Fitch rates Carnival bond A-

Fitch Ratings said it assigned an A- rating to the €500 million senior unsecured bonds offered by Carnival plc and guaranteed by Carnival Corp. The A- issuer default ratings and F2 short-term debt/commercial paper ratings remain unchanged.

The outlook is stable.

Proceeds of the notes will be used to refinance outstanding euro commercial paper obligations and for general corporate purposes.

The agency said the ratings reflect Carnival's ample liquidity position, robust cash flow generation ability, market- leading competitive position and favorable industrywide supply/demand outlook for the next few years. Carnival has firm orders for 17 ships to be delivered from 2007-2010, and these orders span eight brands and will be placed in multiple markets including North America, Southern Europe, the United Kingdom and Germany. Fitch said this geographic and brand diversity represents a significant competitive advantage because it allows Carnival to lower currency risk and effectively allocate assets.

Ongoing risks include the potential for a consumer-driven economic slowdown and an increase in the amount of cash returned to shareholders, taking into account Carnival's stated intention to manage capital allocation in a manner consistent with the current rating, the agency said.

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