Arnold W. Donald
President, Chief Executive Officer and Chief Climate Officer at Carnival Co. &
Good morning, and welcome to our Business Update Conference Call. I am Arnold Donald, President and CEO of Carnival Corporation & plc. I'm joined today telephonically by our Chairman, Micky Arison, who is in Europe; and here with me in Miami, David Bernstein, our Chief Financial Officer; Beth Roberts, Senior Vice President, Investor Relations; and as part of our previously announced transition, our Chief Operations Officer, Josh Weinstein. Thank you all for joining us this morning.
Now before I begin, please note that some of our remarks on this call will be forward-looking. Therefore, I must refer you to the cautionary statement in today's press release. This is my final business update as CEO. While very disappointingly, our share price unfortunately reflects the current market conditions, I am nonetheless very proud of all that the team has accomplished over the last 9 years. I am especially proud of how well we have collectively overcome what seemed like insurmountable obstacles at times these last few years.
And I remain very excited about our future. With cash from operations now turning positive, we have reached an inflection point and, in fact, turned the corner and are headed on a positive trajectory. I'm not only excited about, I am also very confident in the future of our company, and I'm looking forward to its continuous success. I strongly believe in this team and we are enjoying a smooth transition. As Vice Chairman, far and away, my number one responsibility will be to support Josh and his management team as they work to build on the current momentum.
Josh is a proven executive. He is well respected throughout the company. He served in key leadership roles. He's driven strong business results during his tenure. And he played an integral part in tuning the company through the global pandemic. Josh's thorough understanding of our industry, of our operations and our business strategy puts him in a strong position to lead the next phase of our company's journey. With his vision, intensity and core values truly aligned with those that characterize our company, I cannot think of anyone better suited for this role than Josh.
Now turning to our business results. It is reinforcing to see the continued strength and demand for cruise. We are aggressively, yet thoughtfully, ramping up to full operations, with over 90% of the fleet now in service. And at the same time, we are driving occupancy higher on those ships that have been sailing and we are focused on improving pricing compared to pre-COVID levels.
As we had indicated, for the 20 ships that restarted over the last quarter, occupancy has been intentionally constrained. That said, occupancy increased from 54% last quarter to 69% this quarter, while we also increased available capacity by 25%. Now the combination drove an over 60% sequential improvement in passengers carried. In fact, we carried over 1.6 million guests this past quarter. And partly in the month of June, we are already approaching 80% occupancy and, again, on even higher capacity.
Now what makes that even more impressive is we were able to achieve that in an environment of uncertainty, given frequently changing protocols, including those that were far more restrictive than those in broader society and that were far more restrictive than those found even in other portions of the travel and leisure sector. While thankfully, vaccination and test requirements are starting to relax given the improvement in the state of the virus, we continue, nonetheless, to face constraints in the pool of potential guests due to ongoing requirements in a number of places. Yet, we have been able to make very meaningful progress.
As you know, the CDC recently lifted the testing requirements for reentry into the U.S. for air travel which, going forward, clearly removes some of the friction from our North American brands deployment in both Europe and due to Canadian embarkation Alaska. Usually requiring a longer duration flight, these itineraries are typically associated with longer lead times. Consequently, we expect the real benefit to be realized in 2023 and beyond.
Importantly, customer deposits increased by $1.4 billion in the second quarter, topping $5 billion. Now we have seen a continued increase in express demand, and we expect to see that demand continue to build as protocols are further relaxed and as society becomes increasingly comfortable managing the virus. Concerning the threat of global recession, while not recession-proof, our business has proven to be recession-resilient time and again.
As we have seen in prior cycles, even in downturns, employed people take vacations. And that's even more true in today's environment where people prioritize spending on experiences over spending on things. Cruise remains an especially appealing vacation option during downturns because of its compelling value proposition relative to land-based alternatives. Also, there is pent-up demand for travel globally which is a powerful tailwind.
Currently, we are seeing success for close-to-home cruises, with many sailings achieving occupancy at or above 100%, where guests perceive far less friction than with international embarkations. In fact, our Carnival Cruise Line brand, sailing its entire fleet, is expected to reach nearly 110% occupancy during our third quarter. We also saw an improvement in new-to-cruise guests in the second quarter, and we have begun to ramp up our advertising efforts selectively to help support attracting first-time cruisers.
Concerning pricing. We remain focused on improving price through next year. We are focused on optimizing the occupancy while preserving long-term pricing. In this current environment of travel restrictions and health protocols where we have coast unavailability, we use OPay channels and limited promotions to capitalize on near-term demand. We are building on our aggressive fleet optimization efforts. Given challenges in parts of Europe, we have reallocated capacity to capitalize on markets where there is stronger demand.
In fact, we just announced an especially creative approach that we think holds great promise-, the launch of Costa by Carnival. With Costa by Carnival, we bring the ambience and beauty of Italy to Carnival Cruise Line guests. Costa Venezia, Costa Firenze, both newly introduced and both spectacular, will be managed by Carnival Cruise Line, catering to Carnival's guest base beginning in the spring of '23 and 2024, respectively.
This new concept will offer a unique experience for Carnival guests to choose fun, Italian style while capitalizing on Costa's beautiful Italian design elements. Deployment for Venezia will be announced shortly and will represent a new itinerary option for Carnival guests. Separately, we also announced the transfer of Costa Luminosa to the Carnival brand beginning in November 2022 catering to Australian guests. Now with these changes, the Carnival brand will replenish capacity that have been removed from recent ship exits and contribute to manage growth for the brand.
These new and differentiated product offerings enable us to capitalize on demand among Carnival Cruise Line guests and strengthen return on invested capital across our portfolio. In addition, we continue to further optimize our fleet and have announced a removal of an additional smaller, less efficient ship, bringing the total to 23 ships to be removed from the fleet since 2019. The accelerated removal of these less efficient ships, coupled with the delivery of 9 larger, more efficient ships delivered since 2019 fosters higher revenues over time through a 7 percentage point increase in the mix of premium priced balcony cabins and an even better platform for onboard revenue opportunities as well as generating a 6% reduction in ship level unit costs, excluding fuel, moderating the effects of inflation and enabling us to deliver more revenue to the bottom line.
Upon returning to full operations, nearly a quarter of our capacity will consist of newly delivered ships, expediting our return to profitability and improving our return on invested capital. Moreover, next year, our capacity growth compared to 2019 is concentrated in brands with our highest returns. Concerning recent fuel prices, we continue to aggressively manage our fuel consumption. Upon reaching full fleet operations, we anticipate that we will achieve a further 10% reduction in unit fuel consumption and 9% reduction in carbon intensity as compared to 2019.
With our proactive efforts to reduce fuel consumption, we actually peaked our carbon footprint in 2011, and that's despite an over 30% increase in capacity expected through 2023. In fact, we have reaffirmed and strengthened our carbon intensity reduction goals for 2030 and are on an accelerated path to achieve them through our fleet optimization efforts, investing in projects that drive energy efficiency, designing energy-efficient itineraries and investing in port and destination projects.
During the quarter, Carnival Cruise Line broke ground on an exciting new destination project, Carnival Grand Bahama Cruise port. This destination is expected to open in late 2024 and will offer guests a uniquely Bahamian experience with many exciting features and amenities. Now this private guest experience destination will join Princess Cay, Half Moon Cay, Grand Turk, Mahogany Bay, Amber Cove and Cozumel, securing our strong foothold in the Caribbean. In fact, we benefit from a total of 9 owned or operated private destinations and port facilities, including terminals in Santa Cruz de Tenerife and Barcelona.
Again, I believe we have operationally reached an inflection point and we are heading in the right direction with cash from operations turning positive this quarter. We have a strong liquidity position of $7.5 billion and have already managed our debt maturity towers down through 2024. We have 91% of the fleet now operating and at improving occupancy levels, which bodes well for future cash generation.
And while to date, travelers perceive uncertainty and friction continues to be a headwind as protocols become less restrictive and society continues to become increasingly more comfortable managing the virus, we expect to see demand continue to build, as we have already seen with the strength for Carnival Cruise Lines closer-to-home cruises. The attractive value proposition relative to land-based alternatives, which is even greater today, and the continued strength in onboard revenues should help foster a good environment for pricing and should help to accelerate our momentum going forward.
Once again, I don't have the words to adequately convey how personally rewarding and inspiring the commitment, the dedication, the creative ingenuity and the phenomenal execution of our Carnival team, shipboard and shoreside around the world has been. And that, of course, includes our Chairman, Micky Arison, and the rest of our Board of Directors. In the face of constantly changing barriers and constraints, in an environment of continuous and extreme uncertainty, our global team of tens of thousands successfully tackled challenge after challenge after challenge, honoring our commitment to our highest priority of compliance, environmental protection and the health, safety and well-being of everyone while stewarding the shareholders' assets and positioning us for great success over time. I simply can't thank them enough and it's truly a privilege and an honor to work with them.
Thank you also to our valued guests. Their loyalty to our 9 world-leading brands and the countless letters and calls of support are so deeply appreciated. Thank you to our travel agent partners, who are more critical than ever and helping to deliver the great story of our cruise. Thank you to our home port and destination communities who have stood by us throughout these challenges, among other contributions providing vaccines and lobbying for workable protocols.
Thank you to our suppliers and other many stakeholders who stood by us and worked hard to meet our needs while facing challenges of their own. And of course, thank you to our shareholders, our bondholders, the banks, the export credit agencies for continued confidence in us and for ongoing support. We are indeed poised for a great future because of the efforts and contributions of so many.
With that, I would like to take the opportunity to introduce Josh and give him the chance to say a few words before turning the call back to David. Josh?