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(Mark One)
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Republic of Liberia
(State or other jurisdiction of
incorporation or organization)
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98-0081645
(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $.01 per share
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New York Stock Exchange
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a
smaller reporting company)
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Smaller reporting company
o
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Year
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North America(1)
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Europe(2)
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2009
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|
3.0%
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1.0%
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2010
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3.1%
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1.1%
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2011
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3.4%
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1.1%
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2012
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3.3%
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1.2%
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2013
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3.4%
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1.2%
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(1)
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Source: International Monetary Fund and Cruise Line International Association based on cruise guests carried for at least two consecutive nights for years 2009 through 2012. Year 2013 amounts represent our estimates. Includes the United States of America and Canada.
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(2)
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Source: International Monetary Fund and CLIA Europe, formerly European Cruise Council, for years 2009 through 2012. Year 2013 amounts represent our estimates.
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Year
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Weighted-Average
Supply of
Berths
Marketed
Globally(1)
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Royal Caribbean Cruises Ltd. Total Berths
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Global
Cruise Guests(1) |
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North American
Cruise
Guests(2)
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European
Cruise
Guests (3)
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2009
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363,000
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84,050
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17,340,000
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10,198,000
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5,000,000
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2010
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391,000
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92,300
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18,800,000
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10,781,000
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5,540,000
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2011
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412,000
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92,650
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20,227,000
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11,625,000
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5,894,000
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2012
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425,000
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98,650
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20,898,000
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11,640,000
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6,139,000
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2013
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432,000
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98,750
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21,300,000
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11,816,000
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6,399,000
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(1)
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Source: Our estimates of the number of global cruise guests and the weighted-average supply of berths marketed globally are based on a combination of data that we obtain from various publicly available cruise industry trade information sources including Seatrade Insider, Cruise Industry News and Cruise Line International Association (“CLIA”). In addition, our estimates incorporate our own statistical analysis utilizing the same publicly available cruise industry data as a base.
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(2)
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Source: Cruise Line International Association based on cruise guests carried for at least two consecutive nights for years 2009 through 2012. Year 2013 amounts represent our estimates (see number 1 above). Includes the United States of America and Canada.
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(3)
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Source: CLIA Europe, formerly European Cruise Council, for years 2009 through 2012. Year 2013 amounts represent our estimates (see number 1 above).
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•
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protect the health, safety and security of our guests and employees and protect the environment in which our vessels and organization operate,
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•
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strengthen and support our human capital in order to better serve our global guest base and grow our business,
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•
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further strengthen our consumer engagement in order to enhance our revenues,
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•
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increase the awareness and market penetration of our brands globally,
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•
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focus on cost efficiency, manage our operating expenditures and ensure adequate cash and liquidity, with the overall goal of maximizing our return on invested capital and long-term shareholder value,
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•
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strategically invest in our fleet through the revitalization and maintenance of existing ships and the transfer of key innovations across each brand, while prudently expanding our fleet with new state-of-the-art cruise ships,
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•
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capitalize on the portability and flexibility of our ships by deploying them into those markets and itineraries that provide opportunities to optimize returns, while continuing our focus on existing key markets,
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•
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further enhance our technological capabilities to service customer preferences and expectations in an innovative manner, while supporting our strategic focus on profitability, and
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•
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maintain strong relationships with travel agencies, which continue to be the principal industry distribution channel, while enhancing our consumer outreach programs.
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Ship
|
Year Ship
Entered Service
(1)
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Approximate
Berths
|
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Primary Areas of Operation
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Royal Caribbean International
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Quantum of the Seas
|
2014
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4,150
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Bahamas, Eastern/Southern Caribbean
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Allure of the Seas
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2010
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5,400
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Eastern/Western Caribbean
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Oasis of the Seas
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2009
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5,400
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Eastern/Western Caribbean, Europe
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Independence of the Seas
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2008
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3,600
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Europe, Eastern/Western Caribbean
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Liberty of the Seas
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2007
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3,600
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Europe, Short Caribbean
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Freedom of the Seas
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2006
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3,600
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Eastern/Western Caribbean
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Jewel of the Seas
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2004
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2,100
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Southern Caribbean
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Mariner of the Seas
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2003
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3,100
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Asia
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Serenade of the Seas
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2003
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2,100
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Western Caribbean, Europe
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Navigator of the Seas
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2002
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3,250
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Western Caribbean
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Brilliance of the Seas
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2002
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2,100
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Europe, Western Caribbean, Canada
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Adventure of the Seas
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2001
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3,100
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Southern Caribbean, Europe
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Radiance of the Seas
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2001
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2,100
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Alaska, Australia/New Zealand
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Explorer of the Seas
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2000
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3,100
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Eastern/Southern Caribbean, Bermuda, Canada
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Voyager of the Seas
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1999
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3,250
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Asia, Australia/New Zealand
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Vision of the Seas
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1998
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2,000
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Western Caribbean, Short Caribbean, Southern Caribbean, Bermuda
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Enchantment of the Seas
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1997
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2,250
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Bahamas
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Rhapsody of the Seas
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1997
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2,000
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Australia/New Zealand, Alaska
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Grandeur of the Seas
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1996
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1,950
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Southern/Eastern/Western Caribbean, Bermuda, Canada
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Splendour of the Seas
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1996
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1,800
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Europe, Brazil
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Legend of the Seas
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1995
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1,800
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Europe, Eastern/Southern Caribbean, Panama Canal
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Majesty of the Seas
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1992
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2,350
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Bahamas
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Celebrity Cruises
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Celebrity Reflection
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2012
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3,000
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Europe, Eastern/Western Caribbean
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Celebrity Silhouette
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2011
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2,850
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Europe, Eastern/Western Caribbean
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Celebrity Eclipse
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2010
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2,850
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Europe, Southern Caribbean
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Celebrity Equinox
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2009
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2,850
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Europe, Eastern/Western/Southern Caribbean
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Celebrity Solstice
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2008
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2,850
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Alaska, Australia/New Zealand
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Celebrity Constellation
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2002
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2,150
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Short Caribbean, Eastern Caribbean, Europe
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Celebrity Summit
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2001
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2,150
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Southern Caribbean, Bermuda, Canada
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Celebrity Infinity
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2001
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2,150
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Europe, Panama Canal, S. America
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Celebrity Millennium
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2000
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2,150
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Alaska, Asia, Panama Canal
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Celebrity Century
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1995
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1,800
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Alaska, Hawaii, Panama Canal, Australia
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Celebrity Xpedition
(2)
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2004
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100
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Galapagos Islands
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Ship
|
Year Ship
Entered Service
(1)
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Approximate
Berths
|
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Primary Areas of Operation
|
Azamara Club Cruises
|
|
|
|
|
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Azamara Quest
(3)
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2006
|
|
700
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Europe, South/Central America, Asia
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Azamara Journey
(3)
|
2004
|
|
700
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Europe, Asia, South America
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Pullmantur
(4)
|
|
|
|
|
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Monarch of the Seas
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1991
|
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2,350
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Southern Caribbean
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Empress
|
1990
|
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1,600
|
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Europe, Brazil
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Sovereign
|
1988
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2,300
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Europe, Brazil
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CDF Croisières de France
|
|
|
|
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Horizon
(5)
|
2010
|
|
1,350
|
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Europe, Southern Caribbean
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Zenith
(6)
|
1992
|
|
1,400
|
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Europe, Brazil
|
TUI Cruises
|
|
|
|
|
|
Mein Schiff 3
|
2014
|
|
2,500
|
|
Europe, Canary Islands
|
Mein Schiff 2
(7)
|
2011
|
|
1,900
|
|
Europe, Middle East
|
Mein Schiff 1
(8)
|
2009
|
|
1,900
|
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Europe, Southern Caribbean
|
Total
|
|
105,700
|
|
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(1)
|
The year a ship entered service refers to the year in which the ship commenced cruise revenue operations for the Company, which is the same as the year the ship was built, unless otherwise noted.
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(2)
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Originally built in 2001.
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(3)
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Originally built in 2000.
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(4)
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Does not include Pullmantur’s
Ocean Dream
as it was delivered to an unrelated third party in April 2012 as part of a six-year bareboat charter agreement. The charter agreement provides a renewal option exercisable by the unrelated third party for an additional four years.
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(5)
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Originally
built in 1990.
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(6)
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Zenith
was redeployed from Pullmantur to CDF Croisières de France in January 2014.
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(7)
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Originally
built in 1997.
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(8)
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Originally
built in 1996.
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Ship
|
Expected to
Enter Service
|
|
Approximate
Berths
|
|
Royal Caribbean International—
|
|
|
|
|
Quantum-class:
|
|
|
|
|
Quantum of the Seas
|
4th Quarter 2014
|
|
4,150
|
|
Anthem of the Seas
|
2nd Quarter 2015
|
|
4,150
|
|
Unnamed
|
2nd Quarter 2016
|
|
4,150
|
|
Oasis-class:
|
|
|
|
|
Unnamed
|
2nd Quarter 2016
|
|
5,400
|
|
TUI Cruises—
|
|
|
|
|
Mein Schiff 3
|
2nd Quarter 2014
|
|
2,500
|
|
Mein Schiff 4
|
2nd Quarter 2015
|
|
2,500
|
|
Total Berths
|
|
22,850
|
|
|
Year Ended December 31,
|
|||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|||||
Passengers Carried
|
4,884,763
|
|
|
4,852,079
|
|
|
4,850,010
|
|
|
4,585,920
|
|
|
3,970,278
|
|
Passenger Cruise Days
|
35,561,772
|
|
|
35,197,783
|
|
|
34,818,335
|
|
|
32,251,217
|
|
|
28,503,046
|
|
Available Passenger Cruise Days (APCD)
|
33,974,852
|
|
|
33,705,584
|
|
|
33,235,508
|
|
|
30,911,073
|
|
|
27,821,224
|
|
Occupancy
|
104.7
|
%
|
|
104.4
|
%
|
|
104.8
|
%
|
|
104.3
|
%
|
|
102.5
|
%
|
Name
|
Age
|
|
Position
|
Richard D. Fain
|
66
|
|
Chairman, Chief Executive Officer and Director
|
Adam M. Goldstein
|
54
|
|
President and Chief Executive Officer, Royal Caribbean International
|
Michael W. Bayley
|
55
|
|
President and Chief Executive Officer, Celebrity Cruises
|
Lawrence Pimentel
|
62
|
|
President and Chief Executive Officer, Azamara Club Cruises
|
Brian J. Rice
(1)
|
55
|
|
Vice Chairman
|
Harri U. Kulovaara
|
61
|
|
Executive Vice President, Maritime
|
Lisa Lutoff-Perlo
|
56
|
|
Executive Vice President, Operations, Royal Caribbean International
|
Jason T. Liberty
|
38
|
|
Senior Vice President, Chief Financial Officer
|
Bradley H. Stein
|
58
|
|
Senior Vice President, General Counsel, Chief Compliance Officer
|
Henry L. Pujol
|
46
|
|
Senior Vice President, Chief Accounting Officer
|
(1)
|
Mr. Rice is retiring in early 2014.
|
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NYSE
Common Stock
|
|
OSE
Common Stock
(1)
|
||||||||||
|
High
|
|
Low
|
|
High
|
|
Low
|
||||||
2013
|
|
|
|
|
|
|
|
||||||
Fourth Quarter
|
$
|
47.66
|
|
|
$
|
35.97
|
|
|
292.60
|
|
|
216.10
|
|
Third Quarter
|
40.71
|
|
|
33.31
|
|
|
241.80
|
|
|
201.40
|
|
||
Second Quarter
|
38.62
|
|
|
31.35
|
|
|
224.90
|
|
|
178.00
|
|
||
First Quarter
|
38.56
|
|
|
31.72
|
|
|
213.50
|
|
|
184.10
|
|
||
2012
|
|
|
|
|
|
|
|
||||||
Fourth Quarter
|
$
|
36.18
|
|
|
$
|
30.26
|
|
|
202.50
|
|
|
169.70
|
|
Third Quarter
|
31.97
|
|
|
22.45
|
|
|
182.90
|
|
|
134.50
|
|
||
Second Quarter
|
29.45
|
|
|
22.12
|
|
|
167.60
|
|
|
134.60
|
|
||
First Quarter
|
31.96
|
|
|
25.40
|
|
|
183.70
|
|
|
149.30
|
|
(1)
|
Denominated in Norwegian kroner, as listed in the price history database available at www.oslobors.no
|
|
12/08
|
|
12/09
|
|
12/10
|
|
12/11
|
|
12/12
|
|
12/13
|
||||||
Royal Caribbean Cruises Ltd
.
|
100.00
|
|
|
183.85
|
|
|
341.82
|
|
|
181.64
|
|
|
253.12
|
|
|
359.70
|
|
S&P 500
|
100.00
|
|
|
126.46
|
|
|
145.51
|
|
|
148.59
|
|
|
172.37
|
|
|
228.19
|
|
Dow Jones US Travel & Leisure
|
100.00
|
|
|
130.99
|
|
|
185.20
|
|
|
197.58
|
|
|
223.93
|
|
|
325.76
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
|
(in thousands, except per share data)
|
||||||||||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenues
|
$7,959,894
|
|
$7,688,024
|
|
$7,537,263
|
|
$6,752,504
|
|
$5,889,826
|
||||||||||
Operating income
(1)
|
798,148
|
|
|
403,110
|
|
|
931,628
|
|
|
802,633
|
|
|
488,511
|
|
|||||
Net income
(1)(2)
|
473,692
|
|
|
18,287
|
|
|
607,421
|
|
|
515,653
|
|
|
152,485
|
|
|||||
Per Share Data—Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income
|
$
|
2.16
|
|
|
$
|
0.08
|
|
|
$
|
2.80
|
|
|
$
|
2.40
|
|
|
$
|
0.71
|
|
Weighted-average shares
|
219,638
|
|
|
217,930
|
|
|
216,983
|
|
|
215,026
|
|
|
213,809
|
|
|||||
Per Share Data—Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income
|
$
|
2.14
|
|
|
$
|
0.08
|
|
|
$
|
2.77
|
|
|
$
|
2.37
|
|
|
$
|
0.71
|
|
Weighted-average shares and potentially dilutive shares
|
220,941
|
|
|
219,457
|
|
|
219,229
|
|
|
217,711
|
|
|
215,295
|
|
|||||
Dividends declared per common share
|
$
|
0.74
|
|
|
$
|
0.44
|
|
|
$
|
0.20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total assets
|
$20,072,947
|
|
$19,827,930
|
|
$19,804,405
|
|
$19,653,829
|
|
$18,224,425
|
||||||||||
Total debt, including capital leases
|
8,074,804
|
|
|
8,489,947
|
|
|
8,495,853
|
|
|
9,150,116
|
|
|
8,419,770
|
|
|||||
Common stock
|
2,308
|
|
|
2,291
|
|
|
2,276
|
|
|
2,262
|
|
|
2,243
|
|
|||||
Total shareholders' equity
|
8,808,265
|
|
|
8,308,749
|
|
|
8,407,823
|
|
|
7,900,752
|
|
|
7,489,781
|
|
(1)
|
Amounts for 2013 include restructuring charges of
$23.4 million
and an impairment charge of
$33.5 million
to write down the assets held for sale related to the businesses to be sold and certain long-lived assets, consisting of aircraft owned and operated by Pullmantur Air, to their fair value. (See Note 16.
Restructuring and Related Impairment Charges
to our consolidated financial statements under Item 8.
Financial Statements and Supplementary Data
for further information).
Amounts for 2012 include an impairment charge of
$385.4 million
to write down Pullmantur's goodwill to its implied fair value and to write down trademarks and trade names and certain long-lived assets, consisting of aircraft owned and operated by Pullmantur Air, to their fair value. (See
Valuation of Goodwill, Indefinite-Lived Intangible Assets and Long-Lived Assets
under Item 7.
Management's Discussion and Analysis of Financial Condition and Results of Operations
for more information regarding the impairment of these assets).
|
(2)
|
Amounts for 2012 include a
$33.7 million
charge to record a 100% valuation allowance related to our deferred tax assets for Pullmantur. In addition, we reduced the deferred tax liability related to Pullmantur's trademarks and trade names and recorded a deferred tax benefit of
$5.2 million
. These adjustments resulted in an increase of
$28.5 million
to
Other (expense) income
. (See
Valuation of Goodwill, Indefinite-Lived Intangible Assets and Long-Lived Assets
under Item 7.
Management's Discussion and Analysis of Financial Condition and Results of Operations
for more information regarding these transactions).
|
•
|
a review of our critical accounting policies and review of our financial presentation, including discussion of certain operational and financial metrics we utilize to assist us in managing our business;
|
•
|
a discussion of our results of operations for the year ended
December 31, 2013
compared to the same period in
2012
and the year ended
December 31, 2012
compared to the same period in
2011
;
|
•
|
a discussion of our business outlook, including our expectations for selected financial items for the
first
quarter and full year of
2014
; and
|
•
|
a discussion of our liquidity and capital resources, including our future capital and contractual commitments and potential funding sources.
|
•
|
Passenger ticket revenues
, which consist of revenue recognized from the sale of passenger tickets and the sale of air transportation to and from our ships; and
|
•
|
Onboard and other revenues
, which consist primarily of revenues from the sale of goods and/or services onboard our ships not included in passenger ticket prices, cancellation fees, sales of vacation protection insurance, pre- and post-cruise tours, Pullmantur's travel agency network, land-based tours and air charter business to third parties.
|
•
|
Commissions, transportation and other expenses
, which consist of those costs directly associated with passenger ticket revenues, including travel agent commissions, air and other transportation expenses, port costs that vary with passenger head counts and related credit card fees;
|
•
|
Onboard and other expenses
, which consist of the direct costs associated with onboard and other revenues, including the costs of products sold onboard our ships, vacation protection insurance premiums, costs associated with pre- and post-cruise tours and related credit card fees as well as the minimal costs associated with concession revenues, as the costs are mostly incurred by third-party concessionaires;
|
•
|
Payroll and related expenses
, which consist of costs for shipboard personnel (costs associated with our shoreside personnel are included in marketing, selling and administrative expenses);
|
•
|
Food expenses
, which include food costs for both guests and crew;
|
•
|
Fuel expenses
, which include fuel and related delivery and storage costs, including the financial impact of fuel swap agreements; and
|
•
|
Other operating expenses
, which consist primarily of operating costs such as repairs and maintenance, port costs that do not vary with passenger head counts, vessel operating lease costs, costs associated with Pullmantur's travel agency network, land-based tours and air charter business to third parties, vessel related insurance and entertainment.
|
•
|
Total revenues increased 3.5% to $8.0 billion from $7.7 billion in 2012 primarily due to an increase in ticket prices and onboard spending.
|
•
|
Cruise operating expenses increased 2.9% to $5.3 billion from $5.2 billion in 2012 primarily due to an increase in capacity, crew expenses and onboard and other expenses.
|
•
|
We entered into a series of transactions to refinance our 2013 and 2014 bond maturities, reduce interest costs, improve financing terms and extend maturities. See Note 7.
Long-Term Debt
to our consolidated financial statements for further information.
|
•
|
We entered into an agreement with STX France S.A. to build the third Oasis-class ship for Royal Caribbean International with approximately 5,400 berths which is expected to enter service in the second quarter of 2016. We have entered into a credit agreement to finance the purchase of the ship which includes a sovereign financing guarantee. Pullmantur's
Atlantic Star
, which has been out of operation since 2009,
|
•
|
We entered into an agreement with Meyer Werft to build the third Quantum-class ship for Royal Caribbean International with approximately 4,150 berths which is expected to enter service in the second quarter of 2016. We have entered into a credit agreement to finance the purchase of the ship which includes a sovereign financing guarantee. See Note 15.
Commitments and Contingencies
to our consolidated financial statements under Item 8.
Financial Statements and Supplementary Data
for further information.
|
•
|
We incurred restructuring exit costs of $23.4 million related to our profitability initiatives. In addition, we recognized an impairment charge of $13.5 million to write down the aircraft owned and operated by Pullmantur Air to their fair value, and a $20.0 million charge to write down assets classified as held for sale as of December 31, 2013. These charges are classified as
Restructuring and related impairment charges
in our consolidated statements of comprehensive income (loss). Refer to Note 16.
Restructuring and Related Impairment Charges
to our consolidated financial statements under Item 8.
Financial Statements and Supplementary Data
for further information on our profitability initiatives.
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Total revenues
|
$
|
7,959,894
|
|
|
$
|
7,688,024
|
|
|
$
|
7,537,263
|
|
Operating income
|
$
|
798,148
|
|
|
$
|
403,110
|
|
|
$
|
931,628
|
|
Net income
|
$
|
473,692
|
|
|
$
|
18,287
|
|
|
$
|
607,421
|
|
Pullmantur impairment related charges
(1)
|
—
|
|
|
413,932
|
|
|
—
|
|
|||
Restructuring and related impairment charges
|
56,946
|
|
|
—
|
|
|
—
|
|
|||
Adjusted Net Income
|
$
|
530,638
|
|
|
$
|
432,219
|
|
|
$
|
607,421
|
|
Estimated impact of divesting businesses held for sale
|
8,586
|
|
|
10,654
|
|
|
(9,572
|
)
|
|||
Adjusted Net Income excluding estimated impact of businesses held for sale
|
$
|
539,224
|
|
|
$
|
442,873
|
|
|
$
|
597,849
|
|
|
|
|
|
|
|
||||||
Weighted-Average Shares Outstanding:
|
|
|
|
|
|
||||||
Basic
|
219,638
|
|
|
217,930
|
|
|
216,983
|
|
|||
Diluted
|
220,941
|
|
|
219,457
|
|
|
219,229
|
|
|||
|
|
|
|
|
|
||||||
Basic:
|
|
|
|
|
|
||||||
Earnings per Share
|
$
|
2.16
|
|
|
$
|
0.08
|
|
|
$
|
2.80
|
|
Adjusted Earnings per Share
|
$
|
2.42
|
|
|
$
|
1.98
|
|
|
$
|
2.80
|
|
Estimated impact of divesting businesses held for sale
|
$
|
0.04
|
|
|
$
|
0.05
|
|
|
$
|
(0.04
|
)
|
Adjusted Earnings per Share excluding estimated impact of businesses held for sale
|
$
|
2.46
|
|
|
$
|
2.03
|
|
|
$
|
2.76
|
|
|
|
|
|
|
|
||||||
Diluted:
|
|
|
|
|
|
||||||
Earnings per Share
|
$
|
2.14
|
|
|
$
|
0.08
|
|
|
$
|
2.77
|
|
Adjusted Earnings per Share
|
$
|
2.40
|
|
|
$
|
1.97
|
|
|
$
|
2.77
|
|
Estimated impact of divesting businesses held for sale
|
$
|
0.04
|
|
|
$
|
0.05
|
|
|
$
|
(0.04
|
)
|
Adjusted Earnings per Share excluding estimated impact of businesses held for sale
|
$
|
2.44
|
|
|
$
|
2.02
|
|
|
$
|
2.73
|
|
|
|
|
|
|
|
||||||
(1)
Includes $28.5 million in net deferred tax expense related to the Pullmantur impairment
|
|
|
|
|
|
|
Year Ended December 31,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Passenger ticket revenues
|
71.9
|
%
|
|
72.8
|
%
|
|
73.3
|
%
|
Onboard and other revenues
|
28.1
|
|
|
27.2
|
|
|
26.7
|
|
Total revenues
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cruise operating expenses:
|
|
|
|
|
|
|||
Commissions, transportation and other
|
16.5
|
%
|
|
16.8
|
%
|
|
17.2
|
%
|
Onboard and other
|
7.1
|
|
|
6.9
|
|
|
7.1
|
|
Payroll and related
|
10.6
|
|
|
10.8
|
|
|
11.0
|
|
Food
|
5.9
|
|
|
5.8
|
|
|
5.6
|
|
Fuel
|
11.6
|
|
|
11.8
|
|
|
10.1
|
|
Other operating
|
14.9
|
|
|
15.0
|
|
|
14.5
|
|
Total cruise operating expenses
|
66.7
|
|
|
67.1
|
|
|
65.6
|
|
Marketing, selling and administrative expenses
|
13.1
|
|
|
13.2
|
|
|
12.7
|
|
Depreciation and amortization expenses
|
9.5
|
|
|
9.5
|
|
|
9.3
|
|
Impairment of Pullmantur related assets
|
—
|
|
|
5.0
|
|
|
—
|
|
Restructuring and related impairment charges
|
0.7
|
|
|
—
|
|
|
—
|
|
Operating income
|
10.0
|
|
|
5.2
|
|
|
12.4
|
|
Other expense
|
(4.1
|
)
|
|
(5.0
|
)
|
|
(4.3
|
)
|
Net income
|
6.0
|
%
|
|
0.2
|
%
|
|
8.1
|
%
|
|
Year Ended December 31,
|
|||||||
|
2013
|
|
2012
|
|
2011
|
|||
Passengers Carried
|
4,884,763
|
|
|
4,852,079
|
|
|
4,850,010
|
|
Passenger Cruise Days
|
35,561,772
|
|
|
35,197,783
|
|
|
34,818,335
|
|
APCD
|
33,974,852
|
|
|
33,705,584
|
|
|
33,235,508
|
|
Occupancy
|
104.7
|
%
|
|
104.4
|
%
|
|
104.8
|
%
|
|
Year Ended December 31,
|
||||||||||||||
|
2013
|
|
2013
On a Constant Currency basis |
|
2012
|
|
2011
|
||||||||
Passenger ticket revenues
|
$
|
5,722,718
|
|
|
$
|
5,756,849
|
|
|
$
|
5,594,595
|
|
|
$
|
5,525,904
|
|
Onboard and other revenues
|
2,237,176
|
|
|
2,232,642
|
|
|
2,093,429
|
|
|
2,011,359
|
|
||||
Total revenues
|
7,959,894
|
|
|
7,989,491
|
|
|
7,688,024
|
|
|
7,537,263
|
|
||||
Less:
|
|
|
|
|
|
|
|
||||||||
Commissions, transportation and other
|
1,314,595
|
|
|
1,319,340
|
|
|
1,289,255
|
|
|
1,299,713
|
|
||||
Onboard and other
|
568,615
|
|
|
567,094
|
|
|
529,453
|
|
|
535,501
|
|
||||
Net revenues
|
6,076,684
|
|
|
6,103,057
|
|
|
5,869,316
|
|
|
5,702,049
|
|
||||
Less:
|
|
|
|
|
|
|
|
||||||||
Net revenues related to businesses held for sale
|
218,350
|
|
|
211,627
|
|
|
189,527
|
|
|
175,678
|
|
||||
Net revenues excluding businesses held for sale
|
$
|
5,858,334
|
|
|
$
|
5,891,430
|
|
|
$
|
5,679,789
|
|
|
$
|
5,526,371
|
|
|
|
|
|
|
|
|
|
||||||||
APCD
|
33,974,852
|
|
|
33,974,852
|
|
|
33,705,584
|
|
|
33,235,508
|
|
||||
Gross Yields
|
$
|
234.29
|
|
|
$
|
235.16
|
|
|
$
|
228.09
|
|
|
$
|
226.78
|
|
Net Yields
|
$
|
178.86
|
|
|
$
|
179.63
|
|
|
$
|
174.13
|
|
|
$
|
171.56
|
|
Net Yields excluding businesses held for sale
|
$
|
172.43
|
|
|
$
|
173.41
|
|
|
$
|
168.51
|
|
|
$
|
166.28
|
|
|
Year Ended December 31,
|
||||||||||||||
|
2013
|
|
2013 On a
Constant Currency basis |
|
2012
|
|
2011
|
||||||||
Total cruise operating expenses
|
$
|
5,305,270
|
|
|
$
|
5,302,946
|
|
|
$
|
5,157,434
|
|
|
$
|
4,942,607
|
|
Marketing, selling and administrative expenses
|
1,044,819
|
|
|
1,043,050
|
|
|
1,011,543
|
|
|
960,602
|
|
||||
Gross Cruise Costs
|
$
|
6,350,089
|
|
|
$
|
6,345,996
|
|
|
$
|
6,168,977
|
|
|
$
|
5,903,209
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Commissions, transportation and other
|
1,314,595
|
|
|
1,319,340
|
|
|
1,289,255
|
|
|
1,299,713
|
|
||||
Onboard and other
|
568,615
|
|
|
567,094
|
|
|
529,453
|
|
|
535,501
|
|
||||
Net Cruise Costs
|
$
|
4,466,879
|
|
|
$
|
4,459,562
|
|
|
$
|
4,350,269
|
|
|
$
|
4,067,995
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Fuel
|
924,414
|
|
|
927,572
|
|
|
909,691
|
|
|
764,758
|
|
||||
Net Cruise Costs Excluding Fuel
|
$
|
3,542,465
|
|
|
$
|
3,531,990
|
|
|
$
|
3,440,578
|
|
|
$
|
3,303,237
|
|
|
|
|
|
|
|
|
|
||||||||
Net Cruise Costs
|
$
|
4,466,879
|
|
|
$
|
4,459,562
|
|
|
$
|
4,350,269
|
|
|
$
|
4,067,995
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Net Cruise Costs related to businesses held for sale
|
224,864
|
|
|
219,241
|
|
|
199,596
|
|
|
162,671
|
|
||||
Net Cruise Costs excluding businesses held for sale
|
$
|
4,242,015
|
|
|
$
|
4,240,321
|
|
|
$
|
4,150,673
|
|
|
$
|
3,905,324
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Fuel
|
924,414
|
|
|
927,572
|
|
|
909,691
|
|
|
764,758
|
|
||||
Net Cruise Costs Excluding Fuel and businesses held for sale
|
$
|
3,317,601
|
|
|
$
|
3,312,749
|
|
|
$
|
3,240,982
|
|
|
$
|
3,140,566
|
|
|
|
|
|
|
|
|
|
||||||||
APCD
|
33,974,852
|
|
|
33,974,852
|
|
|
33,705,584
|
|
|
33,235,508
|
|
||||
Gross Cruise Costs per APCD
|
$
|
186.91
|
|
|
$
|
186.79
|
|
|
$
|
183.03
|
|
|
$
|
177.62
|
|
Net Cruise Costs per APCD
|
$
|
131.48
|
|
|
$
|
131.26
|
|
|
$
|
129.07
|
|
|
$
|
122.40
|
|
Net Cruise Cost excluding businesses held for sale per APCD
|
$
|
124.86
|
|
|
$
|
124.81
|
|
|
$
|
123.14
|
|
|
$
|
117.50
|
|
Net Cruise Cost Excluding Fuel per APCD
|
$
|
104.27
|
|
|
$
|
103.96
|
|
|
$
|
102.08
|
|
|
$
|
99.39
|
|
Net Cruise Costs Excluding Fuel and businesses held for sale per APCD
|
$
|
97.65
|
|
|
$
|
97.51
|
|
|
$
|
96.16
|
|
|
$
|
94.49
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
|
Year Ended December 31, 2013
|
||||||||||
Passenger ticket revenues
|
$
|
1,393,778
|
|
|
$
|
1,366,713
|
|
|
$
|
1,672,051
|
|
|
$
|
1,290,176
|
|
|
$
|
5,722,718
|
|
Onboard and other revenues
|
517,442
|
|
|
516,054
|
|
|
639,698
|
|
|
563,982
|
|
|
2,237,176
|
|
|||||
Total revenues
|
1,911,220
|
|
|
1,882,767
|
|
|
2,311,749
|
|
|
1,854,158
|
|
|
7,959,894
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commissions, transportation and other
|
322,937
|
|
|
316,506
|
|
|
378,291
|
|
|
296,861
|
|
|
1,314,595
|
|
|||||
Onboard and other
|
121,487
|
|
|
140,710
|
|
|
178,269
|
|
|
128,149
|
|
|
568,615
|
|
|||||
Net Revenues
|
1,466,796
|
|
|
1,425,551
|
|
|
1,755,189
|
|
|
1,429,148
|
|
|
6,076,684
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Revenues related to businesses held for sale
|
33,114
|
|
|
39,431
|
|
|
70,098
|
|
|
75,707
|
|
|
218,350
|
|
|||||
Net Revenues excluding businesses held for sale
|
$
|
1,433,682
|
|
|
$
|
1,386,120
|
|
|
$
|
1,685,091
|
|
|
$
|
1,353,441
|
|
|
$
|
5,858,334
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
APCD
|
8,428,110
|
|
|
8,238,182
|
|
|
8,667,948
|
|
|
8,640,612
|
|
|
33,974,852
|
|
|||||
Gross Yields
|
$
|
226.77
|
|
|
$
|
228.54
|
|
|
$
|
266.70
|
|
|
$
|
214.59
|
|
|
$
|
234.29
|
|
Net Yields
|
$
|
174.04
|
|
|
$
|
173.04
|
|
|
$
|
202.49
|
|
|
$
|
165.40
|
|
|
$
|
178.86
|
|
Net Yields excluding businesses held for sale
|
$
|
170.11
|
|
|
$
|
168.26
|
|
|
$
|
194.40
|
|
|
$
|
156.64
|
|
|
$
|
172.43
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
|
December 31, 2013
|
||||||||||
Total cruise operating expenses
|
$
|
1,282,190
|
|
|
$
|
1,323,619
|
|
|
$
|
1,416,801
|
|
|
$
|
1,282,660
|
|
|
$
|
5,305,270
|
|
Marketing, selling and administrative expenses
(1)
|
274,034
|
|
|
257,948
|
|
|
249,954
|
|
|
262,883
|
|
|
1,044,819
|
|
|||||
Gross Cruise Costs
|
1,556,224
|
|
|
1,581,567
|
|
|
1,666,755
|
|
|
1,545,543
|
|
|
6,350,089
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commissions, transportation and other
|
322,937
|
|
|
316,506
|
|
|
378,291
|
|
|
296,861
|
|
|
1,314,595
|
|
|||||
Onboard and other
|
121,487
|
|
|
140,710
|
|
|
178,269
|
|
|
128,149
|
|
|
568,615
|
|
|||||
Net Cruise Costs
|
$
|
1,111,800
|
|
|
$
|
1,124,351
|
|
|
$
|
1,110,195
|
|
|
$
|
1,120,533
|
|
|
$
|
4,466,879
|
|
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Fuel
|
241,652
|
|
|
232,471
|
|
|
215,686
|
|
|
234,605
|
|
|
924,414
|
|
|||||
Net Cruise Costs Excluding Fuel
|
$
|
870,148
|
|
|
$
|
891,880
|
|
|
$
|
894,509
|
|
|
$
|
885,928
|
|
|
$
|
3,542,465
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Cruise Costs
|
$
|
1,111,800
|
|
|
$
|
1,124,351
|
|
|
$
|
1,110,195
|
|
|
$
|
1,120,533
|
|
|
$
|
4,466,879
|
|
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Cruise Costs related to businesses held for sale
|
34,971
|
|
|
49,196
|
|
|
67,760
|
|
|
72,937
|
|
|
224,864
|
|
|||||
Net Cruise Costs excluding businesses held for sale
|
$
|
1,076,829
|
|
|
$
|
1,075,155
|
|
|
$
|
1,042,435
|
|
|
$
|
1,047,596
|
|
|
$
|
4,242,015
|
|
Less:
|
|
|
|
|
|
|
|
|
|
||||||||||
Fuel
|
241,652
|
|
|
232,471
|
|
|
215,686
|
|
|
234,605
|
|
|
924,414
|
|
|||||
Net Cruise Costs Excluding Fuel and businesses held for sale
|
$
|
835,177
|
|
|
$
|
842,684
|
|
|
$
|
826,749
|
|
|
$
|
812,991
|
|
|
$
|
3,317,601
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
APCD
|
8,428,110
|
|
|
8,238,182
|
|
|
8,667,948
|
|
|
8,640,612
|
|
|
33,974,852
|
|
|||||
Gross Cruise Costs per APCD
|
$
|
184.65
|
|
|
$
|
191.98
|
|
|
$
|
192.29
|
|
|
$
|
178.87
|
|
|
$
|
186.91
|
|
Net Cruise Costs per APCD
|
$
|
131.92
|
|
|
$
|
136.48
|
|
|
$
|
128.08
|
|
|
$
|
129.68
|
|
|
$
|
131.48
|
|
Net Cruise Costs excluding businesses held for sale per APCD
|
$
|
127.77
|
|
|
$
|
130.51
|
|
|
$
|
120.26
|
|
|
$
|
121.24
|
|
|
$
|
124.86
|
|
Net Cruise Costs Excluding Fuel per APCD
|
$
|
103.24
|
|
|
$
|
108.26
|
|
|
$
|
103.20
|
|
|
$
|
102.53
|
|
|
$
|
104.27
|
|
Net Cruise Costs Excluding Fuel and businesses held for sale per APCD
|
$
|
99.09
|
|
|
$
|
102.29
|
|
|
$
|
95.38
|
|
|
$
|
94.09
|
|
|
$
|
97.65
|
|
|
As of December 31,
|
||||||
|
2013
|
|
2012
|
||||
Long-term debt, net of current portion
|
$
|
6,511,426
|
|
|
$
|
6,970,464
|
|
Current portion of long-term debt
|
1,563,378
|
|
|
1,519,483
|
|
||
Total debt
|
8,074,804
|
|
|
8,489,947
|
|
||
Less: Cash and cash equivalents
|
204,687
|
|
|
194,855
|
|
||
Net Debt
|
$
|
7,870,117
|
|
|
$
|
8,295,092
|
|
Total shareholders' equity
|
$
|
8,808,265
|
|
|
$
|
8,308,749
|
|
Total debt
|
8,074,804
|
|
|
8,489,947
|
|
||
Total debt and shareholders' equity
|
16,883,069
|
|
|
16,798,696
|
|
||
Debt-to-Capital
|
47.8
|
%
|
|
50.5
|
%
|
||
Net Debt
|
7,870,117
|
|
|
8,295,092
|
|
||
Net Debt and shareholders' equity
|
$
|
16,678,382
|
|
|
$
|
16,603,841
|
|
Net Debt-to-Capital
|
47.2
|
%
|
|
50.0
|
%
|
|
As Reported
|
|
Constant Currency
|
Net Yields
|
Approx. 2%
|
|
2% to 3%
|
Net Cruise Costs per APCD
|
Approx. Flat
|
|
Approx. Flat
|
Net Cruise Costs per APCD, excluding Fuel
|
Approx. Flat
|
|
Flat to slightly down
|
Capacity Increase
|
1.7%
|
|
|
Depreciation and Amortization
|
$780 to $790 million
|
|
|
Interest Expense, net
|
$260 to $270 million
|
|
|
Fuel Consumption (metric tons)
|
1,352,000
|
|
|
Fuel Expenses
|
$944 million
|
|
|
Percent Hedged (fwd consumption)
|
55%
|
|
|
Impact of 10% change in fuel prices
|
$41.4 million
|
|
|
Adjusted Earnings per Share-Diluted*
|
$3.20 to $3.40
|
|
|
|
As Reported
|
|
Constant Currency
|
Net Yields
|
Approx. (2%)
|
|
Approx. Flat
|
Net Cruise Costs per APCD
|
1% to 2%
|
|
Approx. 2%
|
Net Cruise Costs per APCD, excluding Fuel
|
Approx. 2%
|
|
2% to 3%
|
Capacity Increase
|
0.7%
|
|
|
Depreciation and Amortization
|
$190 to $200 million
|
|
|
Interest Expense, net
|
$60 to $70 million
|
|
|
Fuel Consumption (metric tons)
|
342,000
|
|
|
Fuel Expenses
|
$242 million
|
|
|
Percent Hedged (fwd consumption)
|
52%
|
|
|
Impact of 10% change in fuel prices
|
$11.5 million
|
|
|
Adjusted Earnings per Share-Diluted*
|
$0.20 to $0.30
|
|
|
•
|
an increase in ticket prices for European sailings and certain deployment initiatives, including but not limited to increased deployment in Australia and Asia
,
all of which contributed to a $117.6 million increase in
Passenger ticket revenues
; and
|
•
|
a 0.8% increase in capacity, which increased
Passenger ticket revenues
by $44.6 million. The increase in capacity was primarily due to the addition of
Celebrity Reflection
which entered service in October 2012. This increase was partially offset by the transfer of
Ocean Dream
to an unrelated third party in April 2012 as part of a six year bareboat charter agreement and the transfer of
Monarch of the Seas
to Pullmantur in April 2013 reducing capacity due to the two-month lag further discussed in Note 1.
General
.
|
•
|
a $101.7 million increase in onboard revenue primarily due to higher spending on a per passenger basis due to revenue enhancing initiatives as a result of our ship revitalization projects and an increase in shore excursion revenues attributable to certain deployment initiatives particularly in Australia.
Onboard and other revenues
included concession revenues of $316.3 million in 2013 and $288.6 million in 2012;
|
•
|
a $28.3 million increase in revenues related to Pullmantur’s travel agency network and air charter business due to the addition of new tour packages; and
|
•
|
a $14.8 million increase attributable to the 0.8% increase in capacity noted above.
|
•
|
a $39.6 million increase attributable to the 0.8% increase in capacity noted above;
|
•
|
a $22.6 million increase in crew expenses related to higher medical expenses and, to a lesser extent, an increase in crew movement related to deployment changes;
|
•
|
a $21.1 million increase in expenses related to Pullmantur’s travel agency network and air charter business noted above;
|
•
|
a $16.4 million increase in food expenses due to higher costs on a per passenger basis related to our new culinary initiatives and itinerary changes;
|
•
|
a $12.1 million increase in expenses attributable to the impact of the unscheduled drydocks for
Celebrity Millennium
and
Grandeur of the Seas
and the 2012 gain from the sale of
Oceanic
which did not recur in 2013; and
|
•
|
a $8.6 million increase in shore excursion expenses attributable to itinerary changes noted above.
|
•
|
a $29.8 decrease in deferred income tax expense as a result of a 100% valuation allowance recorded in connection with Pullmantur's deferred tax assets in 2012 partially offset by a reduction in Pullmantur's deferred tax liability and resulting tax benefit related to a 2013 impairment of Pullmantur's long-lived assets and a 2012 impairment charge of Pullmantur's trademarks and trade names; and
|
•
|
income of $32.0 million from our equity method investments in 2013 as compared to income of $23.8 million in 2012.
|
•
|
an increase in ticket prices primarily driven by changes to our international distribution system mainly in Brazil and certain deployment initiatives including, but not limited to increased deployment in Australia and China
,
all of which contributed to a $94.6 million increase in
Passenger ticket revenues
; and
|
•
|
a 1.4% increase in capacity, which contributed to a $78.1 million increase in passenger ticket revenue. The increase in capacity was primarily due to the addition of
Celebrity Silhouette
which entered service in July 2011 and the addition of
Celebrity Reflection
which entered service in October 2012. This increase was partially offset by the sale of
Celebrity Mercury
to TUI Cruises in February 2011 and the completion of our one-year charter of
Bleu de France
in November 2011 following its sale to a third party in November 2010. The increase in capacity was also partially offset by the delivery of
Ocean Dream
to an unrelated third party in April 2012 as part of a six-year bareboat charter agreement.
|
•
|
a $32.5 million increase in onboard revenue attributable to higher spending on a per passenger basis primarily due to the addition of specialty restaurants and other onboard activities as a result of our ship revitalization projects and other revenue enhancing initiatives.
Onboard and other revenues
included concession revenues of $288.6 million in 2012 and $273.4 million in 2011;
|
•
|
a $25.4 million increase attributable to the 1.4% increase in capacity noted above; and
|
•
|
a $19.1 million increase in revenues related to Pullmantur’s travel agency network and air charter business due to an increase in guests and the addition of new itineraries.
|
•
|
a $138.9 million increase in fuel expenses which are net of the financial impact of fuel swap agreements accounted for as hedges due to an increase in fuel prices in 2012 as compared to 2011;
|
•
|
a $22.5 million increase in food expenses due to higher costs on a per passenger basis related to our new culinary initiatives.
|
•
|
the favorable effect of changes in foreign currency exchange rates related to our cruise operating expenses denominated in currencies other than the United States dollar of approximately $74.5 million; and
|
•
|
a $39.5 million decrease in commissions expense attributable to increased charter business and changes in our distribution channels.
|
•
|
Deferred income tax expense of $33.7 million as a result of a 100% valuation allowance recorded in connection with Pullmantur's deferred tax assets that are no longer expected to be recovered prior to their expiration;
|
•
|
A reduction in deferred income tax expense of $5.2 million due to a reduction in Pullmantur's deferred tax liability related to the impairment charge of Pullmantur's trademarks and trade names;
|
•
|
A loss of $8.4 million associated with our fuel derivative instruments in 2012 as compared to a gain of $26.0 million in 2011, for a net change of $34.4 million.
|
•
|
A loss of $7.5 million on the early extinguishment of €255.0 million, or approximately $328.0 million in aggregate principal amount of our outstanding €1.0 billion unsecured senior notes due 2014 in September 2012.
|
|
Payments due by period
|
||||||||||||||||||
|
Total
|
|
Less than
1 year
|
|
1-3
years
|
|
3-5
years
|
|
More than
5 years
|
||||||||||
Operating Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating lease obligations
(1)(2)
|
$
|
499,930
|
|
|
$
|
47,097
|
|
|
$
|
88,484
|
|
|
$
|
79,203
|
|
|
$
|
285,146
|
|
Interest on long-term debt
(3)
|
1,093,746
|
|
|
228,083
|
|
|
340,646
|
|
|
184,098
|
|
|
340,919
|
|
|||||
Other
(4)
|
696,827
|
|
|
200,660
|
|
|
254,795
|
|
|
158,432
|
|
|
82,940
|
|
|||||
Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Ship purchase obligations
|
3,722,011
|
|
|
934,517
|
|
|
2,787,494
|
|
|
—
|
|
|
—
|
|
|||||
Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt obligations
(5)
|
8,020,061
|
|
|
1,555,869
|
|
|
2,515,563
|
|
|
1,968,898
|
|
|
1,979,731
|
|
|||||
Capital lease obligations
(6)
|
54,743
|
|
|
7,509
|
|
|
11,176
|
|
|
6,536
|
|
|
29,522
|
|
|||||
Other
(7)
|
80,011
|
|
|
27,787
|
|
|
37,929
|
|
|
12,322
|
|
|
1,973
|
|
|||||
Total
|
$
|
14,167,329
|
|
|
$
|
3,001,522
|
|
|
$
|
6,036,087
|
|
|
$
|
2,409,489
|
|
|
$
|
2,720,231
|
|
(1)
|
We are obligated under noncancelable operating leases primarily for a ship, offices, warehouses and motor vehicles.
|
(2)
|
Under the
Brilliance of the Seas
lease agreement, we may be required to make a termination payment of approximately £65.4 million, or approximately $108.3 million based on the exchange rate at
December 31, 2013
, if the lease is canceled in 2020. This amount is included in the more than 5 years column. Interest on the
Brilliance of the Seas
lease agreement is calculated based on the applicable variable interest rate at December 31, 2013.
|
(3)
|
Long-term debt obligations mature at various dates through fiscal year 2027 and bear interest at fixed and variable rates. Interest on variable-rate debt is calculated based on forecasted debt balances, including interest swapped using the applicable rate at
December 31, 2013
. Debt denominated in other currencies is calculated based on the applicable exchange rate at
December 31, 2013
.
|
(4)
|
Amounts represent future commitments with remaining terms in excess of one year to pay for our usage of certain port facilities, marine consumables, services and maintenance contracts.
|
(5)
|
Amounts represent debt obligations with initial terms in excess of one year.
|
(6)
|
Amounts represent capital lease obligations with initial terms in excess of one year.
|
(7)
|
Amounts represent fees payable to sovereign guarantors in connection with certain of our export credit debt facilities and facility fees on our revolving credit facilities.
|
(2)
|
Financial Statement Schedules
|
(3)
|
Exhibits
|
ROYAL CARIBBEAN CRUISES LTD.
(Registrant)
|
|
By:
|
/s/ JASON T. LIBERTY
|
|
Jason T. Liberty
Senior Vice President, Chief Financial Officer
(Principal Financial Officer and duly authorized signatory)
|
/s/ RICHARD D. FAIN
|
Richard D. Fain
Director, Chairman and Chief Executive Officer
(Principal Executive Officer)
|
|
/s/ JASON T. LIBERTY
|
Jason T. Liberty
Senior Vice President, Chief Financial Officer
(Principal Financial Officer)
|
|
/s/ HENRY L. PUJOL
|
Henry L. Pujol
Senior Vice President, Chief Accounting Officer (Principal Accounting Officer)
|
|
*
|
Bernard W. Aronson
Director
|
|
|
John F. Brock
Director |
|
*
|
William L. Kimsey
Director
|
|
*
|
Ann S. Moore
Director
|
|
*
|
Eyal M. Ofer
Director
|
|
*
|
Thomas J. Pritzker
Director
|
|
*
|
William K. Reilly
Director
|
|
*
|
Bernt Reitan
Director
|
|
*
|
Vagn O. Sørensen
Director
|
|
*
|
Arne Alexander Wilhelmsen
Director
|
*By:
|
/s/ JASON T. LIBERTY
|
|
Jason T. Liberty,
as Attorney-in-Fact
|
Exhibit
|
Description
|
3.1
|
— Restated Articles of Incorporation of the Company, as amended (composite) (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-3, File No. 333-158161, filed with the Securities and Exchange Commission (the ‘‘Commission’’)) on March 23, 2009.
|
|
|
3.2
|
— Amended and Restated By-Laws of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on September 11, 2013).
|
|
|
4.1
|
— Indenture dated as of July 15, 1994 between the Company, as issuer, and The Bank of New York Trust Company, N.A., successor to NationsBank of Georgia, National Association, as Trustee (incorporated by reference to Exhibit 2.4 to the Company’s 1994 Annual Report on Form 20-F, File No. 1-11884).
|
|
|
4.2
|
— Sixth Supplemental Indenture dated as of October 14, 1997 to Indenture dated as of July 15, 1994 between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 2.11 to the Company’s 1997 Annual Report on Form 20-F, File No. 1-11884).
|
|
|
4.3
|
— Eighth Supplemental Indenture dated as of March 16, 1998 to Indenture dated as of July 15, 1994 between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 2.13 to the Company’s 1997 Annual Report on Form 20-F, File No. 1-11884).
|
|
|
4.4
|
— Fifteenth Supplemental Indenture dated as of June 12, 2006 to Indenture dated as of July 15, 1994 between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 4.14 to the Company’s 2006 Annual Report on Form 10-K).
|
|
|
4.5
|
— Form of Indenture dated as of July 31, 2006 between the Company, as issuer, and The Bank of New York Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-3 (No. 333-136186) filed with the Commission on July 31, 2006).
|
|
|
4.6
|
— First Supplemental Indenture dated as of July 6, 2009 between the Company, as issuer, and The Bank of New York Mellon Trust Company, N.A. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the Commission on July 2, 2009).
|
|
|
4.7
|
— Second Supplemental Indenture dated as of November 7, 2012 between the Company, as issuer, and The Bank of New York Mellon Trust Company, N.A. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the Commission on November 7, 2012).
|
|
|
10.1
|
— Amended and Restated Registration Rights Agreement dated as of July 30, 1997 among the Company, A. Wilhelmsen AS., Cruise Associates, Monument Capital Corporation, Archinav Holdings, Ltd. and Overseas Cruiseship, Inc. (incorporated by reference to Exhibit 2.20 to the Company’s 1997 Annual Report on Form 20-F, File No. 1-11884).
|
|
|
10.2
|
— Assignment and Amendment to the US$875,000,000 Amended and Restated Credit Agreement dated as of July 15, 2011 among the Company, the various financial institutions party thereto and Citibank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 19, 2011).
|
|
|
10.3
|
— Assignment and Amendment to the Credit Agreement, dated as of August 23, 2013, among the Company, the various financial institutions as are or shall become parties thereto and Nordea Bank Finland plc, New York Branch, as administrative agent for the lender parties (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 26, 2013).
|
|
|
10.4
|
— Assignment and Amendment Deed to Hull No. 679 Credit Agreement, dated as of February 17, 2012, among Celebrity Silhouette Inc., the Company and KfW IPEX-BANK GMBH, in its capacity as agent for Hermes, administrative agent and lender (incorporated by reference to Exhibit 10.5 to the Company’s 2011 Annual Report on Form 10-K).
|
|
|
10.5
|
— Assignment and Amendment Deed to Hull No. 691 Credit Agreement, dated as of February 17, 2012, among Celebrity Solstice V Inc., the Company and KfW IPEX-BANK GMBH, in its capacity as agent for Hermes, administrative agent and lender (incorporated by reference to Exhibit 10.6 to the Company’s 2011 Annual Report on Form 10-K).
|
|
|
Exhibit
|
Description
|
10.6
|
— Assignment and Amendment No. 4 to Credit Agreement, dated as of March 26, 2012, among Oasis of the Seas Inc., Royal Caribbean Cruises Ltd., the various financial institutions as are parties to the Credit Agreement and BNP Paribas, as administrative agent (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012).
|
|
|
10.7
|
— Assignment and Amendment No. 4 to Credit Agreement, dated as of March 26, 2012, among Allure of the Seas Inc., Royal Caribbean Cruises Ltd., the various financial institutions as are parties to the Credit Agreement and Skandinaviska Enskilda Banken AB, as administrative agent (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012).
|
|
|
10.8
|
— Hull No. S-697 Credit Agreement, dated as of June 8, 2011, between Company, the Lenders from time to time party thereto and KfW-IPEX-Bank GmbH, as Hermes Agent, Facility Agent and Initial Mandated Lead Arranger, as amended on February 17, 2012 and May 10, 2012 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the Quarterly Period ended June 30, 2012).
|
|
|
10.9
|
— Amendment Agreement in connection with the Credit Agreement in respect of Hull No. S-698, dated as of February 17, 2012, between the Company, the Lenders from time to time party thereto and KfW-IPEX-Bank GmbH, as Hermes Agent, Facility Agent and Initial Mandated Lead Arranger (incorporated by reference to Exhibit 10.10 to the Company’s 2011 Annual Report on Form 10-K).
|
|
|
10.10
|
— Facility Agreement, dated as of July 9, 2013, between the Company, as the Borrower, the Lenders from time to time party thereto, Société Générale, as Facility Agent and Mandated Lead Arranger, BNP Paribas, as Documentation Bank and Mandated Lead Arranger, and HSBC France, as Mandated Lead Arranger (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 12, 2013).
|
|
|
10.11
|
— Hull No. S-699 Credit Agreement, dated as of November 27, 2013, between the Company, as the Borrower, the Lenders from time to time party thereto and KfW IPEX-Bank GmbH, as Hermes Agent, Facility Agent and Initial Mandated Lead Arranger (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 3, 2013).
|
|
|
10.12
|
— Office Building Lease Agreement dated July 25, 1989 between Miami-Dade County and the Company, as amended (incorporated by reference to Exhibits 10.116 and 10.117 to the Company’s Registration Statement on Form F-1, File No. 33-46157, filed with the Commission and Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 5, 2011).
|
|
|
10.13
|
— Office Building Lease Agreement dated January 18, 1994 between Miami-Dade County and the Company (incorporated by reference to Exhibit 2.13 to the Company’s 1993 Annual Report on Form 20-F, File No. 1-11884 and Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on August 5, 2011).
|
|
|
10.14
|
— Multi-Tenant Office Lease Agreement dated May 3, 2000, as amended through January 26, 2010, between the Company and RT Miramar II, LLC (incorporated by reference to Exhibit 4.6 to the Company’s 2003 Annual Report on Form 20-F and Exhibit 10.17 to the Company’s 2009 Annual Report on Form 10-K).
|
|
|
10.15
|
— Lease Agreement dated January 24, 2005, as amended through March 20, 2006, between the Company and RC Springfield 2007, LLC (formerly Workstage-Oregon, LLC) (incorporated by reference to Exhibit 10.7 to the Company’s 2004 Annual Report on Form 10-K, Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2005 and Exhibit 10.12 to the Company’s 2007 Annual Report on Form 10-K).
|
|
|
10.16
|
— Royal Caribbean Cruises Ltd. 2000 Stock Award Plan, as amended and restated through September 18, 2006 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on December 8, 2005 and Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on September 22, 2006).
|
|
|
10.17
|
— Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan, as amended by Amendment No. 1 dated as of May 20, 2010 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2008 and Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2010).
|
|
|
10.18
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Stock Option Award Agreement—Incentive Options (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008).
|
|
|
10.19
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Stock Option Award Agreement—Nonqualified shares (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008).
|
|
|
Exhibit
|
Description
|
10.20
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Restricted Stock Unit Agreement for grants made in 2010, 2011, 2012 and 2013 (incorporated by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008).
|
|
|
10.21
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Restricted Stock Unit Agreement—Director Grants (incorporated by reference to Exhibit 10.31 to the Company’s 2010 Annual Report on Form 10-K).
|
|
|
10.22
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Performance Share Agreement for grants made in 2012 and 2013 (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the Commission on February 22, 2012).
|
|
|
10.23
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Restricted Stock Unit Agreement for grants made in 2014*
|
|
|
10.24
|
— Form of Royal Caribbean Cruises Ltd. 2008 Equity Incentive Plan Performance Share Agreement for grants made in 2014*
|
|
|
10.25
|
— Employment Agreement dated December 31, 2012 between the Company and Richard D. Fain (incorporated by reference to Exhibit 10.22 to the Company’s 2012 Annual Report on Form 10-K).
|
|
|
10.26
|
— Employment Agreement dated December 31, 2012 between the Company and Adam M. Goldstein (incorporated by reference to Exhibit 10.23 to the Company’s 2012 Annual Report on Form 10-K).
|
|
|
10.27
|
— Employment Agreement dated December 31, 2012 between Celebrity Cruises Inc. and Michael W. Bayley (incorporated by reference to Exhibit 10.24 to the Company’s 2012 Annual Report on Form 10-K).
|
|
|
10.28
|
— Employment Agreement dated December 31, 2012 between the Company and Brian J. Rice (incorporated by reference to Exhibit 10.25 to the Company’s 2012 Annual Report on Form 10-K).
|
|
|
10.29
|
— Employment Agreement dated December 31, 2012 between the Company and Harri U. Kulovaara (incorporated by reference to Exhibit 10.26 to the Company’s 2012 Annual Report on Form 10-K).
|
|
|
10.30
|
— Employment Agreement dated May 20, 2013 between the Company and Jason T. Liberty (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2013).
|
|
|
10.31
|
— Royal Caribbean Cruises Ltd. Executive Short-Term Bonus Plan dated as of September 12, 2008, as amended (incorporated by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011).
|
|
|
10.32
|
— Royal Caribbean Cruises Ltd. et. al. Non Qualified Deferred Compensation Plan, formerly Royal Caribbean Cruises Ltd. et. al. Non Qualified 401(k) Plan, as amended through November 11, 2008 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Commission on December 8, 2005, Exhibit 10.29 to the Company’s 2006 Annual Report on Form 10-K, Exhibit 10.28 to the Company’s 2007 Annual Report on Form 10-K, Exhibit 10.29 to the Company’s 2007 Annual Report on Form 10-K and Exhibit 10.36 to the Company’s 2008 Annual Report on Form 10-K).
|
|
|
10.33
|
— Royal Caribbean Cruises Ltd. Supplemental Executive Retirement Plan as amended through November 11, 2008 (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the Commission on December 8, 2005, Exhibit 10.31 to the Company’s 2006 Annual Report on Form 10-K, Exhibit 10.31 to the Company’s 2007 Annual Report on Form 10-K, Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2008 and Exhibit 10.38 to the Company’s Annual Report on Form 10-K).
|
|
|
10.34
|
— Summary of Royal Caribbean Cruises Ltd. Board of Directors Compensation (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2013).
|
|
|
10.35
|
— Cruise Policy for Members of the Board of Directors of the Company*
|
|
|
12.1
|
— Statement regarding computation of fixed charge coverage ratio*
|
|
|
21.1
|
— List of Subsidiaries*
|
|
|
23.1
|
— Consent of PricewaterhouseCoopers LLP, an independent registered certified public accounting firm*
|
|
|
23.2
|
— Consent of Drinker Biddle & Reath LLP*
|
Exhibit
|
Description
|
|
|
24.1
|
— Power of Attorney*
|
|
|
31.1
|
— Certification of Richard D. Fain required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934*
|
|
|
31.2
|
— Certification of Jason T. Liberty required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934*
|
|
|
32.1
|
— Certification of Richard D. Fain and Jason T. Liberty pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code**
|
*
|
Filed herewith
|
**
|
Furnished herewith
|
101
|
—The following financial statements from Royal Caribbean Cruises Ltd.'s Annual Report on Form 10-K for the year ended December 31, 2013, as filed with the SEC on February 20, 2014, formatted in XBRL, as follows:
|
|
|
(i)
|
the Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2013, 2012 and 2011;
|
|
(ii)
|
the Consolidated Balance Sheets at December 31, 2013 and 2012;
|
|
(iii)
|
the Consolidated Statements of Cash Flows for the years ended December 31, 2013, 2012 and 2011;
|
|
(iv)
|
the Consolidated Statements of Shareholders' Equity for the years ended December 31, 2013, 2012 and 2011; and
|
|
(v)
|
the Notes to the Consolidated Financial Statements, tagged in summary and detail.
|
|
Page
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands, except per share data)
|
||||||||||
Passenger ticket revenues
|
$
|
5,722,718
|
|
|
$
|
5,594,595
|
|
|
$
|
5,525,904
|
|
Onboard and other revenues
|
2,237,176
|
|
|
2,093,429
|
|
|
2,011,359
|
|
|||
Total revenues
|
7,959,894
|
|
|
7,688,024
|
|
|
7,537,263
|
|
|||
Cruise operating expenses:
|
|
|
|
|
|
||||||
Commissions, transportation and other
|
1,314,595
|
|
|
1,289,255
|
|
|
1,299,713
|
|
|||
Onboard and other
|
568,615
|
|
|
529,453
|
|
|
535,501
|
|
|||
Payroll and related
|
841,737
|
|
|
828,198
|
|
|
825,676
|
|
|||
Food
|
469,653
|
|
|
449,649
|
|
|
424,308
|
|
|||
Fuel
|
924,414
|
|
|
909,691
|
|
|
764,758
|
|
|||
Other operating
|
1,186,256
|
|
|
1,151,188
|
|
|
1,092,651
|
|
|||
Total cruise operating expenses
|
5,305,270
|
|
|
5,157,434
|
|
|
4,942,607
|
|
|||
Marketing, selling and administrative expenses
|
1,044,819
|
|
|
1,011,543
|
|
|
960,602
|
|
|||
Depreciation and amortization expenses
|
754,711
|
|
|
730,493
|
|
|
702,426
|
|
|||
Impairment of Pullmantur related assets
|
—
|
|
|
385,444
|
|
|
—
|
|
|||
Restructuring and related impairment charges
|
56,946
|
|
|
—
|
|
|
—
|
|
|||
|
7,161,746
|
|
|
7,284,914
|
|
|
6,605,635
|
|
|||
Operating Income
|
798,148
|
|
|
403,110
|
|
|
931,628
|
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest income
|
13,898
|
|
|
21,331
|
|
|
25,318
|
|
|||
Interest expense, net of interest capitalized
|
(332,422
|
)
|
|
(355,785
|
)
|
|
(382,416
|
)
|
|||
Extinguishment of unsecured senior notes
|
(4,206
|
)
|
|
(7,501
|
)
|
|
—
|
|
|||
Other (expense) income (including $28.5 million net deferred tax expense related to impairments in 2012)
|
(1,726
|
)
|
|
(42,868
|
)
|
|
32,891
|
|
|||
|
(324,456
|
)
|
|
(384,823
|
)
|
|
(324,207
|
)
|
|||
Net Income
|
$
|
473,692
|
|
|
$
|
18,287
|
|
|
$
|
607,421
|
|
Basic Earnings per Share:
|
|
|
|
|
|
||||||
Net income
|
$
|
2.16
|
|
|
$
|
0.08
|
|
|
$
|
2.80
|
|
Diluted Earnings per Share:
|
|
|
|
|
|
||||||
Net income
|
$
|
2.14
|
|
|
$
|
0.08
|
|
|
$
|
2.77
|
|
Comprehensive Income (Loss)
|
|
|
|
|
|
||||||
Net Income
|
$
|
473,692
|
|
|
$
|
18,287
|
|
|
$
|
607,421
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
1,529
|
|
|
(2,764
|
)
|
|
(18,200
|
)
|
|||
Change in defined benefit plans
|
10,829
|
|
|
(4,567
|
)
|
|
(6,698
|
)
|
|||
Change related to cash flow derivative hedges
|
127,829
|
|
|
(51,247
|
)
|
|
(76,106
|
)
|
|||
Total other comprehensive income (loss)
|
140,187
|
|
|
(58,578
|
)
|
|
(101,004
|
)
|
|||
Comprehensive Income (Loss)
|
$
|
613,879
|
|
|
$
|
(40,291
|
)
|
|
$
|
506,417
|
|
|
As of December 31,
|
||||||
|
2013
|
|
2012
|
||||
|
(in thousands, except share data)
|
||||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
204,687
|
|
|
$
|
194,855
|
|
Trade and other receivables, net
|
259,746
|
|
|
281,421
|
|
||
Inventories
|
151,244
|
|
|
146,295
|
|
||
Prepaid expenses and other assets
|
252,852
|
|
|
207,662
|
|
||
Derivative financial instruments
|
87,845
|
|
|
57,827
|
|
||
Total current assets
|
956,374
|
|
|
888,060
|
|
||
Property and equipment, net
|
17,517,752
|
|
|
17,451,034
|
|
||
Goodwill
|
439,231
|
|
|
432,975
|
|
||
Other assets
|
1,159,590
|
|
|
1,055,861
|
|
||
|
$
|
20,072,947
|
|
|
$
|
19,827,930
|
|
Liabilities and Shareholders' Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current portion of long-term debt
|
$
|
1,563,378
|
|
|
$
|
1,519,483
|
|
Accounts payable
|
372,226
|
|
|
351,587
|
|
||
Accrued interest
|
103,025
|
|
|
106,366
|
|
||
Accrued expenses and other liabilities
|
563,702
|
|
|
541,722
|
|
||
Customer deposits
|
1,664,679
|
|
|
1,546,993
|
|
||
Total current liabilities
|
4,267,010
|
|
|
4,066,151
|
|
||
Long-term debt
|
6,511,426
|
|
|
6,970,464
|
|
||
Other long-term liabilities
|
486,246
|
|
|
482,566
|
|
||
Commitments and contingencies (Note 15)
|
|
|
|
||||
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; 230,782,315 and 229,080,109 shares issued, December 31, 2013 and December 31, 2012, respectively)
|
2,308
|
|
|
2,291
|
|
||
Paid-in capital
|
3,159,038
|
|
|
3,109,887
|
|
||
Retained earnings
|
6,054,952
|
|
|
5,744,791
|
|
||
Accumulated other comprehensive income (loss)
|
5,671
|
|
|
(134,516
|
)
|
||
Treasury stock (10,308,683 common shares at cost, December 31, 2013 and December 31, 2012)
|
(413,704
|
)
|
|
(413,704
|
)
|
||
Total shareholders' equity
|
8,808,265
|
|
|
8,308,749
|
|
||
|
$
|
20,072,947
|
|
|
$
|
19,827,930
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands)
|
||||||||||
Operating Activities
|
|
|
|
|
|
||||||
Net income
|
$
|
473,692
|
|
|
$
|
18,287
|
|
|
$
|
607,421
|
|
Adjustments:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
754,711
|
|
|
730,493
|
|
|
702,426
|
|
|||
Impairment of Pullmantur related assets
|
—
|
|
|
385,444
|
|
|
—
|
|
|||
Restructuring related impairments
|
33,514
|
|
|
—
|
|
|
—
|
|
|||
Net deferred tax expense related to Pullmantur impairment
|
—
|
|
|
28,488
|
|
|
—
|
|
|||
Loss (gain) on derivative instruments not designated as hedges
|
19,287
|
|
|
(2,014
|
)
|
|
(18,920
|
)
|
|||
Loss on extinguishment of unsecured senior notes
|
4,206
|
|
|
7,501
|
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Decrease in trade and other receivables, net
|
95,401
|
|
|
8,026
|
|
|
87,872
|
|
|||
Increase in inventories
|
(4,321
|
)
|
|
(1,645
|
)
|
|
(18,423
|
)
|
|||
Increase in prepaid expenses and other assets
|
(22,657
|
)
|
|
(1,614
|
)
|
|
(17,052
|
)
|
|||
Increase in accounts payable
|
18,957
|
|
|
36,602
|
|
|
56,755
|
|
|||
Decrease in accrued interest
|
(3,341
|
)
|
|
(15,786
|
)
|
|
(28,553
|
)
|
|||
(Decrease) increase in accrued expenses and other liabilities
|
(6,714
|
)
|
|
33,060
|
|
|
25,318
|
|
|||
Increase in customer deposits
|
37,077
|
|
|
103,733
|
|
|
19,482
|
|
|||
Cash received on settlement of derivative financial instruments
|
—
|
|
|
69,684
|
|
|
12,200
|
|
|||
Dividends received from unconsolidated affiliates
|
5,093
|
|
|
—
|
|
|
21,147
|
|
|||
Other, net
|
7,163
|
|
|
(18,525
|
)
|
|
6,066
|
|
|||
Net cash provided by operating activities
|
1,412,068
|
|
|
1,381,734
|
|
|
1,455,739
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Purchases of property and equipment
|
(763,777
|
)
|
|
(1,291,499
|
)
|
|
(1,173,626
|
)
|
|||
Cash (paid) received on settlement of derivative financial instruments
|
(17,338
|
)
|
|
(10,886
|
)
|
|
16,307
|
|
|||
Investments in unconsolidated affiliates
|
(70,626
|
)
|
|
—
|
|
|
(110,660
|
)
|
|||
Cash payments received on loan to unconsolidated affiliate
|
23,372
|
|
|
23,512
|
|
|
—
|
|
|||
Proceeds from sale of ships
|
—
|
|
|
9,811
|
|
|
345,000
|
|
|||
Other, net
|
3,831
|
|
|
5,739
|
|
|
(1,586
|
)
|
|||
Net cash used in investing activities
|
(824,538
|
)
|
|
(1,263,323
|
)
|
|
(924,565
|
)
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Debt proceeds
|
2,449,464
|
|
|
2,558,474
|
|
|
1,578,368
|
|
|||
Debt issuance costs
|
(57,622
|
)
|
|
(75,839
|
)
|
|
(84,381
|
)
|
|||
Repayments of debt
|
(2,856,481
|
)
|
|
(2,561,290
|
)
|
|
(2,179,046
|
)
|
|||
Dividends paid
|
(143,629
|
)
|
|
(117,707
|
)
|
|
(21,707
|
)
|
|||
Proceeds from exercise of common stock options
|
30,125
|
|
|
15,146
|
|
|
19,463
|
|
|||
Other, net
|
1,517
|
|
|
1,599
|
|
|
10,788
|
|
|||
Net cash used in financing activities
|
(576,626
|
)
|
|
(179,617
|
)
|
|
(676,515
|
)
|
|||
Effect of exchange rate changes on cash
|
(1,072
|
)
|
|
(6,125
|
)
|
|
(12,402
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
9,832
|
|
|
(67,331
|
)
|
|
(157,743
|
)
|
|||
Cash and cash equivalents at beginning of year
|
194,855
|
|
|
262,186
|
|
|
419,929
|
|
|||
Cash and cash equivalents at end of year
|
$
|
204,687
|
|
|
$
|
194,855
|
|
|
$
|
262,186
|
|
Supplemental Disclosures
|
|
|
|
|
|
||||||
Cash paid during the year for:
|
|
|
|
|
|
||||||
Interest, net of amount capitalized
|
$
|
319,476
|
|
|
$
|
341,047
|
|
|
$
|
360,892
|
|
|
|
|
|
|
|
||||||
Non cash Investing Activities
|
|
|
|
|
|
||||||
Purchase of property and equipment through asset trade-in
|
$
|
46,375
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Common Stock
|
|
Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Total Shareholders' Equity
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Balances at January 1, 2011
|
$
|
2,262
|
|
|
$
|
3,027,130
|
|
|
$
|
5,259,998
|
|
|
$
|
25,066
|
|
|
$
|
(413,704
|
)
|
|
$
|
7,900,752
|
|
Issuance under employee related plans
|
14
|
|
|
44,629
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,643
|
|
||||||
Common Stock dividends
|
—
|
|
|
—
|
|
|
(43,435
|
)
|
|
—
|
|
|
—
|
|
|
(43,435
|
)
|
||||||
Dividends declared by Pullmantur Air, S.A.
(1)
|
—
|
|
|
—
|
|
|
(554
|
)
|
|
—
|
|
|
—
|
|
|
(554
|
)
|
||||||
Changes related to cash flow derivative hedges
|
—
|
|
|
—
|
|
|
—
|
|
|
(76,106
|
)
|
|
—
|
|
|
(76,106
|
)
|
||||||
Change in defined benefit plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,698
|
)
|
|
—
|
|
|
(6,698
|
)
|
||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,200
|
)
|
|
—
|
|
|
(18,200
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
607,421
|
|
|
—
|
|
|
—
|
|
|
607,421
|
|
||||||
Balances at December 31, 2011
|
2,276
|
|
|
3,071,759
|
|
|
5,823,430
|
|
|
(75,938
|
)
|
|
(413,704
|
)
|
|
8,407,823
|
|
||||||
Issuance under employee related plans
|
15
|
|
|
38,128
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,143
|
|
||||||
Common Stock dividends
|
—
|
|
|
—
|
|
|
(95,979
|
)
|
|
—
|
|
|
—
|
|
|
(95,979
|
)
|
||||||
Dividends declared by Pullmantur Air, S.A.
(1)
|
—
|
|
|
—
|
|
|
(947
|
)
|
|
—
|
|
|
—
|
|
|
(947
|
)
|
||||||
Changes related to cash flow derivative hedges
|
—
|
|
|
—
|
|
|
—
|
|
|
(51,247
|
)
|
|
—
|
|
|
(51,247
|
)
|
||||||
Change in defined benefit plans
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,567
|
)
|
|
—
|
|
|
(4,567
|
)
|
||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,764
|
)
|
|
—
|
|
|
(2,764
|
)
|
||||||
Net income
|
—
|
|
|
—
|
|
|
18,287
|
|
|
—
|
|
|
—
|
|
|
18,287
|
|
||||||
Balances at December 31, 2012
|
2,291
|
|
|
3,109,887
|
|
|
5,744,791
|
|
|
(134,516
|
)
|
|
(413,704
|
)
|
|
8,308,749
|
|
||||||
Issuance under employee related plans
|
17
|
|
|
49,151
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49,168
|
|
||||||
Common Stock dividends
|
—
|
|
|
—
|
|
|
(162,727
|
)
|
|
—
|
|
|
—
|
|
|
(162,727
|
)
|
||||||
Dividends declared by Pullmantur Air, S.A.
(1)
|
—
|
|
|
—
|
|
|
(804
|
)
|
|
—
|
|
|
—
|
|
|
(804
|
)
|
||||||
Changes related to cash flow derivative hedges
|
—
|
|
|
—
|
|
|
—
|
|
|
127,829
|
|
|
—
|
|
|
127,829
|
|
||||||
Change in defined benefit plans
|
—
|
|
|
—
|
|
|
—
|
|
|
10,829
|
|
|
—
|
|
|
10,829
|
|
||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
1,529
|
|
|
—
|
|
|
1,529
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
473,692
|
|
|
—
|
|
|
—
|
|
|
473,692
|
|
||||||
Balances at December 31, 2013
|
$
|
2,308
|
|
|
$
|
3,159,038
|
|
|
$
|
6,054,952
|
|
|
$
|
5,671
|
|
|
$
|
(413,704
|
)
|
|
$
|
8,808,265
|
|
(1)
|
Dividends declared by Pullmantur Air, S.A. to its non-controlling shareholder. See Note 6.
Other Assets
for further information regarding Pullmantur Air, S.A.'s ownership structure.
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Accumulated net (loss) gain on cash flow derivative hedges at beginning of year
|
$
|
(84,505
|
)
|
|
$
|
(33,258
|
)
|
|
$
|
42,848
|
|
Net gain on cash flow derivative hedges
|
197,428
|
|
|
58,138
|
|
|
70,480
|
|
|||
Net gain reclassified into earnings
|
(69,599
|
)
|
|
(109,385
|
)
|
|
(146,586
|
)
|
|||
Accumulated net gain (loss) on cash flow derivative hedges at end of year
|
$
|
43,324
|
|
|
$
|
(84,505
|
)
|
|
$
|
(33,258
|
)
|
|
Years
|
Ships
|
generally 30
|
Ship improvements
|
3-20
|
Buildings and improvements
|
10-40
|
Computer hardware and software
|
3-5
|
Transportation equipment and other
|
3-30
|
Leasehold improvements
|
Shorter of remaining lease term or useful life 3-30
|
|
2013
|
|
2012
|
|
2011
|
Passenger ticket revenues:
|
|
|
|
|
|
United States
|
52%
|
|
51%
|
|
51%
|
All other countries
|
48%
|
|
49%
|
|
49%
|
|
Royal
Caribbean International |
|
Pullmantur
|
|
Total
|
||||||
Balance at December 31, 2011
|
$
|
287,408
|
|
|
$
|
459,129
|
|
|
$
|
746,537
|
|
Impairment charge
|
—
|
|
|
(319,214
|
)
|
|
(319,214
|
)
|
|||
Foreign currency translation adjustment
|
28
|
|
|
5,624
|
|
|
5,652
|
|
|||
Balance at December 31, 2012
|
$
|
287,436
|
|
|
$
|
145,539
|
|
|
$
|
432,975
|
|
Foreign currency translation adjustment
|
(312
|
)
|
|
6,568
|
|
|
6,256
|
|
|||
Balance at December 31, 2013
|
$
|
287,124
|
|
|
$
|
152,107
|
|
|
$
|
439,231
|
|
|
2013
|
|
2012
|
||||
Indefinite-life intangible asset—Pullmantur trademarks and trade names
|
$
|
204,866
|
|
|
$
|
218,883
|
|
Impairment charge
|
—
|
|
|
(17,356
|
)
|
||
Foreign currency translation adjustment
|
9,246
|
|
|
3,339
|
|
||
Total
|
$
|
214,112
|
|
|
$
|
204,866
|
|
|
2013
|
|
2012
|
||||
Ships
|
$
|
20,858,553
|
|
|
$
|
20,855,606
|
|
Ship improvements
|
1,683,644
|
|
|
1,341,137
|
|
||
Ships under construction
|
563,676
|
|
|
169,274
|
|
||
Land, buildings and improvements, including leasehold improvements and port facilities
|
394,120
|
|
|
377,821
|
|
||
Computer hardware and software, transportation equipment and other
|
771,304
|
|
|
698,865
|
|
||
Total property and equipment
|
24,271,297
|
|
|
23,442,703
|
|
||
Less—accumulated depreciation and amortization
|
(6,753,545
|
)
|
|
(5,991,669
|
)
|
||
|
$
|
17,517,752
|
|
|
$
|
17,451,034
|
|
|
2013
|
|
2012
|
||||
$1.1 billion unsecured revolving credit facility, LIBOR plus 1.75%, currently 1.91% and a facility fee of 0.3675%, due 2016
|
$
|
435,000
|
|
|
$
|
48,000
|
|
$850 million unsecured revolving credit facility, LIBOR plus 1.75%, currently 1.92% and a facility fee of 0.3675%, due 2018
|
295,000
|
|
|
12,000
|
|
||
Unsecured senior notes and senior debentures, 5.25% to 11.88%, due 2015, 2016, 2018, 2022 and 2027
|
1,703,040
|
|
|
2,698,531
|
|
||
€745 million unsecured senior notes, 5.63%, due 2014
|
1,028,126
|
|
|
1,004,940
|
|
||
$570 million unsecured term loan, 4.02%, due through 2013
|
—
|
|
|
40,714
|
|
||
$589 million unsecured term loan, 4.47%, due through 2014
|
42,071
|
|
|
126,214
|
|
||
$530 million unsecured term loan, LIBOR plus 0.51%, currently 0.87%, due through 2015
|
113,571
|
|
|
189,286
|
|
||
$519 million unsecured term loan, LIBOR plus 0.45%, currently 0.81%, due through 2020
|
302,835
|
|
|
346,097
|
|
||
$420 million unsecured term loan, 5.41%, due through 2021
(1)
|
274,974
|
|
|
318,230
|
|
||
$420 million unsecured term loan, LIBOR plus 2.10%, currently 2.46%, due through 2021
(1)
|
280,000
|
|
|
315,000
|
|
||
€159.4 million unsecured term loan, EURIBOR plus 1.58%, currently 1.92%, due through 2021
(1)
|
146,452
|
|
|
157,643
|
|
||
$524.5 million unsecured term loan, LIBOR plus 0.50%, currently 0.90%, due through 2021
|
349,667
|
|
|
393,375
|
|
||
$566.1 million unsecured term loan, LIBOR plus 0.37%, currently 0.74%, due through 2022
|
400,966
|
|
|
448,138
|
|
||
$1.1 billion unsecured term loan, LIBOR plus 2.10%, currently 2.46%, due through 2022
(2)
|
690,978
|
|
|
767,754
|
|
||
$632.0 million unsecured term loan, LIBOR plus 0.40%, currently 0.80%, due through 2023
|
526,632
|
|
|
579,295
|
|
||
$673.5 million unsecured term loan, LIBOR plus 0.40%, currently 0.77%, due through 2024
|
617,351
|
|
|
673,474
|
|
||
$290.0 million unsecured term loan, LIBOR plus 2.5%, currently 2.67%, due 2016
|
290,000
|
|
|
290,000
|
|
||
€365 million unsecured term loan, EURIBOR plus 3.0%, currently 3.23%, due 2017
|
502,934
|
|
|
—
|
|
||
$7.3 million unsecured term loan, LIBOR plus 2.5%, currently 2.93%, due through 2023
|
5,391
|
|
|
5,867
|
|
||
$30.3 million unsecured term loan, LIBOR plus 3.75%, currently 3.99%, due through 2021
|
15,073
|
|
|
22,458
|
|
||
Capital lease obligations
|
54,743
|
|
|
52,931
|
|
||
|
8,074,804
|
|
|
8,489,947
|
|
||
Less-current portion
|
(1,563,378
|
)
|
|
(1,519,483
|
)
|
||
Long-term portion
|
$
|
6,511,426
|
|
|
$
|
6,970,464
|
|
(1)
|
Corresponds to
Oasis of the Seas
unsecured term loan. With respect to
60%
of the financing, the lenders have the ability to exit the facility in October 2015.
|
(2)
|
Corresponds to
Allure of the Seas
unsecured term loan. With respect to
100%
of the financing, the lenders have the ability to exit the facility in October 2017.
|
Year
|
|
||
2014
|
$
|
1,563,378
|
|
2015
|
1,051,912
|
|
|
2016
|
1,474,827
|
|
|
2017
|
1,247,158
|
|
|
2018
|
728,276
|
|
|
Thereafter
|
2,009,253
|
|
|
|
$
|
8,074,804
|
|
|
Employee Stock-Based Compensation
|
||||||||||
Classification of expense
|
2013
|
|
2012
|
|
2011
|
||||||
In thousands
|
|
|
|
|
|
||||||
Marketing, selling and administrative expenses
|
$
|
21,178
|
|
|
$
|
24,153
|
|
|
$
|
23,803
|
|
Total compensation expense
|
$
|
21,178
|
|
|
$
|
24,153
|
|
|
$
|
23,803
|
|
|
2012
|
|
2011
|
Dividend yield
|
1.5%
|
|
—
|
Expected stock price volatility
|
46.0%
|
|
46.0%
|
Risk-free interest rate
|
1.1%
|
|
2.6%
|
Expected option life
|
6 years
|
|
6 years
|
Stock Option Activity
|
Number of
Options |
|
Weighted-
Average Exercise Price |
|
Weighted-
Average Remaining Contractual Term |
|
Aggregate
Intrinsic Value (1) |
|||||
|
|
|
|
|
(years)
|
|
(in thousands)
|
|||||
Outstanding at January 1, 2013
|
4,448,773
|
|
|
$
|
33.56
|
|
|
4.55
|
|
$
|
25,522
|
|
Granted
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
Exercised
|
(1,206,860
|
)
|
|
$
|
25.42
|
|
|
|
|
|
|
|
Canceled
|
(547,041
|
)
|
|
$
|
37.37
|
|
|
|
|
|
|
|
Outstanding at December 31, 2013
|
2,694,872
|
|
|
$
|
36.30
|
|
|
3.83
|
|
$
|
30,080
|
|
Vested and expected to vest at December 31, 2013
|
2,678,160
|
|
|
$
|
36.27
|
|
|
3.81
|
|
$
|
29,978
|
|
Options Exercisable at December 31, 2013
|
2,344,123
|
|
|
$
|
36.42
|
|
|
3.41
|
|
$
|
25,914
|
|
(1)
|
The intrinsic value represents the amount by which the fair value of stock exceeds the option exercise price as of
December 31, 2013
.
|
Restricted Stock Activity
|
Number of
Awards |
|
Weighted-
Average Grant Date Fair Value |
|||
Non-vested share units at January 1, 2013
|
1,196,440
|
|
|
$
|
14.02
|
|
Granted
|
489,840
|
|
|
$
|
36.07
|
|
Vested
|
(535,009
|
)
|
|
$
|
35.93
|
|
Canceled
|
(162,266
|
)
|
|
$
|
37.38
|
|
Non-vested share units expected to vest as of December 31, 2013
|
989,005
|
|
|
$
|
9.26
|
|
Performance Stock Activity
|
Number of
Awards |
|
Weighted-
Average Grant Date Fair Value |
|||
Non-vested share units at January 1, 2013
|
288,493
|
|
|
$
|
30.78
|
|
Granted
|
242,352
|
|
|
$
|
35.98
|
|
Vested
|
(3,021
|
)
|
|
$
|
41.79
|
|
Canceled
|
(67,895
|
)
|
|
$
|
38.13
|
|
Non-vested share units expected to vest as of December 31, 2013
|
459,929
|
|
|
$
|
32.36
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Net income for basic and diluted earnings per share
|
$
|
473,692
|
|
|
$
|
18,287
|
|
|
$
|
607,421
|
|
Weighted-average common shares outstanding
|
219,638
|
|
|
217,930
|
|
|
216,983
|
|
|||
Dilutive effect of stock options, performance share awards and restricted stock awards
|
1,303
|
|
|
1,527
|
|
|
2,246
|
|
|||
Diluted weighted-average shares outstanding
|
220,941
|
|
|
219,457
|
|
|
219,229
|
|
|||
Basic earnings per share:
|
|
|
|
|
|
||||||
Net income
|
$
|
2.16
|
|
|
$
|
0.08
|
|
|
$
|
2.80
|
|
Diluted earnings per share:
|
|
|
|
|
|
||||||
Net income
|
$
|
2.14
|
|
|
$
|
0.08
|
|
|
$
|
2.77
|
|
|
|
Changes related to cash flow derivative hedges
|
|
Changes in defined
benefit plans |
|
Foreign currency translation adjustments
|
|
Accumulated other comprehensive (loss) income
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Accumulated comprehensive loss at January 1, 2012
|
|
$
|
(33,258
|
)
|
|
$
|
(30,256
|
)
|
|
$
|
(12,424
|
)
|
|
$
|
(75,938
|
)
|
Other comprehensive income before reclassifications
|
|
58,138
|
|
|
(6,797
|
)
|
|
(2,764
|
)
|
|
48,577
|
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
|
(109,385
|
)
|
|
2,230
|
|
|
—
|
|
|
(107,155
|
)
|
||||
Net current-period other comprehensive income
|
|
(51,247
|
)
|
|
(4,567
|
)
|
|
(2,764
|
)
|
|
(58,578
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Accumulated comprehensive loss at January 1, 2013
|
|
(84,505
|
)
|
|
(34,823
|
)
|
|
(15,188
|
)
|
|
(134,516
|
)
|
||||
Other comprehensive income before reclassifications
|
|
197,428
|
|
|
8,240
|
|
|
1,529
|
|
|
207,197
|
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
|
(69,599
|
)
|
|
2,589
|
|
|
—
|
|
|
(67,010
|
)
|
||||
Net current-period other comprehensive income
|
|
127,829
|
|
|
10,829
|
|
|
1,529
|
|
|
140,187
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Accumulated comprehensive income (loss) at December 31, 2013
|
|
$
|
43,324
|
|
|
$
|
(23,994
|
)
|
|
$
|
(13,659
|
)
|
|
$
|
5,671
|
|
|
|
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
|
||||||||
|
|
|
|
|
|
|
||||
Details about Accumulated Other Comprehensive Income (Loss) Components
|
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
|
Affected Line Item in Statements of Comprehensive Income (Loss)
|
||||
Gain (loss) on cash flow derivative hedges:
|
|
|
|
|
|
|
||||
Cross currency swaps
|
|
$
|
—
|
|
|
$
|
2,505
|
|
|
Other (expense) income
|
Cross currency swaps
|
|
(3,531
|
)
|
|
(2,209
|
)
|
|
Interest expense, net of interest capitalized
|
||
Foreign currency forward contracts
|
|
(1,797
|
)
|
|
(953
|
)
|
|
Depreciation and amortization expenses
|
||
Foreign currency forward contracts
|
|
27,423
|
|
|
(953
|
)
|
|
Other (expense) income
|
||
Foreign currency forward contracts
|
|
(440
|
)
|
|
—
|
|
|
Interest expense, net of interest capitalized
|
||
Fuel swaps
|
|
47,944
|
|
|
110,995
|
|
|
Fuel
|
||
|
|
69,599
|
|
|
109,385
|
|
|
|
||
Amortization of defined benefit plans:
|
|
|
|
|
|
|
||||
Actuarial loss
|
|
(1,753
|
)
|
|
(1,394
|
)
|
|
Payroll and related
|
||
Prior service costs |
|
(836
|
)
|
|
(836
|
)
|
|
Payroll and related |
||
|
|
(2,589
|
)
|
|
(2,230
|
)
|
|
|
||
|
|
|
|
|
|
|
||||
Total reclassifications for the period
|
|
$
|
67,010
|
|
|
$
|
107,155
|
|
|
|
|
|
|
Fair Value Measurements at December 31, 2013 Using
|
|
|
|
Fair Value Measurements at December 31, 2012 Using
|
||||||||||||||||||||||||||||||||
Description
|
Total Carrying Amount
|
|
Total Fair Value
|
|
Level 1
(1)
|
|
Level 2
(2)
|
|
Level 3
(3)
|
|
Total Carrying Amount
|
|
Total Fair Value
|
|
Level 1
(1)
|
|
Level 2
(2)
|
|
Level 3
(3)
|
||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Cash and cash equivalents
(4)
|
$
|
204,687
|
|
|
$
|
204,687
|
|
|
$
|
204,367
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
194,855
|
|
|
$
|
194,855
|
|
|
$
|
194,855
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Assets
|
$
|
204,687
|
|
|
$
|
204,687
|
|
|
$
|
204,367
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
194,855
|
|
|
$
|
194,855
|
|
|
$
|
194,855
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Long-term debt (including current portion of long-term debt)
(5)
|
$
|
8,074,804
|
|
|
$
|
8,431,220
|
|
|
$
|
2,888,255
|
|
|
$
|
5,542,965
|
|
|
$
|
—
|
|
|
$
|
8,489,947
|
|
|
$
|
8,859,310
|
|
|
$
|
3,917,398
|
|
|
$
|
4,941,912
|
|
|
$
|
—
|
|
Total Liabilities
|
$
|
8,074,804
|
|
|
$
|
8,431,220
|
|
|
$
|
2,888,255
|
|
|
$
|
5,542,965
|
|
|
$
|
—
|
|
|
$
|
8,489,947
|
|
|
$
|
8,859,310
|
|
|
$
|
3,917,398
|
|
|
$
|
4,941,912
|
|
|
$
|
—
|
|
(1)
|
Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.
|
(2)
|
Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account our creditworthiness based on publicly available credit default swap rates.
|
(3)
|
Inputs that are unobservable. The Company did not use any Level 3 inputs as of
December 31, 2013
and
December 31, 2012
.
|
(4)
|
Consists of cash and marketable securities with original maturities of less than 90 days.
|
(5)
|
Consists of unsecured revolving credit facilities, unsecured senior notes, senior debentures and unsecured term loans. Does not include our capital lease obligations.
|
|
Fair Value Measurements at December 31, 2013 Using
|
|
Fair Value Measurements at December 31, 2012 Using
|
||||||||||||||||||||||||||||
Description
|
Total Fair Value
|
|
Level 1
(1)
|
|
Level 2
(2)
|
|
Level 3
(3)
|
|
Total Fair Value
|
|
Level 1
(1)
|
|
Level 2
(2)
|
|
Level 3
(3)
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative financial instruments
(4)
|
$
|
188,576
|
|
|
—
|
|
|
188,576
|
|
|
—
|
|
|
$
|
96,489
|
|
|
—
|
|
|
96,489
|
|
|
—
|
|
||||||
Investments
(5)
|
$
|
6,044
|
|
|
6,044
|
|
|
—
|
|
|
—
|
|
|
$
|
6,231
|
|
|
6,231
|
|
|
—
|
|
|
—
|
|
||||||
Total Assets
|
$
|
194,620
|
|
|
$
|
6,044
|
|
|
$
|
188,576
|
|
|
$
|
—
|
|
|
$
|
102,720
|
|
|
$
|
6,231
|
|
|
$
|
96,489
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative financial instruments
(6)
|
$
|
100,260
|
|
|
—
|
|
|
100,260
|
|
|
—
|
|
|
$
|
85,119
|
|
|
—
|
|
|
85,119
|
|
|
—
|
|
||||||
Total Liabilities
|
$
|
100,260
|
|
|
$
|
—
|
|
|
$
|
100,260
|
|
|
$
|
—
|
|
|
$
|
85,119
|
|
|
$
|
—
|
|
|
$
|
85,119
|
|
|
$
|
—
|
|
(1)
|
Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.
|
(2)
|
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps, cross currency swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. For fuel call options, fair value is determined by using the prevailing market price for the instruments consisting of published price quotes for similar assets based on recent transactions in an active market. Fair value for foreign currency collar options is determined by using standard option pricing models with inputs based on the options' contract terms, such as exercise price and maturity, and readily available public market data, such as foreign exchange curves, foreign exchange volatility levels and discount rates. All derivative instrument fair values take into account the creditworthiness of the counterparty and the Company.
|
(3)
|
Inputs that are unobservable. The Company did not use any Level 3 inputs as of
December 31, 2013
and
December 31, 2012
.
|
(4)
|
Consists of foreign currency forward contracts, foreign currency collar options, interest rate swaps, fuel swaps and purchased fuel call options. Please refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.
|
(5)
|
Consists of exchange-traded equity securities and mutual funds.
|
(6)
|
Consists of interest rate swaps, fuel swaps, foreign currency forward contracts, foreign currency collar options and sold fuel call options. Please refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.
|
|
|
|
Fair Value Measurements at December 31, 2013 Using
|
|
|
|
Fair Value Measurements at December 31, 2012 Using
|
||||||||||||||||||||||
Description
|
Total Carrying Amount
|
|
Total Fair Value
|
|
Level 3
|
|
Total Impairment
|
|
Total Carrying Amount
|
|
Total Fair Value
|
|
Level 3
|
|
Total Impairment
|
||||||||||||||
Pullmantur Goodwill
(1)
|
$
|
152,107
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
145,539
|
|
|
$
|
145,539
|
|
|
145,539
|
|
|
$
|
319,214
|
|
Indefinite-life intangible asset-Pullmantur trademarks and trade names
(2)
|
$
|
214,112
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
204,866
|
|
|
$
|
204,866
|
|
|
204,866
|
|
|
$
|
17,356
|
|
Long-lived assets-Pullmantur aircraft
(3)
|
$
|
49,507
|
|
|
$
|
49,507
|
|
|
49,507
|
|
|
$
|
13,529
|
|
|
$
|
62,288
|
|
|
$
|
62,288
|
|
|
62,288
|
|
|
$
|
48,874
|
|
Assets held for sale
(4)
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
19,985
|
|
|
$
|
19,168
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
(1)
|
For 2012, we estimated the fair value of the Pullmantur reporting unit using a probability-weighted discounted cash flow model. The principal assumptions used in the discounted cash flow model are projected operating results, weighted-average cost of capital, and terminal value. Significantly impacting these assumptions were the anticipated future transfer of vessels from our other cruise brands to Pullmantur. The discounted cash flow model used our 2013 projected operating results as a base. To that base we added future years' cash flows through 2017 assuming multiple revenue and expense scenarios that reflect the impact of different global economic environments for this period on Pullmantur's reporting unit. We assigned a probability to each revenue and expense scenario. We discounted the projected cash flows using rates specific to Pullmantur's reporting unit based on its weighted-average cost of capital, which was determined to be
10%
.
|
(2)
|
For 2012, we estimated the fair value of our indefinite-life intangible asset using a discounted cash flow model and the relief-from-royalty method. We used a royalty rate of
3%
based on comparable royalty agreements in the tourism and hospitality industry. These trademarks and trade names relate to Pullmantur and we have used a discount rate of
11%
, comparable to the rate used in valuing the Pullmantur reporting unit.
|
(3)
|
We estimated the fair value of our long-lived assets using an undiscounted cash flow model. A significant assumption in performing the undiscounted cash flow test was the number of years during which we expect to use these aircraft. Additionally, as of December 31, 2013, the expected operating use of the aircraft has modified the expected cash flows.
|
(4)
|
For 2013, we estimated the fair value of assets held for sale related to the sale of Pullmantur's non-core businesses. This resulted in an impairment of
$20.0 million
mostly consisting of
$18.2 million
for property and equipment. See Note 16.
Restructuring and Related Impairment Charges
for further discussion.
|
|
Fuel Swap Agreements
|
||||
|
As of December 31, 2013
|
|
As of December 31, 2012
|
||
|
(metric tons)
|
||||
2013
|
—
|
|
|
755,000
|
|
2014
|
762,000
|
|
|
635,000
|
|
2015
|
665,000
|
|
|
363,000
|
|
2016
|
372,000
|
|
|
104,000
|
|
2017
|
74,000
|
|
|
—
|
|
|
Fuel Swap Agreements
|
||||
|
As of December 31, 2013
|
|
As of December 31, 2012
|
||
|
(% hedged)
|
||||
Projected fuel purchases for year:
|
|
|
|
||
2013
|
—
|
|
|
55
|
%
|
2014
|
57
|
%
|
|
45
|
%
|
2015
|
45
|
%
|
|
25
|
%
|
2016
|
25
|
%
|
|
7
|
%
|
2017
|
5
|
%
|
|
—
|
|
|
Fair Value of Derivative Instruments
|
||||||||||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||||||
|
Balance Sheet
Location |
|
As of December 31, 2013
|
|
As of December 31, 2012
|
|
Balance Sheet
Location |
|
As of December 31, 2013
|
|
As of December 31, 2012
|
||||||||
|
|
Fair Value
|
|
Fair Value
|
|
|
Fair Value
|
|
Fair Value
|
||||||||||
In thousands
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives designated as hedging instruments under ASC 815-20
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
Other assets
|
|
$
|
56,571
|
|
|
$
|
5,099
|
|
|
Other long-term liabilities
|
|
$
|
66,920
|
|
|
$
|
55,471
|
|
Foreign currency forward contracts
|
Derivative financial instruments
|
|
61,596
|
|
|
951
|
|
|
Accrued expenses and other liabilities
|
|
—
|
|
|
338
|
|
||||
Foreign currency forward contracts
|
Other assets
|
|
13,783
|
|
|
11,564
|
|
|
Other long-term liabilities
|
|
—
|
|
|
1,000
|
|
||||
Foreign currency collar options
|
Other assets
|
|
22,172
|
|
|
8,974
|
|
|
Other long-term liabilities
|
|
—
|
|
|
—
|
|
||||
Fuel swaps
|
Derivative financial instruments
|
|
10,902
|
|
|
48,624
|
|
|
Accrued expenses and other liabilities
|
|
1,657
|
|
|
1,761
|
|
||||
Fuel swaps
|
Other assets
|
|
8,205
|
|
|
8,585
|
|
|
Other long-term liabilities
|
|
9,052
|
|
|
6,369
|
|
||||
Total derivatives designated as hedging instruments under ASC 815-20
|
|
|
$
|
173,229
|
|
|
$
|
83,797
|
|
|
|
|
$
|
77,629
|
|
|
$
|
64,939
|
|
Derivatives not designated as hedging instruments under ASC 815-20
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forward contracts
|
Derivative Financial Instruments
|
|
$
|
15,347
|
|
|
$
|
—
|
|
|
Accrued expenses and other liabilities
|
|
$
|
22,631
|
|
|
$
|
—
|
|
Foreign currency forward contracts
|
Other assets
|
|
—
|
|
|
4,440
|
|
|
Other long-term liabilities
|
|
—
|
|
|
11,475
|
|
||||
Fuel swaps
|
Derivative financial instruments
|
|
—
|
|
|
—
|
|
|
Accrued expenses and other liabilities
|
|
—
|
|
|
475
|
|
||||
Fuel call options
|
Derivative financial instruments
|
|
—
|
|
|
8,252
|
|
|
Accrued expenses and other liabilities
|
|
—
|
|
|
8,230
|
|
||||
Total derivatives not designated as hedging instruments under ASC 815-20
|
|
|
15,347
|
|
|
12,692
|
|
|
|
|
22,631
|
|
|
20,180
|
|
||||
Total derivatives
|
|
|
$
|
188,576
|
|
|
$
|
96,489
|
|
|
|
|
$
|
100,260
|
|
|
$
|
85,119
|
|
(1)
|
Accounting Standard Codification 815-20 "
Derivatives and Hedging".
|
|
|
|
|
Carrying Value
|
||||||
Non-derivative instrument designated as
hedging instrument under ASC 815-20 |
|
Balance Sheet Location
|
|
As of December 31, 2013
|
|
As of December 31, 2012
|
||||
In thousands
|
|
|
|
|
|
|
||||
Foreign currency debt
|
|
Current portion of long-term debt
|
|
$
|
477,442
|
|
|
$
|
17,516
|
|
Foreign currency debt
|
|
Long-term debt
|
|
273,354
|
|
|
617,593
|
|
||
|
|
|
|
$
|
750,796
|
|
|
$
|
635,109
|
|
|
|
Location of Gain
(Loss) Recognized in Income on Derivative and Hedged Item |
|
Amount of Gain (Loss)
Recognized in Income on Derivative |
|
Amount of Gain (Loss)
Recognized in Income on Hedged Item |
||||||||||||
Derivatives and related Hedged Items
under ASC 815-20 Fair Value Hedging Relationships |
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
||||||||||
In thousands
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
Interest expense, net of interest capitalized
|
|
$
|
9,354
|
|
|
$
|
13,682
|
|
|
$
|
37,745
|
|
|
$
|
32,389
|
|
Interest rate swaps
|
|
Other (expense) income
|
|
(71,630
|
)
|
|
(1,763
|
)
|
|
68,743
|
|
|
2,070
|
|
||||
Interest rate swaps
|
|
Extinguishment of unsecured senior notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,698
|
|
||||
|
|
|
|
$
|
(62,276
|
)
|
|
$
|
11,919
|
|
|
$
|
106,488
|
|
|
$
|
44,157
|
|
|
|
Amount of Gain (Loss)
Recognized in OCI on Derivative (Effective Portion) |
|
Location of Gain
(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) |
|
Amount of Gain (Loss)
Reclassified from Accumulated OCI into Income (Effective Portion) |
|
Location of Gain
(Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) |
|
Amount of Gain (Loss)
Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness testing) |
||||||||||||||||||
Derivatives under
ASC 815-20 Cash Flow Hedging Relationships |
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
|
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
|
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
||||||||||||||
In thousands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cross currency swaps
|
|
$
|
—
|
|
|
$
|
851
|
|
|
Other (expense) income
|
|
$
|
—
|
|
|
$
|
2,505
|
|
|
Other (expense) income
|
|
$
|
—
|
|
|
$
|
—
|
|
Cross currency swaps
|
|
—
|
|
|
—
|
|
|
Interest Expense
|
|
(3,531
|
)
|
|
(2,209
|
)
|
|
Other (expense) income
|
|
—
|
|
|
—
|
|
||||||
Interest rate swaps
|
|
111,223
|
|
|
(44,971
|
)
|
|
Other (expense) income
|
|
—
|
|
|
—
|
|
|
Other (expense) income
|
|
431
|
|
|
(348
|
)
|
||||||
Foreign currency forward contracts
|
|
68,364
|
|
|
11,928
|
|
|
Depreciation and amortization expenses
|
|
(1,797
|
)
|
|
(953
|
)
|
|
Other (expense) income
|
|
9
|
|
|
—
|
|
||||||
Foreign currency forward contracts
|
|
—
|
|
|
—
|
|
|
Other (expense) income
|
|
27,423
|
|
|
(953
|
)
|
|
Other (expense) income
|
|
—
|
|
|
—
|
|
||||||
Foreign currency forward contracts
|
|
—
|
|
|
—
|
|
|
Interest expense
|
|
(440
|
)
|
|
—
|
|
|
Other (expense) income
|
|
—
|
|
|
—
|
|
||||||
Foreign currency collar options
|
|
13,199
|
|
|
3,316
|
|
|
Depreciation and amortization expenses
|
|
—
|
|
|
—
|
|
|
Other (expense) income
|
|
—
|
|
|
—
|
|
||||||
Fuel swaps
|
|
4,642
|
|
|
87,014
|
|
|
Fuel
|
|
47,944
|
|
|
110,995
|
|
|
Other (expense) income
|
|
(3,413
|
)
|
|
(1,041
|
)
|
||||||
|
|
$
|
197,428
|
|
|
$
|
58,138
|
|
|
|
|
$
|
69,599
|
|
|
$
|
109,385
|
|
|
|
|
$
|
(2,973
|
)
|
|
$
|
(1,389
|
)
|
|
|
Amount of Gain (Loss)
Recognized in OCI (Effective Portion) |
|
Location of Gain
(Loss) in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) |
|
Amount of Gain (Loss) Recognized in Income
(Ineffective Portion and Amount Excluded from Effectiveness Testing) |
||||||||||||
Non-derivative instruments under ASC 815-20
Net Investment Hedging Relationships |
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
|
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
|||||||||
In thousands
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign Currency Debt
|
|
$
|
(34,295
|
)
|
|
$
|
(11,065
|
)
|
|
Other (expense) income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
(34,295
|
)
|
|
$
|
(11,065
|
)
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
Amount of Gain (Loss) Recognized
in Income on Derivative |
||||||
Derivatives Not Designated as Hedging
Instruments under ASC 815-20 |
|
Location of Gain (Loss)
Recognized in Income on Derivative |
|
Year Ended December 31, 2013
|
|
Year Ended December 31, 2012
|
||||
In thousands
|
|
|
|
|
|
|
||||
Foreign currency forward contracts
|
|
Other (expense) income
|
|
$
|
(21,244
|
)
|
|
$
|
7,152
|
|
Fuel swaps
|
|
Other (expense) income
|
|
243
|
|
|
(3,058
|
)
|
||
Fuel call options
|
|
Other (expense) income
|
|
(23
|
)
|
|
(5,613
|
)
|
||
|
|
|
|
$
|
(21,024
|
)
|
|
$
|
(1,519
|
)
|
Year
|
|
||
2014
|
$
|
47,097
|
|
2015
|
45,608
|
|
|
2016
|
42,876
|
|
|
2017
|
40,577
|
|
|
2018
|
38,626
|
|
|
Thereafter
|
285,146
|
|
|
|
$
|
499,930
|
|
Year
|
|
||
2014
|
$
|
200,660
|
|
2015
|
139,540
|
|
|
2016
|
115,255
|
|
|
2017
|
117,663
|
|
|
2018
|
40,769
|
|
|
Thereafter
|
82,940
|
|
|
|
$
|
696,827
|
|
Restructuring exit costs
|
$
|
23,432
|
|
Impairment charges
|
33,514
|
|
|
Restructuring and related impairment charges
|
$
|
56,946
|
|
|
|
Beginning
Balance January 1, 2013 |
|
Accruals
|
|
Payments
|
|
Ending Balance December 31, 2013
|
|
Cumulative
Charges Incurred |
|
Expected
Additional Expenses to be Incurred (1) |
|
||||||||||||
Termination benefits
|
|
$
|
—
|
|
|
$
|
9,638
|
|
|
$
|
1,323
|
|
|
$
|
8,315
|
|
|
$
|
9,638
|
|
|
$
|
915
|
|
|
Contract termination costs
|
|
|
—
|
|
|
|
4,142
|
|
|
|
4,016
|
|
|
$
|
126
|
|
|
|
4,142
|
|
|
|
—
|
|
|
Other related costs
|
|
|
—
|
|
|
|
4,379
|
|
|
|
2,982
|
|
|
$
|
1,397
|
|
|
|
4,379
|
|
|
|
317
|
|
|
Total
|
|
$
|
—
|
|
|
$
|
18,159
|
|
|
$
|
8,321
|
|
|
$
|
9,838
|
|
|
$
|
18,159
|
|
|
$
|
1,232
|
|
|
(1)
|
These amounts relate to restructuring exit costs associated with our Global Sales, Marketing and General and Administrative restructuring and consolidation efforts. It does not include charges related to other initiatives.
|
|
|
Beginning
Balance January 1, 2013 |
|
Accruals
|
|
Payments
|
|
Ending Balance December 31, 2013
|
|
Cumulative
Charges Incurred |
|
Expected
Additional Expenses to be Incurred (2) |
|
||||||||||||
Termination benefits
|
|
$
|
—
|
|
|
$
|
3,910
|
|
|
$
|
—
|
|
|
$
|
3,910
|
|
|
$
|
3,910
|
|
|
$
|
2,056
|
|
|
Contract termination costs
|
|
|
—
|
|
|
|
847
|
|
|
|
—
|
|
|
$
|
847
|
|
|
|
847
|
|
|
|
—
|
|
|
Other related costs
|
|
|
—
|
|
|
|
516
|
|
|
|
—
|
|
|
$
|
516
|
|
|
|
516
|
|
|
|
7,121
|
|
|
Total
|
|
$
|
—
|
|
|
$
|
5,273
|
|
|
$
|
—
|
|
|
$
|
5,273
|
|
|
$
|
5,273
|
|
|
$
|
9,177
|
|
|
(2)
|
These amounts relate to restructuring exit costs associated with our Pullmantur restructuring. It does not include any charges related to other initiatives.
|
|
(In thousands, except per share data)
|
||||||||||||||||||||||||||||||
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||||||||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||||||||||
Total revenues
(1)
|
$
|
1,911,220
|
|
|
$
|
1,834,480
|
|
|
$
|
1,882,767
|
|
|
$
|
1,821,004
|
|
|
$
|
2,311,749
|
|
|
$
|
2,226,390
|
|
|
$
|
1,854,158
|
|
|
$
|
1,806,150
|
|
Operating income (loss)
(2)
|
$
|
165,632
|
|
|
$
|
135,375
|
|
|
$
|
113,338
|
|
|
$
|
96,905
|
|
|
$
|
444,209
|
|
|
$
|
452,137
|
|
|
$
|
74,969
|
|
|
$
|
(281,307
|
)
|
Net income (loss)
(2),(3)
|
$
|
76,226
|
|
|
$
|
46,964
|
|
|
$
|
24,747
|
|
|
$
|
(3,653
|
)
|
|
$
|
365,701
|
|
|
$
|
367,779
|
|
|
$
|
7,018
|
|
|
$
|
(392,803
|
)
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
$
|
0.35
|
|
|
$
|
0.22
|
|
|
$
|
0.11
|
|
|
$
|
(0.02
|
)
|
|
$
|
1.66
|
|
|
$
|
1.69
|
|
|
$
|
0.03
|
|
|
$
|
(1.80
|
)
|
Diluted
|
$
|
0.35
|
|
|
$
|
0.21
|
|
|
$
|
0.11
|
|
|
$
|
(0.02
|
)
|
|
$
|
1.65
|
|
|
$
|
1.68
|
|
|
$
|
0.03
|
|
|
$
|
(1.80
|
)
|
Dividends declared per share
|
$
|
0.12
|
|
|
$
|
0.10
|
|
|
$
|
0.12
|
|
|
$
|
0.10
|
|
|
$
|
0.25
|
|
|
$
|
0.12
|
|
|
$
|
0.25
|
|
|
$
|
0.12
|
|
(1)
|
Our revenues are seasonal based on the demand for cruises. Demand is strongest for cruises during the Northern Hemisphere's summer months and holidays.
|
(2)
|
Amounts for the second, third and fourth quarters of 2013 include restructuring charges of
$1.7 million
,
$12.2 million
and
$9.5 million
, respectively, and the fourth quarter of 2013 includes an impairment charge of
$33.5 million
to write down the assets held for sale related to the businesses to be sold and certain long-lived assets, consisting of aircraft owned and operated by Pullmantur Air, to their fair value. Amounts for the fourth quarter of 2012, include an impairment charge of
$385.4 million
to write down Pullmantur's goodwill to its implied fair value and to write down trademarks and trade names and certain long-lived assets, consisting of aircraft owned and operated by Pullmantur Air, to their fair value.
|
(3)
|
Amounts for the fourth quarter of 2012, include a
$33.7 million
deferred tax expense to record a
100%
valuation allowance related to our deferred tax assets for Pullmantur. In addition, we recorded a deferred tax benefit related to Pullmantur's trademarks and trade names of
$5.2 million
. These adjustments resulted in an increase of
$28.5 million
to
Other (expense) income
.
|
Taxes
|
(a) FICA/Medicare Taxes
. U.S. employees of the Company and/or its Affiliates will be subject to FICA/Medicare tax on each Vesting Date based on the Fair Market Value of the Shares underlying the Units that Vest on such Vesting Date.
(b) U.S. Federal Income Taxes
. U.S. employees of the Company and/or its Affiliates will be subject to U.S. federal income tax on each Vesting Date based on the Fair Market Value of the Shares underlying the Units that Vest on such Vesting Date.
(c) Tax Consequences for Non-U.S. Residents.
Grantees who are neither citizens nor resident aliens of the U.S. should consult with their financial/tax advisor regarding both the U.S. and non-U.S. tax consequences of the receipt of this award and subsequent settlement/receipt of the Shares.
(d)
Grantee will be solely responsible for the payment of all such taxes, as well as for any other state, local or non-U.S. taxes that may be related to Grantee’s receipt of the Units and/or Shares.
|
Miscellaneous
|
(a) This Agreement shall not confer upon an employee any right to continue employment with the Company or any Affiliate, nor shall this Agreement interfere in any way with the Company’s or Affiliate’s right to terminate such employment at any time.
(b) Subject to the terms of the Plan, the Committee may terminate, amend, or modify the Plan;
provided, however
, that no such termination, amendment, or modification of the Plan may in any way adversely affect Grantee’s rights under this Agreement without Grantee’s consent.
(c) This Agreement will be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or stock exchanges as may be required.
(d) To the extent not preempted by U.S. federal law, this Agreement shall be governed by, and construed in accordance with, the laws of the State of Florida.
|
Signatures
|
By the signatures below, the Grantee and the authorized representative of the Company acknowledge agreement to this Restricted Stock Unit Agreement as of the Date of Grant specified above.
|
|
Royal Caribbean Cruises Ltd.
|
|
Grantee:
|
|
|
|
|
|
By: ______________________________
|
|
___________________________________
|
|
Jason T. Liberty
|
|
|
|
Senior Vice President & CFO
|
|
|
1.
|
For purposes of this Agreement, the following terms shall, when capitalized, have the following meanings:
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2.
|
If Grantee is a Grant Date Qualifying Grantee, then, notwithstanding the vesting schedule set forth in “Vesting”, 100% of the Units shall vest on the First Vesting Date.
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3.
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If Grantee is not a Grant Date Qualifying Grantee but meets both of the Qualifying Criteria prior to the Final Vesting Date, all Units that have not Vested in accordance with the vesting schedule set forth in “Vesting” shall immediately Vest on the first anniversary of the first date Grantee meets both of the Qualifying Criteria.
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4.
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(a) Grantee hereby acknowledges and agrees that he or she shall not sell, assign, pledge, transfer or otherwise dispose of any of the Shares issued in respect of the Vested Units issued in accordance with Section 2 or 3 above earlier than the Vesting Dates that would have applied to such Units but for the application of this Schedule A. By way of example, a Grant Date Qualifying Grantee whose shares vest on an accelerated basis pursuant to Section 2 above shall be eligible to sell up to 25% of the Shares starting on the First Vesting Date, up to 50% of the Shares starting on the Second Vesting Date, up to 75% of the Shares on the Third Vesting Date and up to 100% of the Shares starting on the Final Vesting Date.
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Name of Grantee
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Grant Date
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Target Number of Performance Shares
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Value of Each Performance Share on Date of Grant
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Service Vesting Date
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Performance Period
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Royal Caribbean Cruises Ltd.
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Grantee:
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By: ___________________________
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_______________________________
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Jason T. Liberty
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Senior Vice President & CFO
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[Performance Metric]
|
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Component Payout (Percentage of Target Award)
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Threshold
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0%
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Target
|
|
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100%
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|
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Maximum
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200%
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•
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required under regulations adopted under the Dodd Frank Wall Street Reform and Consumer Protection Act;
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•
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the Company’s financial statements covering the Performance Period are restated due to material non-compliance with financial reporting requirements prior to the Service Vesting Date; or
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•
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the Committee determines, in consultation with the Company’s Audit Committee, that there is a high likelihood
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Non-Management Director Cruise Policy
|
|
Chairman & Chief Executive Officer
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1.1
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Scope
|
1.2
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Purpose
|
2.1
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Generally
|
2.2
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Immediate Family Traveling with Non-Management Director
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2.3
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Responsibility for Other Costs Associated with the Complimentary Cruise
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2.4
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Upgrade of Stateroom Category
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2.5
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Celebrity Xpedition/Special Situations
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Years Ended December 31,
|
||||||||
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|
2013
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2012
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2011
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2010
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2009
|
|
|
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|
|
|
|
|
|
|
Earnings
|
|
|
|
|
|
|
|
|
|
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|
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Net income
|
|
$473,692
|
|
$18,287
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|
$607,421
|
|
$515,653
|
|
$152,485
|
Income tax expense (benefit)
|
|
24,937
|
|
55,518
|
|
20,673
|
|
20,266
|
|
(5,053)
|
(Income) loss from equity investees, net of distributions
|
|
(26,071)
|
|
(21,078)
|
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(118)
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|
(200)
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|
15,244
|
|
|
|
|
|
|
|
|
|
|
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Fixed charges
|
|
364,515
|
|
383,575
|
|
409,246
|
|
409,065
|
|
363,277
|
Capitalized interest
|
|
(17,878)
|
|
(13,281)
|
|
(13,986)
|
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(28,093)
|
|
(41,473)
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Earnings
|
|
$819,165
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|
$423,021
|
|
$1,023,236
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|
$916,691
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$484,480
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Fixed Charges
|
|
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|
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Interest expense
(1)
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$350,299
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$369,062
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$396,402
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$399,300
|
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$351,421
|
Interest portion of rent expense
(2)
|
|
14,216
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|
14,513
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12,844
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|
9,765
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11,856
|
|
|
|
|
|
|
|
|
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Fixed charges
|
|
$364,515
|
|
$383,575
|
|
$409,246
|
|
$409,065
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|
$363,277
|
|
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|
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|
|
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|
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Ratio of Earnings to Fixed Charges
|
|
2.2x
|
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1.1x
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2.5x
|
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2.2x
|
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1.3x
|
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|
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(1)
Interest expense includes capitalized interest and amortization of deferred financing expenses.
|
||
(2)
Interest portion of rent expense represents actual interest charges for the
Brilliance of the Seas
operating lease and, for all other rentals, we have assumed that one-third of rent expense is representative of the interest factor.
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NAME
|
INCORPORATION
|
|
Adventure of the Seas Inc.
|
Liberia
|
|
Allure of the Seas Inc.
|
Liberia
|
|
Azamara Journey Inc.
|
Liberia
|
|
Azamara Quest Inc.
|
Liberia
|
|
Blue Sapphire Marine Inc.
|
Liberia
|
|
CDF Croisieres de France, SAS
|
France
|
|
Celebrity Cruise Lines Inc.
|
Cayman Islands
|
|
Celebrity Cruises Holdings Inc.
|
Liberia
|
|
Celebrity Cruises Inc., doing business as Celebrity Cruises
|
Liberia
|
|
Celebrity Eclipse Inc.
|
Liberia
|
|
Celebrity Equinox Inc.
|
Liberia
|
|
Celebrity Reflection Inc.
|
Liberia
|
|
Celebrity Silhouette Inc.
|
Liberia
|
|
Celebrity Solstice Inc.
|
Liberia
|
|
Constellation Inc.
|
Liberia
|
|
Enchantment of the Seas Inc.
|
Liberia
|
|
Explorer of the Seas Inc.
|
Liberia
|
|
Freedom of the Seas Inc.
|
Liberia
|
|
Galapagos Cruises Inc.
|
Liberia
|
|
GG Operations Inc
|
Delaware
|
|
Grandeur of the Seas Inc.
|
Liberia
|
|
Independence of the Seas Inc.
|
Liberia
|
|
Infinity Inc.
|
Liberia
|
|
Island for Science, Inc.
|
Indiana
|
|
Islas Galapagos Turismo y Vapores CA
|
Ecuador
|
|
Jewel of the Seas Inc.
|
Liberia
|
|
Labadee Investments Ltd.
|
Cayman Islands
|
|
Legend of the Seas Inc.
|
Liberia
|
|
Liberty of the Seas Inc.
|
Liberia
|
|
Majesty of the Seas Inc.
|
Liberia
|
|
Mariner of the Seas Inc.
|
Liberia
|
|
Millennium Inc.
|
Liberia
|
|
Nautalia Viajes, S.L.
|
Spain
|
|
Navigator of the Seas Inc.
|
Liberia
|
|
Oasis of the Seas Inc.
|
Liberia
|
|
Pullmantur, S.A.
|
Spain
|
|
Pullmantur Cruises, S.L.
|
Spain
|
|
Pullmantur Cruises Atlantic Limited
|
Malta
|
|
Pullmantur Cruises Empress Limited
|
Malta
|
|
Pullmantur Cruises Monarch Limited
|
Malta
|
|
Pullmantur Cruises Pacific Dream Limited
|
Malta
|
|
NAME
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INCORPORATION
|
|
Pullmantur Cruises Ship Management Ltd.
|
Malta
|
|
Pullmantur Cruises Sovereign Limited
|
Malta
|
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Pullmantur Cruises Zenith Limited
|
Malta
|
|
Pullmantur Ship Management, Ltd.
|
Bahamas
|
|
Radiance of the Seas Inc.
|
Liberia
|
|
RCL Cruises Ltd.
|
England and Wales
|
|
RCL Holdings Cooperatief U.A.
|
Netherlands
|
|
RCL Investments Ltd.
|
England and Wales
|
|
RCL (UK) Ltd.
|
England and Wales
|
|
Rhapsody of the Seas Inc.
|
Liberia
|
|
Royal Caribbean Cruise Lines AS
|
Norway
|
|
Royal Caribbean Cruises (Asia) Pte. Ltd.
|
Singapore
|
|
Royal Caribbean Cruises Services (China) Company Limited
|
China
|
|
Royal Caribbean Holdings de Espana S.L.
|
Spain
|
|
Royal Caribbean Holdings de Panama S. de R.L.
|
Panama
|
|
Royal Celebrity Tours Inc.
|
Delaware
|
|
Serenade of the Seas Inc.
|
Liberia
|
|
Societe Labadee Nord, S.A.
|
Haiti
|
|
Splendour of the Seas Inc.
|
Liberia
|
|
Summit Inc.
|
Liberia
|
|
Vision of the Seas Inc.
|
Liberia
|
|
Voyager of the Seas Inc.
|
Liberia
|
|
|
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|
|
|
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|
|
/s/ Bernard W. Aronson
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|
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|
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/s/ William K. Reilly
|
|
Bernard W. Aronson
|
|
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|
|
William K. Reilly
|
|
Director
|
|
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Director
|
|
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|
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/s/ William L. Kimsey
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|
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/s/ Bernt Reitan
|
|
William L. Kimsey
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|
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|
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Bernt Reitan
|
|
Director
|
|
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Director
|
|
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|
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/s/ Ann S. Moore
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/s/ Vagn O. Sørensen
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|
Ann S. Moore
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Vagn O. Sørensen
|
|
Director
|
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Director
|
|
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|
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/s/ Eyal Ofer
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|
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/s/ Arne Alexander Wilhelmsen
|
|
Eyal Ofer
|
|
|
|
|
Arne Alexander Wilhelmsen
|
|
Director
|
|
|
|
|
Director
|
|
|
|
|
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|
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/s/ Thomas J. Pritzker
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|
|
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Thomas J. Pritzker
|
|
|
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|
Director
|
|
|
|
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|
|
|
|
|
|
|
|
1.
|
I have reviewed this annual report on Form 10-K of Royal Caribbean Cruises Ltd.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
February 20, 2014
|
|
|
|
/s/ Richard D. Fain
|
|
|
Richard D. Fain
|
|
|
Chairman and
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of Royal Caribbean Cruises Ltd.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
February 20, 2014
|
|
|
|
/s/ Jason T. Liberty
|
|
|
Jason T. Liberty
|
|
|
Senior Vice President,
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
Date:
|
February 20, 2014
|
|
|
|
|
|
|
|
|
By:
|
/s/ Richard D. Fain
|
|
|
|
Richard D. Fain
|
|
|
|
Chairman and
|
|
|
|
Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
By:
|
/s/ Jason T. Liberty
|
|
|
|
Jason T. Liberty
|
|
|
|
Senior Vice President,
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|