FORM 10-KSECURITIES AND EXCHANGE COMMISSIONWash<strong>in</strong>gton, DC 20549(Mark One)[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934For <strong>the</strong> fiscal year ended November 30, <strong>1998</strong>OR[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934For <strong>the</strong> transition period from ______________ to ________________Commission file number 1-9610CARNIVAL CORPORATION(Exact name of registrant as specified <strong>in</strong> its charter)Republic of Panama 59-1562976(State or o<strong>the</strong>r jurisdiction of(I.R.S. Employer<strong>in</strong>corporation or organization)Identification No.)3655 N.W. 87th Avenue, Miami, Florida 33178-2428(Address of pr<strong>in</strong>cipal executive offices) (Zip Code)Registrant's telephone number, <strong>in</strong>clud<strong>in</strong>g area code (305) 599-2600Securities registered pursuant to Section 12(b) of <strong>the</strong> Act:Name of exchange onTitle of each classwhich registeredCommon StockNew York Stock($.01 par value) Exchange, Inc.
PART IItem 1. Bus<strong>in</strong>essA. GeneralCarnival Corporation was <strong>in</strong>corporated under <strong>the</strong> laws of <strong>the</strong> Republic of Panama <strong>in</strong> November 1974. Carnival Corporation,<strong>in</strong>clud<strong>in</strong>g its wholly and majority owned subsidiaries (referred to collectively as <strong>the</strong> "Company"), is <strong>the</strong> world's largest multiplenightcruise company based on <strong>the</strong> number of passengers carried, revenues generated and available capacity. The Company offersa broad range of lead<strong>in</strong>g cruise brands serv<strong>in</strong>g <strong>the</strong> contemporary cruise market through Carnival Cruise L<strong>in</strong>es ("Carnival"), <strong>the</strong>premium cruise market through Holland America L<strong>in</strong>e ("Holland America") and <strong>the</strong> luxury cruise market through Cunard L<strong>in</strong>e("Cunard"), Seabourn Cruise L<strong>in</strong>e ("Seabourn") and W<strong>in</strong>dstar <strong>Cruises</strong> ("W<strong>in</strong>dstar") (collectively <strong>the</strong> "Majority Owned CruiseOperations"). The Company also owns equity <strong>in</strong>terests <strong>in</strong> Costa Crociere S.p.A. ("Costa"), an Italian cruise company, andAirtours plc ("Airtours"), an <strong>in</strong>tegrated leisure travel group of companies which also operates cruise ships (collectively <strong>the</strong>"Affiliated Cruise Operations"). Costa and Airtours' Sun <strong>Cruises</strong> target <strong>the</strong> contemporary cruise market.A summary of <strong>the</strong> cruise operations of <strong>the</strong> Company and its affiliates is as follows:PercentageOwned byPrimaryCruise Carnival Number Passenger GeographicBrand Corporation of Ships Capacity(1) MarketMajority Owned CruiseOperations:Carnival 100% 13 24,404 North AmericaHolland America 100% 8 10,302 North AmericaW<strong>in</strong>dstar 100% 4 756 North AmericaCunard (2) 68% 5 3,380 WorldwideSeabourn (2) 68% 3 624 North America33 39,466Affiliated CruiseOperations:Costa 50%(3) 7 7,644 EuropeAirtours' Sun <strong>Cruises</strong> 26% 3 2,924 Europe10 10,56843 50,034(1) In accordance with cruise <strong>in</strong>dustry practice, all passenger capacities <strong>in</strong>dicated with<strong>in</strong> this document are calculated based ontwo passengers per cab<strong>in</strong> even though some cab<strong>in</strong>s can accommodate three or four passengers.(2) In May <strong>1998</strong>, <strong>the</strong> Company and a group of <strong>in</strong>vestors acquired <strong>the</strong> assets of Cunard, a cruise company operat<strong>in</strong>g five luxuryships, <strong>for</strong> $500 million, as adjusted. Simultaneous with <strong>the</strong> acquisition, Seabourn Cruise L<strong>in</strong>e Limited, a luxury cruise l<strong>in</strong>e <strong>in</strong>which <strong>the</strong> Company owned a 50% <strong>in</strong>terest, was comb<strong>in</strong>ed with Cunard. The Company now owns 68% of <strong>the</strong> comb<strong>in</strong>ed entity,which is named Cunard L<strong>in</strong>e Limited. See Note 13 to <strong>the</strong> F<strong>in</strong>ancial Statements as <strong>in</strong>cluded <strong>in</strong> Exhibit 13 to this Form 10-K.(3) The 50% equity <strong>in</strong>terest of Costa not owned by <strong>the</strong> Company is owned by Airtours. Includ<strong>in</strong>g <strong>the</strong> Company's <strong>in</strong>terest <strong>in</strong>Airtours, it beneficially owns 63% of Costa.Historically, <strong>the</strong> Company's cruise brands have been marketed primarily <strong>in</strong> North America. The Company began to globalize itscruise bus<strong>in</strong>ess by expand<strong>in</strong>g its markets <strong>in</strong>to Europe through <strong>the</strong> acquisition of its <strong>in</strong>terest <strong>in</strong> Airtours <strong>in</strong> April 1996, Costa <strong>in</strong>June 1997 and Cunard <strong>in</strong> May <strong>1998</strong>. Airtours, which is headquartered <strong>in</strong> Manchester, England, is <strong>the</strong> largest air <strong>in</strong>clusive touroperator <strong>in</strong> <strong>the</strong> world, sell<strong>in</strong>g packaged tours <strong>in</strong> <strong>the</strong> Austrian, British, Belgian, Dutch, French, German, Irish, Polish,Scand<strong>in</strong>avian, Swiss and North American markets. Additionally, it operates three cruise ships (a fourth ship is expected to enterservice <strong>in</strong> April 1999) under <strong>the</strong> Sun <strong>Cruises</strong> name. Costa, which is headquartered <strong>in</strong> Genoa, Italy, has sales offices <strong>in</strong> Argent<strong>in</strong>a,Brazil, England, Florida, France, Italy, Spa<strong>in</strong> and Switzerland and sells <strong>the</strong> majority of its cruises <strong>in</strong> Sou<strong>the</strong>rn Europe, primarily<strong>in</strong> Italy, France and Spa<strong>in</strong>. Cunard L<strong>in</strong>e Limited, which is headquartered <strong>in</strong> Miami, Florida, has Cunard and Seabourn salesoffices <strong>in</strong> Miami, New York City, England, Germany and Australia, and sells a substantial number of its cruises <strong>in</strong> Europe,primarily <strong>in</strong> <strong>the</strong> United K<strong>in</strong>gdom and Germany. The cruise markets <strong>in</strong> Europe are much smaller than <strong>the</strong> North American market.Industry-wide European cruise passengers carried <strong>in</strong> <strong>1998</strong> are estimated to be approximately 1.3 million compared toapproximately 5.4 million from North America.
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