By Martinne Geller

(Reuters) – Carnival Corp & plc, whose luxury liner Costa Concordia capsized off the coast of Italy last week, said it was providing lodging, refunds and other support to people affected by the accident, even as some public relations executives criticized the company’s handling of the situation.

“I give my personal assurance that we will take care of each and every one of our guests, crew and their families affected by this tragic event,” Carnival Chief Executive Micky Arison said in a statement late on Wednesday – five days after the incident that left 11 people dead and 22 missing.

Costa Cruise Lines, a unit of Carnival and operator of the ship, has been arranging lodging and transportation for passengers and crew members to return home, and has offered assistance and counseling as needed. It has also begun refunding passengers their cruise fares and all costs incurred while on board.

The company also said it was contacting every passenger and crew member or their family and will be addressing personal possessions lost on board.

Public relations experts have chastised Carnival for being slow to address the disaster and vague about its response and efforts to prevent similar incidents in the future.

On a scale of one to 10, with 10 being “outstanding,” Carnival’s public relations strategy in the immediate wake of the disaster gets a four, said Allyson Stewart-Allen, director of International Marketing Partners, a consulting firm.

NEW YORK (Reuters) – Last week’s fatal Italian cruise accident could wipe out a good chunk of Carnival Corp & Plc’s (CCL.N: Quote, Profile, Research, Stock Buzz) 2012 profits, and the cruise operator could risk more long-term damage if it doesn’t have a stronger public response to the crisis, Wall Street analysts and public relations experts said.

The event could also bruise a $30 billion global industry already grappling with an uncertain economy.

The captain of the ship, the Costa Concordia, is under house arrest, accused of multiple manslaughter, causing a shipwreck by sailing too close to shore and abandoning the ship while some passengers and crew remained.

“This affects the whole industry. If you see a cruise ship upside-down in the water, and you see people talking about their harrowing escape, that’s going to turn off a lot of people,” said Levin Stein, CEO of CruiseCompete.com, a website where travel agents compete to offer the best deal on cruises.

A drop in demand for cruise holidays would quickly lead to lower prices, Stein said, since operators hate to sail with empty cabins.

Barclays Capital analyst Felicia Hendrix lowered her 2012 earnings estimate for Carnival by 29 percent to $1.90 per share and her 2013 estimate by 26 percent to $2.25 per share.

Hendrix said it will be some time before Wall Street has any clarity on the financial impact of any resulting loss of demand, commensurate promotions, public relations efforts or future safety measures.

By Martinne Geller

(Reuters) – U.S. health officials said they found no trace of potentially deadly bacteria that killed two infants in recent weeks in sealed cans of Enfamil baby formula, and that a recall was unnecessary, providing relief for the product’s manufacturer, Mead Johnson Nutrition Co.

The death of one baby, 10-day-old Avery Cornett in Missouri on December 18, is what prompted chains including Wal-Mart Stores Inc, Walgreen Co and Kroger to pull some cans of Enfamil Newborn from shelves in an effort to protect consumers from Cronobacter, which can cause severe illness in newborns and has been found in powdered milk-based baby formula.

The death of a second baby, in Florida, was not known until an update from the U.S. Food and Drug Administration and the Centers for Disease Control and Prevention late on Friday following the testing of samples taken from the infected babies’ homes and company facilities.

“Parents may continue to use powdered infant formula, following the manufacturer’s directions on the printed label,” the agencies said in a joint statement.

Two other babies, one in Illinois and one in Oklahoma, were also reported with infections in recent weeks, but they both recovered.

The agencies said they found Cronobacter in an open container of infant formula, an open bottle of nursery water and prepared infant formula.

By Martinne Geller and Alina Selyukh

(Reuters) – U.S. health inspectors this week visited an Enfamil baby formula factory run by Mead Johnson Nutrition Co as part of an investigation into the cause of bacterial infections that killed one infant and sickened another, a company spokesman said on Wednesday.

The visit is standard procedure in such investigations by the U.S. Food and Drug Administration, said Mead Johnson spokesman Chris Perille. Mead Johnson’s own tests have twice found no sign of the bacterium at issue, Cronobacter.

The first wave of results could come as early as Friday, but the full investigation is likely to continue for several weeks, health officials have said.

“Because Cronobacter is so commonly present throughout the environment, we expect they are looking at a large number of other possible sources — water, clothing, bedding, preparation and use surfaces,” said Mead Johnson spokesman Chris Perille.

“This is standard operating procedure for them, and we would expect that they have also had inspectors visit production facilities for various other products/items they are testing as part of this investigation,” he added.

Officials at rival formula makers Abbott Laboratories Inc and Pfizer Inc said their facilities had not been visited by health inspectors.

NEW YORK (Reuters) – Vodkas flavored with citrus and berry have been around for years and recently some newer brands have been trying to create buzz with unusual flavors.

But this holiday season, for the first time, the world’s largest vodka brand is trying to appeal to Americans’ sweet tooth with zany flavors like “fluffed marshmallow” and “whipped cream.”

Faced with relentless competition from established and upstart brands, Smirnoff’s owner — the London-based beverage group Diageo Plc — took inspiration from things like cookie-scented candles and vanilla-scented laundry soap. It then relied on focus groups, mixologists and food scientists to come up with the new drinks, which went through some 15 iterations, according to the company’s chief marketing and innovation officer for North America, Peter McDonough.

Tasters preferred a “toasted” marshmallow flavor, but the marketing team decided that “fluffed” marshmallow would be a better name, McDonough said, since it would help avoid perceptions that the drink tasted “chalky or burnt.”

Diageo paired the drinks with an advertising campaign around the title “Fluffed and Whipped” that features a circus of dancers, dogs, aerialists, women spraying whipped cream into their mouths and model Amber Rose purring that “vodka never felt this good.”

YOUNG VS MATURE DRINKERS

The mixing of sugar and spice has struck a chord, particularly with younger, female drinkers, say some New York bartenders.

NEW YORK/LAS VEGAS (Reuters) – U.S. retailers saw a steady flow of last-minute shoppers on Saturday, the day before Christmas, putting a moderate cap on a pre-holiday season that started with a bang and has since waned.

Industry watchers are forecasting a stronger holiday shopping season than expected, fueled by deep discounts at the start of the season, unusually warm and dry weather, a late Hanukkah, and an extra shopping day.

On the last shopping day before Christmas, the scene at several malls in different parts of the country was busy, but neither shoppers nor retailers seemed overwhelmed.

“The last-minute Charlies have come out,” said Marshal Cohen, chief industry analyst at the NPD Group. “Stores are busy, but not bustling.”

The fact that Christmas Eve falls on a Saturday is good for retailers like Wal-Mart Stores (WMT.N: Quote, Profile, Research), Best Buy (BBY.N: Quote, Profile, Research) and Gap Inc (GPS.N: Quote, Profile, Research). So is the fact that the day after Christmas is a Monday, instead of a Sunday like last year, when many people stayed home and watched American football, said Ramesh Swamy, an analyst in Deloitte’s retail practice.

“The calendar is working in our favor,” Swamy said.

So is the fact that there was no blizzard this year, like there was last year.

NEW YORK/LAS VEGAS (Reuters) – Retailers saw their fair share of last-minute shoppers on Saturday, the day before Christmas, but stores were not super-busy, putting a moderate cap on pre-holiday season that started with a bang and has waned ever since.

Industry watchers are forecasting a stronger holiday shopping season than expected, as deep discounts at the start of the season prompted a flurry of purchasing and unusually warm and dry weather has made it easier for people to shop.

But on the last shopping day before Christmas, the scene at several malls in different parts of the country was busy, but neither shoppers, nor retailers seemed overwhelmed.

“The last-minute Charlies have come out,” said Marshal Cohen, chief industry analyst at the NPD Group. “Stores are busy, but not bustling.”

The fact that Christmas Eve falls on a Saturday is good for retailers like Wal-Mart Stores (WMT.N: Quote, Profile, Research, Stock Buzz), Best Buy (BBY.N: Quote, Profile, Research, Stock Buzz) and Gap Inc (GPS.N: Quote, Profile, Research, Stock Buzz). So is the fact that the day after Christmas is a Monday, instead of a Sunday like last year, when many people stayed home and watched American football, said Ramesh Swamy, an analyst in Deloitte’s retail practice.

“The calendar is working in our favor,” Swamy said.

Saturday caps a key week in the retail calendar that saw a handful of major store chains staying open around the clock to cater to consumers’ late-night shopping craves, from Toys R Us Inc to Macy’s, a decision hailed by shoppers and industry watchers alike.

By Martinne Geller

(Reuters) – Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research, Stock Buzz) has pulled cans of Enfamil baby formula from the shelves of 3,000 of its stores this week and other U.S. retailers followed after the death of a Missouri newborn who drank the formula.

Shares of the formula’s manufacturer, Mead Johnson Nutrition Co (MJN.N: Quote, Profile, Research, Stock Buzz), fell 10 percent on Thursday, their biggest one-day decline ever.

Ten-day-old Avery Cornett of Lebanon, Missouri, tested positive for Cronobacter, a bacteria that has sometimes been linked to rare illnesses in newborns and has been found in milk-based powdered baby formula.

A federal investigation is under way and so far no link has been found between Cornett’s illness and the formula which was purchased at a Wal-Mart store in Missouri.

Wal-Mart began taking 12.5-ounce cans of Enfamil Newborn from lot number ZP1K7G from shelves late Monday night, a spokeswoman said.

Mead Johnson said that lot number of Enfamil Newborn tested negative for the bacteria when it was packaged. Mead Johnson has not recalled the formula.

By Martinne Geller

(Reuters) – Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research, Stock Buzz) pulled some Enfamil baby formula cans from its shelves this week after the death of a Missouri newborn, sending shares of the formula’s manufacturer, Mead Johnson, down as much as 21 percent on Thursday.

The infant in Lebanon, Missouri, tested positive for Cronobacter, a bacteria that has sometimes been linked to rare illnesses in newborns and has been found in milk-based powdered baby formula.

There has been no link between the illness and the formula. The batch in question tested negative for the bacteria when it was packaged, Mead Johnson said.

Walmart began the process of voluntarily removing the product used by the infant’s family — 12.5-ounce cans of Enfamil Newborn with lot number ZP1K7G — from more than 3,000 U.S. stores late Monday night, a spokeswoman said.

The product is being held pending an investigation by health officials, who are also testing other potential contaminants including the water with which the formula was prepared.

Cans from the same batch have been sold to other retailers besides Walmart, but Mead Johnson has not been informed that any other stores have removed it, company spokesman Chris Perille said. Mead Johnson has not recalled the product.

By Martinne Geller

(Reuters) – General Mills Inc (GIS.N: Quote, Profile, Research, Stock Buzz) posted disappointing quarterly earnings, hurt by higher ingredient costs, and its shares fell nearly 3 percent, while rival ConAgra Foods Inc (CAG.N: Quote, Profile, Research, Stock Buzz) topped Wall Street’s expectations.

Both packaged food companies backed their fiscal 2012 outlooks on Tuesday despite higher ingredient costs and lingering economic uncertainty.

General Mills, which makes Progresso soups and Cheerios cereal reported net income of $444.8 million, or 67 cents per share, for the second quarter ended on November 27, down from $613.9 million, or 92 cents per share, a year earlier.

Excluding the effects of accounting for commodity hedges, costs from the acquisition of Yoplait and a tax benefit, earnings were 76 cents per share.

On that basis, analysts on average were expecting 79 cents per share, according to Thomson Reuters I/B/E/S.

Sales rose 14 percent to $4.62 billion, helped by the addition of Yoplait, increases in price and volume, and foreign exchange rates.