Carnival Corp.’s quarterly profit plunged 93 per cent due to rising fuel costs and weaker bookings following the Costa Concordia wreck earlier this year, sending its shares down 3 per cent in midday trade.

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The European business of the world’s largest cruise operator took a big hit after its Costa Concordia cruise liner capsized off the coast of Italy in January, killing at least 25 people. Carnival has said a companywide recovery will take a year or two.

“You had that big accident, and immediately after bookings dried up. It created a hole that Carnival is trying to fill,” said Matthew Jacob, senior analyst at ITG, noting that the number of empty cabins on its cruises remains higher than normal.

The company reported on Friday that it earned just $14-million, or 2 cents a share, in the fiscal second quarter ended May 31, compared with $206-million, or 26 cents a share, a year earlier.

Adjusted for unrealized losses on fuel derivatives, earnings were 20 cents a share, topping analysts’ average forecast of 8 cents, according to Thomson Reuters I/B/E/S.

Fuel prices increased 12 per cent to $756 per metric ton, costing the company an additional $71-million. But Carnival said it expects lower costs and fuel prices in the future, and it raised its full-year profit view.

For the full year, it expects to earn $1.80 to $1.90 per share on an adjusted basis. In March it forecast $1.40 to $1.70.

The forecast did not impress analysts, however, as about 30 cents of the increase was due to expectations for lower fuel prices, not stronger demand.

Carnival said full-year net revenue yields, on a constant dollar basis, are expected “to be down slightly.” Including the European cruise line Costa, the company expects a decline of 3 to 4 per cent in net revenue yields.

For the last seven weeks, booking volumes excluding Costa have increased 8 per cent versus the prior year. Booking volumes for Costa over the same period are up 25 per cent.

But ITG’s Jacob said that number “could be misleading” as yields – the amount of money spent by each customer per cabin for both the price of the ticket and on items once they are on the ship – are low and future booking trends are weak.

“In a hotel, if a room is not booked on Monday, it does not mean you can’t rent it Tuesday. For a cruise liner, if you start Sunday and the cabin isn’t sold, you can’t sell it later,” he said.

Carnival shares were down 3 per cent at $33.61 on the New York Stock Exchange.

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