Micky Arison - Chairman and Chief Executive Officer Howard Frank - Vice Chairman and Chief Operating Officer David Bernstein - Senior Vice President and Chief Financial Officer Beth Roberts - Vice President of Investor Relations

Rick Lyall - John W. Bristol Robin Farley - UBS Tim Conder - Wachovia Steve Kent - Goldman Sachs Steve Wieczynski - Stifel Nicolaus John Graff - Boston Company Assia Georgieva - Infinity Research David Leibowitz - Horizon Nick Kayano - Olson & Co. Dominique Neil - Canyon Capital Sharon Zackfia - William Blair

Ladies and gentlemen, thank you for standing by. Welcome to the Carnival Corporation fourth quarter 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) I would now like to turn the conference over to Howard Frank, Vice Chairman, and COO. Please go ahead, sir.

Thank you, Alex. Good morning everyone. This is Howard Frank and with me this morning is Micky Arison, Chairman, and CEO of Carnival along with David Bernstein, who is our Chief Financial Officer and Senior VP of Finance and Beth Roberts, who is our VP of Investor Relations. I will turn the call over to David who will take you through some of the color for the 2008 year in the fourth quarter and then David will turn it back to me and I’ll give you some views on our current outlook for the business going into 2009. David.

Thank you, Howard. I will begin the conference call by reading the forward-looking statements. During this conference call we will make certain forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties or other factors, which may cause the actual results, performances, or achievements of Carnival to be materially different from any future results, performances, or achievements expressed or implied by such forward-looking statements. For further information, please see Carnival’s earnings press release and its filings with the Securities and Exchange Commission. For the fourth quarter, our earnings per share was $0.47, which came in above the midpoint of our September guidance by $0.10 per share. This was driven by lower fuel prices worth $0.06, stronger than expected revenue yields on close-in bookings worth $0.02 and various other items worth $0.02. The gain on the sale of the QE2 was in our previous guidance; however the stronger dollar versus the sterling increased the gain. Looking at our fourth quarter operating results versus the prior year, our capacity increased 8.1% for the fourth quarter with the majority of the increase going to our European brands. Our European brands grew over 16%, while our North American brands grew 4.6%. Overall, net revenue yields in local currency increased 2% in the fourth quarter versus the prior year. Now, let’s look at the two components of net revenue yields. For net cruise ticket yields, we saw an increase of 3.2% in local currency. Our North American brands were up 4.4% driven by the Caribbean, Mexico and other exotic itineraries. Our European brands, experienced 1.3% lower local currency ticket yields. Given the 21% capacity increase for our European brands this year and the increasing competition from other companies in the European marketplace, we were expecting to see overall flattish yield, which is exactly where we wound up, excluding Ibero. As to Ibero, they did experience soft pricing in the fourth quarter, as they did in the third quarter, which resulted from the difficult economic environment in Spain. P&O Cruises Australia with its reconfigured fleet, adding Pacific Dawn in November of ‘07 and delivering the Pacific Star to Pullman Tours in March of ’08, achieved a healthy yield increase for the fourth quarter versus the prior year, which supports our decision to grow the brands by redeploying the Ocean Village ships over the next two years. For net onboard and other yields, we reported a yield decline of 1.8% in local currency; however, mix accounts for 0.8% to the decline, as our European brands, which have always had lower onboard spending are growing faster than our North American brands. We saw yield declines in about half of our brands around the world, a trend which we anticipated in our previous guidance. On the cost side, our cruise costs per available lower berth day for the fourth quarter in local currency were essentially flat. Fuel prices this quarter were higher by 24%, costing us an additional $84 million or $0.10 per share. Our continued focus on managing controllable costs, allowed us to offset the $84 million of higher fuel costs, which is a tribute to the strength and talent of our brand management team. Excluding fuel and the gain on the sale of the QE2, which was included in other ship operating expenses, cruise costs per available lower berth day were down 1.2%. However, the best measure of cruise cost changes are on an annual basis and I’ll touch on that in a moment. Looking back at the full year 2008, our EPS was $2.90, which I recognize was not in the range of the original guidance that we gave one year ago, $3.10 to $3.30 per share. The midpoint of that range, which was $3.20 per share, was based on $486 per metric ton of fuel. If you adjust the actual price of fuel, the midpoint would be $2.92. Therefore, we missed our guidance by a mere $0.02 per share. For 2008, our capacity increased 8.9%. Net revenue yield in constant dollars was up 2.4%. This was slightly below the range of our guidance a year ago. During 2008, we saw pressure on an onboard revenue yield as a result to the ongoing recession and its impact on our guest. As I indicated before, the best measure of cruise cost changes are on an annual basis. For the full year, our cruise cost per available lower berth day in constant dollars was up 7.5%. However, excluding fuel, the gain on the sale of the QE2 in the fourth quarter and the gain in the third quarter from the final insurance settlement related to the damage done to our port facility in Cozumel; cruise costs per available lower berth day were essentially flat. So, our controllable expenses, excluding fuel and currency were essentially flat despite inflationary pressures, which is a great accomplishment. We were able to offset inflation during the year through economies of scale and increased efficiencies; however, as I’ve indicated on previous calls, our long-term track record up flat cruise costs per available berth day dating back to 1990 is getting harder to maintain in the face of moderate capacity growth. As a result, our goal for future cruise costs per available lower berth day is in the range of flat to one-half the rate of inflation. In summary for 2008, we posted solid earnings in an extremely difficult year. The 55% increase in fuel prices, was largely offset by a combination of our capacity growth, our yield improvement and our excellent cost controls. Turning to our 2009 outlook, I will skip net revenue yields and Howard will discuss that in a few movements. For cruise costs per available lower berth day for the full-year, excluding fuel and in local currency, our costs are projected to be up 2%. However, half a percentage point is due to the gain recognized in the prior year on the sale of the QE2, which reduced prior year cost. In addition, another half a percentage point, is due to the gain from the final insurance settlement related to the damage done to our port facility in Cozumel, which also reduced prior year cruise cost. So, without these two one-time items the real underlying increase in cruise costs would be approximately 1%. While, this guidance for controllable expense unit costs, excluding fuel and currency is within a long term target of unit costs growth between flat to one half of the rate of inflation, we continue to look for opportunities to reduce this increase. I’ve had numerous discussions with our brand management teams. We’re all working very hard to find ways to improve upon the guidance in this very difficult economic environment. I’m hopeful that we will have another year of flat costs. Based on the spot price of fuel using Monday’s closing price, fuel prices for the full year are projected to be $295 per metric ton for 2009 versus $558 per metric ton in 2008, saving at $861 million. In addition, FX rate have moved from an average in 2008 of a euro 1.49 to a GBP of 1.90 to our 2009 guidance of euro 1.38 and sterling 1.58. So in the end, fuel and currency are driving down our cost. So, in current dollars and including fuel, our costs are actually expected to be down 13% to 15%. While these movements reduce our costs, given the diversity of our worldwide revenues, 50% of which comes from passengers sourced outside the United States, these movements are expected to negatively impact our bottom line. So, given these FX rates, our year-over-year profit hit from currency is expected to be $195 million or $0.24 per share. As fuel and currency are big factors affecting our 2009 results, I wanted to share with you some current rules of thumb about the impact that these exchange rates and fuel prices have on our 2009 results. To start with, a 10% change in the price of fuel represents a $97 million or $0.12 per share impact on our P&L. 10% change in fuel has obviously comedown along with the price of fuel. While a 10% change in all currencies relative to the US dollar would impact our P&L by about $114 million or $0.17 per share. Fortunately for us, these items have moved in opposite direction acting somewhat as natural hedges of each other. At this point, I will turn the conference call over to Howard.

Thank you David, Let me make some comments on the outlook for 2009. Since we reported to you some six weeks ago, the slowdown in the cruise booking has continued. While bookings for close-in business have been satisfactory, bookings for late spring and summer continue at a slow pace. We had taken pricing lower and while that has helped to fill the ship on close-in business, it is yet to have much of an impact on late spring and summer booking patterns. In this weakened North American economy, bookings for our shorter value oriented Caribbean cruises have been stronger than our longer and more expensive European, Alaska and long and exotic cruises. The good news is that consumers are still taking their vacations, but the vacation decision is for next month rather than next year. Looking at our booking patterns it is also clear that consumers are looking for more value for their vacation dollar and our shorter, less expense Caribbean cruise products are performing much better than our premium and luxury longer cruise products. So, we are seeing a consumer trade down to value which plays nicely into our Carnival Cruise Lines brands and that should help us to perform reasonably well during this economic downturn. While we are hopeful that consumer physiology will change when the new President and his administration take office in January and as a new fiscal stimulus plan is implemented, there is no real way of knowing if and when that will kick in. There is however another silver lining in the booking picture and that is, our European brand bookings are holding up considerably better than our U.S. brands. This will be a positive factor in 2009’s performance since much of our brands new capacity additions in 2009 will be for our European Cruise companies. While many Western European markets are also experiencing a recessionary economy, we believe a European consumer has net savers and with considerably lower credit card and other personal debt are better able to cope with the weakening economies in there countries. Also as you know European’s have far more vacation time and the European cruise market is far less penetrated than in the U.S. So, our strategy of investing in our European cruise brands should be a positive factor in our overall financial performance for the upcoming year. Our European brand capacity in 2009 will increase by 8%, as compared to North American brand capacity which will increase by 4%. As we indicated in the press release, we have reduced local currency net yield guidance range for 2009, from the guidance we provided in late October, to a range of negative 6% to negative 10%. Three points of this reduction is due to the elimination of the fuel supplement revenue for 2009 which we announced earlier this month, and we also took our ticket pricing and onboard revenues lower for the year in view of the further deterioration in the economic environment. However, given the closer in booking patterns, revenue yield guidance is more of a challenge for 2009 and consequently we are using a broader range of guidance than in past years. Fuel prices have comedown further, but not enough to offset the revenue loss from eliminating the fuel supplement and the other revenue reductions and as David indicated, we are still estimating on approximate 2% increase in costs for the year, excluding fuel. Taking all these factors into consideration, we have lowered 2009 earnings guidance to a range of $2.25 to $2.75 per share. Turning to our specific ship deliveries in 2009; this spring we take delivery of three ships for our European brands. The AIDA Luna for our AIDA brand in Germany; the Costa Luminosa and Costa Pacifica for our Costa brand, the largest company cruise company in Europe and in June the Seabourn Odyssey, the spectacular new class of ship for Seabourn and the first ship to join the Seabourn fleet in over 15 years. In September, the Carnival Dream, the new class of ship for Carnival cruise lines will be delivered. On a fleet-wide basis, this capacity increase will be about 5.5% for the full-year. Given the continuing challenges to raising debt in the capital markets, I think it’s appropriate to make some comments on a company’s balance sheet and its liquidity going forward into 2009. In late October as a result of the extraordinary high cost of raising new debt, the company suspended its dividend, which on an annualize basis will save us approximately $1.3 billion. With this in mind, let me provide you with a brief overview of our cash flows for 2009. Using operating cash flow at the midpoint of our earnings range for 2009 and that is the $2.50 a share; we are currently estimating 2009 cash flow of approximately $3.3 billion. In addition, we have committed financing for ship deliveries today of approximately $800 million or a total of $4.1 billion of incoming funds flow. Against that we have approximately $3.4 billion of CapEx spending, which covers the five ships I just talked about, plus estimated maintenance CapEx for the year and we have maturing debt of approximately $700 million. So, essentially our cash inflows for the year will be sufficient to fund cash outflow requirements without having to raise any capital in the debt markets. The debt markets continue to be very difficult, even for solid investment grade credits like Carnival, with credit spread still at historical highs. However, in order to further strengthed our balance sheet, we have recently closed an additional lower cost bank financing and are working on several new financing also at lower costs. In addition as a further liquidity cushion we have approximately $1.3 billion of cash and availability under our revolving credit facilities going into calendar 2009. Given these uncertain time, we believe our strategy of maintaining a strong balance sheet has positioned us well and we will continue with this strategy going forward. Now, let me give you some color on each of the first three quarters of 2009, a little bit more color on the booking patterns. Looking at the first quarter of 2009, fleet-wide first quarter capacity is up 2.6% on an overall basis; 1.9% in North America, 7% in Europe. On a fleet-wide basis, right now as we look at the booking picture, first quarter occupancies and pricing, all running behind last year. For North American brands in the first quarter, 62% of capacity is in the Caribbean, that’s slightly up from 61% a year ago, 12% is in our Mexican Riviera programs, down from 15% last year and the balance are in various other itineraries, including long and exotic cruises. At this juncture with a small amount of inventory left to sell, Q1 occupancies and pricing are running behind year-over-year. Caribbean and Mexican Riviera pricing is slightly ahead with occupancies slightly behind, not unexpectedly pricing and occupancy for longer and exotic cruises at higher price points are running behind. This is consistent with what we have been saying, that shorter and less expensive Caribbean cruise products are holding up recently well as consumers search for good value in their vacation choices. Turning to our European brands, their ships are 32% in the Caribbean versus 37% from last year; 24% are in Europe up a couple of points from 22% last year; 12% in the Orient Pacific area versus 10% in the prior year, 12% in world cruises, which is about the same as last year and 11% in South America, up slightly from 10% last year. At this point, Europe brands with a 7% increase in first quarter capacity are running slightly behind in occupancy and pricing; however, cost of brand pricing in Q1 is running higher year-over-year, which is a positive sign as Costa will be taking on significant capacity this year. Costa appears to performing relatively well despite the softening of the economies in continental Europe, which is its primary market. By the time the first quarter closes, we expect pricing to be lower for North America and Europe brands and as we indicated in the press release, we are estimating that local currency ticket yields for the first quarter will be 5% to 10% lower than last year’s first quarter. Approximately 40% of the lower yields in the first quarter reflect the elimination of the fuel supplement. Fuel cost in the first quarter using today’s pricing of $295 a ton, will result in fuel being lower by $159 million versus last year. However, operating costs are expected to be higher in the first quarter, but we think there is some opportunity to bring these costs lower as the slowing global economy should help to reduce the costs for certain commodity based products. Taking all of these factors into the consideration, we are currently forecasting earnings per share to be in the range of $0.20 to $0.22 for the first quarter versus $0.30 in the first quarter of 2008. Turning now to the second quarter of 2009, on a fleet-wide basis second quarter capacity is up 6.1%; 4.4% of that is in North America and 8.3% is in Europe. On an overall basis, second quarter ticket pricing occupancies are running behind year-over-year as a result of a slowdown in the booking pattern. For North American brands, second quarter capacity breaks down as follows. Caribbean is 54% versus 51% from last year, Mexican Riviera is 10% versus 13% a year-ago, with all other itineraries, including the Alaska and Europe shoulder seasons, Panama Canal, long and exotic’s, each under 10%. Caribbean and Mexican Riviera occupancies and pricing are lower year-over-year. Occupancy and prices for Alaska and Europe and long cruises are even more significantly lower. It’s clear that North American consumers are holding off and making any decisiouns on cruise vacations until we get into 2009. However, we believe these booking gaps will start to close in the second quarter as we begin the New Year. Europe brands in the second quarter are 59% in Europe trade, approximately the same as last year; 11% in the Caribbean, downs from 16% a year-ago; 11% in transatlantic, about the same as last year, the balance in all other itineraries are all under 10%. On an overall basis European brand occupancies are lower than last year, although better than the North American brands. Overall Europe brand local currency pricing is slightly higher than last year. Europe itinerary pricing, this is for ships that are in Europe for our European brands is running at about the same levels as last year with lower occupancies at this point. Caribbean pricing is running behind last year, with approximately flat occupancy. Pricing for the various other itineraries are running slightly better than last year at lower occupancies. As you can see from this even with the 8% increase in capacity; our European cruise company seems to be performing better within their North American counterparts. Now turning to the third quarter where our fleet-wide capacity is up 5.6%, 3.8% of the capacity is up in North America and 7.4% is increased in Europe. Booking information for the third quarter is still in the early stages of development, so I caution not to read too much into the information I’m about to talk about. On an overall basis, third quarter occupancy and ticket pricing have fallen significantly behind last year. Although, we continue to have positive bookings week after week for the third quarter, the booking levels are lower than last year’s levels, further evidenced that the North American consumer is differing their vacation decisions. North American brand capacity breaks down as follows: Caribbean is 36%, approximately the same as last year; Alaska was 28%, slightly lower than last year and Europe is at 19%, down from 22% in the prior year, with the balance of North American brand itineraries in the rest of the world. Caribbean itinerary occupancies are down year-over-year with pricing at approximately the same levels. Alaska and Europe occupancies and pricing are significantly lower year-over-year. Turning to Europe, our Europe brands are 96% and Europe itineraries. And at this point in time, Europe brand pricing in the third quarter is running ahead year-over-year with occupancies significantly behind. From an overall standpoint, the third quarter is shaping up to be quite challenging at this time; however, given the closer in booking pattern, we expect the fixture to improve as we get close to the cruise dates and consumers begin to make their vacation decisions. Just anecdotally, let me make the comment about Australia and Asia. Since for the first time in our history we will have four ships in Asia and Australia in the third quarter, with two ships operating for the P&O Australia brand and two ships for Costa Asia. Third quarter occupancies on these ships are nicely ahead year-over-year on somewhat lower pricing. So, we are starting to see some progress in these developing markets. Later in 2009, we will be moving an Ocean Village ship, we’ve previously announced this from the U.K. to P&O Australia, and the second Ocean Village ship will be moved to Australia in 2010. So, we are feeling very strongly that Australia market is a very good market and we will be looking to expand our capacity in that market going forward. So, with those comments from David and myself, I will turn it back to you Alex for questions.

(Operator Instructions) Your first question comes from Rick Lyall - John W. Bristol. Rick Lyall - John W. Bristol: It’s obviously a very tentative environment and the picture is probably changing almost daily. Can you talk about how you could get more conservative if you needed to in the P&L. It seems like you’ve been pretty aggressive in our cost controls and I’m wondering how much further flexibility you have and then the corollary to that is, how could you go or become more aggressive and really take advantage of your better balance sheet, etc if conditions start to improve?

Let me comment about the cost picture a little bit Rick. I’m not sure it’s going to answer your question, but we have been working on a number of opportunities, mostly back of the house opportunities in the organization to create more synergies, more shared services in the organization and we have a number of objectives in 2009 to achieve those opportunities, to achieve those objectives throughout the organization and I would say there’s a very positive view that we will make some progress in there. I think, David’s comment and my comment about, we think there maybe some more opportunities on the cost side of the business, I think is based on that. It is a very positive view that we can save some money and we will continue to look for these kinds of opportunities going forward, with I think the objective of getting back to a zero cost metric on an ALBD basis going into 2009. I think that’s our largest opportunity, but you have to remember, we’ve got these two other factors in here, fuel and currency which also play a roll in to business and those are things that are very difficult and obviously we can’t control those.

The volatility of fuel and currencies is unbelievable. I mean if you took this mornings prices versus Monday’s prices, we’d get pretty close back to the guidance that we had in October. So, it’s amazing how volatile these markets are. I guess everybody on the call understands that. Rick Lyall - John W. Bristol: How about going on offense?

What would you like us to do Rick?

There’s a saying a good defense is your best offense. Obviously, from an antitrust point of view there’s not a whole lot that we can do, but like post September 11, sometimes opportunities avail themselves that you’re not expecting and we’ll be diligent about that as time progresses. Rick Lyall - John W. Bristol: Have you guys ever seen an environment like this? When I think back to the various wars and 9/11 and this seems to be a very different environment than that and have you got any relevant experience that you can compare this too and take advantage of?

Well, it’s different in that September 11 we saw a very quick bounce back, which although we’ve seen some improved volume post the election, it has been on deteriorating yields. I guess, we had to some degree as similar situation in built-ups to both Iraq wars, where it would just seem like the built-up went on forever and people were put on hold during that built-up, but this is a pretty unique set of circumstances, where people can’t get credit and how that affectsthe consumer might want to do something, but his inability to get credit to affect the decision. So, as time goes on, we’ll learn more, but baked into our numbers is an overriding concern by all our management teams about how many people are going to taken out the market because they just can’t get credit.

Your next question comes from Robin Farley - UBS. Robin Farley - UBS: A couple of questions; one is, I just wanted to make sure I heard your comment correctly when you mentioned opportunities like disaster 9/11. Does that mean you’re looking for acquisitions, is that how we should interpret that comment?

What I said was because of antitrust we can’t really do that, but if things continue to deteriorate and opportunities exist similar to what happened. I mean, if you remember post 9/11, there was a number of failed cruise companies and that created a number of opportunities and some people jumped on them. If you look NCL went into Hawaii because American Classic went out of business and the Renaissance fleet was broken up and sent around the world to various cruise companies including ours and Royal Caribbean and Oceania. So, stuff happens and we just have to be aware that stuff may happen again.

If it’s challenge for us to get credit at reasonable prices in the marketplace, it will be a challenge for companies with a lower quality credit companies in the industry. So clearly, we never know what’s going to happen, but clearly we are in a unique position having really run a conservative balance sheet over these years.

It’s not that we’re doing anything in an aggressive manner. All I’m saying is that we have to remain diligent to the possible opportunities that might come our way. Robin Farley - UBS: Okay, great, and then also your comment in release about close-in bookings in Q4 being better than expected. So that must mean some of that was on price not just on volume that…

I think the way to look at that, because when I read it myself it was kind of funny. That’s not to give any indication of strength in bookings in the fourth quarter. Its an indication of how conservative we were at the time and how weak we thought bookings might be in the fourth quarter and its outperformed our expectation, but I don’t want to you develop any thoughts that that means that there was strength, that’s not the case. Robin Farley - UBS: Well, so I was going to ask if there was a trend that you were seeing in the Q1, but it sounds like that’s not the case?

Well, what we are seeing is that volumes in Q1 are strong because the curve has moved in. So, we’re seeing very strong volumes in Q1 and very weak volumes in Q2 and Q3 and we would expect that to roll overtime. Robin Farley - UBS: But, if the Q4 comments sounded like it was price rather than volume, that’s what had kind of come to my attention, but I understand your clarification.

It’s never volume.

It’s always price. Robin Farley - UBS: Right that’s helpful and then last thing is and I know this is looking out very hard, but it was helpful when you walked thorough your position in ’09 in terms of liquidity, committed financing and CapEx. Can you walk us through a tentative version of that for 2010?

We’ve really haven’t given any guidance for 2010. I guess the only thing I can add at this point in time is that our maturities for 2010 are $1 billion. We do currently have one export credit for 2010, which is $350 million, but we don’t have any forecast for 2010 or any guidance to work off. Our CapEx is (inaudible)

I think that some of the situation will probably look pretty similar by the time we get close to 2010 that we have in 2009.

And we are continuing by the way to work on a number of export credits. In fact we’re hoping within the next week or two to close on two German export credits, but those are for 11 and 12 and we’re also working on some Italian export credits which we should probably have closed in the next 30 to 60 days and all of these export credits again will have interest rates at probably below 5% overall in.

I think there’s also some misunderstanding of how this export credit works. Generally speaking, the export credit is agency of government guaranteeing a percentage of the overall loan. So, that the lending banks have to take into consideration the credit worthiness of the government for one piece of the loan and the credit worthiness of the company for the other piece of the loan and that varies by government by loan. That’s one loan, if you understand what I’m saying, because there is been some confusion on that issue.

In some cases the banks have committed to the export credit as in our case. In other cases they don’t commit until later on, even though the export credit facility is out there. They still have to syndicate the loan.

For intense, the one that I just mentioned, we’re working on Italian export credits that will close in the next 30 to 60 days; that’s where we have the government commitment, but we’re looking to get the banks to sign on the dotted line in the next 30 to 60 days and then it’s fully committed.

Your next question comes from Tim Conder - Wachovia. Tim Conder - Wachovia: Along those same lines David, could you kind a outline for us; I guess if you look at the ships you have delivering in ‘09, ‘10 and you’re talking little bit about ‘11 and ‘12. Of those, what do have, again just recap for us, there’s the bank groups that are lined up and then the government commitments that are lined up. I mean we have to look at two columns, what’s opened, and what’s confirmed. So, I guess that’s one question and that’s a broad question and the second one Howard, you talked about the booking strength in Europe on a relative basis. Could you give us a little more color by country say the Spain, Ireland and the U.K. where there’s been a lot of problems versus some of the other areas on the continent?

As you know Tim, we’ve got 17 ships on order; its five ships in 2009, six in ‘10, four in a ‘11 and two in ‘12. At the current moment including all of the bank commitments fully signed and done, we have three export credits, two for 2009, one for 2010. Tim Conder - Wachovia: Okay, so that’s the group A and the export credit collectively done.

Correct. The banks have signed the governments have signed. At this moment, I have government commitment for one more ship in 2009 and I’ve got an additional ship in ‘11 and ‘12. So, we’ve got three additional governing commitments; two of the three should be signed within a week, maybe two. Holidays are always a difficult to time to get everybody to sign and then the last one would be signed in the next 30 to 60 days. So, we talking about three done and three in hoper and that doesn’t mean we’ll stop there, that’s just what we’re working on right now.

The way we’re presently structured, remember that five of the ships are being build in Italy for Italian flags, so there is no export involved. That’s the way it’s presently structured. Obviously, if we wanted to we can structure it slightly differently, but that’s the way it’s presently structured.

Tim, on the relative performance of the European brand by market, I think you kind of almost hit the nail on the head yourself. I think that if you look at continental Europe and lets suppose we’re talking here Italy, Germany and France, that seems to be performing better. And Spain is still a challenge, there’s still a problem, but of course we only have a few ships in Spain with Ibero and right now two other ships are in Brazil, so that’s not a problem for this winter. It does become a challenge for the springtime, but it’s only two ships. If you look at the U.K., while the U.K. is not performing as well as continental Europe and this is all relative now, if we’re performing better than the U.S., so it sort of between the U.S. and Europe. I can’t comment to that, I don’t know that; although I’m sure if we get passengers from Ireland, I assume it’s very similar to the U.K. Tim Conder - Wachovia: Okay and lastly, Micky if you could, you alluded to earlier in the preamble about how you’re going to have more difficulty going forward hearing to your cost controls just because there’s going to be less capacity growth. Looking at 2012 and beyond, Micky, and you’ve talked about this for well over a year, almost two years that it’s going to slow. Any general range of percentage capacity growth or any color you can give on that on looking ‘12 and beyond?

It’s difficult to say. As David said, we have what two ships now for ’12.

Current capacity growth for 2012 for us is about close to 4% already.

It’s unlikely that there would be any contracts done unless we believe we can get the kind of returns that we expect and based on the current situation, that’s doubtful. So, we’ll see, but right now it’s hard to project much higher than what we’ve got. Tim Conder - Wachovia: Okay, even if returns would be more palatable, would you say…?

They are clearly brands in our portfolio that could use capacity in 2012. We have for example, Princess has no ships on order and clearly it’s a brand we feel very strongly about and would like to see growth, but again we’re not going to do it unless the returns are there. So, we have brands that clearly from a strategic and a long-term point of view, we would like to grow, but we’re not going to it unless the environment is such that we can get reasonable returns from it.

We also should point out that we still have time to order ships for 2012. I mean this isn’t like something that we have to do tomorrow in order to get the ships in 2012

And again we look at these as 30-year assets, if we don’t get them in ‘12 and we get them in ’13 or we get them in ’14, that’s fine. We look at these as very long-term investments.

Your next question comes from Steve Kent - Goldman Sachs. Steve Kent - Goldman Sachs: Just on the current stuff, can you just talk about trends in cancellations, any price adjustments on already booked cruises, so just to give us a sense on that. Then Howard, just on this expense structure, you alluded to that you have a program in place to reduce expenses and I can’t help but notice that every hotel, every gaming company has made massive cutbacks in overhead and in CapEx and I just wanted to hear if you could give us a dollar amount as to what your expenses are. Would that include travel agent commission cuts and what it can include consolidation of your multiple headquarters?

First of all, let me answer the last one first. The reality is that we have been a very cost efficient, high margin business from day one. We are working diligently to maintain that culture in the company, but we have done it without massive or drastic cuts that negatively impact the business for the long-term. A hotel can close a wing and layoff hundreds of workers. We can’t close a deck of a ship and the economic environment doesn’t allow you to do that anyway. Laying up ships also unless the situation is that you’ve got two ships in the same itinerary at 50% load factor, which doesn’t exist, the economics don’t work for laying up a ship. So it’s just, we’re not in the hotel business, we’re in a very, very different environment and in different business. The other part of your question is about travel agent commission, the answer is absolute not. Times like this, more than ever, we need a strong distribution system and we need folks out there selling the cruise concepts, selling our various brand all over the country, hundreds of thousands of them, the more the merrier and the reality is that we will support that distribution as long as I’m CEO of this company. What was the first part of your question? Steve Kent - Goldman Sachs: Headquarters Micky.

This is Howard. We’ve had this discussion before and our view is that when you have unique brands with different cultures and in many cases different markets, it would be a huge risk to try to go to bring everybody into one place and quite honestly, when you look at the risk of doing that versus the potential award, because we have done that, we have run numbers on it, you just can’t justify in order we think it make any sense.

All companies that have that model have lower margins.

So, really what we have been focusing on is more datacenters and consolidation of datacenters and looking for more shared services, procurement, working together on potential opportunities we have in Alaska. I mean there is just a whole variety of different things that we’re doing right now and we have current organizations, we have current committees of all the companies working on these things and we’ve made some progress actually in 2008 and then we hope to see a whole lot more progress in 2009. Steve Kent - Goldman Sachs: And when you add all that up Howard, how much money is it; are you keeping track of it for your board?

Yes, well internally we have projections and we provide the information to the board yes. We haven’t externally published the information, but clearly it is a very nice opportunity. Some of that is actually baked into the numbers, the cost numbers for 2009, some of it is not. So, I hate to give that a number, but it’s a nice number, but hopefully we get from the 1% to the flat, that’s our charge and what would 1% be David?

One percent on cruise costs is around $65 million, without fuel it’ll be about $55 million.

Yes, so within that range.

Also you mentioned CapEx. Most of our CapEx of course its fixed relating to the new build, but we do have a portion of the CapEx which is maintenance CapEx. Since the budgets been put together, we’ve gone around to all of the operating company’s, have asked them to take another look at that their CapEx and to reduce it where it was absolutely possible. So, we’re doing everything we can to reduce costs, reduce CapEx and preserve the cash.

But again we’re doing it in a way that would be unperceivable to a customer or to a traveler. Steve Kent - Goldman Sachs: On CapEx, have you talked to the shipyards about delaying new deliveries? It seems like everything is negotiable in this environment. We’ve seen things that we would have never seen, everything from airlines to the hotels.

I don’t know why everybody is focused on the delaying delivery. No, we have not. The reality is that when we want to mitigate growth in a particular market; if you look at the majority of the new builds in this spring, it’s IETA and Costa, its all in Europe and the reality is there’s ways to mitigate capacity increases without delaying new builds. The realty is that in the European theater, we have significantly mitigated the growth next year; we sold the QE2; we delayed the delivery of the Holiday to IberoCruceros. We’re transferring two of the Ocean Villages ships from the U.K. market to the Australian market and cost is moving one ship from Europe to Asia. So there’s ways to mitigate growth in a particular market without delaying it.

I think, if it ever got to that point, we would probably take an older ship out of service rather than delay the new build, you want the new build. Steve Kent - Goldman Sachs: I don’t know if I would want to answer, any cancellations or pricing adjustments on already booked cruises?

Cancellations have increased. The consumer environment is as everybody knows, difficult.

No, we have seen more of an increase. I mean it varies depending on the brand, but we have seen some increases in cancellations across all brands.

Clearly, we’ve taken that into consideration as we put together the guidance that we gave you.

Your next question comes from Steve Wieczynski - Stifel Nicolaus. Steve Wieczynski - Stifel Nicolaus: When you look at to what used to be the important wave season coming up, I mean how subdued do you think that period is going to be and would you think that the bulk of the summer booking, as the booking window continues to shrink, is that going to move closer to an April to May kind of time period?

I wish we knew. The reality is that baked into our numbers is a concern about the consumer obviously for all of ’09 and I think we view the condition, I think baked into our numbers as a deteriorating situation as we go into the year, because obviously the booking pattern for September would have been for the second or third quarter. September to now would have been strong for second and third quarter historically. So, we don’t know, we’re hopeful there’ll be a bounce back. We predicted a bounce back after the election. We actually did see that, we did see volumes improved. The five weeks after the election, the volumes improved year-over-year versus the five weeks prior to the election, but unfortunately with deteriorating yield and that’s why we adjusted number. So, we’re hopeful that it would be a reasonable wave period, but I must say we’re all cautious in our outlook because we all read the same newspapers and see what’s going on. Steve Wieczynski - Stifel Nicolaus: Okay and then a last question in terms of it’s been pretty helpful in the past terms of onboard spending, in terms of what you’re seeing; where you’re seeing strength and where you’re seeing weakness, just across the board?

Yes, overall it’s in the same areas that we have talked about before. Art auctions, bar, casinos generally speaking and as you can imagine we took our on-boards down in the guidance for 2009, along with the ticket prices, which is how we got to the 6% to 10% reduction overall that Howard mentioned.

Your next question comes from John Graff - Boston Company. John Graff - Boston Company: Howard, I just had a quick question for you. You indicated you thought the booking gaps would close as time progressed. I’m curious, is that just a result of the shorter booking window or there are other factors there that you’re counting on?

No, what I’m talking about is the shorter booking windows. I think as Micky mentioned, if you look at first quarter now which is substantially done. I mean we’ve got more to book, but you could see booking volumes now in the first quarter week-over-week, prior week last year running ahead. So, what happens is that we’re getting the bookings late. They’re coming in closer to the cruise, but what also happens is that you’re not able to sustain the pricing. So, we see deterioration of pricing as a result of the closer in booking pattern. John Graff - Boston Company: Okay, great and then one another question is, back in as you mentioned around September 11, there were a fair amount of, I guess I would describe them as weak sisters that went out of business. How much competition is out there that potentially could suffer, maybe be reduced, maybe be eliminated as a result of the difficult environment we’re experiencing now. Is there much left to go?

John, I don’t think we should comment on that. That wouldn’t be appropriate now.

Your next question comes from Assia Georgieva - Infinity Research. Assia Georgieva - Infinity Research: Micky, maybe you can help me. Q4 outperformed your October 31 expectations, even though the times obviously were pretty much done with Q4. Is Q1 in 2009 guidance as conservative?

I hope so.

We’ll let David answer that question

I think that you have to recognize that of the $0.10 that webeat guidance, $0.06 was purely due to lower fuel prices. So, a lot of the increase was just as a result to the market and the drop in fuel and as Micky talked before, he had said that a couple of pennies was due to higher than expected revenue yields and these things are very difficult to project.

I think it’s fair to say that, I think the revenue picture probably won’t dramatically change from where we think it’s going to be in Q1, I don’t think. It maybe a little bit, but I think that from a cost side, Micky already mentioned that for purposes of the guidance, we priced out on Monday’s fuel prices currently. So that’s improved and if it stays at those levels, clearly there’s some opportunity in those two areas; from currency standpoint and fuel standpoint to show some improvement in Q1 earnings, if they stay at the levels that we have today. So, there has been just some improvement in the last few days, but fuel and currency are moving very dramatically and it’s hard to know three months out what it’s going to look like for the period.

When it comes to the yield, the yield is based on what the yield management people at the brand deliver to their management and they deliver to us and obviously, they are human beings and they watch the CNBC and they’re hearing everything else and that conservatism is built into a concern over where the consumer is going to be next year and that’s built into the number and was built into the number in October. Assia Georgieva - Infinity Research: Given that we are still a couple of weeks away from wave season and I imagine booking volumes at present are probably at some of their lowest for the year given that people are focused on the holidays rather than on their vacation plans for ’09, do you think there could be upside to expectations for Q2 and Q3. Clearly Q1 is probably over on the revenue side or pretty much over, but how about the more critical Q2 and Q3.

I mentioned that when the president takes office in his new administration and if you assume that they get through a fiscal stimulus plan pretty quickly, which I think they will I think that could be a very positive factor psychologically I think for consumers in American and I think that could benefit to wave season, but it’s really hard to know right now, because you just can’t see at the numbers we’re booking right now.

One of the reasons we gave a broader range than normal, which was a $0.50 range is because of the uncertainty that Howard just mentioned. Howard. Frank: I think its always interesting to me because, all during ’08 we had lot of skepticism in the market that we could deliver the revenue in such a weak economic environment and of course nobody now is focusing on the 290 we delivered in 2008; everybody, including yourself focusing on ’09 and that’s logical, but the reality is we delivered despite the economy. All I can say is that we outperformed virtually every area of leisure and believe we will do it in ’09. Now what does that mean? It mean we will do better than the rest of the industry, but how will the rest of the industry do and time will only we tell, but sometimes you do have to look back to understand and have the confidence in the future and when you look back we’ve always outperformed in tough economic environments. Assia Georgieva - Infinity Research: Well Micky I’m clearly with you on hoping that you outperform the number you gave us today. So I guess we’ll have to wait until wave season and see how bookings continue for ’09.

I can assure you that the number we’re after is the highest possible number that can be achieved and not whatever we’re giving you as guidance, that is not our goal, that is just our number to give you guidance. Assia Georgieva - Infinity Research: What is the highest possible number?

Tell me what fuel is going to look like, tell me what currency is going to look like and I’ll give you a better sense. I mean how many banks are going to be lending any money in the first quarter and people are going to be able to use their credit cards and buy cars and general motors is going to be in business and how many more people will be unemployed. We run cruise companies, were not economists

Your next question comes from David Leibowitz – Horizon. David Leibowitz - Horizon: Briefly fuel, have you constructed fuel out further because of the current low price or are you playing it as close as you normally do?

Right now we’re playing it as close as we normally do, but as we said before we always look at those options and we continue to look at those options, but as off today we’re taking full advantage of the lower fuel price. David Leibowitz - Horizon: I apologize Micky for the add-on hear; am I to take that if you’re taking full advantage where you normally would contract out to three moths, you might be contracting out to four or five months now?

I mean full advantage in that and the declines you see today will be in our price this week end. David Leibowitz - Horizon: Okay, second question in terms of the potential tonnage that might be coming onto the market as lesser yield competitors were to go by the wayside; if we leave out your major publicly traded competitor, is there any tonnage out there that you would be willing to buy and if so, which fleets would you give it to?

I don’t think it would be appropriate to answer that question.

No, that’s inappropriate and David I don’t think we know the answer to that question. David Leibowitz - Horizon: Well, I’m not asking you to identify where the tonnage would come from; all I’m saying is where there tobe another renaissance, were there will be whatever, where tonnage was made available where you would be able to purchase,would you infact,,is there any there any tonnage out there you would be willing to buy and if so which fleets would it go to?

Is there any tonnage we’d be willing buy, the answer to that question is, yes. The question of which fleet would it go to would depend slowly on the tonnage, which would inappropriate to respond to. David Leibowitz - Horizon: Okay, and then absent that then, if there was tonnage available, would you start a new brand?

Probably not.

Your next question comes from the line of Nick Kayano – Olson & Co. Nick Kayano – Olson & Co.: I just had a question regarding deposits on the balance sheet. I was reading in some trade rags that some agents are seeing customers ask for refunds at a much more increased rate than has been historically, even in the face of paying penalties and such. I was wondering what your experience is with refunds of deposits and how you think that may play out in 2009 and if it would be anything meaningful?

The refund of deposit is just another way of saying a cancellation, because whenever somebody takes the bookings they put money down and if they’re canceling they get their money back and Howard had indicated cancellations are up, but we have taken that into consideration in our guidance for 2009. So we understand that trend.

But indeed that is happening, yes we see that. Nick Kayano – Olson & Co.: So, I guess when I look at the balance sheet, could that cause a cash flow issue meaning I’m not suggesting this is what happens, but if half the people said, “We want our money, we’d like to cancel.” I think there was $2 billion worth of deposit liabilities on the balance sheet, would we in theory then have to give half of that back, and then come up was $1 billon of cash?

You’re talking a rolling number…

It is a rolling number. Remember most of those people are actually in the next six to eight weeks because, they are the fully paid people that make up the majority of that, but the booking curve moves in, that deposit liability account will decline because you have less people on the books and that has declined..

We saw a net of the currency movement we did see a decline of 3% in 2008 and obviously in taking a look at that and the cash flow projections that Howard gave for 2009 at the midpoints, we took into account the slower booking curve and perhaps also a decrease in customer deposit there.

Well Howard went through the liquidity information, clearly that is one key element of the liquidity, which we look at very carefully.

So when forecasting it out, we assume we are going to see more of that and some lower deposit liabilities as a result.

(Operator Instructions) Your next question comes from Rick Lyall - John W. Bristol Rick Lyall - John W. Bristol: Sorry for the follow-up guys, but two quick questions. On group bookings, have you seen any divergence in the behavior of groups versus individuals i.e., are groups canceling and then rebooking at lower prices and then secondary, I wanted to follow-up on the note that talked about your P&I recovery; there was a call for 2006 to 2008. I was surprised at that, because usually P&I guys just adjust their rates prospectively. So what’s the nature of that retro call if you will?

On the P&I, the way our P&I insurance works and this has been this way for as long as I’ve been in the cruise industry; you pay a certain premium every year and there are what is called supplemental calls that could potentially come after the fact. Any particular year in P&I stays open for three years before they close the year, because there’s a long tail of claims and so sometimes if the clubs have a very high claim experience or as has been occurring right now too is low investment income. They could require some additional supplemental calls and so these calls related back to 2006 and 2008 and we accrued them in the fourth quarter. So, it’s very typical, nothing unusual.

This is been the way forever. Your question about groups is really tough. It appears that the behaviors of the groups are quite similar to the behavior of the regular FIT bookings. Maybe slightly a less year-over-year decline versus FIT, but not significant enough. I mean if you put on a graph, the graphs will look pretty similar.

Your next question comes from the line of Dominique Neil - Canyon Capital Dominique Neil - Canyon Capital: I wanted to ask you as you look at your product line and potentially acquisitions, what is the product that’s most attractive for you, in terms of the price point; is it the low-end, mid-end, luxury line?

We’re really not looking quite honestly making any acquisitions right now. Dominique Neil - Canyon Capital: No, I recognize this is completely hypothetical.

What I think Micky said was that if something, if ships became available as a result of a competitor having difficulty and we might be interested in acquiring a ship if the price was right depending and betting whether it would work for one of our existing products in our fleet. Dominique Neil - Canyon Capital: Right, so putting aside acquisition, what is the best return on investment category at this point given the environment and the fact that consumers are pretty much along everywhere suffering, but maybe some price point is better than others.

Right now as Howard said, the contemporary lower cost product is the one that’s performing the best for obvious reasons, but that hopefully is just a temporary phenomenon. So we’ll see, but it’s very difficult to answer that question. Clearly, if you’re looking for margins profitability, McDonalds makes more money than a three star Michelin guide restaurant and historically the cruise industries worked in a similar way.

Your next question comes from the line of Sharon Zackfia - William Blair. Sharon Zackfia - William Blair: Just maybe a rather naive question; I’m kind of new to the story, but I’m just curious in terms since your seeing some changes in the consumer behavior and you’ve mentioned more of an interest in the shorter itineraries than the more value oriented cruises. Is there any opportunity as you look into 2010 to change the length of some cruises or change the itineraries and then separately does the current mindset from the consumer change your marketing message at all?

Yes, well the marketing message is really brand specific and each brand has very different marketing messages and makes tweaks and adjustments. You will be seeing a new Carnival Cruise Lines campaign break very soon, which slightly tweaks the message, but it’s still very fun focused as Carnival has always been. Your first question’s a very good one actually. When you look at for example at Europe deployment, the premium brands that operate most of their ships in Europe and Alaska in the summertime; we’ve gotten a lot of questions about that and despite the fact that we see a lot of challenge in those market for the North American brands, they still are forecasting yields that would be higher even in this difficult environment than moving the ship back to the Caribbean. Summer Caribbean is a mass market product and while our mass market brands does very well there, the reality is that it would take a lot of deterioration in Europe and Alaska to move those ships back to the Caribbean, because there is s significant premium that those markets receive, but that premium will be lower this year than the prior couple of years, but still not low enough to force movement. However, our brands look at this ship-by-ship every year, but the effect of that will be felt in 2010 not before.

And gentlemen we have no further questions at this time.

Well thank you very much everybody. I want to wish you all a happy holiday season and a happy healthy New Year and hopefully a more prosperous New Year.

Ladies and gentlemen, that does conclude your conference call for today. We thank you for your participation and ask that you please disconnect your line.