Overview
Corp Gov
Press ReleasesFinancial Information
Stock Info
Info Request
Shareholder Benefit
FAQs
Overview
Latest Earnings Call
Q2 2014 Royal Caribbean Cruises Ltd. Earnings Conference Call
Thursday, July 24, 2014 10:00 a.m. ET
RCL (Common Stock)
ExchangeNYSE (US Dollar)
Price$66.86
Change (%)0.00 (1.24%)
Volume1,846,970
Data as of 09/23/14 4:01 p.m. ET
Minimum 20 minute delay
Refresh quote
Investor Tools
Print PagePrint Page
E-mail PageE-mail Page
RSS FeedsRSS Feeds
E-mail AlertsE-mail Alerts
IR ContactsIR Contacts
Financial Tear SheetFinancial Tear Sheet
Online Investor Kit
Most Viewed Links
1.Financial Reports - Annual Reports
2.Royal Caribbean Reports Second Quarter Results, Updates 2014 Guidance and Introduces The Double-Double Program
3.SEC Filings
4.Webcasts & Presentations
5.Royal Caribbean Reports 2013 Results and Provides 2014 Guidance
Updated 09/23/14
* Data collected 09/15/14 - 09/22/14
Corporate Information
1050 Caribbean Way
Miami, FL 33132
Phone (305) 539-6000
Transfer Agent
American Stock Transfer and Trust Company
6201 15th Avenue
Brooklyn, New York 11219
800-937-5449
www.amstock.com
Corporate Counsel
Bradley Stein
Royal Caribbean Cruises Ltd.
1050 Caribbean Way
Miami, FL 33132 
Independent Accountants
PricewaterhouseCoopers, LLP
1441 Brickell Avenue, Suite 1100
Miami, FL 33131-2330 

Press Releases

Printer Friendly Version View printer-friendly version
<< Back
Royal Caribbean Reports Second Quarter Results, Updates 2014 Guidance and Introduces The Double-Double Program
  

MIAMI, July 24, 2014 /PRNewswire/ -- Royal Caribbean Cruises Ltd. (NYSE, OSE: RCL) today reported second quarter results, updated full year guidance and introduced its Double-Double Program, a new three-year profitability initiative.

KEY HIGHLIGHTS

Second Quarter 2014 results:

  • Net Yields were up 2.6% on a Constant-Currency basis (up 2.4% As-Reported).
  • Net Cruise Costs ("NCC") excluding fuel were down 4.7% on a Constant-Currency basis (down 4.2% As-Reported), better than guidance mainly due to timing.
  • Adjusted Net Income of $146.7 million, or $0.66 per share, versus Adjusted Net Income of $34.2 million, or $0.15 per share, in 2013.
  • US GAAP Net Income was $137.7 million or $0.62 per share versus $24.7 million, or $0.11 per share in 2013.

Full Year 2014 forecast:     

  • Net Yields are expected to increase 2% to 3% on a Constant-Currency basis (2% to 3% As-Reported).
  • NCC excluding fuel are expected to be flat to slightly down on a Constant-Currency basis (Approx. flat As-Reported).   
  • Adjusted EPS is expected to be in the range of $3.40 to $3.50 per share. This is a $0.10 increase from the mid-point of the company's previous guidance.

Double-Double Program:

The Double-Double Program is designed to achieve two important goals by 2017: increasing the company's Return on Invested Capital (ROIC) to double digits and doubling 2014 EPS.  The company also believes that articulating clear and specific goals helps guide internal decision-making as well as better informing investors of the path of the business.

"Our focus over the last few years on improving investment returns with moderate capacity growth is clearly paying dividends," said Richard D. Fain, chairman and chief executive officer.  "Our brands have never been stronger and we are well positioned for continued step change in performance.  The Double-Double Program sets demanding, but realistic targets, against which we will measure our continued progress."

SECOND QUARTER RESULTS

Adjusted Net Income for the second quarter of 2014 was $146.7 million, or $0.66 per share, compared to Adjusted Net Income of $34.2 million, or $0.15 per share, in the second quarter of 2013.  US GAAP Net Income for the second quarter 2014 was $137.7 million or $0.62 per share, compared to $24.7 million or $0.11 per share in 2013.  

Net Yields on a Constant-Currency basis increased 2.6% during the quarter.  This was at the high end of the company's guidance driven by strong close-in booking trends for European and China sailings despite continued softness in the Caribbean.  Yields were up double digits in Europe and China offsetting the Caribbean's softness.

"Higher pricing for close-in European sailings propelled us above the top end of our guidance for the quarter," said Jason T. Liberty, chief financial officer. "While the environment in the Caribbean remains promotional, our European itineraries continue to resonate well with strong demand from all markets."

Onboard revenue initiatives continue to deliver positive results with a 3% increase for the quarter.  This is the tenth consecutive quarter of onboard revenue growth.

Constant-Currency NCC excluding fuel decreased 4.7%, which is 220 basis points better than the mid-point of guidance mainly due to timing. Approximately $16 million of expenses expected to be incurred during the second quarter were deferred to the second half of the year. Bunker pricing net of hedging for the second quarter was $711 per metric ton and consumption was 341,000 metric tons.

FULL YEAR 2014

The company has raised full year Adjusted EPS guidance to a range of $3.40 to $3.50 driven by a successful second quarter. Outperforming the mid-point of guidance for the second quarter by $0.16, with $0.07 related to the timing of expenses, drove the increase. Constant-Currency Net Revenue Yields and Net Cruise Costs excluding fuel are expected to be consistent with our previous guidance of up 2% to 3% and flat to slightly down, respectively.

"It is gratifying to raise our 2014 EPS guidance again," said Jason T. Liberty, chief financial officer. "Overall business has been solid and our equity investments continue to outperform, allowing us to deliver even better returns to our shareholders."

Bookings since the April earnings call have been up nicely and the company continues to be booked ahead of last year in both load factor and APD.  Double-digit yield improvement on European and China sailings is helping offset a continued promotional environment in the Caribbean.

NCC excluding fuel are expected to be flat to slightly down on a Constant-Currency basis and approximately flat on an As-Reported basis.  Taking into account current fuel pricing, interest rates, currency exchange rates and the factors detailed above, the company expects 2014 Adjusted EPS to be in the range of $3.40 to $3.50 per share.

THIRD QUARTER 2014

Constant-Currency Net Yields are expected to be up approximately 4.0% in the third quarter of 2014.  NCC excluding fuel are expected to be flat to up 1% on a Constant-Currency basis. Equity investments for the third quarter are expected to increase, mainly driven by the addition of TUI Cruises' Mein Schiff 3.  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 $2.20 per share.

DOUBLE-DOUBLE PROGRAM

In recent years, the company has focused heavily on improving investment returns with moderate capacity growth. Due to the success of this approach, management believes that now is an appropriate time to publicly articulate long-term goals for both ROIC and EPS.

"We are delighted to see how well our brands are doing in the marketplace," said Richard D. Fain, chairman and chief executive officer.  "Our teams have worked diligently to solidify the company's market position while maintaining strong cost discipline.  This has allowed us to target double digit ROIC and a doubling of earnings within three years."

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 $231 million and $949 million of fuel expense in its third quarter and full year 2014 guidance, respectively.

Forecasted consumption is 55% hedged via swaps for the remainder of 2014 and 51%, 35% and 15% hedged for 2015, 2016 and 2017, respectively.  For the same four-year period, the average cost per metric ton of the hedge portfolio is approximately $614, $642, $607 and $589, respectively. 

The company provided the following fuel statistics for the third quarter and full year 2014:

FUEL STATISTICS

Third Quarter 2014

Full Year 2014

Fuel Consumption (metric tons)

325,000

1,345,000

Fuel Expenses

$231 million

$949 million

Percent Hedged (fwd consumption)

57%

55%

Impact of 10% change in fuel prices

$9.8 million

$20.8 million

In summary, the company provided the following guidance for the third quarter and full year of 2014:

GUIDANCE

As-Reported                    Constant-Currency



Third Quarter 2014


Net Yields

5% to 6%

Approx. 4%


Net Cruise Costs per APCD

Approx. 2%

1.5% to 2.0%


Net Cruise Costs per APCD

excluding Fuel

Approx.1%

Flat to up 1%






Full Year 2014


Net Yields

2% to 3%

2% to 3%


Net Cruise Costs per APCD

Flat to up 1%

Flat to up 1%


Net Cruise Costs per APCD

excluding Fuel

Approx. Flat

Flat to slightly down







Third Quarter 2014

Full Year 2014


Capacity Increase

0.3%

1.7%


Depreciation and Amortization

$190 to $200 million

$775 to $785 million


Interest Expense, net

$55 to $60 million

$250 to $255 million


Adjusted EPS

Approx. $2.20

$3.40 to $3.50






1% Change in Currency

$4 million

$7 million


1% Change in Net Yield

$18 million

$33 million


1% Change in NCC x fuel

$9 million

$17 million




Exchange rates used in guidance calculations



Current – July

Previous – April


GBP

$1.71

$1.68


CAD

$0.93

$0.91


BRL

$0.45

$0.45


AUD

$0.94

$0.93


EUR

$1.35

$1.38


LIQUIDITY AND FINANCING ARRANGEMENTS

As of June 30, 2014, liquidity was $1.1 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 2014, 2015, 2016, 2017 and 2018 are $0.2 billion, $0.8 billion, $1.8 billion, $0.9 billion, and $1.3 billion, respectively. 

CAPITAL EXPENDITURES AND CAPACITY GUIDANCE

Based upon current ship orders, projected capital expenditures for full year 2014, 2015, 2016, 2017 and 2018 are $1.4 billion, $1.4 billion, $2.2 billion, $0.3 billion and $1.5 billion, respectively.

Capacity increases for 2014, 2015, 2016, 2017 and 2018 are expected to be 1.7%, 6.9%, 7.0%, 3.7% and 3.9%, respectively.  These figures do not include potential ship sales or additions that we may elect to make in the future.  In the fourth quarter of 2014, the Royal Caribbean International brand takes delivery of the first of three Quantum class vessels.  This is the first new ship delivery for the brand since 2010.

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

Represents US GAAP net income adjusted for certain items where the company believes that the adjustment 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.  Full year 2014 restructuring and related charges are expected to total approximately $23 million, with approximately $5.4 million remaining for the balance of the year.  The estimated impact of the divested Pullmantur non-core businesses reflect first quarter losses of these businesses adjusted for the ownership percentage we retained as well as intercompany transactions that are no longer eliminated in our consolidated statements of comprehensive income (loss).

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 and Net Cruise Costs are our most relevant financial measures.  However, a significant portion of our revenue and expenses are denominated in currencies other than the United States dollar.  Because our reporting currency is the United States 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 and Net Cruise Costs on a "Constant-Currency" basis – i.e. as if the current period's currency exchange rates had remained constant with the comparable prior period's rates.  We calculate "Constant-Currency" by applying the average prior year period exchange rates for each of the corresponding months of the reported and/or forecasted period, so as to calculate what the results would have been had exchange rates been the same throughout both periods.  We do not make predictions about future exchange rates and use current exchange rates for calculations of future periods.  It should be emphasized that the use of Constant-Currency is primarily used by us for comparing short-term changes and/or projections.  Over the longer term, changes in guest sourcing and shifting the amount of purchases between currencies significantly change the impact of the purely currency-based fluctuations. 

Gross Cruise Costs

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

Gross Yields

Gross Yields represent total revenues per APCD. 

Net Cruise Costs ("NCC")

Net Cruise Costs represent Gross Cruise Costs excluding commissions, transportation and other expenses and onboard and other 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.  A reconciliation of historical Gross Cruise Costs to Net Cruise Costs is provided below under Results of Operations.  We have not provided a quantitative reconciliation of projected Gross Cruise Costs to projected Net Cruise Costs 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 42 ships with an additional six under construction contracts.  They operate diverse itineraries around the world that call on approximately 490 destinations on all seven continents.  Additional information can be found on www.royalcaribbean.com, www.celebritycruises.com, www.pullmantur.es, www.azamaraclubcruises.com, www.cdfcroisieresdefrance.com or www.rclinvestor.com.

Certain statements in this release relating to, among other things, our future performance constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995.  These statements include, but are not limited to, statements regarding expected financial results for the third quarter and full year 2014, and expectations regarding the timing and results of our Double-Double initiative, costs related to our restructuring initiatives, and the costs and yields expected in 2014 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, 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 and subsequent quarterly reports on Form 10-Q, copies 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,







2014



2013



2014



2013




















Passenger ticket revenues


$

1,455,099


$

1,366,713


$

2,803,302


$

2,760,491




Onboard and other revenues



524,944



516,054



1,063,965



1,033,496




        Total revenues



1,980,043



1,882,767



3,867,267



3,793,987




Cruise operating expenses:

















Commissions, transportation and other



346,180



316,506



672,045



639,443





Onboard and other



150,606



140,710



273,638



262,197





Payroll and related



209,171



208,975



419,972



418,898





Food



119,184



112,530



237,264



232,013





Fuel



242,804



232,471



487,263



474,123





Other operating



262,729



312,427



544,472



579,135






Total cruise operating expenses



1,330,674



1,323,619



2,634,654



2,605,809




Marketing, selling and administrative expenses



260,988



257,948



551,295



531,982




Depreciation and amortization expenses



192,880



186,184



386,615



375,548




Restructuring charges



(86)



1,678



1,650



1,678




Operating Income



195,587



113,338



293,053



278,970




Other income (expense):

















Interest income



2,630



3,405



5,906



7,152





Interest expense, net of interest capitalized



(65,260)



(86,877)



(133,831)



(177,059)





Other income (expense)



4,716



(5,119)



(998)



(8,090)







(57,914)



(88,591)



(128,923)



(177,997)




Net Income


$

137,673


$

24,747


$

164,130


$

100,973




















Earnings Per Share:
















Basic


$

0.62


$

0.11


$

0.74


$

0.46




Diluted


$

0.62


$

0.11


$

0.74


$

0.46




















Weighted-Average Shares Outstanding:
















Basic



222,189



219,502



221,745



219,301




Diluted



223,381



220,648



223,055



220,596




















































Comprehensive Income
















Net Income


$

137,673


$

24,747


$

164,130


$

100,973




Other comprehensive (loss) income:

















Foreign currency translation adjustments



(1,833)



(1,551)



637



(5,795)





Change in defined benefit plans



(2,054)



5,293



(4,085)



5,293





(Loss) gain on cash flow derivative hedges



(20,638)



17,542



(73,553)



(5,058)






Total other comprehensive (loss) income



(24,525)



21,284



(77,001)



(5,560)




















Comprehensive Income


$

113,148


$

46,031


$

87,129


$

95,413



















































STATISTICS




















Quarter Ended



Six Months Ended





June 30,



June 30,






2014



2013



2014



2013




















Passengers Carried



1,283,596



1,174,397



2,561,830



2,435,689




















Passenger Cruise Days



9,032,618



8,485,968



17,886,254



17,330,559




















APCD



8,607,667



8,238,182



17,080,917



16,666,292




Occupancy



104.9%



103.0%



104.7%



104.0%



 

ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)




As  of



June 30,


December 31,




2014


2013




(unaudited)




Assets






Current assets







Cash and cash equivalents


$     185,262


$        204,687



Trade and other receivables, net


293,516


259,746



Inventories


143,375


151,244



Prepaid expenses and other assets


299,882


252,852



Derivative financial instruments


56,305


87,845



   Total current assets


978,340


956,374









Property and equipment, net


17,474,143


17,517,752


Goodwill


438,367


439,231


Other assets


1,121,361


1,159,590




$ 20,012,211


$   20,072,947








Liabilities and Shareholders' Equity






Current liabilities







Current portion of long-term debt


$     494,579


$     1,563,378



Accounts payable


331,462


372,226



Accrued interest


44,006


103,025



Accrued expenses and other liabilities


576,233


563,702



Customer deposits


2,103,140


1,664,679



   Total current liabilities


3,549,420


4,267,010


Long-term debt


7,099,269


6,511,426


Other long-term liabilities


514,282


486,246








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;







232,639,334 and 230,782,315 shares issued, June 30, 2014







and December 31, 2013, respectively)


2,326


2,308



Paid-in capital


3,223,832


3,159,038



Retained earnings


6,108,116


6,054,952



Accumulated other comprehensive (loss) income


(71,330)


5,671



Treasury stock (10,308,683 common shares at
   cost, June 30, 2014 and December 31, 2013)


(413,704)


(413,704)



   Total shareholders' equity


8,849,240


8,808,265





$ 20,012,211


$   20,072,947


 


ROYAL CARIBBEAN CRUISES LTD. 


CONSOLIDATED STATEMENTS OF CASH FLOWS 


(unaudited, in thousands) 











Six Months Ended




June 30,





2014


2013










Operating Activities







Net income


$   164,130


$   100,973



Adjustments:








Depreciation and amortization


386,615


375,548




(Gain) loss on derivative instruments not designated as hedges


(10,841)


25,494



Changes in operating assets and liabilities:








Decrease in trade and other receivables, net


15,903


21,084




Decrease in inventories


7,777


4,679




Increase in prepaid expenses and other assets


(35,799)


(53,555)




Decrease in accounts payable


(41,228)


(36,265)




Decrease in accrued interest


(59,019)


(31,259)




Increase (decrease) in accrued expenses and other liabilities


45,730


(6,513)




Increase in customer deposits


388,693


272,329



Other, net


18,968


273



Net cash provided by operating activities


880,929


672,788










Investing Activities







Purchases of property and equipment


(342,472)


(396,073)



Cash received (paid) on settlement of derivative financial instruments


18,096


(25,843)



Investments in unconsolidated affiliates


(68,885)


(35,757)



Cash received on loan to unconsolidated affiliate


66,138


11,993



Other, net


1,280


781



Net cash used in investing activities


(325,843)


(444,899)










Financing Activities







Debt proceeds


1,846,200


1,519,464



Debt issuance costs


(33,627)


(20,554)



Repayments of debt


(2,334,396)


(1,670,248)



Dividends paid


(131,857)


(54,098)



Proceeds from exercise of common stock options


54,938


6,918



Cash received on settlement of derivative financial instruments


22,835


-



Other, net


941


742



Net cash used in financing activities


(574,966)


(217,776)










Effect of exchange rate changes on cash

 


455


206










Net (decrease) increase in cash and cash equivalents


(19,425)


10,319



Cash and cash equivalents at beginning of period


204,687


194,855



Cash and cash equivalents at end of period


$   185,262


$   205,174










Supplemental Disclosure







Cash paid during the period for:








Interest, net of amount capitalized


$   173,470


$   199,288










Non cash Investing Activities







Purchases of property and equipment through asset trade in


$             -


$    46,375


 

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,




2014



2014
On a
Constant
Currency
basis



2013




2014



2014
On a
Constant
Currency
basis



2013






















Passenger ticket revenues

$

1,455,099


$

1,456,740


$

1,366,713



$

2,803,302


$

2,843,461


$

2,760,491


Onboard and other revenues


524,944



523,820



516,054




1,063,965



1,064,584



1,033,496


Total revenues


1,980,043



1,980,560



1,882,767




3,867,267



3,908,045



3,793,987


Less:





















Commissions, transportation and other


346,180



345,544



316,506




672,045



678,005



639,443



Onboard and other


150,606



149,711



140,710




273,638



273,798



262,197


Net Revenues including divested businesses


1,483,257



1,485,305



1,425,551




2,921,584



2,956,242



2,892,347


Less:





















Net Revenues related to divested businesses





















prior to sales transaction


-



-



39,431




35,656



34,403



72,545


Net revenues

$

1,483,257


$

1,485,305


$

1,386,120



$

2,885,928


$

2,921,839


$

2,819,802






















APCD


8,607,667



8,607,667



8,238,182




17,080,917



17,080,917



16,666,292


Gross Yields

$

230.03


$

230.09


$

228.54



$

226.41


$

228.80


$

227.64


Net Yields

$

172.32


$

172.56


$

168.26



$

168.96


$

171.06


$

169.19
























 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,




2014



2014
On a
Constant Currency basis



2013




2014



2014
On a
Constant Currency basis



2013






















Total cruise operating expenses

$

1,330,674


$

1,328,146


$

1,323,619



$

2,634,654


$

2,642,448


$

2,605,809


Marketing, selling and administrative expenses


260,988



258,818



257,948




551,295



548,640



531,982


Gross Cruise Costs


1,591,662



1,586,964



1,581,567




3,185,949



3,191,088



3,137,791


Less:





















Commissions, transportation and other


346,180



345,544



316,506




672,045



678,005



639,443



Onboard and other


150,606



149,711



140,710




273,638



273,798



262,197


Net Cruise Costs including divested businesses


1,094,876



1,091,709



1,124,351




2,240,266



2,239,285



2,236,151


Less:





















Net Cruise Costs related to divested businesses





















prior to sales transaction


-



-



49,196




47,854



46,158



84,167



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


8,562



8,472



-




13,796



12,796



-


Net Cruise Costs


1,086,314



1,083,237



1,075,155




2,178,616



2,180,331



2,151,984


Less:





















Fuel


242,804



243,770



232,471




487,263



489,700



474,123


Net Cruise Costs Excluding Fuel

$

843,510


$

839,467


$

842,684



$

1,691,353


$

1,690,631


$

1,677,861






















APCD


8,607,667



8,607,667



8,238,182




17,080,917



17,080,917



16,666,292


Gross Cruise Costs per APCD

$

184.91


$

184.37


$

191.98



$

186.52


$

186.82


$

188.27


Net Cruise Costs per APCD

$

126.20


$

125.85


$

130.51



$

127.55


$

127.65


$

129.12


Net Cruise Costs Excluding Fuel per APCD

$

98.00


$

97.53


$

102.29



$

99.02


$

98.98


$

100.67

 

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,









2014



2013






















Long-term debt, net of current portion


$  7,099,269



$   6,511,426










Current portion of long-term debt


494,579



1,563,378










Total debt  


7,593,848



8,074,804










Less: Cash and cash equivalents


185,262



204,687










Net Debt


$  7,408,586



$   7,870,117

























Total shareholders' equity 


$  8,849,240



$   8,808,265










Total debt


7,593,848



8,074,804










Total debt and shareholders' equity


$ 16,443,088



$ 16,883,069










Debt-to-Capital  


46.2%



47.8%










Net Debt  


$  7,408,586



$   7,870,117










Net Debt and shareholders' equity


$ 16,257,826



$ 16,678,382










Net Debt-to-Capital  


45.6%



47.2%






















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,




2014



2013



2014



2013















Net Income 

$

137,673


$

24,747


$

164,130


$

100,973


Restructuring charges


(86)



1,678



1,650



1,678


Other initiative costs


9,122



-



16,035



-


Estimated impact of divested businesses prior to sales transaction


-



7,772



11,013



9,696















Adjusted Net Income 

$

146,709


$

34,197


$

192,828


$

112,347















Weighted-Average Shares Outstanding - Diluted


223,381



220,648



223,055



220,596




























Earnings per Share - Diluted

$

0.62


$

0.11


$

0.74


$

0.46


Restructuring charges


-



0.01



-



0.01


Other initiative costs


0.04



-



0.07



-


Estimated impact of divested businesses prior to sales transaction


-



0.03



0.05



0.04


Adjusted Earnings per Share - Diluted

$

0.66


$

0.15


$

0.86


$

0.51

































 

SOURCE Royal Caribbean