Ladies and gentlemen, thank you for standing by. Welcome to the Carnival Corporation's Second Quarter 2014 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. (Operator Instructions) As a reminder, this conference is being recorded Tuesday, June 24, 2014. I would now like to turn the conference over to Arnold Donald, President and CEO of Carnival Corporation LLC. Please go ahead, sir.

Hello, everyone. This is Arnold Donald, and with me today is David Bernstein, our Chief Financial Officer; Beth Roberts, Vice President of Investor Relations; and Mickey Arison, our Chairman. I'll start with a few comments, and then I'll hand it over to David to review in more depth the quarter results and some looks ahead. So, first of all, it feels like we've turned a bit of a corner. We achieved not only better than expected results for the second quarter, but we also achieved year-over-year earnings growth. And we're working very hard to build on our current momentum. Our progress is a credit to the outstanding efforts of our 120,000 shipboard and shore side team members who strive to create exceptional vacation experiences each and every day for our 10 million plus guests around the globe. We were pleased to see our European brands’ revenue yields turn positive in the second quarter and particularly encouraged by the favorable pricing trends emerging not only in Europe, but in North America, as well. We're making every effort to maintain pricing integrity, despite aggressive price moves by other cruise lines, even if it means giving up a little more occupancy than we had planned, as was the case, for example, in our summer Caribbean deployment. We believe this strategy can have positive implications next year and particularly, as we have already rebalanced our deployment for 2015. So, next year, we expect flat capacity in Europe and Alaska for our brands and a slight reduction in Caribbean deployment, with a notable double-digit decline in the third quarter. And we hope that will make for a better balance between supply and demand in our more established markets in both North America and in Europe. As we had anticipated, our capacity growth in both Asia…

Thank you, Arnold. Before I begin, please note that some of our remarks on this conference call will be forward-looking. I must refer you to the cautionary statement in today's press release. Also, all of my references to revenue and cost metrics will be in local currency as this is a much more meaningful measure of our business trends. I will start today with a summary of our second quarter results and then get into more detail on, first, our overall positive booking status; second, our yield expectations for the remainder of the year; and third, our booking patterns by program or deployment for each of our two major business segments, the North American Brands and the European, Australia, and Asia Brands, known as our EAA Brands. I will then finish up with an update on our improved full year 2014 June guidance. Our non-GAAP net income for the second quarter was $80 million. I'm pleased to report that our second quarter non-GAAP EPS was $0.10 above the midpoint of our March guidance and that was driven mainly by two things. First, better than expected net revenue yields at most of our brands worth $0.04 which was split between net ticket and net onboard and other yields. And second, lower than expected net cruise cost without fuel which was also worth $0.04 and that was due to lower than expected occupancy as well as the timing of certain expenses between the quarters. Now, let's turn the second quarter operating results versus the prior year. Our capacity increased 5%. The North American brands were up 8%, while the EAA brands were flat. Our total net revenue yields in the second quarter declined just over 2%. So, let's break apart the two components of net revenue yields. Net ticket yields declined almost…

Thank you, David. And we'll open up, Melody, to Q&A, please? Thank you.

Thank you. (Operator Instructions) And our first question comes from the line of Robin Farley with UBS. Please proceed with your question.

Great. Thanks. I wanted to ask about Q3, because you had such a strong result in Q2 versus your expectations. And I think the general expectation had been that your yields would start to be positive in Q3, even with the weak Caribbean, since Caribbean's only, I think, about 27% of your capacity in Q3. And given the strength in Europe and Alaska, maybe it's surprising that the 73% or the rest of the fleet isn't enough to get Q3 into positive territory. So, I wonder if you could give us a little bit more color on what the degree, if Europe is up double-digits that is kind of implying very large double-digit declines in Q3 in the Caribbean, on top of what had already been a tough Caribbean season last year for you. So, I wonder if you could give a little more color around that.

Sure. Well, to start with, we had indicated that we thought our yields would be slightly positive in the third quarter last time. So, all we're talking about is a very small movement from a tad positive to slightly negative at this point. And it was just -- there was a more promotional environment in the Caribbean than we had anticipated. And as a result, Carnival Cruise Lines decided to hold price and give up the occupancy and it's the lower occupancy that's driving the yield down. As I indicated in my notes, the ticket prices are moving in a positive direction overall. So, we were very pleased with that, but it's the lower occupancy. And it's a couple of points of occupancy overall that we're expecting lower from this year -- from last year to this year, which is driving the price down - the yield down, sorry.

Is it fair to say that European yields are up double-digit in Q3 and Alaska up at least high single-digit? Just to try to get a sense of the huge variance here versus the Caribbean.

Yeah. We didn't indicate that Europe was up double-digits. What we had indicated was that bookings and pricing are well ahead and very strong and Europe was doing very well for our North American brand. Alaska, the same thing and that the EAA brands were moving in a positive direction and we were expecting single-digit increases in all the categories.

And then I guess just lastly in Q4, which you're expecting to be positive now, but just thinking about some of the same issues continuing into Q4 and since there's a slightly higher concentration of Caribbean in Q4 versus Q3, I guess just trying to get a sense of your conviction level. There's probably some late fall Caribbean that is still unbooked. And how do you get comfortable that Q4 will absolutely bring the full year -- to your full year guidance really all being carried by Q4?

I think what we do is try to give our best guess of where we're today given the booking trends, given what we're seeing on the books. One of the big differences between Q3 and Q4 is that the increase in the Caribbean as an industry is significantly less. I think it's up 13% in Q4 versus like 22% in Q3. So, we're expecting to see a better Caribbean overall environment in Q4 than we saw in Q3 on a comparative basis. And therefore, we're anticipating that yields will be up slightly in Q4 as part of our overall guidance. So, we feel good. It's looking at what we have on the books and what we have remaining to sell that gives us the confidence that the yields will turn positive in Q4.

And as a company, our capacity growth in the fourth quarter is only 5%, 6% in the Caribbean, which is a much lower hurdle for us as an entity versus the 19% we absorbed in the third quarter.

Okay, great. Thank you.

Our next question comes from the line of Steve Kent with Goldman Sachs. Please proceed with your question.

Hi. Arnold, could you talk a little bit about the air expense reduction? How big of an opportunity is that? At one point, I thought it was measured in the hundreds of millions of dollars and I'm just wondering why that -- what's the delay or what could accelerate that? And then just to Robin's question, because it doesn't really make a whole lot of sense, the guidance for Q3. Is something happening on last minute bookings? Are last minute bookings coming in a lot better than expected? And is that Europe or North America that maybe is doing that?

Okay. First of all, on the air question, overall between the air and port combination team that we've put together, they're dealing with about $1.1 billion or $1.2 billion of annual costs. The air component of that is split between crew and passengers, charters for passengers in Europe, et cetera. But there is an opportunity there, for certain. We've issued the RFP. We are going to be in negotiations with a number of airlines. And so we are not throwing any numbers around for obvious reasons. But the reality is there will be an opportunity there for certain to capture some value by leveraging our scale. And we fully expect to begin to see the benefit of that next year. With regard to our comment about hundreds of millions of dollars, I wouldn’t anticipate being able to sell 50% or 30% of the cost or anything like that, which would result in your hundreds of millions of dollars on other basis. But we certainly have an opportunity to save substantial dollars that can contribute to the bottom-line. And of course, we have the initiatives across number of other areas as well with regards to provisions and technical stores, et cetera. Your second question again…

Sure.

Go ahead, yeah.

Yeah. As far as the last minute bookings and what's happening, in the first quarter what we had indicated was that the last minute bookings on Carnival Cruise Lines and -- in the Caribbean were better than anticipated. And remember, the first quarter Caribbean capacity was only up a couple of percentage points. It was the second, third and fourth quarter that were up significantly on a year-over-year basis. In the second quarter, as I indicated in my notes, as far as the ticket revenue was concerned, it was the EAA brands, particularly the Continental European brands that performed a little bit better than we had expected. Of course, the overall increase in yields year-over-year had to do with -- some of it was ticket and some of it was onboard and other yields as well. Some of the programs on onboard, particularly our casino program and our casino partnerships are bearing fruit and the onboard revenue did well in the second quarter. And we didn’t change the onboard revenue for the remainder of the year despite the lower occupancy, because of some of the improvements that we are seeing.

What I can tell you in regards of the guidance question has come up a couple of times in different ways. Obviously, we have confidence in the guidance we provided. We anticipated a number of the things that have occurred already this year. We feel we have reasonable line of sight barring unforeseen mega macro issues that we have confidence in the guidance that we provided for the year. Go ahead…

Okay. Thanks. No, I was just going to say it's -- given what you seeing so far and given what you've seen in Q1, Q2, that better than expected results are -- better than expected bookings are coming in. David, you said that it was Europe in Q2 and given what Robin and I are both seeing, which is that you have a lot of capacity in Europe this -- for Q3. It's surprising that that won't carry over into Q3.

I understand what you are saying. I mean, it’s a mix of a number of different things and factors. Just as an example, one of the things we talked about on the last conference call were the expectations for Japan, which had an impact on the third quarter as well. So, there are a lot of factors that are coming together including the lower occupancy in the Caribbean, Japan and other things, which is yielding our net guidance.

Okay. Thank you.

Our next question comes from the line of Felicia Hendrix with Barclays. Please proceed.

Hi, good morning. Thank you. So, David, the promotional environment in the Caribbean that’s been persistent and we’ve all known about it. Is it worse than what you saw it would be when you last reported your quarter?

I think it's fair to say the fact that the guidance for the third quarter, it's fair to say that -- as I indicated before, a little bit worse than we had anticipated. But there are other positives that are more than offsetting that and that’s why the net trend is positive. We're never going to get everything perfectly correct. There is always some pluses and minuses.

Right, that’s fair. So, it's also fair to say, you reported the ticket prices in the North American yields were down 7% in the second quarter, it's fair to say that will be worse in the third quarter? Correct?

No.

No.

No, not at all. You have different comparisons, right? So, first of all, the first half of last year was booked prior to the voyage disruption that caused a number of issues for us and in the industry in general. So, you've got a different comparison half-to-half. So, we are not saying we're going to be down 7% in the third quarter, or anything like that, David?

Okay. So you're still going to see sequential -- so you're going to see -- could you say you're going to see sequential improvement in yields generally? You will see sequential improvement in the Caribbean as well, I guess, that’s where I'm trying to get to.

Yes. Well, and for the North American brands had it not been for the change in capacity, as I said, the ticket prices were up than we've would have gotten -- a change in occupancy we would have gotten higher yields. So it’s the lower occupancy that’s driving it.

Okay. That’s fair.

I just want to say the -- we are seeing a recovery from the down over Q in the second quarter to the flat to slightly down in the third quarter. So things are improving.

I'm just trying to separate out the Caribbean, but I get it, you were clear. Let's move on to cost for a second. Arnold, regarding your initiatives, you've been pretty consistent to say that a more detailed discussion of this is going to take some time and you reiterated that again today. Just wondering, you've kind of -- you've been in for a year and you've been examining these costs. Just wonder if you can give us some sense of when you might be ready to discuss that. And then also will the cost initiatives be incremental to your cost base or will they be used to reinvest in the business and offset inflation. How should we think about those?

Good. First of all, it hasn’t been a year yet, I have all the way to, I think, July 3rd for that.

Okay. Rounding -- I'm rounding, I'm sorry.

Okay. With regards to the costs, we have a number of initiatives as I mentioned on the way. In the end we want to deliver the results and so the best way to do that, at times we have lot of things to manage, including the negotiations with outside parties, and so we are not too anxious to float numbers around for obvious reasons, because they can obviously influence the discussion. We could glob a bunch of numbers together across various initiatives and whatever, but I'd rather led the troops, as I mentioned to you before, bottom it up and as I mentioned before they often come through much more aggressively than if we just mandated arbitrary targets. So, it's going well. We are beginning to experience everyday just through the ongoing behavior of collaboration and coordination, communication across the brands. We began to see benefits in cost areas as well as in revenue generating areas and sharing our best practices. And we're beginning to see results and we feel good about our quarter and we feel good about the year. We feel very good about looking ahead to the future and realizing those. So we will reveal along the way. Once we've completed the RFPs and have done a good deal, we'll probably share the level of cost improvements that we've been able to achieve. But that would be more likely the process in some of these areas. With regard to -- what was your second question?

Well, just as we anticipate this -- I mean, should we think about these initiatives as being incremental to your cost base. In other words improving it or are they basically going to be kind of used to reinvest in the business and offset inflation?

Yeah. It's going to be a combination. We have our annual strategy reviews in August and September. The brands will come in with their plans and request for investments and what have you. Where we see line of slight on an investment producing higher returns and we're not -- obviously we'll make that investment. And where we don’t, we probably won't. And so, some of the savings, I'm sure will go to smart investments that are more powerful bottom-line and some of it will directly go to the bottom-line.

Okay, great. Thank you so much.

Thank you.

And our next question comes from Harry Curtis with Nomura. Please proceed with your question.

Good morning. Let's just look ahead to global capacity shifts in 2015. I think you made a brief comment about your expectations for Europe and the Caribbean. Could you just review those again with respect or maybe keeping in mind the 4% to 5% increase in fleet capacity overall. What are your expectations not only for what you expect but also what you expect in capacity growth in the Caribbean and Europe next year?

I think everybody wants to answer that. Dave you want to answer, go ahead.

Yeah. Overall, our capacity for the year is up little over 2%. And as Arnold said, we're looking at relatively flat capacity in Europe year-over-year, flat in Alaska. On a full year basis, we are looking at the Caribbean being down slightly. But there is a couple of big things there, particularly in the third quarter. I think Arnold mentioned double-digit decline in the Caribbean. So that should bode well for pricing. And the other thing is that as we have indicated before within the Caribbean the biggest promotional activity has been in the South Florida market and we are also making some changes in the overall deployments around the Caribbean. So while it's going down, it’s also being redeployed and changing as well. And we had talked about the double-digit increases in both Asia and Australia and New Zealand. So that's where we are investing overall and that's where the overall increasing capacity is going.

And we see some capacity reduction in the industry as well -- in the rest of industry in the third quarter next year in the Caribbean, for example. And [overall] [ph] for the year some reduction by the rest of the industry. So that should help things - the added time and investment in marketing and all those people that are sailing this year having great experiences onboard and already thinking about booking next year. So, you know, all of that should bode for a better environment in the Caribbean next year than we experienced.

Okay. So as a follow-up, industry-wide there should be a lift of roughly eight to 10 ships next year. Where do you think they're going? And how are you positioning yourself in those markets against those other new ships coming?

The industry growth for 2015 we do have the North American brands pretty flat. Our European -- the industry has an increase in European brands of roughly 6%. And the Asia-Pacific region is really carrying the most growth at 16% for the industry that is off a very small base.

Okay. Let me just quickly touch on one last question. When we think about the Carnival brand, how has that been rebounding relative to your expectations particularly in the Caribbean over the last three to four, five months? And can you give us an update on where the Carnival pricing has rebounded to versus where it was?

With regards to the brand image, it has rebounded very well. And it continues to muster great brand image strength, driven in no small part due to the fact that we had a lot of people sailing on Carnival. And they are thrilled with the experience. So both from a broader consumer perspective, but certainly amongst those that are cruising, the Carnival brand image recovery has been partly very strong. And kudos and hats off to our employees and their brand leadership of that brand, for all the initiatives they undertook to help make that happen. With regard to the second part of your question, David?

Yeah, we don't give detailed by brand and ticket yields and pricing for each of our individual brands. But it's fair to say that overall the rebound has not been what we had hoped because of the promotional pricing environment in the Caribbean for Carnival and occupancy as well. We're holding price and giving up the occupancy. And that's worked very well for us over the last year. We will keep analyzing that and see where we go. But hopefully next year, with the redeployment in the Caribbean and the lower capacity, we do hope to be able to fill the ships and to bear those fruits and get the yields up.

That's great. Thanks, guys.

Our next question comes from Jaime Katz with Morningstar. Please proceed with your question.

Good morning and thanks for taking my question. First, I am curious if you guys are willing to comment on where your best opportunity is on the cost side or not necessarily putting a dollar amount with it, but obviously, the costs have been pretty well controlled in the recent years. So where are your best opportunities to continue on that path? And second, how do we think about the Asia-Pacific market potential longer term, and the cadence of moving ships into that territory without over penetrating it too quickly? Thanks.

Yeah, thank you Jaime for your questions. With regards to the cost side, first of all, we do have opportunities everywhere. We do. If you try to force rank them you would have to come up with categorizations. So if you take some broad categories like air and port, and provisions, food, hotel services, different things, they are very large buckets. And the teams are resolving exactly what their targets are. Right now, I would say that there is considerable opportunity across all of them. And cumulatively 1% improvement non-fuel, non-payroll. So even payroll out of it, leaving fuel cost out of it, 1% cost improvement yields $60 million to us, okay. And so we are mining every aspect, because just a few percentage points can give us significant positive impact. And I would like to leave it at that for now. But I want you to know we have a focus on it and where it emanates from is just coordination and communication and then single sourcing in some instances are limited sourcing, multi sourcing, you know, across the brands and just leveraging the scale that we have. The brands individually have done good jobs at managing their costs. Some of the brands have done outstanding jobs. And we want to mine those best practices, deploy them across the fleet and across the brands. And then leverage the scale we have and negotiations and take advantage of that. And doing that, as I mentioned, 1% improvement is worth $60 million to us. So that would be how I would answer that question.

As far as the Asia-Pacific region and the growth in the long-term, I mean, the market has tremendous potential. When you look particularly at China which is the largest market and you look at the areas in Shanghai, Beijing, Guangdong province, you are talking about over 130 million people, probably double the size of the U.K., so there is a lot of opportunity there. We have been growing the market slowly, taking it one ship at a time making the decisions as we go along. And China and Asia are doing very well for us. And we are looking forward as a great growth opportunity for us over the next few years.

There is always the risk of timing, if everybody floods the market at once, and so on and so forth. But right now what we are able to see looking ahead, we continue to see China as very promising. Australia is definitely a hot market and people want to send their ships there. And if you are going to be in China, you're not going to be there all year long, you are probably going to spend some time in Australia with the ships and so on. And so all of that will add some complexity, but we feel very well positioned in those markets. We feel that the growth that we have staged and what we see coming from the industry, on balance, nets positive in the short term and very positive in the long-term.

Thank you.

Our next question comes from the line of Lena Thakkar with HSBC. Please proceed with your question. Lena Thakkar – HSBC PLC: Thanks, a couple of questions. Firstly, I know you don’t sort of discuss performance by brand. But I think you have made an exception for Costa in the past. Can you help us to understand how much of the 15% yield loss you are sort of planning to recover this year and therefore how the European pricing is weighted towards that Costa recovery? And then just secondly, more generally, on the sort of occupancy and price dynamic, you have clearly changed the way you think about that. And I am just wondering if that's a more longer term dynamic whether you will continue to sort of give up occupancy in various markets where it make sense. And just on that, does it mean we should think about a different EPS sensitivity to yield change given the mix of occupancy in price.

Okay. So, on the latter part of your question, we have focused on a couple of markets on trying to ensure some price integrity, okay? We continue to pursue that, and we will as long as we see net benefit. If ultimately we don't see net benefit, we would discontinue that, okay. And each market is its own market, its own source of guests and how they buy and shop, and how they think. And we really have to be careful, one-size-fits-all, even one-size-fits-all-times even. And so we're going to be very disciplined and very analytical in our approaches. So, we do, in fact, optimize, because as I mentioned many times to you all, the reality is we fill 78 million plus passenger cruise days a year and $1 more per day is worth $78 million to us. So, the details matter and the discipline and the fine tuning matters. So, I wouldn't want the team to be operating on a one broad swoop anything, because that's not going to optimize the return for us and accelerate our path to return on invested capital. So, there is no grand single scheme plan. So, I want to make that really clear. The second thing with regards to that is if you look at Europe in particular, the booking patterns have improved. So, people are booking further ahead than they did the prior year. Occupancy is up, yields are up, so that's all very positive stuff. We expect to see similar trends, in due course, on a consistent basis in North America, as well. I don't know if David had any additional comments he wanted to make, or Beth, but go right ahead.

Yeah, I guess, Costa was down 16% as a result of the incident. And we had given out some information on the brand because of the circumstance. Last year in 2013, we had indicated they rebounded four points. It was less than we had hoped, because they were facing economic headwinds. This year, Costa does continue to improve, it’s a few points higher than the prior year. So, it keeps going in the positive direction. But as you had indicated, we're trying to stay away from giving brand-by-brand improvement -- or brand-to-brand changes.

Okay. And just as a quick follow-up, Arnold, you talked about the net benefit of the pricing and occupancy dynamic. Are you thinking net benefit for just this year, i.e., the short-term or the future benefits of holding that price and how that may help to perhaps derive a bit more pricing power?

Yeah, absolutely, we're thinking over time and monitoring carefully and tracking carefully to see if we're having the desired effect. So, it's not just in the moment. We're thinking longer term, no question about that.

Okay. Thanks very much.

Thank you.

Our next question comes from the line of Tim Conder with Wells Fargo Securities. Please proceed with your question.

Thank you. Let's return to the Caribbean and the Carnival brand in particular. Again, in the third quarter, you said that you've given up a little bit more occupancy to hold price. As we look to fourth and first quarter, going forward and granted you've got more capacity in the Caribbean seasonally, but year-over-year, the capacity growth is slowing for yourselves and the industry. Do you see -- have we reached the inflection point in the Caribbean to where potentially that occupancy can improve along with price or hold price and occupancy can improve in the fourth and first quarters at this point?

Go ahead, David.

You know what given what we're seeing in the overall booking trend, and the pricing and everything else, I do believe that we can see yield improvement overall in the Caribbean. And the Caribbean does vary by quarter significantly. We see the third quarter -- as we said, we gave up price and occupancy for the CCL brand. We gave -- I'm sorry -- we gave up occupancy and held price. And in the fourth quarter, I mean the brand still expects to hold price. And overall, we do anticipate an improvement for the fourth quarter.

Okay. So, maybe we're seeing this inflection here in the third then moving to the fourth, is that fair to say then?

Yeah, that's fair to say.

Okay, okay. And then gentlemen, you had given some color regarding onboard deals, how those were improving nicely both in the North American brands and in the EAA brands. In -- please correct me if I'm wrong, did I hear that the Europe, if you just sort of looked at it year-over-year in the second quarter had improved a little bit more than North America or was that fairly balanced and then the expectations for the remainder of the year?

What I said was the EAA brands improved a little bit more than we had expected in the second quarter. That was all what we had guided to and that’s what drove the increase from our guidance. I had indicated that North American brands were down in the second quarter.

Okay, okay.

The other comment -- I know you guys are focused pretty heavily on the Caribbean I can understand it. But the bottom-line is in the fourth quarter the capacity changes for the industry year-to-year in the fourth quarter are nothing were near as dramatic as they were in the third quarter in the Caribbean. And beyond that, we just believe a number of other things we implemented, whether it’s marketing initiatives, the pricing philosophy whatever, we are seeing strength. We have to play it all the way out to see where we end up. But right now we definitely see improvement in the fourth quarter which gives us the confidence to give the guidance we have and increase the guidance from where we were.

Okay. And just one last thing on the onboard, David, is it being driven by the changes predominantly on the casino or are you seeing that in other areas of onboard also.

We are seeing some -- positive things in a number of other areas. I guess, I'd mentioned the casino only because it was the largest positive of all of the variety of items.

And because David has responsibility for casino now.

Okay. Okay, thank you gentlemen.

Very good.

Our next question comes from Assia Georgieva with Infiniti Research. Please proceed with your question.

Good morning guys. This is Assia. Beth was very helpful in providing the Caribbean capacity distribution up 19% in Q3, up only 5% to 6% in Q4. Could you give us capacity for the corporate entity?

Well, capacity by…

Meaning all destinations by quarter.

Assia, why don’t you call Beth after the call? There is a long list of details and she'll be happy to go through it with you.

Okay, great. Thank you for that. And secondly, with Europe being so strong, I think none of us expected it to be that good this year before wave season started. Do you see indications for 2015 or is it still too early?

It's very early for 2015 overall. I mean, we will give you some indications in December when we talk about our guidance for next year. But, overall, remember we had been facing some economic headwinds particularly in Europe and so it is somewhat improving environment. And so hopefully that does help us positively in 2015.

Okay. Thank you, David. And one last quick question. I should understand that you expect Q4 yields to be slightly up, correct?

That’s correct.

That’s correct.

Great. Thank you so much.

(Operator Instructions) Our next question comes from the line of Rick Lyall with John W. Bristol. Please proceed with your question. Rick Lyall - John W. Bristol & Co.: Yeah. I have two questions. First, have you commented on what the cost savings are from folding the Ibero brand into Costa and are there any other broader opportunities in the brand overhead structure?

First of all let me answer the latter part of the question -- thank you Rick for the question. In terms of other opportunities, if the question is, do we plan to roll in the other brands up? Absolutely, not at this point in time. So we have really leading brands. Even the Ibero decision took some time, but Costa is so strong in Spain and the opportunity was there to minimize marketing cost and other related cost to maintain a separate brands. So given that, and it was a small brand, we thought it was the right thing to do. But, if you go beyond that brand in terms of thinking about rolling up in the other brands that is not on the table right now at all. So I want to make that really clear.

And, Rick, keep in mind that Ibero was a highly integrated brand within Costa, and it was only two ships, so very tiny brand. And so as a result, there will be some cost savings. But you might be talking a penny or two. I mean, we are not talking about big dollars here.

We will take one or two more questions, Melody. Rick Lyall - John W. Bristol & Co.: Okay. I had a follow-up on your profitability in China. Can you comment on where the relative profitability of China is versus other brands or other geographies?

Yeah, we have said before that overall, the yields in China was slightly less than the corporate average. And, you know, the thing that really drives that is somewhat on the onboard, while the gambling is great the Chinese don’t seem to drink very much, so there are differences and that’s what makes the yields slightly lower than the overall corporate average at this point. Rick Lyall - John W. Bristol & Co.: Okay. Thank you.

Okay. One or two more…

Mr. Arnold?

Yes.

I apologize. We have no further questions at this time. So, I will turn it back over to you.

Well, thank you everyone. We appreciate your interest and your time. Again, we feel good looking forward. And we look forward to giving you guys updates along the way. Thank you very much everyone and thank you Melody.

Thank you, sir. And ladies and gentlemen, that does conclude today's conference call. We thank you for your participation and ask that you please disconnect your lines.