Royal Caribbean Cruises’ earnings guidance for 2012 is within the range of $1.80 to $2.10. However, the company said in its earnings call today that Q2 and the all-important Q3 were going to be more impacted by the Costa Concordia incident than Q1 which was largely booked when the incident took place.

According to CEO and Chairman Richard Fain, Europe and Southern Europe in particular have been most affected by the Concordia, but going into the fall he expects to that the industry will turn the corner. Meanwhile, Brazil, Asia and Australia have been performing “nicely,” he said.

However, Europe looms large as more than half of the company’s passengers will come from outside of the U.S, in 2012 and a majority from Europe.

While Europe is what executives called a somewhat challenging revenue management environment, North American bookings are strong and marketwise, the Caribbean and Alaska are strong.

As for Asia, Fain said that Asia, and China in particular, represent a strategic objective, but in the short-term is a money-losing proposition. He said Asia is costing money in the short-term but is expected to pay off relatively quickly. “Long-term, we think we’ll get strong enough returns to justify the investment,” Fain noted. “We are not that far away from breaking even today.”

In the bigger picture, Brian Rice, executive vice president and CFO, noted that Royal Caribbean has kept cost increases, except for fuel, below the rate of inflation.

Looking forward, Fain said: ‘In the environment we see today, we are looking at margin growth vs. volume growth. Modest capacity growth will help boost our margins.”