common stock or Carnival plc ordinary shares were sold or repurchased under the “Stock Swap” programs.

[removed: All] Carnival plc [added: ordinary] share repurchases under both the Repurchase Program and the [removed: “Stock Swap”] [added: Stock Swap] authorizations require annual shareholder approval.

At January [removed: 23, 2012, the remaining availability under the Repurchase Program was $334 million and] [added: 22, 2013,] the remaining availability under the [removed: “Stock Swap” program] [added: Stock Swap programs] repurchase authorizations were 18.1 million Carnival plc ordinary shares and [removed: 31.5] [added: 32.8] million Carnival Corporation [removed: shares.][added: common stock.]

The existing shareholder approval is limited to a maximum of [removed: 21.4] [added: 21.5] million ordinary shares and is valid until the earlier of the conclusion of the Carnival plc [removed: 2012] [added: 2013] annual general [removed: meeting,] [added: meeting] or October [removed: 12, 2012.][added: 10, 2013.]

| | II. | [removed: “Stock Swap”] [added: Stock Swap] Programs |

We use the [removed: “Stock Swap”] [added: Stock Swap] programs in situations where we can obtain an economic benefit because either Carnival Corporation common stock or Carnival plc ordinary shares are trading at a price that is at a premium or discount to the price of Carnival plc [added: ordinary shares or Carnival Corporation common stock, as the case may be.]

Carnival Corporation may issue and sell up to [removed: 19.2] [added: 18.1] million of its common stock in the U.S. market, which shares are to be sold from time to time at prevailing market prices in ordinary brokers’ transactions.

Carnival Corporation or Carnival Investments Limited may sell up to [removed: 31.5] [added: 32.8] million Carnival plc ordinary shares in the UK market, which shares are to be sold from time to time at prevailing market prices in ordinary brokers’ transactions.

During [removed: fiscal 2011,] [added: the year ended November 30, 2010,] no Carnival Corporation common stock [removed: or] [added: was sold and no] Carnival plc ordinary shares were [removed: sold or] repurchased under the “Stock Swap” [removed: programs.][added: program.]

| --- | --- |

| 2012 | | $ | 0.25 | | | $ | 0.25 | | | $ | 0.25 | | | $ | 0.75 | (a) |

| (a) | Includes the regular quarterly dividend of $0.25 per share and a special dividend of $0.50 per share. |

| --- | --- |

The special dividend of $0.50 per share declared on November 15, 2012 is in keeping with our strategy of returning free cash flow to shareholders, which we remain committed to doing through a combination of dividends and opportune share repurchases.

| --- | --- |

| --- | --- |

| --- | --- |

| | | | | | | | | | | (in millions) | | |

| September 1, 2012 through September 30, 2012 | | | — | | | $ | — | | | $ | 265 | |

| October 1, 2012 through October 31, 2012 | | | — | | | $ | — | | | $ | 265 | |

| November 1, 2012 through November 30, 2012 | | | 565,561 | | | $ | 38.36 | | | $ | 244 | |

| --- | --- |

| (b) | During the three months ended November 30, 2012, there were no repurchases of Carnival plc ordinary shares under the Repurchase Program. |

| --- | --- |

During fiscal 2012 and 2010, there were no repurchases of Carnival plc ordinary shares under the Repurchase Program.

On January 16, 2013, the Boards of Directors increased the remaining authorization available under the Repurchase Program back to $1 billion, which was fully available at January 22, 2013.

Depending on market conditions and other factors, we may purchase shares of Carnival Corporation common stock and/or Carnival plc ordinary shares under the Repurchase Program and the Stock Swap programs concurrently.

During 2010, Carnival Investments Limited sold 14.8 million shares of Carnival plc ordinary shares for total net proceeds of $545 million.

Substantially all of the net proceeds of these sales were used to purchase 14.8 million shares of Carnival Corporation common stock.

| --- | --- | --- |

| 2009 | | $ | 0.00 | | | $ | 0.00 | | | $ | 0.00 | | | $ | 0.00 | |

We believe preserving liquidity is a prudent step to take during uncertain times.

Accordingly in October 2008 at the height of the financial crisis, the Boards of Directors voted to suspend our $0.40 quarterly dividend payment beginning March 2009.

At the January 2010 Boards of Directors meetings, it was decided to reinstate our March 2010 quarterly dividend payment at $0.10 per share.

At the January 2011 Boards of Directors meetings, it was decided to increase the March 2011 quarterly dividend payment to $0.25 per share.

| | | | | | | | | | | | | |

| September 1, 2011 through September 30, 2011 | | | 3,934,851 | | | $ | 31.03 | | | $ | 343,395,493 | |

| October 1, 2011 through October 31, 2011 | | | 109,534 | | | $ | 28.86 | | | $ | 340,234,509 | |

| November 1, 2011 through November 30, 2011 | | | 200,000 | | | $ | 30.69 | | | $ | 334,096,418 | |

| | | | 4,244,385 | | | $ | 30.96 | | | | | |

In addition, during 2011 Carnival Investment Limited also repurchased 1.3 million ordinary shares of Carnival plc for $41 million under the Repurchase Program.

At November 30, 2011, the remaining availability under the Repurchase Program was $334 million.

Carnival plc ordinary share repurchases under both the Repurchase Program and the “Stock Swap” authorizations require annual shareholder approval.

ordinary shares or Carnival Corporation common stock, as the case may be.

##### [Table of Contents](#toc)

| [removed: |] A. | Evaluation of Disclosure Controls and Procedures |

Our Chief Executive Officer, Chief Operating Officer and Chief Financial Officer have evaluated our disclosure controls and procedures and have concluded, as of November 30, [removed: 2011,] [added: 2012,] that they are effective as described above.

| [removed: |] B. | Management’s Annual Report on Internal Control over Financial Reporting |

[added: Based on] our evaluation under the COSO Framework, our management concluded that our internal control over financial reporting was effective as of November 30, [removed: 2011.][added: 2012.]

PricewaterhouseCoopers LLP, the independent registered certified public accounting firm that audited our consolidated financial statements incorporated in this Form 10-K, has also audited the effectiveness of our internal control over financial reporting as of November 30, [removed: 2011] [added: 2012] as stated in their report, which is shown in Exhibit 13 and is incorporated by reference into this Form 10-K.

| [removed: |] C. | Changes in Internal Control over Financial Reporting |

There have been no changes in our internal control over financial reporting during the quarter ended November 30, [removed: 2011] [added: 2012] that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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Based on

##### [Table of Contents](#toc)

None.

On January 13, 2012, the 2,978-passenger capacity _Costa Concordia_ grounded off the coast of Isola del Giglio, Italy and sustained significant damage.

The ship remains grounded and partially submerged off the coast.

The cause of the accident is currently under investigation by the Italian authorities.

A damage assessment review of the ship is being undertaken to determine whether the ship can be repaired and what the total cost would be.

If the ship is repairable, it is expected to be out-of-service for the remainder of fiscal 2012 if not longer.

The net carrying value of this euro-denominated ship, including ship improvements, at December 31, 2011 was $490 million (at the December 31, 2011 exchange rate or €379 million).

We have euro-denominated insurance coverage of $510 million (at the December 31, 2011 exchange rate or €395 million) for damage to the ship with a potential deductible of approximately $30 million as well as insurance for third party personal injury liability subject to an additional deductible of approximately $10 million for this incident.

We self-insure for loss of use of the ship.

The additional information required by Item 10 is incorporated herein by reference to the Carnival Corporation and Carnival plc joint definitive Proxy Statement to be filed with the U.S. Securities and Exchange Commission not later than 120 days after the close of the [removed: 2011] [added: 2012] fiscal year, except that the information concerning the Carnival Corporation and Carnival plc executive officers called for by Item 401(b) of Regulation S-K is included in Part I of this Form 10-K.

The information required by Item 11 is incorporated herein by reference to the Carnival Corporation and Carnival plc joint definitive Proxy Statement to be filed with the U.S. Securities and Exchange Commission not later than 120 days after the close of the [removed: 2011] [added: 2012] fiscal year.

| [removed: |] A. | Securities Authorized for Issuance under Equity Compensation Plans |

Set forth below is a table that summarizes compensation plans (including individual compensation arrangements) under which Carnival Corporation equity securities are authorized for issuance as of November 30, [removed: 2011.][added: 2012.]

| (a) | Includes outstanding options to purchase Carnival Corporation common stock under the Carnival [removed: Cruise Lines, Inc. 1987 Stock Option Plan, Carnival] Corporation 2002 Stock Plan and Carnival Corporation 2001 Outside Director Stock Plan. Also includes [removed: 1,826,721] [added: 989,210] restricted share units outstanding under the Carnival Corporation 2002 Stock Plan, [removed: 17,529] [added: 3,088] restricted share units outstanding under the Carnival Corporation 2001 Outside Director Stock Plan and [removed: 3,188] [added: 802,627] restricted share units outstanding under the Carnival Corporation 2011 Stock Plan. |

| (b) | Includes Carnival Corporation common stock available for issuance as of November 30, [removed: 2011] [added: 2012] as follows: [removed: 2,438,022] [added: 2,389,697] under the Carnival Corporation Employee Stock Purchase Plan, which includes [removed: 20,903] [added: 32,731] shares subject to purchase during the current purchase period and [removed: 14,964,932] [added: 13,748,439] under the Carnival Corporation 2011 Stock Plan. |

Set forth below is a table that summarizes compensation plans (including individual compensation arrangements) under which Carnival plc equity securities are authorized for issuance as of November 30, [removed: 2011.][added: 2012.]

| Plan category | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | | Weighted-average exercise price of [removed: outstanding options, warrants and] [added: outstanding options, warrants and] rights (a) | | | | Number of securities remaining available for future [removed: issuance under] [added: issuance under] equity [removed: compensation plans] [added: compensation plans] (excluding securities reflected in column (1)) | | |

| (a) | Converted from sterling, if applicable, using the November 30, [removed: 2011] [added: 2012] exchange rate of [removed: $1.5501:£1.] [added: $1.60:£1.] |

| (b) | Includes outstanding options to purchase Carnival plc ordinary shares under the Carnival plc Executive Share Option Plan and Carnival plc 2005 Employee Share Plan. Also includes [removed: 812,881] [added: 823,037] restricted share units outstanding under the Carnival plc 2005 Employee Share Plan. |

The additional information required by Item 12 is incorporated herein by reference to the Carnival Corporation and Carnival plc joint definitive Proxy Statement to be filed with the U.S. Securities and Exchange Commission not later than 120 days after the close of the [removed: 2011] [added: 2012] fiscal year.

| Items 13 and 14. | | Certain Relationships and Related Transactions, and Director Independence and Principal [removed: Accounting] [added: Accountant] Fees and Services. |

The information required by Items 13 and 14 is incorporated herein by reference to the Carnival Corporation and Carnival plc joint definitive Proxy Statement to be filed with the U.S. Securities and Exchange Commission not later than 120 days after the close of the [removed: 2011] [added: 2012] fiscal year.

| Equity compensation plans approved by security holders | | | 8,551,942 | (a) | | $ | 48.10 | | | | 16,138,136 | (b)(c) |

| | | | 8,551,942 | | | $ | 48.10 | | | | 16,138,136 | |

| Equity compensation plans approved by security holders | | | 2,194,233 | (b) | | $ | 45.88 | | | | 16,578,671 | (c) |

| | | | 2,194,233 | | | $ | 45.88 | | | | 16,578,671 | |

| --- | --- |

| --- | --- | --- |

| Equity compensation plans approved by security holders | | | 10,622,672 | (a) | | $ | 46.24 | | | | 17,402,954 | (b)(c) |

| | | | 10,622,672 | | | $ | 46.24 | | | | 17,402,954 | |

| Equity compensation plans approved by security holders | | | 2,466,598 | (b) | | $ | 42.54 | | | | 15,329,093 | (c) |

| | | | 2,466,598 | | | $ | 42.54 | | | | 15,329,093 | |

| CARNIVAL CORPORATION | | [added: | |] CARNIVAL PLC |

| /s/ Micky Arison | | [added: | |] /s/ Micky Arison |

| Micky Arison | | [added: | |] Micky Arison |

| Chairman of the Board of Directors and Chief Executive Officer | | [added: | |] Chairman of the Board of Directors and Chief Executive Officer |

| /s/ Howard S. Frank | | [added: | |] /s/ Howard S. Frank |

| Howard S. Frank | | [added: | |] Howard S. Frank |

| Vice Chairman of the Board of Directors and Chief Operating Officer | | [added: | |] Vice Chairman of the Board of Directors and Chief Operating Officer |

| /s/ David Bernstein | | [added: | |] /s/ David Bernstein |

| David Bernstein | | [added: | |] David Bernstein |

| Senior Vice President and Chief Financial Officer | | [added: | |] Senior Vice President and Chief Financial Officer |

| /s/ Larry Freedman | | [added: | |] /s/ Larry Freedman |

| Larry Freedman | | [added: | |] Larry Freedman |

| Chief Accounting Officer and Vice President – Controller | | [added: | |] Chief Accounting Officer and Vice President [removed: –] [added: -] Controller |

| /s/*Sir Jonathon Band | | [added: | |] /s/*Sir Jonathon Band |

| Sir Jonathon Band [added: Director] | | [added: | |] Sir Jonathon Band [added: Director] |

| Director | | [added: | |] Director |

| /s/*Robert H. Dickinson | | [added: | |] /s/*Robert H. Dickinson |

| Robert H. Dickinson [added: Director] | | [added: | |] Robert H. Dickinson [added: Director] |

| /s/*Arnold W. Donald | | [added: | |] /s/*Arnold W. Donald |

| Arnold W. Donald [added: Director] | | [added: | |] Arnold W. Donald [added: Director] |

| /s/*Pier Luigi Foschi | | [added: | |] /s/*Pier Luigi Foschi |

| Pier Luigi Foschi [added: Director] | | [added: | |] Pier Luigi Foschi [added: Director] |

| /s/*Richard J. Glasier | | [added: | |] /s/*Richard J. Glasier |

| Richard J. Glasier | | [added: | |] Richard J. Glasier |

| /s/*Modesto A. Maidique | | [added: | |] /s/*Modesto A. Maidique |

| Modesto A. Maidique [added: Director] | | [added: | |] Modesto A. Maidique [added: Director] |

| /s/*Sir John Parker | | [added: | |] /s/*Sir John Parker |

| Sir John Parker [added: Director] | | [added: | |] Sir John Parker [added: Director] |

| /s/*Peter G. Ratcliffe | | [added: | |] /s/*Peter G. Ratcliffe |

| Peter G. Ratcliffe [added: Director] | | [added: | |] Peter G. Ratcliffe [added: Director] |

| /s/*Stuart Subotnick | | [added: | |] /s/*Stuart Subotnick |

| Stuart Subotnick [added: Director] | | [added: | |] Stuart Subotnick [added: Director] |

| /s/*Laura Weil | | [added: | |] /s/*Laura Weil |

| Laura Weil [added: Director] | | [added: | |] Laura Weil [added: Director] |

| /s/*Randall J. Weisenburger | | [added: | |] /s/*Randall J. Weisenburger |

| Randall J. Weisenburger [added: Director] | | [added: | |] Randall J. Weisenburger [added: Director] |

| *By: /s/ Arnaldo Perez | | [added: | |] *By: /s/ Arnaldo Perez |

| Arnaldo Perez [added: (Attorney-in-fact)] | | [added: | |] Arnaldo Perez [added: (Attorney-in-fact)] |

| 4.1 | | Agreement of Carnival Corporation and Carnival plc, dated January 17, [removed: 2012] [added: 2013] to furnish certain debt instruments to the Securities and Exchange Commission. | | | | | | | | | | X |

| [removed: 4.12] [added: 4.11] | | Form of Indenture, dated March 1, 1993, between Carnival Cruise Lines, Inc. and First Trust National Association, as Trustee, relating to the Debt Securities, including form of Debt Security. | | S-3 | | 4 | | | 3/2/93 | | | |

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| January 29, 2013 | | | | January 29, 2013 |

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| CARNIVAL CORPORATION | | | | CARNIVAL PLC |

| | | | | |

| /s/ Micky Arison | | | | /s/ Micky Arison |

| Micky Arison | | | | Micky Arison |

| Chairman of the Board of Directors and Chief Executive Officer | | | | Chairman of the Board of Directors and Chief Executive Officer |

| | | | | |

| January 29, 2013 | | | | January 29, 2013 |

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| January 29, 2013 | | | | January 29, 2013 |

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| January 29, 2013 | | | | January 29, 2013 |

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| January 29, 2013 | | | | January 29, 2013 |

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| January 29, 2013 | | | | January 29, 2013 |

| | | | | |

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| January 29, 2013 | | | | January 29, 2013 |

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| January 29, 2013 | | | | January 29, 2013 |

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| January 29, 2013 | | | | January 29, 2013 |

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| | | |

| January 30, 2012 | | January 30, 2012 |

| /s/*Uzi Zucker | | /s/*Uzi Zucker |

| Uzi Zucker | | Uzi Zucker |

| (Attorney-in-fact) | | (Attorney-in-fact) |

| | | | | | | | | | | | | |

| 4.11 | | Indenture, dated as of April 25, 2001, between Carnival Corporation and U.S. Bank Trust National Association, as trustee, relating to unsecured and unsubordinated debt securities. | | S-3 | | 4.5 | | | 6/13/01 | | | |

| | | and | | | | | | | | |