New York  - Carnival Corp, the world's largest cruise-line operator, Tuesday reported first-quarter profits after cutting costs and offering heavy discounts.

The Miami-based Carnival said its net income was 260 million dollars, up from 236 million dollars a year earlier. Sales dropped 9.1 per cent to 2.86 billion dollars in the three months ending February 28.

"Considering the economic climate, achieving higher quarterly net income is quite remarkable," Carnival CEO Micky Arison said in a statement.

The company, however, reduced its forecast for the rest of the year as it is filling its ships only because of lower prices offered. Cost cuts and lower fuel prices were helping counter discounts.

"People continue to book cruise vacations while seeking the best possible value," Arison said. "Though pricing is down significantly, we continue to fill our ships by reaching people who might not have otherwise considered a cruise vacation."

The group includes lines such as Princess, Cunard, AIDA, Holland America and Seabourn. Despite the tough economic times, it has 16 new vessels scheduled for delivery between April 2009 and June 2012. (dpa)