23growth. Also, in 2014, Norwegian’s operating profit margin was well above the industry average of 13.01% while Carnival’s was below. Operating Profit Growth 2013-2014 2012-2013 2011-2012 2010-2011 Carnival 32.54% -17.66% -35.73 -15.68% Norwegian 27.02% 10.92% 12.97% 37.39% Due to a combination of capacity growth and revenue yield improvement, Carnival’s operating income in China significantly increased, which was another reason for the strong growth in 2014.1365.4 Net Income and Net Profit Margin 137The visual representation above really does a good job of showing just how disconcerting Carnival’s inability to grow really is. With the blue bars representing Norwegian’s growth and the red representing Carnival’s it is easy to see how much Norwegian dwarfs Carnival on a percentage growth scale. Although Norwegian had a bad year in 2013 with negative growth, it is safe to say that their incredible growth of 460.9% in 2011 and 232.6% in 2014 puts them on top. Carnival’s growth in net income has been negative four out of the five years shown. This is a huge red flag. It is good, however that they had a positive growth this last year in 2014. This may mean that they have finally recovered and are ready to move forward. Compared to 136CCL 10-‐K Document (2014)1372010-‐20112011-‐20122012-‐20132013-‐2014-‐1000100200300400500Net Income Growth (%)CarnivalNorwegian
24Norwegian, the 2014 growth was negligible, but the positive growth is at least a step in the right direction for the company as a whole. The net profit margin is another area that is important to look at. It does not show the company’s growth, but measures how much of every dollar the company makes that they actually keep.138Net Profit Margin 2014 2013 2012 2011 2010 Carnival1397.78% 6.97% 8.44% 12.11% 13.67% Norwegian14010.82% 3.96% 7.40% 5.72% 1.12% Industry Avg. 9.35% Over the last five years, neither company looks stellar. One however, obviously looks better than the other. It appears that, after the disaster in 2012, that Carnival’s net profit margins declined fairly significantly and Norwegian’s was almost cut in half. It is obvious that 2013 was a bad year for both of them. However, looking at 2014, it looks like carnival is staying fairly level in their margin while they try to get back to the place they were in 2010 and 2011.