MIAMI, April 20, 2015 /PRNewswire/ -- Royal Caribbean
Cruises Ltd. (NYSE, OSE: RCL) today reported stronger than expected
first quarter results and updated its outlook for the full
year.
Commercially the year is turning out as expected, with strong
booking trends and yield growth for all major products. The
strengthening of the US Dollar and the rise in fuel prices are
negatively affecting earnings, but cost efficiencies are mitigating
a large portion of the impact.
KEY HIGHLIGHTS
Results for the First Quarter 2015:
- Net Yields were down 1.0% on a Constant-Currency basis (down
5.4% As-Reported). Strong close-in pricing on Caribbean sailings drove the better than
anticipated performance.
- Net Cruise Costs ("NCC") excluding fuel increased 0.9% on a
Constant-Currency basis (down 1.7% As-Reported), significantly
better than guidance driven by further efficiencies.
- Adjusted Net Income was $45.2
million, or $0.20 per share,
versus a forecast of $0.10 to $0.15
per share. Currency and fuel negatively impacted the first quarter
by $0.05.
- US GAAP Net Income was $45.2
million or $0.20 per share,
versus $26.5 million or $0.12 per share in 2014.
Full Year 2015:
- Adjusted EPS is expected to be in the range of $4.45 to $4.65 per share – $0.20 lower than our previous guidance. The
strengthening of the US Dollar and the increase in fuel prices have
negatively impacted the full year by $0.36.
- Net Yields are expected to increase 2.5% to 4.0% on a
Constant-Currency basis (down 0.5% to 2.0% As-Reported). The slight
narrowing of the range is driven by somewhat weaker onboard revenue
trends from non-US guests due to the strengthening of the US
Dollar.
- NCC excluding fuel are expected to be flat to down 1% on a
Constant-Currency basis (down 2.5% to 3.5% As-Reported).
"It is gratifying to post another strong quarter with both
revenues and expenses exceeding expectations," said Richard D. Fain, chairman and chief executive
officer. "Despite ongoing volatility in the currency and fuel
markets, our Double-Double program remains solidly on
track."
FIRST QUARTER RESULTS
Adjusted Net Income for the first quarter of 2015 was
$45.2 million, or $0.20 per share, compared to Adjusted Net Income
of $46.1 million, or $0.21 per share, in the first quarter of 2014.
Results were approximately $0.08
better than the mid-point of guidance, despite a $0.05 currency and fuel headwind. US GAAP Net
Income for the first quarter 2015 was $45.2
million or $0.20 per share
compared to $26.5 million or
$0.12 per share in 2014.
Net Yields on a Constant-Currency basis decreased 1.0% during
the quarter. Strong close-in demand for Caribbean sailings catapulted yields over the
top end of guidance and more than offset weaker onboard sales from
our internationally sourced guests. Given that the majority of
onboard revenue sales are priced in US Dollars, the strengthening
of the Dollar reduced the purchasing power of many of our
internationally sourced guests, which modestly affected their
onboard spend.
Constant-Currency NCC excluding fuel increased 0.9% which is 160
basis points better than guidance, mainly driven by efficiencies.
Bunker pricing net of hedging for the first quarter was
$597 per metric ton and consumption
was 344,000 metric tons.
FULL YEAR 2015
The company has updated full year Adjusted EPS guidance to a
range of $4.45 to $4.65 from
$4.65 to $4.85. The strengthening of
the US Dollar and the increase in fuel prices since our January
guidance is expected to negatively impact earnings by $0.36. Constant-Currency Net Yields are expected
to be in the range of up 2.5% to 4.0%, a slight reduction from
previous guidance mainly due to the impact of the stronger US
Dollar on the purchasing power of our non-US guests.
Net Cruise Costs excluding fuel are expected to be flat to down
1% on a Constant-Currency basis, better than previous guidance of
1% or better.
The fundamentals of the business as well as the company's focus
on the targets associated with the Double-Double
program remain on track and are unchanged.
"The business continues to perform well, despite the currency
volatility," said Jason T. Liberty,
chief financial officer. "Our unwavering commitment to cost
consciousness has helped us identify further efficiencies that are
driving a significant shift in our cost guidance for the full year.
This type of operational focus throughout all facets of our
business is a core enabler of our continued financial success."
Overall booking volumes during the first quarter were higher
than prior year levels even after adjusting for our increase in
capacity. Caribbean itineraries
enjoyed particularly strong demand, and bookings were also up
year-over-year for Europe and
China itineraries. As previously
discussed, the company has taken actions to extend its booking
curve, as a result of which booked load factors and APDs are higher
than historical levels. More recently, the company has taken
further steps to improve the integrity of its pricing model
including steps to eliminate last minute discounting.
Overall, European itineraries are booked at a higher load factor
and APD than last year. Western Mediterranean itineraries have been
booking well, while trends have been a little weaker for Eastern
Mediterranean itineraries, particularly those that turn in
Turkey. Demand for China remains strong and bookings have been
outpacing expectations despite the significant capacity growth in
the region.
Taking into account current fuel pricing, interest rates,
currency exchange rates and the factors detailed above, the company
expects 2015 guidance for Adjusted EPS to be in the range of
$4.45 to $4.65 per share.
SECOND QUARTER 2015
Constant-Currency Net Yields are expected to increase
approximately 3.5% in the second quarter of 2015. NCC excluding
fuel are expected to be up approximately 4.5% on a
Constant-Currency basis. Based on current fuel pricing, interest
rates and currency exchange rates, the company expects second
quarter Adjusted EPS will be approximately $0.70 per share.
FUEL EXPENSE AND SUMMARY OF KEY GUIDANCE STATS
Fuel Expense
The company does not forecast fuel prices, and its fuel cost
calculations are based on current at-the-pump prices, net of
hedging impacts. Based on today's fuel prices the company has
included $213 million and
$834 million of fuel expense in its
second quarter and full year 2015 guidance, respectively.
Forecasted consumption is 52% hedged via swaps for the remainder
of 2015 and 55%,
40% and 20% hedged for 2016, 2017 and 2018, respectively. For the
same four years, the average cost per metric ton of the hedge
portfolio is approximately $638,
$562, $540 and $503,
respectively.
The company provided the following fuel statistics for the
second quarter and full year 2015:
FUEL
STATISTICS
|
Second Quarter
2015
|
Full Year
2015
|
Fuel Consumption
(metric tons)
|
344,000
|
1,382,000
|
Fuel
Expenses
|
$213
million
|
$834
million
|
Percent Hedged
(fwd consumption)
|
52%
|
52%
|
Impact of 10%
change in fuel prices
|
$7 million
|
$22
million
|
In summary, the company provided the following guidance for the
second quarter and full year of 2015:
GUIDANCE
|
As-Reported
|
Constant-Currency
|
|
Second Quarter
2015
|
Net
Yields
|
Approx.
(1.5%)
|
Approx.
3.5%
|
Net Cruise Costs
per APCD
|
Approx.
(3.0%)
|
Flat to slightly
down
|
Net Cruise Costs
per APCD
Excluding
Fuel
|
Approx.
1.0%
|
Approx.
4.5%
|
|
|
|
|
Full Year
2015
|
Net
Yields
|
(0.5%) to
(2.0%)
|
2.5% to
4.0%
|
Net Cruise Costs
per APCD
|
(5.5%) to
(6.5%)
|
(3.5%) to
(4.5%)
|
Net Cruise Costs
per APCD
Excluding
Fuel
|
(2.5%) to
(3.5%)
|
Flat to down
(1%)
|
|
|
|
|
Second Quarter
2015
|
Full Year
2015
|
Capacity
Increase
|
5.2%
|
5.5%
|
Depreciation and
Amortization
|
$200 to $210
million
|
$830 to $840
million
|
Interest Expense,
net
|
$70 to $80
million
|
$260 to $270
million
|
Adjusted
EPS
|
Approx.
$0.70
|
$4.45 to
$4.65
|
|
|
|
1% Change in
Currency
|
$2 million
|
$12
million
|
1% Change in Net
Yield
|
$15
million
|
$63
million
|
1% Change in NCC x
fuel
|
$9 million
|
$34
million
|
1% Change in
LIBOR
|
$10
million
|
$37
million
|
|
|
Exchange rates
used in guidance calculations:
|
|
|
Current –
April
|
Previous –
January
|
GBP
|
$1.46
|
$1.50
|
AUD
|
$0.77
|
$0.80
|
CAD
|
$0.80
|
$0.81
|
BRL
|
$0.33
|
$0.39
|
EUR
|
$1.06
|
$1.14
|
LIQUIDITY AND FINANCING ARRANGEMENTS
As of March 31, 2015, liquidity
was $0.8 billion, including cash and
the undrawn portion of the company's unsecured credit
facilities. The company noted that scheduled debt maturities
for the remainder of 2015, 2016, 2017, 2018 and 2019 are
$0.7 billion, $2.0 billion, $0.9
billion, $1.9 billion and
$0.5 billion, respectively.
CAPITAL EXPENDITURES AND CAPACITY GUIDANCE
Based upon current ship orders, projected capital expenditures
for full year 2015, 2016, 2017, 2018 and 2019 are $1.6 billion, $2.3
billion, $0.4 billion,
$2.2 billion and $0.4 billion, respectively.
Capacity increases for 2015, 2016, 2017, 2018 and 2019 are
expected to be 5.5%, 6.3%, 3.1%, 3.9% and 3.9%, respectively. These
figures do not include potential ship sales or additions that the
company may elect to make in the future.
CONFERENCE CALL SCHEDULED
The company has scheduled a conference call at 9:30 a.m. Eastern Daylight Time today to
discuss its earnings. This call can be heard, either live or on a
delayed basis, on the company's investor relations web site at
www.rclinvestor.com.
Selected Operational and Financial Metrics
Adjusted Net Income
Adjusted Net Income represents net income excluding certain items
that we believe adjusting for is meaningful when assessing our
performance on a comparative basis. For the periods presented,
these items included restructuring charges, other costs related to
our profitability initiatives, and the estimated impact of the
divested Pullmantur non-core businesses. The estimated impact of
the divested Pullmantur non-core businesses was arrived at by
adjusting the net income (loss) of these businesses for the
ownership percentage we retained as well as for intercompany
transactions that are no longer eliminated in our consolidated
statements of comprehensive income (loss) subsequent to the sales
transaction.
Adjusted Earnings Per Share ("Adjusted EPS")
Represents Adjusted Net Income divided by the diluted shares
outstanding at the end of the reporting period. We believe this
measure is meaningful when assessing our performance on a
comparative basis.
Available Passenger Cruise Days ("APCD")
APCD is our measurement of capacity and represents double occupancy
per cabin multiplied by the number of cruise days for the period.
We use this measure to perform capacity and rate analysis to
identify the main non-capacity drivers that cause our cruise
revenues and expenses to vary.
Constant-Currency
We believe Net Yields, Net Cruise Costs and Net Cruise Costs
Excluding Fuel are our most relevant financial measures. However, a
significant portion of our revenue and expenses are denominated in
currencies other than the US Dollar. Because our reporting
currency is the US Dollar, the value of these revenues and expenses
in US Dollars will be affected by changes in currency exchange
rates. Although such changes in local currency prices are just one
of many elements impacting our revenues and expenses, it can be an
important element. For this reason, we also monitor Net Yields, Net
Cruise Costs and Net Cruise Costs Excluding Fuel on a
"Constant-Currency" basis – i.e. as if the current period's
currency exchange rates had remained constant with the comparable
prior period's rates. We calculate "Constant-Currency" by applying
the average prior year period exchange rates for each of the
corresponding months of the reported and/or forecasted period, so
as to calculate what the results would have been had exchange rates
been the same throughout both periods. We do not make predictions
about future exchange rates and use current exchange rates for
calculations of future periods. It should be emphasized that the
use of Constant-Currency is primarily used by us for comparing
short-term changes and/or projections. Over the longer term,
changes in guest sourcing and shifting the amount of purchases
between currencies significantly change the impact of the purely
currency-based fluctuations.
Gross Cruise Costs
Gross Cruise Costs represent the sum of total cruise operating
expenses plus marketing, selling and administrative expenses.
Gross Yields
Gross Yields represent total revenues per APCD.
Net Cruise Costs ("NCC") and Net Cruise Costs ("NCC") Excluding
Fuel
Represent Gross Cruise Costs excluding commissions, transportation
and other expenses and onboard and other expenses and, in the case
of Net Cruise Costs Excluding Fuel, fuel expenses. In measuring our
ability to control costs in a manner that positively impacts net
income, we believe changes in Net Cruise Costs and Net Cruise Costs
Excluding Fuel to be the most relevant indicators of our
performance. We have not provided a quantitative reconciliation of
projected Gross Cruise Costs to projected Net Cruise Costs and
projected Net Cruise Costs Excluding Fuel due to the significant
uncertainty in projecting the costs deducted to arrive at these
measures. Accordingly, we do not believe that reconciling
information for such projected figures would be meaningful. For the
periods prior to the sale of the Pullmantur non-core businesses,
Net Cruise Costs excludes the estimated impact of these divested
businesses. Net Cruise Costs also excludes initiative costs
reported within Marketing, Selling and Administrative expenses.
Net Revenues
Net Revenues represent total revenues less commissions,
transportation and other expenses and onboard and other expenses.
For the periods prior to the sale of the Pullmantur non-core
businesses, Net Revenues excludes the estimated impact of these
divested businesses.
Net Yields
Net Yields represent Net Revenues per APCD. We utilize Net Revenues
and Net Yields to manage our business on a day-to-day basis as we
believe that it is the most relevant measure of our pricing
performance because it reflects the cruise revenues earned by us
net of our most significant variable costs, which are commissions,
transportation and other expenses and onboard and other expenses.
We have not provided a quantitative reconciliation of projected
Gross Yields to projected Net Yields due to the significant
uncertainty in projecting the costs deducted to arrive at this
measure. Accordingly, we do not believe that reconciling
information for such projected figures would be meaningful. For the
periods prior to the sale of the Pullmantur non-core businesses,
Net Yields excludes the estimated impact of these divested
businesses.
Occupancy
Occupancy, in accordance with cruise vacation industry practice, is
calculated by dividing Passenger Cruise Days by APCD. A percentage
in excess of 100% indicates that three or more passengers occupied
some cabins.
Passenger Cruise Days
Passenger Cruise Days represent the number of passengers carried
for the period multiplied by the number of days of their respective
cruises.
Royal Caribbean Cruises Ltd. (NYSE, OSE: RCL) is a global cruise
vacation company that owns Royal Caribbean International, Celebrity
Cruises, Pullmantur, Azamara Club Cruises and CDF Croisieres de
France, as well as TUI Cruises
through a 50 percent joint venture. Together, these six brands
operate a combined total of 43 ships with an additional six under
construction contracts, and two under conditional agreements. They
operate diverse itineraries around the world that call on
approximately 480 destinations on all seven continents. Additional
information can be found on www.royalcaribbean.com,
www.celebritycruises.com, www.pullmantur.es,
www.azamaraclubcruises.com, www.cdfcroisieresdefrance.com or
www.rclinvestor.com.
Certain statements in this release relating to, among other
things, our future performance constitute forward-looking
statements under the Private Securities Litigation Reform Act of
1995. These statements include, but are not limited to, statements
regarding expected financial results for the second quarter and
full year 2015, and expectations regarding the timing and results
of our Double-Double initiative, the costs and yields expected in
2015 and other future periods. Words such as "anticipate,"
"believe," "could," "estimate," "expect," "goal," "intend," "may,"
"plan," "project," "seek," "should," "will," and similar
expressions are intended to identify these forward-looking
statements. Forward-looking statements reflect management's
current expectations, are inherently uncertain and are subject to
risks, uncertainties and other factors, which could cause our
actual results, performance or achievements to differ materially
from the future results, performance or achievements expressed or
implied in those forward-looking statements. Examples of
these risks, uncertainties and other factors include, but are not
limited to the following: the impact of the economic and
geopolitical environment on the demand for cruises, the impact of
the economic environment on our ability to generate cash flows from
operations or obtain new borrowings from the credit or capital
markets in amounts sufficient to satisfy our capital expenditures,
debt repayments and other financing needs, incidents or adverse
publicity concerning the cruise vacation industry, the
uncertainties of conducting business internationally and expanding
into new markets, changes in operating and financing costs, the
impact of foreign exchange rates and fuel price fluctuations,
vacation industry competition and changes in industry capacity and
overcapacity, emergency ship repairs, including the related lost
revenue, the impact of ship delivery delays, ship cancellations or
ship construction price increases, financial difficulties
encountered by shipyards or their subcontractors and the
unavailability or cost of air service.
More information about factors that could affect our operating
results is included under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" in our most recent annual report on Form
10-K, a copy of which may be obtained by visiting our Investor
Relations web site at www.rclinvestor.com or the SEC's web site at
www.sec.gov. Undue reliance should not be placed on the
forward-looking statements in this release, which are based on
information available to us on the date hereof. We undertake no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Adjusted Measures of Financial Performance
This press
release includes certain adjusted financial measures as defined
under Securities and Exchange Commission rules, which we believe
provide useful information to investors as a supplement to our
consolidated financial statements which are prepared and presented
in accordance with generally accepted accounting principles, or
GAAP.
The presentation of adjusted financial information is not
intended to be considered in isolation or as a substitute for, or
superior to, the financial information prepared and presented in
accordance with GAAP. These measures may be different from adjusted
measures used by other companies. In addition, these adjusted
measures are not based on any comprehensive set of accounting rules
or principles. Adjusted measures have limitations in that they do
not reflect all of the amounts associated with our results of
operations as do the corresponding GAAP measures.
A reconciliation to the most comparable GAAP measure of all
adjusted financial measures included in this press release can be
found in the tables included at the end of this press release.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROYAL CARIBBEAN
CRUISES LTD.
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
(unaudited; in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger ticket
revenues
|
|
|
|
$
|
1,306,779
|
|
$
|
1,348,203
|
|
|
|
Onboard and other
revenues
|
|
|
|
508,820
|
|
|
539,021
|
|
|
|
Total
revenues
|
|
|
|
|
1,815,599
|
|
|
1,887,224
|
|
|
|
Cruise operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions,
transportation and other
|
|
|
324,418
|
|
|
325,865
|
|
|
|
|
Onboard and
other
|
|
|
|
|
116,239
|
|
|
123,032
|
|
|
|
|
Payroll and
related
|
|
|
|
|
211,591
|
|
|
210,801
|
|
|
|
|
Food
|
|
|
|
|
|
|
119,786
|
|
|
118,080
|
|
|
|
|
Fuel
|
|
|
|
|
|
|
205,276
|
|
|
244,459
|
|
|
|
|
Other
operating
|
|
|
|
|
245,307
|
|
|
281,743
|
|
|
|
|
|
Total cruise
operating expenses
|
|
|
1,222,617
|
|
|
1,303,980
|
|
|
|
Marketing, selling
and administrative expenses
|
|
|
286,832
|
|
|
290,307
|
|
|
|
Depreciation and
amortization expenses
|
|
|
200,468
|
|
|
193,735
|
|
|
|
Restructuring
charges
|
|
|
|
|
-
|
|
|
1,736
|
|
|
|
Operating
Income
|
|
|
|
|
105,682
|
|
|
97,466
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
|
|
3,737
|
|
|
3,276
|
|
|
|
|
Interest expense, net
of interest capitalized
|
|
|
(70,159)
|
|
|
(68,571)
|
|
|
|
|
Other income
(expense)
|
|
|
|
5,970
|
|
|
(5,714)
|
|
|
|
|
|
|
|
|
|
|
|
|
(60,452)
|
|
|
(71,009)
|
|
|
|
Net
Income
|
|
|
|
|
$
|
45,230
|
|
$
|
26,457
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.21
|
|
$
|
0.12
|
|
|
|
Diluted
|
|
$
|
0.20
|
|
$
|
0.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-Average
Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
219,626
|
|
|
221,295
|
|
|
|
Diluted
|
|
|
|
|
|
|
220,842
|
|
|
222,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
Loss
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
|
|
|
$
|
45,230
|
|
$
|
26,457
|
|
|
|
Other comprehensive
(loss) income:
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
|
(31,544)
|
|
|
2,470
|
|
|
|
|
Change in defined
benefit plans
|
|
|
(1,493)
|
|
|
(2,031)
|
|
|
|
|
Loss on cash flow
derivative hedges
|
|
|
(260,949)
|
|
|
(52,915)
|
|
|
|
|
|
Total other
comprehensive loss
|
|
|
(293,986)
|
|
|
(52,476)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
Loss
|
|
|
|
$
|
(248,756)
|
|
$
|
(26,019)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STATISTICS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passengers
Carried
|
|
|
|
|
1,335,518
|
|
|
1,278,234
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger Cruise
Days
|
|
|
|
|
9,214,643
|
|
|
8,853,637
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
APCD
|
|
|
|
|
|
|
8,778,945
|
|
|
8,473,250
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Occupancy
|
|
|
|
|
|
105.0%
|
|
|
104.5%
|
|
|
|
|
ROYAL CARIBBEAN
CRUISES LTD.
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
(in thousands,
except share data)
|
|
|
|
|
As
of
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
(unaudited)
|
|
|
|
Assets
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$ 229,705
|
|
$ 189,241
|
|
|
Trade and other
receivables, net
|
|
297,073
|
|
261,392
|
|
|
Inventories
|
|
125,063
|
|
123,490
|
|
|
Prepaid expenses and
other assets
|
|
299,362
|
|
226,960
|
|
|
Total current
assets
|
|
951,203
|
|
801,083
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
18,232,115
|
|
18,193,627
|
|
Goodwill
|
|
405,422
|
|
420,542
|
|
Other
assets
|
|
1,280,853
|
|
1,297,938
|
|
|
|
$20,869,596
|
|
$20,713,190
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Current portion of
long-term debt
|
|
$ 1,089,345
|
|
$ 799,630
|
|
|
Accounts
payable
|
|
336,869
|
|
331,505
|
|
|
Accrued
interest
|
|
77,848
|
|
49,074
|
|
|
Accrued expenses and
other liabilities
|
|
521,408
|
|
635,138
|
|
|
Derivative financial
instruments
|
|
318,252
|
|
266,986
|
|
|
Customer
deposits
|
|
1,992,569
|
|
1,766,914
|
|
|
Total current
liabilities
|
|
4,336,291
|
|
3,849,247
|
|
Long-term
debt
|
|
7,470,260
|
|
7,644,318
|
|
Other long-term
liabilities
|
|
1,089,132
|
|
935,266
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
Preferred stock
($0.01 par value; 20,000,000 shares authorized;
|
|
|
|
|
|
|
none
outstanding)
|
|
-
|
|
-
|
|
|
Common stock ($0.01
par value; 500,000,000 shares authorized;
|
|
|
|
|
|
|
233,696,581 and
233,106,019 shares issued, March 31, 2015
and December 31, 2014, respectively)
|
|
2,337
|
|
2,331
|
|
|
Paid-in
capital
|
|
3,257,809
|
|
3,253,552
|
|
|
Retained
earnings
|
|
6,554,522
|
|
6,575,248
|
|
|
Accumulated other
comprehensive loss
|
|
(1,190,980)
|
|
(896,994)
|
|
|
Treasury stock
(13,808,683 common shares at
cost, March 31, 2015 and December 31, 2014)
|
|
(649,778)
|
|
(649,778)
|
|
|
Total shareholders'
equity
|
|
7,973,910
|
|
8,284,359
|
|
|
|
|
$ 20,869,593
|
|
$ 20,713,190
|
|
|
ROYAL CARIBBEAN
CRUISES LTD.
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
(unaudited, in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Operating
Activities
|
|
|
|
|
|
Net income
|
|
$ 45,230
|
|
$ 26,457
|
|
Adjustments:
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
200,468
|
|
193,735
|
|
|
Net deferred income
tax (benefit) expense
|
|
(520)
|
|
2,633
|
|
|
Loss (gain) on
derivative instruments not designated as hedges
|
|
28,083
|
|
(1,890)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
Decrease (increase)
in trade and other receivables, net
|
|
18,095
|
|
(36,332)
|
|
|
(Increase) decrease
in inventories
|
|
(2,615)
|
|
6,104
|
|
|
Increase in prepaid
expenses and other assets
|
|
(67,772)
|
|
(30,565)
|
|
|
Increase (decrease)
in accounts payable
|
|
9,341
|
|
(13,323)
|
|
|
Increase (decrease)
in accrued interest
|
|
28,774
|
|
(32,002)
|
|
|
(Decrease) increase
in accrued expenses and other liabilities
|
|
(53,681)
|
|
7,579
|
|
|
Increase in customer
deposits
|
|
208,423
|
|
188,367
|
|
Other, net
|
|
12,601
|
|
5,023
|
|
Net cash provided by
operating activities
|
|
426,427
|
|
315,786
|
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
|
|
Purchases of property
and equipment
|
|
(304,644)
|
|
(177,791)
|
|
Cash (paid) received
on settlement of derivative financial instruments
|
|
(45,182)
|
|
4,236
|
|
Investments in and
loans to unconsolidated affiliates
|
|
(54,250)
|
|
(34,260)
|
|
Cash received on loan
to unconsolidated affiliate
|
|
8,280
|
|
11,610
|
|
Other, net
|
|
(3,780)
|
|
(1,165)
|
|
Net cash used in
investing activities
|
|
(399,576)
|
|
(197,370)
|
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
|
|
Debt
proceeds
|
|
749,800
|
|
1,560,000
|
|
Debt issuance
costs
|
|
(16,493)
|
|
(22,641)
|
|
Repayments of
debt
|
|
(587,111)
|
|
(1,638,146)
|
|
Dividends
paid
|
|
(131,745)
|
|
(76,264)
|
|
Proceeds from
exercise of common stock options
|
|
4,615
|
|
46,630
|
|
Cash received on
settlement of derivative financial instruments
|
|
-
|
|
22,835
|
|
Other, net
|
|
587
|
|
81
|
|
Net cash provided
(used) in financing activities
|
|
19,653
|
|
(107,505)
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
(6,040)
|
|
910
|
|
|
|
|
|
|
|
Net increase in cash
and cash equivalents
|
|
40,464
|
|
11,821
|
|
Cash and cash
equivalents at beginning of period
|
|
189,241
|
|
204,687
|
|
Cash and cash
equivalents at end of period
|
|
$ 229,705
|
|
$216, 508
|
|
|
|
|
|
|
|
Supplemental
Disclosure
|
|
|
|
|
|
Cash paid during the
period for:
|
|
|
|
|
|
Interest, net of
amount capitalized
|
|
$ 33, 664
|
|
$ 94,205
|
|
ROYAL CARIBBEAN
CRUISES LTD.
|
|
NON-GAAP
RECONCILING INFORMATION
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Yields and Net
Yields were calculated as follows (in thousands, except APCD and
Yields):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2015
On a
Constant
Currency basis
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger ticket
revenues
|
|
|
$
|
1,306,779
|
|
$
|
1,378,845
|
|
$
|
1,348,203
|
|
|
|
|
Onboard and other
revenues
|
|
|
508,820
|
|
|
519,085
|
|
|
539,021
|
|
|
|
|
Total
revenues
|
|
|
|
|
1,815,599
|
|
|
1,897,930
|
|
|
1,887,224
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions,
transportation and other
|
|
324,418
|
|
|
339,430
|
|
|
325,865
|
|
|
|
|
|
Onboard and
other
|
|
|
|
116,239
|
|
|
119,264
|
|
|
123,032
|
|
|
|
|
Net Revenues
including divested businesses
|
|
1,374,942
|
|
|
1,439,236
|
|
|
1,438,327
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues related
to divested businesses prior to sales transaction
|
|
-
|
|
|
-
|
|
|
35,656
|
|
|
|
|
Net
Revenues
|
|
|
|
$
|
1,374,942
|
|
$
|
1,439,236
|
|
$
|
1,402,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
APCD
|
|
|
|
|
|
8,778,945
|
|
|
8,778,945
|
|
|
8,473,250
|
|
|
|
|
Gross
Yields
|
|
|
|
$
|
206.81
|
|
$
|
216.19
|
|
$
|
222.73
|
|
|
|
|
Net Yields
|
|
|
|
$
|
156.62
|
|
$
|
163.94
|
|
$
|
165.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Cruise Costs,
Net Cruise Costs and Net Cruise Costs Excluding Fuel were
calculated as follows (in thousands, except APCD and costs per
APCD):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2015
On a
Constant
Currency basis
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cruise
operating expenses
|
|
$
|
1,222,617
|
|
$
|
1,255,029
|
|
$
|
1,303,980
|
|
|
|
|
Marketing, selling
and administrative expenses
|
|
286,832
|
|
|
296,331
|
|
|
290,307
|
|
|
|
|
Gross Cruise
Costs
|
|
|
|
1,509,449
|
|
|
1,551,360
|
|
|
1,594,287
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions,
transportation and other
|
|
324,418
|
|
|
339,430
|
|
|
325,865
|
|
|
|
|
|
Onboard and
other
|
|
|
|
116,239
|
|
|
119,264
|
|
|
123,032
|
|
|
|
|
Net Cruise Costs
including divested businesses
|
|
1,068,792
|
|
|
1,092,666
|
|
|
1,145,390
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Cruise Costs
related to divested businesses prior to sales
transaction
|
|
-
|
|
|
-
|
|
|
47,854
|
|
|
|
|
|
Other initiative
costs included within Marketing, selling and administrative
expenses
|
|
-
|
|
|
-
|
|
|
5,234
|
|
|
|
|
Net Cruise
Costs
|
|
|
|
1,068,792
|
|
|
1,092,666
|
|
|
1,092,302
|
|
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fuel
|
|
|
|
|
|
205,276
|
|
|
206,508
|
|
|
244,459
|
|
|
|
|
Net Cruise Costs
Excluding Fuel
|
$
|
863,516
|
|
$
|
886,158
|
|
$
|
847,843
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
APCD
|
|
|
|
|
|
8,778,945
|
|
|
8,778,945
|
|
|
8,473,250
|
|
|
|
|
Gross Cruise Costs
per APCD
|
|
$
|
171.94
|
|
$
|
176.71
|
|
$
|
188.16
|
|
|
|
|
Net Cruise Costs per
APCD
|
|
$
|
121.74
|
|
$
|
124.46
|
|
$
|
128.91
|
|
|
|
|
Net Cruise Costs
Excluding Fuel per APCD
|
$
|
98.36
|
|
$
|
100.94
|
|
$
|
100.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ROYAL CARIBBEAN
CRUISES LTD.
|
NON-GAAP
RECONCILING INFORMATION (CONTINUED)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Debt-to-Capital
was calculated as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
|
December
31,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt, net
of current portion
|
|
|
$ 7,470,260
|
|
|
$ 7,644,318
|
|
|
|
|
Current portion of
long-term debt
|
|
|
1,089,345
|
|
|
799,630
|
|
|
|
|
Total debt
|
|
|
|
|
8,559,605
|
|
|
8,443,948
|
|
|
|
|
Less: Cash and cash
equivalents
|
|
|
229,705
|
|
|
189,241
|
|
|
|
|
Net Debt
|
|
|
|
|
$ 8,329,900
|
|
|
$ 8,254,707
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
|
$ 7,973,910
|
|
|
$ 8,284,359
|
|
|
|
|
Total debt
|
|
|
|
|
8,559,605
|
|
|
8,443,948
|
|
|
|
|
Total debt and
shareholders' equity
|
|
|
$ 16,533,515
|
|
|
$ 16,728,307
|
|
|
|
|
Debt-to-Capital
|
|
|
|
|
51.8%
|
|
|
50.5%
|
|
|
|
|
Net Debt
|
|
|
|
|
$ 8,329,900
|
|
|
$ 8,254,707
|
|
|
|
|
Net Debt and
shareholders' equity
|
|
|
$ 16,303,810
|
|
|
$ 16,539,066
|
|
|
|
|
Net
Debt-to-Capital
|
|
|
|
51.1%
|
|
|
49.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income
and Adjusted Earnings per Share were calculated as follows (in
thousands, except per share data):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Income
|
|
$
|
45,230
|
|
$
|
46,119
|
|
|
Net
income
|
|
|
45,230
|
|
|
26,457
|
|
|
|
Net Adjustments to
Net Income-Increase
|
|
$
|
-
|
|
$
|
19,662
|
|
|
Adjustments to Net
Income:
|
|
|
|
|
|
|
|
|
Restructuring
charges
|
|
$
|
-
|
|
$
|
1,736
|
|
|
Other initiative
costs
|
|
|
-
|
|
|
6,913
|
|
|
Estimated impact of
divested businesses prior to sales transaction
|
|
|
-
|
|
|
11,013
|
|
|
|
Net Adjustments to
Net Income-Increase
|
|
$
|
-
|
|
$
|
19,662
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Earnings
per Share - Diluted
|
|
$
|
0.20
|
|
$
|
0.21
|
|
|
Earnings per Share
- Diluted
|
|
|
0.20
|
|
|
0.12
|
|
|
|
Net Adjustments to
Net Income-Increase
|
|
$
|
-
|
|
$
|
0.09
|
|
|
Adjustments to
Earnings per Share:
|
|
|
|
|
|
|
|
|
Restructuring
charges
|
|
$
|
-
|
|
$
|
0.01
|
|
|
Other initiative
costs
|
|
|
-
|
|
|
0.03
|
|
|
Estimated impact of
divested businesses prior to sales transaction
|
|
|
-
|
|
|
0.05
|
|
|
|
Net Adjustments to
Net Income-Increase
|
|
$
|
-
|
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-Average
Shares Outstanding - Diluted
|
|
|
220,842
|
|
|
222,671
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|