Josh Weinstein
President, Chief Executive Officer and Chief Climate Officer at Carnival Co. &
Thank you, Beth. It's safe to say, we ended the year on a high note and closed another quarter with record revenues, record booking levels and record customer deposits. In fact, we consistently set records in all four quarters this past year. We also achieved per diems EBITDA and net income for the fourth quarter that all exceeded the high end of our September guidance range with cruise cost ex-fuel in line with expectations. Fourth quarter yields continued on a positive trajectory, significantly higher than a very strong 2019 and even higher than we had anticipated and enabled us to overcome four years of high-cost inflation to deliver per unit EBITDA that eclipsed 2019, holding fuel and currency constant. It was encouraging to see both North American and European brand occupancy levels exceed 101% in the fourth quarter, with per diems for our North American brands up double-digits over 2019 and our European brands just shy of a double-digit increase. We delivered per diem improvements of more than 7 points for the full year, with even stronger acceleration in Q4, while closing the double-digit occupancy gap at the start of the year to reach historical levels for the second half of 2023. And absolute spending onboard was consistent across all four quarters, as we drove improvements in ticket prices.
We delivered $85 million more to the bottom line in the fourth quarter than forecasted, which pushed us through to positive adjusted income for the year. Strong EBITDA and cash from operations also propelled us on our journey to reduce the debt load necessitated during the pause in operations. We made debt payments of $6 billion this year alone. And we still have well over $5 billion of liquidity, on top of strong and improving cash flow, which will contribute to further debt reduction over time. All of this leaves us firmly placed on our path back to achieve investment-grade leverage metrics by 2026. And most importantly, our brands delivered happiness to over 12 million guests this year, laying the foundation upon which all of our SEA Change targets are built.
Turning to bookings, we reached an all-time high in booking volumes for the two weeks around Black Friday, Cyber Monday, and ended the year in the best booked position we have ever seen on both price and occupancy, setting 2024 off to an amazing start. We now have nearly two-thirds of the business on the books for 2024 and at considerably higher prices. And during the fourth quarter, we essentially maintained the significant occupancy advantage we have built for 2024 going into the quarter, while improving the year-over-year price position of our booked business even further. At this point, much of the first half is already behind us. With approximately 85% of the business on the books, we've essentially closed the double-digit occupancy gap to historical levels on higher capacity and at higher prices. For our peak summer period, all major products are better booked at higher prices, benefiting from an improving trend in both occupancy and price during the fourth quarter. Our yield management strategy to base load bookings has clearly set us up for another record year. And again, we have seen no sign of our business slowing. The booked position for our North American brands remains as far out as we have ever seen and well ahead of last year at pricing that is considerably higher. Our European brands just delivered record fourth quarter booking volume at considerably higher prices and with a booking window now fully back to historical norms. As expected, our European brands are poised to become an even greater contributor to our 2024 operating improvement. At the same time, we are continuing to pull forward onboard revenue through bundling and through cruise sales. This strategy, coupled with even more features onboard our newer ships for our guests to enjoy, positions us well for further onboard revenue growth next year. Also, we expect occupancy for the full year to return to historical levels on 5% higher capacity, while delivering nicely higher per diem, building on this year's record results.
In 2023, we captured over 3.5 million new-to-cruise guests and remain well positioned to continue to take share from land-based alternatives. In other words, we are gaining momentum in our ability to close the unwarranted value gap to land-based alternatives. And to aid in that effort, we can further [Indecipherable] the fact that while many land-based alternatives have pulled back on service levels, we still delivered incredible service to our guests, thanks to our amazing crew. This pairs exceedingly well with the expansive amounts of guest-pleasing amenities offered onboard our newer fleet. In fact, while almost four years have passed since the pause in our operation, our fleet actually came out of pause a year younger through our fleet optimization efforts. This past year alone, we benefited from three fantastic new ships, including Carnival Celebration and P&O Cruises Arvia, both of which are flagships for their respective brands, yet leverage our scale as a seventh and eighth vessels in our popular and exceptionally efficient series of XL-class ships. And we welcome Seabourn Pursuit, our second expedition ship. Seabourn has truly raised the bar for expedition cruising and extreme luxury. And while not technically new, Carnival Cruise Line also welcomed Carnival Venezia into its Fun Italian Style platform via the transfer from Costa, and it has been going gangbusters. It's the biggest example yet of how we leverage our scale and will be doubling down when we bring over her sister ship, Carnival Firenze, in 2024.
Looking forward, this year is set to match the excitement level with the introduction of Carnival Jubilee, a new icon for Carnival Cruise Line and which no doubt will be the pride of Texas as she has her inaugural home in Galveston; the innovative Sun Princess, the first of its class and a real game changer for Princess; and Queen Anne, a new flagship for Cunard and its first new ship in 14 years. With all of these additions, roughly 30% of our capacity will be newly delivered ships.
We also made meaningful headway on other strategic asset projects. We began construction on Celebration Key, which will be the largest and closest exclusive destination in our destination portfolio and a real game changer for Carnival Cruise Line. We'll bring 18 Carnival ships departing from nine home ports to Celebration Key. And while we are still about 1.5 years from go-live, we are already amping up the awareness and excitement around this fantastic destination. We've also started the process for a significant upsize in guest traffic at Half Moon Cay, our exclusive and beautiful pristine island destination in The Bahamas, with the creation of a pier side berth that can accommodate even our largest vessels. We've begun work with our Grand Bahamas Shipyard partners on the construction of two floating dry-docks, one of which will have the largest lifting capacity in the world. This will result in significant benefit in the future as we reduce travel time, preserve revenue days, and at the same time, reduce our fuel consumption.
As you know, we've also been investing more in advertising over the last 18 months, and it has definitely paid off with elevated awareness and consideration for our brand and record booking levels and revenue results. In fiscal 2023, our web visits were up over 35%, our paid search was up roughly 50%, and our natural search was up almost 75%, all many, many multiples of our 5% capacity growth. In the fourth quarter, we carried more new-to-cruise and more new-to-brand gap than we did in the fourth quarter of 2019. Given our success on generating demand, at this point in time, we plan to maintain a similar level of advertising on a unit basis in 2024 compared to 2023, optimizing around each brand. This will help us continue to build demand and bookings well outside of the current year.
We're working aggressively to keep our strong momentum going through Wave Season and beyond. Just to list a few examples, Costa recently launched a spectacular new campaign in its core markets, focusing on moments where guests are left speechless. Holland America launched a sequel to its highly successful Time of Your Life campaign, and AIDA just kicked off its new campaign, Experience Yourself Differently, in conjunction with the holiday season. Carnival will launch a new marketing campaign, highlighting Celebration Key in time for Wave Season. P&O Cruises' new campaign, Holiday Like Never Before, launches Christmas Day in the UK. And Cunard has planned a welcome fit for a queen to introduce Queen Anne early next year, which ensure [Phonetic] capture huge fanfare. We've been talking about upping our game across the commercial space, and we've made good progress. Of course, we're not done. And as you'd expect, we never will be, as there is always room to improve. There's much more to come as we roll out advancements to our yield management tools and lead generation techniques, continue to invest in sales and sales support, and build on already strong relationships with our trade partners.
Turning to costs, as we previously indicated, unit cruise costs ex-fuel for 2024 are expected to be higher than inflation due to the impact of closing the occupancy gap and the higher volume of dry-dock days. David will walk you through in more detail. With that said, we have been working aggressively to mitigate inflation through our cost optimization initiatives, including leveraging our scale. In some cases, we're investing today for future benefits. Just to cite a couple of examples of initiatives underway, we're essentially complete with the rollout of Starlink across the fleet. This will produce more than a 20% reduction in cost per megabit in 2024 and significantly increase our bandwidth pipeline, resulting in both better guest experience and higher onboard revenues, a clear win-win. And with our new vendor-neutral platform, we are positioned to quickly capture cost savings in future years. We've also launched our maritime asset strategy transformation, or what we refer to internally as MAST. MAST is a centralized system developed to optimize the management of equipment and machinery across all brands and all of our ships. MAST will allow us to leverage spare parts more effectively across the entire fleet and optimize our maintenance schedules and practices, all of which will strengthen our efficiency and reduce unplanned maintenance over time. While we won't see the P&L benefits for MAST this year, as we ramp up its implementation in 2024, we expect a multi-year benefit well in excess of $100 million that really begins to ramp up in 2026.
All the efforts we're making to drive revenue and manage costs are expected to lead to a 4-point margin improvement in 2024 regarding. We're guiding to record EBITDA of over $5.5 billion, which is 30% higher in 2023. Thanks to a strong second half of 2023, we're already tracking ahead of our plan to achieve SEA Change, our three-year financial targets calling for the highest ROIC and EBITDA per ALBD in nearly two decades. And our 2024 guidance delivers another step change toward these deliverables. EBITDA per berth day is expected to be up by more than 25% over our target starting point, hence more than halfway to the 50% increase expected in our SEA Change target. Today's guidance would also deliver 9% ROIC, a 4-point increase from the starting point of our target. This leaves just 1.5-point annual increases in 2025 and 2026 to hit our 12% target. Not surprisingly, our brand dedicated to a single market, Carnival, AIDA and P&O Cruises in the UK are again leading the charge with the highest ROIC levels in the Company.
And with regard to our greenhouse gas target included in our 2026 SEA Change program, our GHG intensity in 2024 is expected to be just shy of the 20% reduction from 2019 we're targeting. It is worth noting this was a 2030 goal. We have already pulled forward by four years. We have been and continue to work aggressively to reduce our environmental footprint and fuel costs at the same time. This deep commitment has not only resulted in industry-leading fuel efficiency, it has also resulted in lower absolute GHG emissions. Our absolute emissions are over 10% lower than the 2011 peak, and that's despite capacity growth of 30% since then. Last year, we also exceeded our industry-leading shore power capability goal. We are ahead of the curve and now have twice as many ships capable of shore power than there are ports around the world available to plug into. Again, I credit all of these important achievements to our people, ship and shore. Collectively, they continue to outperform, allowing us to make good headway on our SEA Change target.
We're poised for another step change in operating improvement this year with nearly two-thirds of the business on the books at considerably higher prices, ongoing momentum from improvements across the commercial space, the amazing vacation experiences we deliver day in, day out at way too good of a relative value to land-based alternatives, and an even greater experience gap [Phonetic], all while growing onboard revenues and managing costs. All of this combined sets us up well to deliver another year of record revenues and record EBITDA.
Our cash flow strength, coupled with excess liquidity, the return of credit card reserves in a few weeks, and the lowest order book in decades, will allow us to continue to actively manage down debt and aggressively reduce interest expense over time. It will also propel us on our path to deleveraging investment-grade credit ratings and higher ROIC. I remain confident in our continued execution with an unparalleled portfolio of best-in-class brands, an amazing fleet that just keeps getting better and better, and our greatest assets, our people. This has been a truly remarkable year, and we've come a long way in an incredibly short amount of time.
I would like to thank our team members, ship and shore, the best in all of travel and leisure, for delivering unforgettable happiness to over 12 million guests this year by providing them with extraordinary cruise vacations, while honoring the integrity of every ocean we sail, place we visit and life we touch. And thank you for the strong support from our travel agent partners, as well as our loyal guests, destination partners, investors and our many other stakeholders.
With that, I'll turn the call over to David.
