Royal Caribbean Reports Second Quarter Results And Updates 2015 Guidance

Jul 31, 2015, 08:00 ET from Royal Caribbean Cruises Ltd.

MIAMI, July 31, 2015 /PRNewswire/ -- Royal Caribbean Cruises Ltd. (NYSE, OSE: RCL) today reported a 26% increase in second quarter earnings and said it expects full year earnings to be almost 40% above last year.  

KEY HIGHLIGHTS

Overall, the year will be another solid step towards the Double-Double. Commercially, the business continues to perform as expected and the biggest drivers of our increased guidance are better foreign exchange and fuel rates.

Second Quarter 2015 results:

  • Net Yields were up 4.2% on a Constant-Currency basis (down 0.2% As-Reported), modestly better than guidance mostly driven by strength in the Caribbean and China.
  • Net Cruise Costs ("NCC") excluding fuel were up 3.4% on a Constant-Currency basis (down 0.1% As-Reported), better than guidance mainly due to timing.
  • Adjusted Net Income of $185.0 million, or $0.84 per share, versus $146.7 million, or $0.66 per share in 2014.
  • US GAAP Net Income was $185.0 million or $0.84 per share, versus $137.7 million, or $0.62 per share in 2014.

Full Year 2015 forecast:     

  • Net Yields are expected to increase in the range of 2.9% to 3.9% on a Constant-Currency basis (down 1.1% to 0.1% As-Reported).
  • NCC excluding fuel are expected to be better than flat on a Constant-Currency basis (down approximately 2.5% As-Reported), including some increased investment in marketing activities.
  • Adjusted EPS is expected to be in the range of $4.65 to $4.75 per share, a $0.15 increase from the mid-point of the company's previous guidance, driven by beneficial currency and fuel rates.

"The Double-Double introduced demanding but achievable targets for our organization, and I am proud of our company's focus on delivering this program," said Richard D. Fain, chairman and chief executive officer. "We continue to focus on the strength of our brands to drive these improving results."

SECOND QUARTER RESULTS

Adjusted Net Income for the second quarter of 2015 was $185.0 million, or $0.84 per share, compared to Adjusted Net Income of $146.7 million, or $0.66 per share, in the second quarter of 2014, representing a 26% increase over the same quarter last year. US GAAP Net Income for the second quarter 2015 was $185.0 million or $0.84 per share, compared to $137.7 million or $0.62 per share in 2014.  

While currency and fuel were the biggest drivers of the earnings increase versus guidance, Net Yields on a Constant-Currency basis also increased 4.2%. Yields were better than expected, mainly driven by close-in pricing in the Caribbean and China. Constant-Currency NCC excluding fuel increased 3.4%, which is 110 basis points better than guidance, mainly due to the timing of shipboard projects.

Bunker pricing net of hedging for the second quarter was $599 per metric ton and consumption was 338,000 metric tons.

FULL YEAR 2015

The company has updated full year Adjusted EPS guidance to a range of $4.65 to $4.75. The $0.15 increase versus April guidance is driven by beneficial currency and fuel rates. Better than expected performance in the Caribbean and China in Q2, and a modest increase in costs are essentially offsetting each other and are neutral to earnings. The cost increase in the second half of the year is for some additional marketing activities focused on 2016.

Constant-Currency Net Revenue Yields are now expected to increase in the range of 2.9% to 3.9%, versus previous guidance of 2.5% to 4.0%, and Net Cruise Costs excluding fuel are expected to be better than flat, versus previous guidance of flat to down 1%.

Bookings since the April earnings call have been healthy and the company continues to be booked ahead of last year in both load factor and APD. A solid Caribbean environment is more than off-setting softness on Latin American sailings associated with our Pullmantur brand.

Taking into account current fuel pricing, interest rates, currency exchange rates and the factors detailed above, the company expects 2015 Adjusted EPS to be in the range of $4.65 to $4.75 per share.

"Momentum in the Caribbean continues at a solid pace, and our strong booked position in the third and fourth quarters gives us confidence as we move through the second half of 2015," said Jason T. Liberty, chief financial officer. "The trajectory of our brands is firmly on course for another record year of earnings, with healthy trends extending into the first quarter of 2016."

While it is too early to provide a detailed picture for 2016, first quarter bookings are running well ahead of last year at higher prices, with improvements in the Caribbean continuing at a robust pace.

THIRD QUARTER 2015

Constant-Currency Net Yields are expected to be up in the range of 3.5% to 4.0% in the third quarter of 2015. NCC excluding fuel are expected to be down 1.5% to 1.0% on a Constant-Currency basis.

Based on current fuel pricing, interest rates and currency exchange rates and the factors detailed above, the company expects third quarter Adjusted EPS to be approximately $2.70 per share.

FUEL EXPENSE AND SUMMARY OF KEY GUIDANCE STATS

Fuel Expense
The company does not forecast fuel prices, and its fuel cost calculations are based on current at-the-pump prices, net of hedging impacts. Based on today's fuel prices the company has included $210 million and $818 million of fuel expense in its third quarter and full year 2015 guidance, respectively.

Forecasted consumption is 53% hedged via swaps for the remainder of 2015 and 65%, 60%, 40% and 10% hedged for 2016, 2017, 2018 and 2019, respectively. For the same five-year period, the average cost per metric ton of the hedge portfolio is approximately $630, $538, $501, $462 and $417, respectively. 

The company provided the following fuel statistics for the third quarter and full year 2015:

 

FUEL STATISTICS

Third Quarter 2015

Full Year 2015

Fuel Consumption (metric tons)

340,000

1,367,000

Fuel Expenses

$210 million

$818 million

Percent Hedged (fwd consumption)

48%

53%

Impact of 10% change in fuel prices

$7.8 million

$13.9 million

 

In summary, the company provided the following guidance for the third quarter and full year of 2015:

 

GUIDANCE

As-Reported                    Constant-Currency



Third Quarter 2015


Net Yields

(0.7%) to (0.2%)

3.5% to 4.0%


Net Cruise Costs per APCD

Approx. (6.0%)

Approx. (4.0%)


Net Cruise Costs per APCD

excluding Fuel

(3.8%) to (3.3%)

(1.5%) to (1.0%)






Full Year 2015


Net Yields

(1.1%) to (0.1%)

2.9% to 3.9%


Net Cruise Costs per APCD

Approx. (6.0%)

Approx. (4.0%)


Net Cruise Costs per APCD

excluding Fuel

Approx. (2.5%)

Better than flat







Third Quarter 2015

Full Year 2015


Capacity Increase

6.7%

5.4%


Depreciation and Amortization

$209 to $214 million

$830 to $835 million


Interest Expense, net

$60 to $70 million

$260 to $270 million


Adjusted EPS

Approx. $2.70

$4.65 to $4.75






1% Change in Currency

$5 million

$8 million


1% Change in Net Yield

$19 million

$34 million


1% Change in NCC x fuel

$9 million

$17 million


1% Change in LIBOR

$10 million

$23 million




Exchange rates used in guidance calculations



Current – July

Previous – April


GBP

$1.55

$1.46


CAD

$0.79

$0.80


AUD

$0.74

$0.77


BRL

$0.32

$0.33


CNY

$0.16

$0.16


LIQUIDITY AND FINANCING ARRANGEMENTS

As of June 30, 2015, liquidity was $1.0 billion, including cash and the undrawn portion of the company's unsecured revolving credit facilities.  The company noted that scheduled debt maturities for the remainder of 2015, 2016, 2017, 2018 and 2019 are $0.5 billion, $0.9 billion, $0.9 billion, $2.0 billion, and $0.6 billion, respectively. 

CAPITAL EXPENDITURES AND CAPACITY GUIDANCE

Based upon current ship orders, projected capital expenditures for full year 2015, 2016, 2017, 2018 and 2019 are $1.6 billion, $2.3 billion, $0.5 billion, $2.4 billion and $1.3 billion, respectively.

Capacity increases for 2015, 2016, 2017, 2018 and 2019 are expected to be 5.4%, 6.7%, 2.4%, 4.6% and 6.4%, respectively.  These figures do not include potential ship sales or additions that we may elect to make in the future. 

CONFERENCE CALL SCHEDULED

The company has scheduled a conference call at 10 a.m. Eastern Daylight Time today to discuss its earnings.  This call can be heard, either live or on a delayed basis, on the company's investor relations web site at www.rclinvestor.com.

Selected Operational and Financial Metrics

Adjusted Net Income
Adjusted Net Income represents net income excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis.  For the periods presented, these items included restructuring charges, other costs related to our profitability initiatives, and the estimated impact of the divested Pullmantur non-core businesses for periods prior to the sales transaction. The estimated impact of the divested Pullmantur non-core businesses was arrived at by adjusting the net income (loss) of these businesses for the ownership percentage we retained as well as for intercompany transactions that are no longer eliminated in our consolidated statements of comprehensive income (loss) subsequent to the sales transaction.

Adjusted Earnings Per Share ("Adjusted EPS")
Represents Adjusted Net Income divided by the diluted shares outstanding at the end of the reporting period. We believe this measure is meaningful when assessing our performance on a comparative basis.

Available Passenger Cruise Days ("APCD")
APCD is our measurement of capacity and represents double occupancy per cabin multiplied by the number of cruise days for the period.  We use this measure to perform capacity and rate analysis to identify the main non-capacity drivers that cause our cruise revenues and expenses to vary.

Constant-Currency
We believe Net Yields, Net Cruise Costs and Net Cruise Costs Excluding Fuel are our most relevant financial measures.  However, a significant portion of our revenue and expenses are denominated in currencies other than the US Dollar.  Because our reporting currency is the US Dollar, the value of these revenues and expenses in US Dollars will be affected by changes in currency exchange rates.  Although such changes in local currency prices are just one of many elements impacting our revenues and expenses, it can be an important element.  For this reason, we also monitor Net Yields, Net Cruise Costs, and Net Cruise Costs Excluding Fuel on a "Constant-Currency" basis – i.e. as if the current period's currency exchange rates had remained constant with the comparable prior period's rates.  We calculate "Constant-Currency" by applying the average prior year period exchange rates for each of the corresponding months of the reported and/or forecasted period, so as to calculate what the results would have been had exchange rates been the same throughout both periods.  We do not make predictions about future exchange rates and use current exchange rates for calculations of future periods.  It should be emphasized that the use of Constant-Currency is primarily used by us for comparing short-term changes and/or projections.  Changes in guest sourcing and shifting the amount of purchases between currencies can change the impact of the purely currency-based fluctuations.

Gross Cruise Costs
Gross Cruise Costs represent the sum of total cruise operating expenses plus marketing, selling and administrative expenses.

Gross Yields
Gross Yields represent total revenues per APCD. 

Net Cruise Costs ("NCC") and Net Cruise Costs ("NCC") Excluding Fuel
Represent Gross Cruise Costs excluding commissions, transportation and other expenses and onboard and other expenses and, in the case of Net Cruise Costs Excluding Fuel, fuel expenses. In measuring our ability to control costs in a manner that positively impacts net income, we believe changes in Net Cruise Costs and Net Cruise Costs Excluding Fuel to be the most relevant indicators of our performance.  We have not provided a quantitative reconciliation of projected Gross Cruise Costs to projected Net Cruise Costs and projected Net Cruise Costs Excluding Fuel due to the significant uncertainty in projecting the costs deducted to arrive at these measures.  Accordingly, we do not believe that reconciling information for such projected figures would be meaningful. For the periods prior to the sale of the Pullmantur non-core businesses, Net Cruise Costs excludes the estimated impact of these divested businesses. Net Cruise Costs also excludes initiative costs reported within cruise operating expenses and marketing, selling and administrative expenses.

Net Revenues
Net Revenues represent total revenues less commissions, transportation and other expenses and onboard and other expenses.  For the periods prior to the sale of the Pullmantur non-core businesses, Net Revenues excludes the estimated impact of these divested businesses.

Net Yields
Net Yields represent Net Revenues per APCD.  We utilize Net Revenues and Net Yields to manage our business on a day-to-day basis as we believe that it is the most relevant measure of our pricing performance because it reflects the cruise revenues earned by us net of our most significant variable costs, which are commissions, transportation and other expenses and onboard and other expenses.  We have not provided a quantitative reconciliation of projected Gross Yields to projected Net Yields due to the significant uncertainty in projecting the costs deducted to arrive at this measure.  Accordingly, we do not believe that reconciling information for such projected figures would be meaningful. For the periods prior to the sale of the Pullmantur non-core businesses, Net Yields excludes the estimated impact of these divested businesses. 

Occupancy
Occupancy, in accordance with cruise vacation industry practice, is calculated by dividing Passenger Cruise Days by APCD.  A percentage in excess of 100% indicates that three or more passengers occupied some cabins.

Passenger Cruise Days
Passenger Cruise Days represent the number of passengers carried for the period multiplied by the number of days of their respective cruises.

Royal Caribbean Cruises Ltd. (NYSE, OSE: RCL) is a global cruise vacation company that owns Royal Caribbean International, Celebrity Cruises, Pullmantur, Azamara Club Cruises and CDF Croisieres de France, as well as TUI Cruises through a 50 percent joint venture.  Together, these six brands operate a combined total of 44 ships with an additional eight under construction contracts, and two under conditional agreements.  They operate diverse itineraries around the world that call on approximately 480 destinations on all seven continents.  Additional information can be found on www.royalcaribbean.com, www.celebritycruises.com, www.pullmantur.es, www.azamaraclubcruises.com, www.cdfcroisieresdefrance.com, www.tuicruises.com or www.rclinvestor.com.

Certain statements in this release relating to, among other things, our future performance constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995.  These statements include, but are not limited to, statements regarding expected financial results for the third quarter and full year 2015, and expectations regarding the timing and results of our Double-Double initiative, the costs and yields expected in 2015 and other future periods.  Words such as "anticipate," "believe," "could," "estimate," "expect," "goal," "intend," "may," "plan," "project," "seek," "should," "will," and similar expressions are intended to identify these forward-looking statements.  Forward-looking statements reflect management's current expectations, are inherently uncertain and are subject to risks, uncertainties and other factors, which could cause our actual results, performance or achievements to differ materially from the future results, performance or achievements expressed or implied in those forward-looking statements.  Examples of these risks, uncertainties and other factors include, but are not limited to the following: the impact of the economic and geopolitical environment on the demand for cruises, the impact of the economic environment on our ability to generate cash flows from operations or obtain new borrowings from the credit or capital markets in amounts sufficient to satisfy our capital expenditures, debt repayments and other financing needs, incidents or adverse publicity concerning the cruise vacation industry, the uncertainties of conducting business internationally and expanding into new markets, changes in operating and financing costs, the impact of foreign exchange rates and fuel price fluctuations, vacation industry competition and changes in industry capacity and overcapacity, emergency ship repairs, including the related lost revenue, the impact of ship delivery delays, ship cancellations or ship construction price increases, financial difficulties encountered by shipyards or their subcontractors and the unavailability or cost of air service. 

More information about factors that could affect our operating results is included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our most recent annual report on Form 10-K, a copy of which may be obtained by visiting our Investor Relations web site at www.rclinvestor.com or the SEC's web site at www.sec.gov. Undue reliance should not be placed on the forward-looking statements in this release, which are based on information available to us on the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Adjusted Measures of Financial Performance
This press release includes certain adjusted financial measures as defined under Securities and Exchange Commission rules, which we believe provide useful information to investors as a supplement to our consolidated financial statements which are prepared and presented in accordance with generally accepted accounting principles, or GAAP.

The presentation of adjusted financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.  These measures may be different from adjusted measures used by other companies. In addition, these adjusted measures are not based on any comprehensive set of accounting rules or principles. Adjusted measures have limitations in that they do not reflect all of the amounts associated with our results of operations as do the corresponding GAAP measures.

A reconciliation to the most comparable GAAP measure of all adjusted financial measures included in this press release can be found in the tables included at the end of this press release.

 

ROYAL CARIBBEAN CRUISES LTD.


CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)


(unaudited, in thousands, except per share data)































 Quarter Ended


Six Months Ended











June 30,


June 30,












2015



2014



2015



2014

























Passenger ticket revenues

$

1,507,468


$

1,455,099


$

2,814,247


$

2,803,302




Onboard and other revenues


550,854



524,944



1,059,674



1,063,965




        Total revenues


2,058,322



1,980,043



3,873,921



3,867,267




Cruise operating expenses:
















Commissions, transportation and other


355,835



346,180



680,253



672,045





Onboard and other


147,105



150,606



263,344



273,638





Payroll and related


218,570



209,171



430,161



419,972





Food


119,407



119,184



239,193



237,264





Fuel


202,565



242,804



407,841



487,263





Other operating


272,927



262,729



518,234



544,472






Total cruise operating expenses


1,316,409



1,330,674



2,539,026



2,634,654




Marketing, selling and administrative expenses


274,148



260,988



560,980



551,295




Depreciation and amortization expenses


206,468



192,880



406,936



386,615




Restructuring charges


-



(86)



-



1,650




Operating Income


261,297



195,587



366,979



293,053




Other income (expense):
















Interest income


2,772



2,630



6,509



5,906





Interest expense, net of interest capitalized


(76,620)



(65,260)



(146,779)



(133,831)





Other (expense) income


(2,482)



4,716



3,488



(998)












(76,330)



(57,914)



(136,782)



(128,923)




Net Income

$

184,967


$

137,673


$

230,197


$

164,130

























Earnings Per Share:















Basic

$

0.84


$

0.62


$

1.05


$

0.74




Diluted

$

0.84


$

0.62


$

1.04


$

0.74



















Weighted-Average Shares Outstanding:















Basic


219,913



222,189



219,770



221,745




Diluted 


220,902



223,381



220,886



223,055



































































Comprehensive Income 















Net Income

$

184,967


$

137,673


$

230,197


$

164,130




Other comprehensive income (loss):
















Foreign currency translation adjustments


11,741



(1,833)



(19,803)



637





Change in defined benefit plans


3,742



(2,054)



2,249



(4,085)





Gain (loss) on cash flow derivative hedges


202,473



(20,638)



(58,476)



(73,553)






Total other comprehensive income (loss)


217,956



(24,525)



(76,030)



(77,001)

























Comprehensive Income

$

402,923


$

113,148


$

154,167


$

87,129


































































STATISTICS






























Quarter Ended



Six Months Ended










June 30,



June 30,











2015



2014



2015



2014

























Passengers Carried


1,314,284



1,283,596



2,649,802



2,561,830

























Passenger Cruise Days


9,465,349



9,032,618



18,679,992



17,886,254

























APCD


9,040,437



8,607,667



17,819,382



17,080,917




Occupancy


104.7%



104.9%



104.8%



104.7%



 

 



ROYAL CARIBBEAN CRUISES LTD.



CONSOLIDATED BALANCE SHEETS



(in thousands, except share data)













As  of





June 30,


December 31,






2015


2014






(unaudited)





Assets







Current assets








Cash and cash equivalents


$      159,360


$       189,241




Trade and other receivables, net


212,454


261,392




Inventories


140,228


123,490




Prepaid expenses and other assets


292,431


226,960




Derivative financial instruments


108,918


-




   Total current assets


913,391


801,083











Property and equipment, net


18,890,338


18,193,627



Goodwill


409,836


420,542



Other assets


1,181,629


1,297,938






$ 21,395,194


$  20,713,190











Liabilities and Shareholders' Equity







Current liabilities








Current portion of long-term debt


$   1,188,576


$       799,630




Accounts payable


343,981


331,505




Accrued interest


54,072


49,074




Accrued expenses and other liabilities


519,080


635,138




Derivative financial instruments


468,614


266,986




Customer deposits


2,217,215


1,766,914




   Total current liabilities


4,791,538


3,849,247



Long-term debt


7,592,330


7,644,318



Other long-term liabilities


691,086


935,266











Commitments and contingencies















Shareholders' equity








Preferred stock ($0.01 par value; 20,000,000 shares authorized; 








   none outstanding)


-


-




Common stock ($0.01 par value; 500,000,000 shares authorized;








233,733,457 and 233,106,019 shares issued, June 30, 2015








and December 31, 2014, respectively)


2,337


2,331




Paid-in capital


3,267,189


3,253,552




Retained earnings


6,673,516


6,575,248




Accumulated other comprehensive loss


(973,024)


(896,994)




Treasury stock (13,808,683 common shares at
   cost, June 30, 2015 and December 31, 2014)


(649,778)


(649,778)




   Total shareholders' equity


8,320,240


8,284,359






$ 21,395,194


$  20,713,190


 

 



ROYAL CARIBBEAN CRUISES LTD.




CONSOLIDATED STATEMENTS OF CASH FLOWS




(unaudited, in thousands)














Six Months Ended 





June 30,






2015


2014











Operating Activities







Net income


$          230,197


$       164,130



Adjustments:








Depreciation and amortization


406,936


386,615




Net deferred income tax expense


2,534


2,934




Loss (gain) on derivative instruments not designated as hedges


16,902


(10,841)



Changes in operating assets and liabilities:








Decrease in trade and other receivables, net


54,272


15,903




(Increase) decrease in inventories


(17,523)


7,777




Increase in prepaid expenses and other assets


(58,722)


(35,799)




Increase (decrease) in accounts payable


14,668


(41,228)




Increase (decrease) in accrued interest


4,998


(59,019)




(Decrease) increase in accrued expenses and other liabilities 


(39,474)


45,730




Increase in customer deposits


405,752


388,693



Other, net


19,805


16,034



Net cash provided by operating activities


1,040,345


880,929











Investing Activities







Purchases of property and equipment 


(1,151,616)


(342,472)



Cash (paid) received on settlement of derivative financial instruments


(118,521)


18,096



Investments in and loans to unconsolidated affiliates


(54,250)


(68,885)



Cash received from loans to unconsolidated affiliates


120,297


66,138



Other, net


(12,482)


1,280



Net cash used in investing activities


(1,216,572)


(325,843)











Financing Activities







Debt proceeds


2,376,001


1,846,200



Debt issuance costs


(41,171)


(33,627)



Repayments of debt


(1,992,232)


(2,334,396)



Dividends paid


(197,718)


(131,857)



Proceeds from exercise of common stock options


5,067


54,938



Cash received on settlement of derivative financial instruments


-


22,835



Other, net


1,156


941



Net cash provided by (used in) financing activities


151,103


(574,966)











Effect of exchange rate changes on cash


(4,757)


455











Net decrease in cash and cash equivalents


(29,881)


(19,425)



Cash and cash equivalents at beginning of period


189,241


204,687



Cash and cash equivalents at end of period


$          159,360


$       185,262











Supplemental Disclosure







Cash paid during the period for:








Interest, net of amount capitalized


$          120,089


$       173,470


 

 

ROYAL CARIBBEAN CRUISES LTD.

NON-GAAP RECONCILING INFORMATION

(unaudited)
















































































 Gross Yields and Net Yields were calculated as follows (in thousands, except APCD and Yields):






































 Quarter Ended



Six Months Ended









June 30,



June 30,










2015



2015
On a
Constant Currency basis



2014




2015



2015
On a
Constant Currency basis



2014




























Passenger ticket revenues



$

1,507,468


$

1,588,539


$

1,455,099



$

2,814,247


$

2,967,384


$

2,803,302


Onboard and other revenues




550,854



563,643



524,944




1,059,674



1,082,728



1,063,965


Total revenues






2,058,322



2,152,182



1,980,043




3,873,921



4,050,112



3,867,267


Less:


























Commissions, transportation and other


355,835



375,694



346,180




680,253



715,124



672,045



Onboard and other




147,105



153,163



150,606




263,344



272,427



273,638


Net Revenues including divested businesses


1,555,382



1,623,325



1,483,257




2,930,324



3,062,561



2,921,584


Less:


























Net Revenues related to divested businesses 





















prior to sales transaction




-



-



-




-



-



35,656


Net revenues





$

1,555,382


$

1,623,325


$

1,483,257



$

2,930,324


$

3,062,561


$

2,885,928




























APCD







9,040,437



9,040,437



8,607,667




17,819,382



17,819,382



17,080,917


Gross Yields





$

227.68


$

238.06


$

230.03



$

217.40


$

227.29


$

226.41


Net Yields






$

172.05


$

179.56


$

172.32



$

164.45


$

171.87


$

168.96






















































 Gross Cruise Costs, Net Cruise Costs and Net Cruise Costs Excluding Fuel were calculated as follows (in thousands, except APCD and costs per APCD):





























































 Quarter Ended



Six Months Ended









June 30,



June 30,










2015



2015
On a
Constant Currency basis



2014




2015



2015
On a
Constant Currency basis



2014




























Total cruise operating expenses



$

1,316,409


$

1,364,803


$

1,330,674



$

2,539,026


$

2,619,832


$

2,634,654


Marketing, selling and administrative expenses


274,148



285,340



260,988




560,980



581,671



551,295


Gross Cruise Costs





1,590,557



1,650,143



1,591,662




3,100,006



3,201,503



3,185,949


Less:


























Commissions, transportation and other


355,835



375,694



346,180




680,253



715,124



672,045



Onboard and other




147,105



153,163



150,606




263,344



272,427



273,638


Net Cruise Costs including divested businesses


1,087,617



1,121,286



1,094,876




2,156,409



2,213,952



2,240,266


Less:


























Net Cruise Costs related to divested businesses 





















prior to sales transaction




-



-



-




-



-



47,854



Other initiative costs included within cruise operating expenses and marketing, selling and administrative expenses


-



-



8,562




-



-



13,796


Net Cruise Costs 





1,087,617



1,121,286



1,086,314




2,156,409



2,213,952



2,178,616


Less:


























Fuel







202,565



205,382



242,804




407,841



411,890



487,263


Net Cruise Costs Excluding Fuel



$

885,052


$

915,904


$

843,510



$

1,748,568


$

1,802,062


$

1,691,353




























APCD







9,040,437



9,040,437



8,607,667




17,819,382



17,819,382



17,080,917


Gross Cruise Costs per APCD



$

175.94


$

182.53


$

184.91



$

173.97


$

179.66


$

186.52


Net Cruise Costs per APCD



$

120.31


$

124.03


$

126.20



$

121.01


$

124.24


$

127.55


Net Cruise Costs Excluding Fuel per APCD 

$

97.90


$

101.31


$

98.00



$

98.13


$

101.13


$

99.02

 

 

ROYAL CARIBBEAN CRUISES LTD.






NON-GAAP RECONCILING INFORMATION (CONTINUED)






(unaudited)

























 Net Debt-to-Capital was calculated as follows (in thousands):

















As  of















June 30,



December 31,
















2015



2014





























Long-term debt, net of current portion 

$     7,592,330



$   7,644,318










Current portion of long-term debt 

1,188,576



799,630










Total debt 

8,780,906



8,443,948










Less: Cash and cash equivalents 

159,360



189,241










Net Debt 

$     8,621,546



$   8,254,707




























Total shareholders' equity

$     8,320,240



$   8,284,359










Total debt 

8,780,906



8,443,948










Total debt and shareholders' equity

$   17,101,146



$ 16,728,307










Debt-to-Capital 

51.3%



50.5%










Net Debt 

$     8,621,546



$   8,254,707










Net Debt and shareholders' equity

$   16,941,786



$ 16,539,066










Net Debt-to-Capital 

50.9%



49.9%


























Adjusted Net Income and Adjusted Earnings per Share were calculated as follows (in thousands, except per share data):




























 Quarter Ended



 Six Months Ended









June 30,



June 30,










2015



2014



2015



2014





















Adjusted Net Income  

$

184,967


$

146,709


$

230,197


$

192,828


Net Income  


184,967



137,673



230,197



164,130



Net Adjustments to Net Income-Increase

$

-


$

9,036


$

-


$

28,698


Adjustments to Net Income:













Restructuring charges

$

-


$

(86)


$

-


$

1,650


Other initiative costs


-



9,122



-



16,035


Estimated impact of divested businesses prior to sales transaction


-



-



-



11,013

















Net Adjustments to Net Income-Increase

$

-


$

9,036


$

-


$

28,698



























































Adjusted Earnings per Share - Diluted

$

0.84


$

0.66


$

1.04


$

0.86


Earnings per Share - Diluted


0.84



0.62



1.04



0.74



Net Adjustments to Net Income-Increase

$

-


$

0.04


$

-


$

0.12


Adjustments to Earnings per Share:













Restructuring charges 

$

-


$

-


$

-


$

-


Other initiative costs


-



0.04



-



0.07


Estimated impact of divested businesses prior to sales transaction


-



-



-



0.05



Net Adjustments to Net Income-Increase

$

-


$

0.04


$

-


$

0.12





















Weighted-Average Shares Outstanding - Diluted


220,902



223,381



220,886



223,055




















 

 

 

SOURCE Royal Caribbean Cruises Ltd.



RELATED LINKS

http://www.royalcaribbean.com