End of shareholder benefits?

[tacticalbanjo]

Prompted by this being mentioned on Facebook, I've noticed that the Shareholder Benefits section of the Carnival Corp and plc annual report is absent. In every annual report going back to 2016 it was in the first few pages but is nowhere to be found at all in the latest report released last week.

 

https://www.carnivalcorp.com/financial-information/annual-reporting

 

But this doesn't chime with the fact that Carnival have been busy introducing a new way of claiming shareholder benefits, does it? So do we think that this is simply an accidental omission or Carnival really are taking away a big factor in a lot of us becoming shareholders?

[exlondoner]

Why not ask them?

[Pushpit]

The Stockperks App (see separate thread) shows the shareholder benefit applies for sailings to the end of July 2024, and as things stand I would expect it to be renewed to July 2025 as we get nearer to July.

[tacticalbanjo]

22 minutes ago, exlondoner said:

Why not ask them?

It's unlikely that anyone on the social media team or in the call centre knows the answer. They might pretend to I suppose.

 

1 minute ago, Pushpit said:

The Stockperks App (see separate thread) shows the shareholder benefit applies for sailings to the end of July 2024, and as things stand I would expect it to be renewed to July 2025 as we get nearer to July.

Typically the renewal has happened when the annual report was released. So in the 2022 annual report (released early 2023) it was pushed to 2024, in the 2021 annual report it was pushed to 2023, in the 2020 annual report it was pushed to 2022 and so on. But this year there is no shareholder benefit statement in the annual report pushing is back to 2025 as we would expect to see.

[tacticalbanjo]

Just to add that as of right now, the last date that you can book a cruise and claim shareholder benefit is tomorrow, Feb 28. So you can book a cruise next week to sail before the end of July and not be able to claim shareholder benefit unless Carnival Corp renew the shareholder benefit.

[david63]

There is nothing in the Annual Report nor in April's Notice of AGM so unless a special resolution is going to be presented at the AGM it looks as if there will be no shareholder OBC for at least the next 12 months.

 

I suspect that the issues is that since Covid the price of Carnival shares has plummeted from it pre Covid price of around £50 making it a much more affordable purchase and I would make a guess that many have bought shares for the OBC and it has now become unsustainable.

 

It will be interesting to see what is said about it at the AGM and what, if anything, will replace it. My guess would be that there will be a break for a year or two and then a larger share holding (500?) for a small OBC. Another case of the bean counters taking at work.

[Victoria2]

On a just in case tomorrow's date is pertinent basis, I have sent through more OBC requests so thanks for any  heads up on this.

[david63]

17 minutes ago, Victoria2 said:

On a just in case tomorrow's date is pertinent basis, I have sent through more OBC requests so thanks for any  heads up on this.

There is no problem now, or in the future, for any OBC up to the end of July - it is after that date when it appears to be stopping.

[tacticalbanjo]

4 minutes ago, david63 said:

There is no problem now, or in the future, for any OBC up to the end of July - it is after that date when it appears to be stopping.

You need to have booked by the end of the tomorrow to be able to claim as per this extract from the 2022 annual report. If you book from Thursday onward, even if it is for a trip sailing before the end of July then you can't claim for OBC according to the terms of the shareholder benefits deal.

[BigMac1953]

1 hour ago, david63 said:

 

 

I suspect that the issues is that since Covid the price of Carnival shares has plummeted from it pre Covid price of around £50 making it a much more affordable purchase and I would make a guess that many have bought shares for the OBC and it has now become unsustainable.

 

 

Surely the share price makes absolutely no difference?

 

If somebody bought 100 x Shares at £50, then sold them at £10 then they would have made a £4000 loss, not Carnival.

 

The exact same number of shares are in circulation. Supply and demand just change the price.

[ClipperinSFO]

10 minutes ago, BigMac1953 said:

 

Surely the share price makes absolutely no difference?

 

If somebody bought 100 x Shares at £50, then sold them at £10 then they would have made a £4000 loss, not Carnival.

 

The exact same number of shares are in circulation. Supply and demand just change the price.

I think @david63 is on to something and that it’s more the sheer volume of OBC requests that a low share price generates (more people owning shares) in terms of workload for CCL. In addition to the amount of money that they then have to dole out in OBC from all those requests. I could see why the accountants would raise an eye brow. Perhaps as well they think the stock will stay relatively low for the foreseeable future and so this “problem” won’t abate anytime soon. 

[david63]

21 minutes ago, BigMac1953 said:

 

Surely the share price makes absolutely no difference?

 

If somebody bought 100 x Shares at £50, then sold them at £10 then they would have made a £4000 loss, not Carnival.

 

The exact same number of shares are in circulation. Supply and demand just change the price.

The share price make a vast difference. If shares are at £50 and you need 100 then that is an outlay of £5,000 with the added likelihood that they will fall in value. On the other hand if shares are at £10 then outlay is only £1,000 with the likelihood of them going up in value.

 

The point being that more people will risk £1,000 in the knowledge that they will get some OBC and be unlikely to loose money overall whereas investing £5,000 is for the long term and ties up more of your money.

 

For example I bought 200 shares when they were at rock bottom. As soon as they doubled in price which was about three months later I sold 100. I now have 100 shares that cost me nothing and are valued at around £1,000 and I have had over £600 in OBC

[ClipperinSFO]

@david63 exactly. We bought our shares with the idea that regardless of what the share price did, with enough cruises and resulting OBC they would eventually be at zero cost.  A lot harder to do when the shares are at 50 than when they are at 15. 

[BigMac1953]

...but my point was; there are no more shares on the market! The total amount of shares now is exactly the same as before Covid. Carnival have not issued any more shares.

 

Whether people buy/ sell makes no difference to the amount in circulation.

[tacticalbanjo]

I suppose it might make a difference to the number of retail vs institutional investors but I don't know enough about the stock market to comment on that.

[david63]

34 minutes ago, BigMac1953 said:

...but my point was; there are no more shares on the market! The total amount of shares now is exactly the same as before Covid. Carnival have not issued any more shares.

 

Whether people buy/ sell makes no difference to the amount in circulation.

You are right about the number of shares that have been issues not having changed but the number of people owing those shares could well have changed.

 

For example if Mr A had, say, 500 shares and was claiming OBC and then he sells 200 of those shares and MrB buys them and claims OBC Carnival are now paying out twice as much OBC for the same number of shares.

[NE John]

Sometimes, when a stock price goes down, the company itself will buy shares to lower the supply (and buy low too). I don’t know if Carnival is buying back shares. 
The question is, “is it worth risking about $1,500 for 100 shares of US CCL stock to get $100 OBC.” 
I took advantage last summer when the stock was $9’ish but I’m going to wait and see at this point. 

Edited February 27 by NE John

[foodsvcmgr]

I would find it very hard to believe that Cunard/Carnival would eliminate this historical perk, particularly if RCL and NCL retain theirs.

[majortom10]

If Shareholder OBC benefit is about to be ended in July, which nobody officially knows it is all guesswork. Why have Carnival negotiated a contract to administer applications for benefit with Stockperks if they are going to end paying benefits.

[Solent Richard]

6 hours ago, david63 said:

There is nothing in the Annual Report nor in April's Notice of AGM so unless a special resolution is going to be presented at the AGM it looks as if there will be no shareholder OBC for at least the next 12 months.

 

I suspect that the issues is that since Covid the price of Carnival shares has plummeted from it pre Covid price of around £50 making it a much more affordable purchase and I would make a guess that many have bought shares for the OBC and it has now become unsustainable.

 

It will be interesting to see what is said about it at the AGM and what, if anything, will replace it. My guess would be that there will be a break for a year or two and then a larger share holding (500?) for a small OBC. Another case of the bean counters taking at work.

You know David, I could have sworn I read that exact statement elsewhere yesterday. 😉😉

[Solent Richard]

52 minutes ago, majortom10 said:

If Shareholder OBC benefit is about to be ended in July, which nobody officially knows it is all guesswork. Why have Carnival negotiated a contract to administer applications for benefit with Stockperks if they are going to end paying benefits.

 

Well er yes Major.

 

Maybe it's a ploy to get those with multiple 'future bookings' to rush in and pay their balances,  earlier than the normal due date, in order to beat the faux deadline.

 

My understanding is that OBC will only be allocated once the FULL balance has been paid.

😉😉

 

 

Edited February 27 by Solent Richard

[Solent Richard]

3 hours ago, david63 said:

You are right about the number of shares that have been issues not having changed but the number of people owing those shares could well have changed.

 

 

And of course, looking at the economics, it's hardly a massive outflow of cash particularly when one takes into account the trade-on loyalty.

 

So a week onboard a Cunard ship will generate $100 for a couple, one of whom is the shareholder. In my case that will buy me two G&Ts pre dinner in the Commodore Club and a bottle of wine with dinner. Accepting that Cunard's mark up will be in the region of 75% I can't see too many bean counters committing Hari-Kari.

 

Surely of far more interest to most shareholders, certainly corporate ones, will be the reinstatement of the Dividend. On a holding of 150 shares 2014 t0 2019 up to the pandemic (when it was stopped) that was worth just over £1000.00.

 

[NE John]

19 minutes ago, Solent Richard said:

And of course, looking at the economics, it's hardly a massive outflow of cash particularly when one takes into account the trade-on loyalty.

 

So a week onboard a Cunard ship will generate $100 for a couple, one of whom is the shareholder. In my case that will buy me two G&Ts pre dinner in the Commodore Club and a bottle of wine with dinner. Accepting that Cunard's mark up will be in the region of 75% I can't see too many bean counters committing Hari-Kari.

 

Surely of far more interest to most shareholders, certainly corporate ones, will be the reinstatement of the Dividend. On a holding of 150 shares 2014 t0 2019 up to the pandemic (when it was stopped) that was worth just over £1000.00.

 

The cruise lines need to pay down mounds of debt first before paying dividends. Norwegian just recorded good results this AM so that’s a good start. 

[Victoria2]

5 hours ago, ClipperinSFO said:

@david63 exactly. We bought our shares with the idea that regardless of what the share price did, with enough cruises and resulting OBC they would eventually be at zero cost.  A lot harder to do when the shares are at 50 than when they are at 15. 

As did we.

Although not quite as canny as david63, our outlay has just about been recouped through additional obc, with the added plus of the shares almost doubling in price. All good fun and to quote a well known UK chain store's slogan, every little helps! 😅

[ClipperinSFO]

As a big Cunard fan, I like the additional touchpoint with the company, and the resulting  gamesmanship of seeing how much OBC I can get against the price paid for the shares. It kind of adds to the fun of traveling with them and fuels the intention to have a long(er) term relationship with the company. I am sure I am not the only one who thinks this way, so when the Carnival Corp execs are weighing the pros and cons of the current program, they may factor in this resulting "stickiness".  How much it's worth to them versus the cost I have no idea.   Probably not all that much since anyone that holds shares is probably also an elite level in their various loyalty programs of their brands.