Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 03, 2016 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | NCL CORP Ltd. | |
Entity Central Index Key | 1,318,742 | |
Trading Symbol | nclc | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock Shares Outstanding | 31,164,004 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Revenue | ||||
Passenger ticket | $ 818,478 | $ 787,991 | $ 1,558,590 | $ 1,458,474 |
Onboard and other | 368,357 | 297,442 | 705,877 | 565,141 |
Total revenue | 1,186,835 | 1,085,433 | 2,264,467 | 2,023,615 |
Cruise operating expense | ||||
Commissions, transportation and other | 193,536 | 192,438 | 368,973 | 364,265 |
Onboard and other | 75,790 | 67,885 | 139,755 | 126,530 |
Payroll and related | 184,476 | 161,930 | 361,619 | 319,559 |
Fuel | 80,607 | 91,581 | 162,279 | 178,955 |
Food | 49,769 | 43,699 | 100,772 | 85,550 |
Other | 121,722 | 98,746 | 236,983 | 205,120 |
Total cruise operating expense | 705,900 | 656,279 | 1,370,381 | 1,279,979 |
Other operating expense | ||||
Marketing, general and administrative | 148,569 | 106,346 | 328,159 | 259,846 |
Depreciation and amortization | 104,610 | 104,607 | 205,905 | 204,583 |
Total other operating expense | 253,179 | 210,953 | 534,064 | 464,429 |
Operating income | 227,756 | 218,201 | 360,022 | 279,207 |
Non-operating income (expense) | ||||
Interest expense, net | (68,420) | (52,446) | (128,174) | (103,435) |
Other expense | (10,753) | (3,717) | (7,948) | (33,856) |
Total non-operating income (expense) | (79,173) | (56,163) | (136,122) | (137,291) |
Net income before income taxes | 148,583 | 162,038 | 223,900 | 141,916 |
Income tax expense | (484) | (202) | (828) | (103) |
Net income | $ 148,099 | $ 161,836 | $ 223,072 | $ 141,813 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net income | $ 148,099 | $ 161,836 | $ 223,072 | $ 141,813 |
Other comprehensive income: | ||||
Shipboard Retirement Plan | 108 | 120 | 216 | 239 |
Cash flow hedges: | ||||
Net unrealized income (loss) | 5,007 | 70,491 | 75,457 | (33,274) |
Amount realized and reclassified into earnings | 23,781 | 26,564 | 58,331 | 48,450 |
Total other comprehensive income | 28,896 | 97,175 | 134,004 | 15,415 |
Total comprehensive income | $ 176,995 | $ 259,011 | $ 357,076 | $ 157,228 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 140,348 | $ 113,183 |
Accounts receivable, net | 60,177 | 44,996 |
Inventories | 67,697 | 58,173 |
Prepaid expenses and other assets | 165,340 | 121,259 |
Total current assets | 433,562 | 337,611 |
Property and equipment, net | 10,068,499 | 9,458,805 |
Goodwill | 1,388,931 | 1,388,931 |
Tradenames | 817,525 | 817,525 |
Other long-term assets | 221,539 | 237,472 |
Total assets | 12,930,056 | 12,240,344 |
Current liabilities: | ||
Current portion of long-term debt | 581,804 | 629,840 |
Accounts payable | 46,463 | 51,352 |
Accrued expenses and other liabilities | 570,124 | 637,743 |
Due to Affiliate | 20,769 | |
Due to NCLH | 43,380 | 32,732 |
Advance ticket sales | 1,390,137 | 1,023,973 |
Total current liabilities | 2,631,908 | 2,396,409 |
Long-term debt | 5,971,143 | 5,767,697 |
Other long-term liabilities | 259,121 | 332,879 |
Total liabilities | 8,862,172 | 8,496,985 |
Commitments and contingencies (Note 9) | ||
Shareholders' equity: | ||
Ordinary shares, $.0012 par value; 40,000,000 shares authorized; 31,164,004 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively | 37 | 37 |
Additional paid-in capital | 3,761,077 | 3,729,628 |
Accumulated other comprehensive income (loss) | (280,359) | (414,363) |
Retained earnings | 587,129 | 428,057 |
Total shareholders' equity | 4,067,884 | 3,743,359 |
Total liabilities and shareholders' equity | $ 12,930,056 | $ 12,240,344 |
Consolidated Balance Sheets (U5
Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Ordinary shares, par value (in dollars per share) | $ 0.0012 | $ 0.0012 |
Ordinary shares, authorized | 40,000,000 | 40,000,000 |
Ordinary shares, issued | 31,164,004 | 31,164,004 |
Ordinary shares, outstanding | 31,164,004 | 31,164,004 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities | ||
Net income | $ 223,072 | $ 141,813 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization expense | 212,268 | 214,717 |
Loss on derivatives | 2,866 | 27,475 |
Deferred income taxes, net | 388 | |
Gain on contingent consideration | (43,400) | |
Write-off of deferred financing fees | 11,427 | 195 |
Provision for bad debts and inventory | 1,115 | |
Share-based compensation expense | 31,449 | 14,166 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (16,146) | (4,369) |
Inventories | (9,674) | (3,246) |
Prepaid expenses and other assets | (25,674) | (9,297) |
Accounts payable | (10,896) | (47,068) |
Accrued expenses and other liabilities | (26,112) | 16,728 |
Advance ticket sales | 358,625 | 412,602 |
Net cash provided by operating activities | 752,708 | 720,316 |
Cash flows from investing activities | ||
Additions to property and equipment, net | (764,899) | (205,056) |
Settlement of derivatives | (34,129) | |
Net cash used in investing activities | (799,028) | (205,056) |
Cash flows from financing activities | ||
Repayments of long-term debt | (2,386,427) | (791,403) |
Repayments to Affiliate | (18,522) | (18,522) |
Proceeds from long-term debt | 2,564,116 | 340,060 |
Due to NCLH, net | 10,648 | 46,179 |
Dividends | (64,000) | |
Deferred financing fees and other | (32,330) | (3,663) |
Net cash provided by (used in) financing activities | 73,485 | (427,349) |
Net increase in cash and cash equivalents | 27,165 | 87,911 |
Cash and cash equivalents at beginning of period | 113,183 | 82,862 |
Cash and cash equivalents at end of period | $ 140,348 | $ 170,773 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Ordinary Shares | Additional paid-in capital | Accumulated Other Comprehensive Income (Loss) | Retained earnings | Total |
Balance at Dec. 31, 2014 | $ 37 | $ 3,687,419 | $ (244,355) | $ 76,256 | $ 3,519,357 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 14,166 | 14,166 | |||
Other comprehensive income, net | 15,415 | 15,415 | |||
Net income | 141,813 | 141,813 | |||
Balance at Jun. 30, 2015 | 37 | 3,701,585 | (228,940) | 218,069 | 3,690,751 |
Balance at Dec. 31, 2015 | 37 | 3,729,628 | (414,363) | 428,057 | 3,743,359 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 31,449 | 31,449 | |||
Dividends | (64,000) | (64,000) | |||
Other comprehensive income, net | 134,004 | 134,004 | |||
Net income | 223,072 | 223,072 | |||
Balance at Jun. 30, 2016 | $ 37 | $ 3,761,077 | $ (280,359) | $ 587,129 | $ 4,067,884 |
Description of Business and Org
Description of Business and Organization | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Description of Business and Organization | 1. Description of Business and Organization NCLH is a leading global cruise company which operates the Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises brands. We have 24 ships with approximately 46,500 Berths including Sirena, previously under a Bareboat Charter, which joined our Oceania Cruises’ fleet in April 2016 and Seven Seas Explorer which was delivered in June 2016. We will introduce four additional ships to our fleet through 2020 including an Explorer Class Ship on order for delivery in the winter of 2020. Norwegian Joy is on order for delivery in the spring of 2017 and two additional Breakaway Plus Class Ships are on order for deliveries to the Norwegian fleet in the spring of 2018 and fall of 2019. These additions to our fleet will increase our total Berths to approximately 59,300. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements are unaudited and, in our opinion, contain all normal recurring adjustments necessary for a fair statement of the results for the periods presented. Our operations are seasonal and results for interim periods are not necessarily indicative of the results for the entire fiscal year. Historically, demand for cruises has been strongest during the Northern Hemisphere’s summer months. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2015, which are included in our most recently filed Annual Report on Form 10-K. Reclassification Certain amounts in prior periods have been reclassified to conform to the current period presentation. Revenue and Expense Recognition Deposits received from guests for future voyages are recorded as advance ticket sales and are subsequently recognized as passenger ticket revenue along with onboard and other revenue, and all associated direct costs of a voyage are recognized as cruise operating expenses on a pro-rata basis over the period of the voyage. Guest cancellation fees are recognized in passenger ticket revenue in the month of the cancellation. Certain of our product offerings are accounted for under the guidance included within multi-element arrangements and result in an allocation of the fair value between passenger ticket revenue and onboard and other revenue. Revenue and expenses include port fees and taxes. The amounts included on a gross basis are $71.8 million and $62.4 million for the three months ended June 30, 2016 and 2015, respectively, and $134.3 million and $114.3 million for the six months ended June 30, 2016 and 2015, respectively. Foreign Currency The majority of our transactions are settled in U.S. dollars. We translate assets and liabilities of our foreign subsidiaries at exchange rates in effect at the balance sheet date. Gains or losses resulting from transactions denominated in other currencies are recognized in our consolidated statements of operations within other expense. We recognized gains of $3.9 million and $0.8 million for the three months ended June 30, 2016 and 2015, respectively, and a loss of $0.3 million and a gain of $5.7 million for the six months ended June 30, 2016 and 2015, respectively. Depreciation and Amortization Expense The amortization of deferred financing fees is included in depreciation and amortization expense in the consolidated statements of cash flows; however, for purposes of the consolidated statements of operations they are included in interest expense, net. Recently Issued Accounting Pronouncements In May 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-12 which addresses improvements to the guidance on revenue from contracts from customers regarding collectibility, noncash consideration, and completed contracts at transition. Additionally, it provides a practical expedient for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. The effective date of this guidance is upon adoption of ASU No. 2014-09. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-11 which is a rescission of Securities and Exchange Commission guidance related to the issuance of ASU No. 2014-09 which is presented below. The effective date of this guidance is upon adoption of ASU No. 2014-09. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, which does not change the core principle of the guidance in ASU No. 2014-09 but clarifies two aspects: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. The effective date of this guidance is upon adoption of ASU No. 2014-09. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09 to improve multiple aspects of the accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The guidance is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods with early adoption permitted. We do not believe that the adoption of this guidance will be material to our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The ASU requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The ASU further modifies lessors’ classification criteria for leases and the accounting for sales-type and direct financing leases. The ASU will also require qualitative and quantitative disclosures designed to give financial statement users additional information on the amount, timing, and uncertainty of cash flows arising from leases. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2018 with early adoption permitted. The ASU is to be applied using a modified retrospective approach. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11 to simplify the measurement of inventory for all entities. This applies to all inventory that is measured using either the first-in, first-out or average cost method. The guidance requires an entity to measure inventory at the lower of cost or net realizable value. The guidance must be applied prospectively and will be effective for our interim and annual reporting periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of an interim or annual reporting period. We are currently evaluating the impact of the adoption of this guidance to our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-05 to clarify a customer’s accounting for fees paid in a cloud computing arrangement. The amendments provide guidance to customers about whether a cloud computing arrangement includes a software license or if the arrangement should be accounted for as a service contract. This guidance will impact the accounting of software licenses but will not change a customer’s accounting for service contracts. The guidance will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. We have adopted this guidance and there has not been an impact to our consolidated financial statements. In May 2014, FASB issued ASU No. 2014-09 which requires entities to recognize revenue through the application of a five-step model, including identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligation and recognition of revenue as the entity satisfies the performance obligations. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance. In August 2015, the FASB issued ASU No. 2015-14 deferring the effective date for one year. We can elect to adopt the provisions of ASU No. 2014-09 for annual periods beginning after December 15, 2017 including interim periods within that reporting period or we can elect to early adopt the guidance as of the original effective date. We are currently evaluating the impact of the adoption of this guidance to our consolidated financial statements. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 3. Intangible Assets The gross carrying amounts of intangible assets included within other long-term assets, the related accumulated amortization, the net carrying amounts and the weighted-average amortization periods of the Company’s intangible assets are listed in the following table (in thousands, except amortization period): June 30, 2016 Gross Carrying Accumulated Net Carrying Weighted- Customer relationships $ 120,000 $ (26,060 ) $ 93,940 6.0 Licenses 3,368 (461 ) 2,907 5.6 Non-compete agreements 660 (165 ) 495 1.0 Total intangible assets subject to amortization $ 124,028 $ (26,686 ) $ 97,342 License (Indefinite-lived) $ 4,427 $ — $ — December 31, 2015 Gross Carrying Accumulated Net Carrying Weighted- Customer relationships $ 120,000 $ (15,527 ) $ 104,473 6.0 Backlog 70,000 (70,000 ) — 1.0 Licenses 3,368 (208 ) 3,160 5.6 Total intangible assets subject to amortization $ 193,368 $ (85,735 ) $ 107,633 License (Indefinite-lived) $ 4,427 $ — $ — The aggregate amortization expense is as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Amortization expense $ 5,562 $ 20,992 $ 10,951 $ 39,222 The following table sets forth the Company’s estimated aggregate amortization expense for each of the five years below (in thousands): Year ended December 31, Amortization 2017 $ 31,342 2018 26,058 2019 18,489 2020 9,906 2021 75 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Accumulated other comprehensive income (loss) | 4. Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive income (loss) for the six months ended June 30, 2016 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (414,363 ) $ (405,945 ) $ (8,418 ) Current period other comprehensive income before reclassifications 75,457 75,457 — Amounts reclassified into earnings 58,547 58,331 (1) 216 (2) Accumulated other comprehensive income (loss) at end of period $ (280,359 ) $ (272,157 )(3) $ (8,202 ) (1) We refer you to Note 7— “Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. (3) Includes $73.6 million of loss expected to be reclassified into earnings in the next 12 months. Accumulated other comprehensive income (loss) for the six months ended June 30, 2015 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (244,355 ) $ (234,835 ) $ (9,520 ) Current period other comprehensive loss before reclassifications (33,274 ) (33,274 ) — Amounts reclassified into earnings 48,689 48,450 (1) 239 (2) Accumulated other comprehensive income (loss) at end of period $ (228,940 ) $ (219,659 ) $ (9,281 ) (1) We refer you to Note 7— “Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. |
Property and Equipment, net
Property and Equipment, net | 6 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment, Net [Abstract] | |
Property and Equipment, net | 5. Property and Equipment, net Property and equipment, net increased $609.7 million for the six months ended June 30, 2016 primarily due to the delivery of Seven Seas Explorer and the refurbishment of several ships. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 30, 2016 | |
Long-term Debt, Unclassified [Abstract] | |
Long-Term Debt | 6. Long-Term Debt In June 2016, NCLC and Voyager Vessel Company, LLC, indirect subsidiaries of NCLH, entered into a Second Amended and Restated Credit Agreement (the “Amended Senior Secured Credit Facility”) with a syndicate of banks which restates the Amended and Restated Credit Agreement, dated as of October 31, 2014 (the “Existing Senior Secured Credit Facility”). The Amended Senior Secured Credit Facility amends the Existing Senior Secured Credit Facility to, among other things, (i) (a) increase the aggregate amount of commitments under the Revolving Loan Facility from $625.0 million to $750.0 million (the “New Revolving Loan Facility”) and (b) increase the aggregate principal amount outstanding under the $1.38 billion term loan facility from $1.16 billion to $1.51 billion (the “New Term Loan A Facility”) and (ii) extend the maturity of the New Term Loan A Facility and the New Revolving Loan Facility to June 2021 (the “Extended Maturity Date”). The agreement incorporates a springing maturity date for the New Term Loan A Facility and the New Revolving Loan Facility such that both mature on (A) the earlier date that is 91 days prior to the final maturity date of NCLC’s $680.0 million aggregate principal amount of 5.25% senior unsecured notes due 2019 (the “5.25% Notes”) if on such date (x) the 5.25% Notes have not been repaid (or refinanced with indebtedness maturing after the Extended Maturity Date) by such date and (y) free liquidity does not exceed the aggregate principal amount of outstanding 5.25% Notes by at least $50.0 million and (B) the earlier date that is 91 days prior to the final maturity date of NCLC’s $600.0 million aggregate principal amount of 4.625% senior unsecured notes due 2020 (the “4.625% Notes”) if on such date (x) the 4.625% Notes have not been repaid (or refinanced with indebtedness maturing after the Extended Maturity Date) by such date and (y) free liquidity does not exceed the aggregate principal amount of outstanding 4.625% Notes by at least $50.0 million. NCLC used proceeds of approximately $1.59 billion from the New Term Loan A Facility and the New Revolving Loan Facility to prepay the entire outstanding principal amount of the Revolving Loan Facility, the $1.38 billion term loan facility and the $350.0 million term loan facility. The New Term Loan A Facility and New Revolving Loan Facility bear interest at a rate per annum of (a) an adjusted LIBOR rate or (b) a base rate determined by reference to the greatest of (i) the federal funds rate plus 0.50%, (ii) the prime rate in effect on such day and (iii) the adjusted LIBOR rate plus 1%, in each case plus an applicable margin that is determined by reference to a total leverage ratio, with an applicable margin of between 2.25% and 1.50% with respect to Eurocurrency loans and between 1.25% and 0.50% with respect to base rate loans. The initial applicable margin for borrowings is 2.25% with respect to Eurocurrency borrowings and 1.25% with respect to base rate borrowings. The New Term Loan A Facility will be paid in quarterly installments commencing in September 2016, in a principal amount equal to (a) in the case of installments payable on or prior to June 6, 2018, 1.25% of the loans outstanding immediately after the closing date under the New Term Loan A Facility and (b) in the case of installments payable after June 6, 2018, 2.50% of the loans outstanding immediately after the closing date under the New Term Loan A Facility, with the remaining unpaid principal amount of loans under the New Term Loan A Facility due and payable in full at maturity on June 6, 2021. Principal amounts outstanding under the New Revolving Loan Facility are due and payable in full at maturity on June 6, 2021, subject to earlier repayment pursuant to the springing maturity date described above. In addition to paying interest on outstanding principal under the borrowings, we are obligated to pay a quarterly commitment fee at a rate determined by reference to a total leverage ratio, with a maximum commitment fee of 40% of the applicable margin for Eurocurrency loans. In June 2016, we took delivery of Seven Seas Explorer. To finance the payment due upon delivery, we had export financing in place for 80% of the contract price. The associated $373.6 million term loan bears interest at 3.43% with a maturity date of June 30, 2028. Principal and interest payments shall be paid semiannually. |
Fair Value Measurements and Der
Fair Value Measurements and Derivatives | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Fair Value Measurements and Derivatives | 7. Fair Value Measurements and Derivatives Fair value is defined as the price at which an orderly transaction to sell an asset or to transfer a liability would take place between market participants at the measurement date under current market conditions (that is, an exit price at the measurement date from the perspective of a market participant that holds the asset or owes the liability). Fair Value Hierarchy The following hierarchy for inputs used in measuring fair value should maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs be used when available: Level 1 Quoted prices in active markets for identical assets or liabilities that are accessible at the measurement dates. Level 2 Significant other observable inputs that are used by market participants in pricing the asset or liability based on market data obtained from independent sources. Level 3 Significant unobservable inputs we believe market participants would use in pricing the asset or liability based on the best information available. Derivatives We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We attempt to minimize these risks through a combination of our normal operating and financing activities and through the use of derivatives. We assess whether derivatives used in hedging transactions are “highly effective” in offsetting changes in the cash flow of our hedged forecasted transactions. We use regression analysis for this hedge relationship and high effectiveness is achieved when a statistically valid relationship reflects a high degree of offset and correlation between the fair values of the derivative and the hedged forecasted transaction. Cash flows from the derivatives are classified in the same category as the cash flows from the underlying hedged transaction. The determination of ineffectiveness is based on the amount of dollar offset between the cumulative change in fair value of the derivative and the cumulative change in fair value of the hedged transaction at the end of the reporting period. If it is determined that a derivative is not highly effective as a hedge, or if the hedged forecasted transaction is no longer probable of occurring, then the amount recognized in accumulated other comprehensive income (loss) is released to earnings. In addition, the ineffective portion of our highly effective hedges is recognized in earnings immediately and reported in other income (expense) in our consolidated statements of operations. There are no amounts excluded from the assessment of hedge effectiveness and there are no credit-risk-related contingent features in our derivative agreements. We monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. Credit risk, including but not limited to counterparty non-performance under derivatives and our New Revolving Loan Facility, is not considered significant, as we primarily conduct business with large, well-established financial institutions that we have established relationships with and that have credit risks acceptable to us or the credit risk is spread out among a large number of creditors. We do not anticipate non-performance by any of our significant counterparties. The following table sets forth our derivatives measured at fair value and discloses the balance sheet location (in thousands): Asset Liability Balance Sheet location June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 Fuel swaps designated as hedging instruments Prepaid expenses and other assets $15,972 $ — $ — $ — Other long-term assets 7,084 — — — Accrued expenses and other liabilities — — 82,672 128,740 Other long-term liabilities 7,340 — 79,646 132,494 Fuel swaps not designated as hedging instruments Accrued expenses and other liabilities — — 1,801 — Foreign currency forward contracts designated as hedging instruments Prepaid expenses and other assets 6,135 — 3,414 — Other long-term assets 2,577 3,446 386 1,370 Accrued expenses and other liabilities 731 — 13,514 8,737 Other long-term liabilities 1,814 551 20,165 24,181 Foreign currency collar not designated as a hedging instrument Accrued expenses and other liabilities — — — 42,993 Interest rate swaps designated as hedging instruments Accrued expenses and other liabilities — — 4,328 4,079 Other long-term liabilities — — 3,973 3,395 The fair values of swap and forward contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. The Company determines the value of options and collars utilizing an option pricing model based on inputs that are either readily available in public markets or can be derived from information available in publicly quoted markets. The option pricing model used by the Company is an industry standard model for valuing options and is used by the broker/dealer community. The inputs to this option pricing model are the option strike price, underlying price, risk-free rate of interest, time to expiration, and volatility. The fair value of option contracts considers both the intrinsic value and any remaining time value associated with those derivatives that have not yet settled. The Company also considers counterparty credit risk and its own credit risk in its determination of all estimated fair values. Our derivatives and financial instruments were categorized as Level 2 in the fair value hierarchy, and we had no derivatives or financial instruments categorized as Level 1 or Level 3. Our derivative contracts include rights of offset with our counterparties. We have elected to net certain assets and liabilities within counterparties when the rights of offset exist. We are not required to post cash collateral related to our derivative instruments. The following table discloses the gross and net amounts recognized within assets and liabilities (in thousands): June 30, 2016 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 31,768 $ (3,800 ) $ 27,968 $ (2,715 ) $ 25,253 Liabilities 206,099 (9,885 ) 196,214 (30,707 ) 165,507 December 31, 2015 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 3,446 $ (1,370 ) $ 2,076 $ (2,043 ) $ 33 Liabilities 344,619 (551 ) 344,068 (336,645 ) 7,423 Fuel Swaps As of June 30, 2016, we had fuel swaps maturing through December 31, 2019 which are used to mitigate the financial impact of volatility in fuel prices pertaining to approximately 1.8 million metric tons of our projected fuel purchases. The effects on the consolidated financial statements of the fuel swaps which were designated as cash flow hedges were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain recognized in other comprehensive income – effective portion $ 85,808 $ 34,133 $ 76,302 $ 31,332 Loss recognized in other expense – ineffective portion (3,524 ) (3,194 ) (8,751 ) (9,245 ) Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 20,440 15,297 51,577 35,833 As of June 30, 2016, we had fuel swaps pertaining to approximately 22,000 metric tons which were not designated as cash flow hedges. These fuel swaps were previously designated as cash flow hedges and were dedesignated due to a change in our expected future fuel purchases mix. The effects on the consolidated financial statements of the fuel swaps which were dedesignated and recognized into earnings were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Loss recognized in other expense $ (92 ) $ — $ (92 ) $ — Amount reclassified from accumulated other comprehensive income (loss) into other expense 1,465 10,000 2,994 10,000 Fuel Collars We had fuel collars that matured and were used to mitigate the financial impact of volatility in fuel prices of our fuel purchases. The effects on the consolidated financial statements of the fuel collars which were designated as cash flow hedges were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into fuel expense $ — $ 10 $ — $ 248 Foreign Currency Options We had foreign currency options that matured which consisted of call options with deferred premiums. These options were used to mitigate the financial impact of volatility in foreign currency exchange rates related to our ship construction contracts denominated in euros. If the spot rate at the date the ships were delivered was less than the strike price under these option contracts, we would have paid the deferred premium and would not exercise the foreign currency options. The effects on the consolidated financial statements of the foreign currency options which were designated as cash flow hedges were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense $ 330 $ 330 $ 660 $ 660 Foreign Currency Forward Contracts As of June 30, 2016, we had foreign currency forward contracts which are used to mitigate the financial impact of volatility in foreign currency exchange rates related to our ship construction contracts and forecasted Dry-dock payments denominated in euros. The notional amount of our foreign currency forward contracts was €2.3 billion, or $2.6 billion based on the euro/U.S. dollar exchange rate as of June 30, 2016. The effects on the consolidated financial statements of the foreign currency forward contracts which were designated as cash flow hedges were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain (loss) recognized in other comprehensive income – effective portion $ (79,900 ) $ 36,928 $ 2,611 $ (60,447 ) Gain (loss) recognized in other expense – ineffective portion (2 ) 8 9 (7 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense 656 (63 ) 1,301 (127 ) We had foreign currency forward contracts that matured and were used to mitigate the volatility of foreign currency exchange rates related to financial instruments denominated in foreign currencies. The effects on the consolidated financial statements of foreign currency forward contracts which were not designated as cash flow hedges were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain (loss) recognized in other expense $ (6,133 ) $ 99 $ (6,133 ) $ 99 Foreign Currency Collars We had foreign currency collars that matured and were used to mitigate the volatility of foreign currency exchange rates related to our ship construction contracts denominated in euros. The effects on the consolidated financial statements of the foreign currency collar which was designated as a cash flow hedge was as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense $ (91 ) $ (91 ) $ (182 ) $ (182 ) The effect on the consolidated financial statements of the foreign currency collar which was not designated as a cash flow hedge was as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain (loss) recognized in other expense $ (3,313 ) $ 9,350 $ 10,312 $ (19,603 ) Interest Rate Swaps As of June 30, 2016, we had interest rate swap agreements to hedge our exposure to interest rate movements and to manage our interest expense. The notional amount of outstanding debt associated with the interest rate swap agreements was $366.3 million. The effects on the consolidated financial statements of the interest rate swaps which were designated as cash flow hedges were as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Loss recognized in other comprehensive income – effective portion $ (901 ) $ (570 ) $ (3,456 ) $ (4,159 ) Gain (loss) recognized in other expense – ineffective portion — (5 ) 3 (12 ) Amount reclassified from accumulated other comprehensive income (loss) into interest expense, net 981 1,081 1,981 2,018 We had an interest rate swap that matured in January 2015, which was used to mitigate our exposure to interest rate movements and to manage our interest expense. The effect on the consolidated financial statements of the interest rate swap contract which was not designated as a hedging instrument was as follows (in thousands): Three Months Ended Six Months Ended 2016 2015 2016 2015 Loss recognized in other expense $ — $ — $ — $ (2 ) Long-Term Debt As of June 30, 2016 and December 31, 2015, the fair value of our long-term debt, including the current portion, was $6.7 billion and $6.5 billion, respectively, which was $11.5 million higher and $6.6 million lower, respectively, than the carrying values. The difference between the fair value and carrying value of our long-term debt is due to our fixed and variable rate debt obligations carrying interest rates that are above or below market rates at the measurement dates. The fair value of our long-term debt was calculated based on estimated rates for the same or similar instruments with similar terms and remaining maturities resulting in Level 2 inputs in the fair value hierarchy. Market risk associated with our long-term variable rate debt is the potential increase in interest expense from an increase in interest rates. The calculation of the fair value of our long-term debt is considered a Level 2 input. Other The carrying amounts reported in the consolidated balance sheets of all other financial assets and liabilities approximate fair value. |
Employee Benefits and Compensat
Employee Benefits and Compensation Plans | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employee Benefits and Compensation Plans | 8. Employee Benefits and Compensation Plans Share Option Awards On March 1, 2016, NCLH granted 1.0 million share option awards to our employees at an exercise price of $50.31 with a contractual term of ten years. The share options vest equally over three years. The following is a summary of option activity under NCLH’s share option plan for the six months ended June 30, 2016 (excludes the impact of 364,584 previously awarded performance-based options as no grant date has been established): Number of Share Option Weighted-Average Exercise Weighted- Aggregate Intrinsic Value Time- Performance- Market- Time- Performance- Market- (years) (in thousands) Outstanding as of December 31, 2015 7,702,071 432,752 208,333 $ 47.35 $ 19.00 $ 59.43 8.59 $ 104,864 Granted 1,060,000 52,083 — 50.13 59.43 — Exercised (89,534 ) (51,857 ) — 25.48 19.00 — Forfeited and cancelled (466,527 ) — — 49.10 — — Outstanding as of June 30, 2016 8,206,010 432,978 208,333 $ 47.85 $ 23.86 $ 59.43 8.31 $ 30,800 Restricted Ordinary Share Awards The following is a summary of NCLH’s restricted ordinary share activity for the six months ended June 30, 2016: Number of Weighted- Non-vested as of January 1, 2016 43,653 $ 5.87 Granted — — Vested (16,830 ) 5.85 Forfeited or expired (352 ) 2.50 Non-vested and expected to vest as of June 30, 2016 26,471 $ 5.92 Restricted Share Unit Awards On March 1, 2016, NCLH granted 1.2 million restricted share unit awards to our employees which vest equally over three years. The following is a summary of restricted share unit activity for the six months ended June 30, 2016 (excludes the impact of 87,500 previously awarded performance-based restricted share units as no grant date was established): Number of Weighted- Number of Weighted- Number of Weighted- Non-vested as of January 1, 2016 150,000 $ 59.43 — $ — 50,000 $ 59.43 Granted 1,246,990 50.41 12,500 50.00 — — Vested (37,500 ) 59.43 (12,500 ) 50.00 — — Forfeited or expired (50,000 ) 50.31 — — — — Non-vested and expected to vest as of June 30, 2016 1,309,490 $ 51.19 — $ — 50,000 $ 59.43 The share-based compensation expense for the six months ended June 30, 2016 was $31.4 million of which $27.7 million was recorded in marketing, general and administrative expense and $3.7 million was recorded in payroll and related expense. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Ship Construction Contracts We have Norwegian Joy and two other Breakaway Plus Class Ships on order with Meyer Werft shipyard for delivery in the spring of 2017, spring of 2018 and fall of 2019, respectively. These ships will be amongst the largest in our fleet, reaching approximately 164,600 Gross Tons. The combined contract price of these three ships is approximately €2.6 billion, or $2.9 billion based on the euro/U.S. dollar exchange rate as of June 30, 2016. We have export credit financing in place that provides financing for 80% of their contract prices. In June 2016, we took delivery of Seven Seas Explorer. We have an additional Explorer Class Ship on order with Fincantieri shipyard with an original contract price of approximately €422.0 million, or approximately $468.7 million based on the euro/U.S. dollar exchange rate as of June 30, 2016. We have export credit financing in place that provides financing for 80% of the contract price. The additional Explorer Class Ship is expected to be delivered in the winter of 2020. In connection with the contracts to build these ships, we do not anticipate any contractual breaches or cancellation to occur. However, if any would occur, it could result in, among other things, the forfeiture of prior deposits or payments made by us, subject to certain refund guarantees, and potential claims and impairment losses which may materially impact our business, financial condition and results of operations. Litigation In the normal course of our business, various claims and lawsuits have been filed or are pending against us. Most of these claims and lawsuits are covered by insurance and, accordingly, the maximum amount of our liability is typically limited to our deductible amount. Nonetheless, the ultimate outcome of these claims and lawsuits that are not covered by insurance cannot be determined at this time. We have evaluated our overall exposure with respect to all of our threatened and pending litigation and, to the extent required, we have accrued amounts for all estimable probable losses associated with our deemed exposure. We are currently unable to estimate any other potential contingent losses beyond those accrued, as discovery is not complete nor is adequate information available to estimate such range of loss or potential recovery. We intend to vigorously defend our legal position on all claims and, to the extent necessary, seek recovery. |
Restructuring Costs
Restructuring Costs | 6 Months Ended |
Jun. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Costs | 10. Restructuring Costs Due to the Acquisition of Prestige, a number of employee positions were consolidated. As of June 30, 2016, we had an accrual balance of $1.9 million for restructuring costs for severance and other employee-related costs. The expense of $2.4 million for the six months ended June 30, 2016 is included in marketing, general and administrative expense. The following table summarizes changes in the accrual for restructuring costs (in thousands): Restructuring costs Accrued expense balance as of December 31, 2015 $ (4,144 ) Amounts paid 4,610 Additional accrued expense (2,404 ) Accrued expense balance as of June 30, 2016 $ (1,938 ) |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | 11. Supplemental Cash Flow Information For the six months ended June 30, 2016, we had non-cash investing activities in connection with property and equipment of $32.0 million and for the six months ended June 30, 2015, we had non-cash investing activities in connection with capital leases of $27.6 million. |
Revision to the Consolidated St
Revision to the Consolidated Statement of Cash Flows | 6 Months Ended |
Jun. 30, 2016 | |
Revisions To Consolidated Financial Statements [Abstract] | |
Revision to the Consolidated Statement of Cash Flows | 12. Revision to the Consolidated Statement of Cash Flows During the three months ended September 30, 2015, we determined that for the six months ended June 30, 2015, cash payments related to property and equipment were reported as a decrease in cash flows from operating activities related to the change in accrued expenses and other liabilities and prepaid and other assets when it should have been reported as a decrease in cash flows from investing activities related to additions to property and equipment. The consolidated statements of cash flows for the six months ended June 30, 2015 have been revised to increase cash from operating activities related to the change in accrued expenses and other liabilities and prepaid and other assets and increase investing cash outflows from additions to property and equipment by $18.5 million. We have determined that the revision is not material to our consolidated financial statements individually and in the aggregate. |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Event | 13. Subsequent Event Amendment to Credit Agreement NCLC, a subsidiary of NCLH, entered into a Supplemental Agreement, dated July 26, 2016, by and among NCLC, as guarantor, Breakaway Four, Ltd. (the “Borrower”), as borrower, NCL International Ltd., as shareholder, and KfW IPEX-Bank GmbH (“KfW”), as facility agent and lender (the “Credit Agreement Amendment”), which amends the Credit Agreement, dated as of October 12, 2012, by and among NCLC, as parent, the Borrower and KfW, as facility agent and lender (the “Existing Credit Agreement”). The Credit Agreement Amendment amends the Existing Credit Agreement to, among other things, increase the aggregate principal amount of commitments under the multi-draw term loan credit facility from €590.5 million to €729.9 million. Except as provided in the Credit Agreement Amendment, all other provisions of the Existing Credit Agreement remain in full force. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements are unaudited and, in our opinion, contain all normal recurring adjustments necessary for a fair statement of the results for the periods presented. Our operations are seasonal and results for interim periods are not necessarily indicative of the results for the entire fiscal year. Historically, demand for cruises has been strongest during the Northern Hemisphere’s summer months. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2015, which are included in our most recently filed Annual Report on Form 10-K. |
Reclassification | Reclassification Certain amounts in prior periods have been reclassified to conform to the current period presentation. |
Revenue and Expense Recognition | Revenue and Expense Recognition Deposits received from guests for future voyages are recorded as advance ticket sales and are subsequently recognized as passenger ticket revenue along with onboard and other revenue, and all associated direct costs of a voyage are recognized as cruise operating expenses on a pro-rata basis over the period of the voyage. Guest cancellation fees are recognized in passenger ticket revenue in the month of the cancellation. Certain of our product offerings are accounted for under the guidance included within multi-element arrangements and result in an allocation of the fair value between passenger ticket revenue and onboard and other revenue. Revenue and expenses include port fees and taxes. The amounts included on a gross basis are $71.8 million and $62.4 million for the three months ended June 30, 2016 and 2015, respectively, and $134.3 million and $114.3 million for the six months ended June 30, 2016 and 2015, respectively. |
Foreign Currency | Foreign Currency The majority of our transactions are settled in U.S. dollars. We translate assets and liabilities of our foreign subsidiaries at exchange rates in effect at the balance sheet date. Gains or losses resulting from transactions denominated in other currencies are recognized in our consolidated statements of operations within other expense. We recognized gains of $3.9 million and $0.8 million for the three months ended June 30, 2016 and 2015, respectively, and a loss of $0.3 million and a gain of $5.7 million for the six months ended June 30, 2016 and 2015, respectively. |
Depreciation and Amortization Expense | Depreciation and Amortization Expense The amortization of deferred financing fees is included in depreciation and amortization expense in the consolidated statements of cash flows; however, for purposes of the consolidated statements of operations they are included in interest expense, net. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-12 which addresses improvements to the guidance on revenue from contracts from customers regarding collectibility, noncash consideration, and completed contracts at transition. Additionally, it provides a practical expedient for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. The effective date of this guidance is upon adoption of ASU No. 2014-09. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-11 which is a rescission of Securities and Exchange Commission guidance related to the issuance of ASU No. 2014-09 which is presented below. The effective date of this guidance is upon adoption of ASU No. 2014-09. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, which does not change the core principle of the guidance in ASU No. 2014-09 but clarifies two aspects: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. The effective date of this guidance is upon adoption of ASU No. 2014-09. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09 to improve multiple aspects of the accounting for share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The guidance is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods with early adoption permitted. We do not believe that the adoption of this guidance will be material to our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The ASU requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The ASU further modifies lessors’ classification criteria for leases and the accounting for sales-type and direct financing leases. The ASU will also require qualitative and quantitative disclosures designed to give financial statement users additional information on the amount, timing, and uncertainty of cash flows arising from leases. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2018 with early adoption permitted. The ASU is to be applied using a modified retrospective approach. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11 to simplify the measurement of inventory for all entities. This applies to all inventory that is measured using either the first-in, first-out or average cost method. The guidance requires an entity to measure inventory at the lower of cost or net realizable value. The guidance must be applied prospectively and will be effective for our interim and annual reporting periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of an interim or annual reporting period. We are currently evaluating the impact of the adoption of this guidance to our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-05 to clarify a customer’s accounting for fees paid in a cloud computing arrangement. The amendments provide guidance to customers about whether a cloud computing arrangement includes a software license or if the arrangement should be accounted for as a service contract. This guidance will impact the accounting of software licenses but will not change a customer’s accounting for service contracts. The guidance will be effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2015. We have adopted this guidance and there has not been an impact to our consolidated financial statements. In May 2014, FASB issued ASU No. 2014-09 which requires entities to recognize revenue through the application of a five-step model, including identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligation and recognition of revenue as the entity satisfies the performance obligations. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance. In August 2015, the FASB issued ASU No. 2015-14 deferring the effective date for one year. We can elect to adopt the provisions of ASU No. 2014-09 for annual periods beginning after December 15, 2017 including interim periods within that reporting period or we can elect to early adopt the guidance as of the original effective date. We are currently evaluating the impact of the adoption of this guidance to our consolidated financial statements. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | June 30, 2016 Gross Carrying Accumulated Net Carrying Weighted- Customer relationships $ 120,000 $ (26,060 ) $ 93,940 6.0 Licenses 3,368 (461 ) 2,907 5.6 Non-compete agreements 660 (165 ) 495 1.0 Total intangible assets subject to amortization $ 124,028 $ (26,686 ) $ 97,342 License (Indefinite-lived) $ 4,427 $ — $ — December 31, 2015 Gross Carrying Accumulated Net Carrying Weighted- Customer relationships $ 120,000 $ (15,527 ) $ 104,473 6.0 Backlog 70,000 (70,000 ) — 1.0 Licenses 3,368 (208 ) 3,160 5.6 Total intangible assets subject to amortization $ 193,368 $ (85,735 ) $ 107,633 License (Indefinite-lived) $ 4,427 $ — $ — |
Schedule of Aggregate amortization expense | Three Months Ended Six Months Ended 2016 2015 2016 2015 Amortization expense $ 5,562 $ 20,992 $ 10,951 $ 39,222 |
Schedule of estimated aggregate amortization expense | Year ended December 31, Amortization 2017 $ 31,342 2018 26,058 2019 18,489 2020 9,906 2021 75 |
Accumulated Other Comprehensi23
Accumulated Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) for the six months ended June 30, 2016 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (414,363 ) $ (405,945 ) $ (8,418 ) Current period other comprehensive income before reclassifications 75,457 75,457 — Amounts reclassified into earnings 58,547 58,331 (1) 216 (2) Accumulated other comprehensive income (loss) at end of period $ (280,359 ) $ (272,157 )(3) $ (8,202 ) (1) We refer you to Note 7— “Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. (3) Includes $73.6 million of loss expected to be reclassified into earnings in the next 12 months. Accumulated other comprehensive income (loss) for the six months ended June 30, 2015 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (244,355 ) $ (234,835 ) $ (9,520 ) Current period other comprehensive loss before reclassifications (33,274 ) (33,274 ) — Amounts reclassified into earnings 48,689 48,450 (1) 239 (2) Accumulated other comprehensive income (loss) at end of period $ (228,940 ) $ (219,659 ) $ (9,281 ) (1) We refer you to Note 7— “Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. |
Fair Value Measurements and D24
Fair Value Measurements and Derivatives (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Schedule of derivatives measured at fair value and disclosed by balance sheet location | Asset Liability Balance Sheet location June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 Fuel swaps designated as hedging instruments Prepaid expenses and other assets $15,972 $ — $ — $ — Other long-term assets 7,084 — — — Accrued expenses and other liabilities — — 82,672 128,740 Other long-term liabilities 7,340 — 79,646 132,494 Fuel swaps not designated as hedging instruments Accrued expenses and other liabilities — — 1,801 — Foreign currency forward contracts designated as hedging instruments Prepaid expenses and other assets 6,135 — 3,414 — Other long-term assets 2,577 3,446 386 1,370 Accrued expenses and other liabilities 731 — 13,514 8,737 Other long-term liabilities 1,814 551 20,165 24,181 Foreign currency collar not designated as a hedging instrument Accrued expenses and other liabilities — — — 42,993 Interest rate swaps designated as hedging instruments Accrued expenses and other liabilities — — 4,328 4,079 Other long-term liabilities — — 3,973 3,395 |
Schedule of amounts recognized within assets and liabilities | June 30, 2016 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 31,768 $ (3,800 ) $ 27,968 $ (2,715 ) $ 25,253 Liabilities 206,099 (9,885 ) 196,214 (30,707 ) 165,507 December 31, 2015 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 3,446 $ (1,370 ) $ 2,076 $ (2,043 ) $ 33 Liabilities 344,619 (551 ) 344,068 (336,645 ) 7,423 |
Fuel Swaps | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain recognized in other comprehensive income – effective portion $ 85,808 $ 34,133 $ 76,302 $ 31,332 Loss recognized in other expense – ineffective portion (3,524 ) (3,194 ) (8,751 ) (9,245 ) Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 20,440 15,297 51,577 35,833 |
Designated as Hedging Instrument | Fuel Swaps | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Loss recognized in other expense $ (92 ) $ — $ (92 ) $ — Amount reclassified from accumulated other comprehensive income (loss) into other expense 1,465 10,000 2,994 10,000 |
Designated as Hedging Instrument | Fuel Collars | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into fuel expense $ — $ 10 $ — $ 248 |
Designated as Hedging Instrument | Foreign Currency Options | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense $ 330 $ 330 $ 660 $ 660 |
Designated as Hedging Instrument | Foreign Currency Forward Contracts | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain (loss) recognized in other comprehensive income – effective portion $ (79,900 ) $ 36,928 $ 2,611 $ (60,447 ) Gain (loss) recognized in other expense – ineffective portion (2 ) 8 9 (7 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense 656 (63 ) 1,301 (127 ) |
Designated as Hedging Instrument | Foreign Currency Collar | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense $ (91 ) $ (91 ) $ (182 ) $ (182 ) |
Designated as Hedging Instrument | Interest Rate Swap | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Loss recognized in other comprehensive income – effective portion $ (901 ) $ (570 ) $ (3,456 ) $ (4,159 ) Gain (loss) recognized in other expense – ineffective portion — (5 ) 3 (12 ) Amount reclassified from accumulated other comprehensive income (loss) into interest expense, net 981 1,081 1,981 2,018 |
Not Designated as Hedging Instrument | Foreign Currency Forward Contracts | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain (loss) recognized in other expense $ (6,133 ) $ 99 $ (6,133 ) $ 99 |
Not Designated as Hedging Instrument | Foreign Currency Collar | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Gain (loss) recognized in other expense $ (3,313 ) $ 9,350 $ 10,312 $ (19,603 ) |
Not Designated as Hedging Instrument | Interest Rate Swap | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended Six Months Ended 2016 2015 2016 2015 Loss recognized in other expense $ — $ — $ — $ (2 ) |
Employee Benefits and Compens25
Employee Benefits and Compensation Plans (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of summary of option activity under NCLH's share option plan | Number of Share Option Weighted-Average Exercise Weighted- Aggregate Intrinsic Value Time- Performance- Market- Time- Performance- Market- (years) (in thousands) Outstanding as of December 31, 2015 7,702,071 432,752 208,333 $ 47.35 $ 19.00 $ 59.43 8.59 $ 104,864 Granted 1,060,000 52,083 — 50.13 59.43 — Exercised (89,534 ) (51,857 ) — 25.48 19.00 — Forfeited and cancelled (466,527 ) — — 49.10 — — Outstanding as of June 30, 2016 8,206,010 432,978 208,333 $ 47.85 $ 23.86 $ 59.43 8.31 $ 30,800 |
Restricted Ordinary Share Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of summary of option activity under NCLH's share option plan | Number of Weighted- Non-vested as of January 1, 2016 43,653 $ 5.87 Granted — — Vested (16,830 ) 5.85 Forfeited or expired (352 ) 2.50 Non-vested and expected to vest as of June 30, 2016 26,471 $ 5.92 |
Restricted Share Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted share activity of NCLH shares | Number of Weighted- Number of Weighted- Number of Weighted- Non-vested as of January 1, 2016 150,000 $ 59.43 — $ — 50,000 $ 59.43 Granted 1,246,990 50.41 12,500 50.00 — — Vested (37,500 ) 59.43 (12,500 ) 50.00 — — Forfeited or expired (50,000 ) 50.31 — — — — Non-vested and expected to vest as of June 30, 2016 1,309,490 $ 51.19 — $ — 50,000 $ 59.43 |
Restructuring Costs (Tables)
Restructuring Costs (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of changes in the accrual | Restructuring costs Accrued expense balance as of December 31, 2015 $ (4,144 ) Amounts paid 4,610 Additional accrued expense (2,404 ) Accrued expense balance as of June 30, 2016 $ (1,938 ) |
Description of Business and O27
Description of Business and Organization (Detail Textuals) | 6 Months Ended |
Jun. 30, 2016BerthCruiseShip | |
Accounting Policies [Abstract] | |
Number of cruises ships | 24 |
Capacity of ship, berths | Berth | 46,500 |
Number of additional ships | 3 |
Increased number of berths | 59,300 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Detail Textuals) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Accounting Policies [Abstract] | ||||
Amounts of tax included on a gross basis | $ 71.8 | $ 62.4 | $ 134.3 | $ 114.3 |
Foreign currency transaction gain (loss) | $ 3.9 | $ 0.8 | $ (0.3) | $ 5.7 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 124,028 | $ 193,368 |
Intangible assets subject to amortization, Accumulated Amortization | (26,686) | (85,735) |
Intangible assets subject to amortization, Net Carrying Amount | 97,342 | 107,633 |
License (Indefinite-lived) | 4,427 | 4,427 |
Customer relationships | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | 120,000 | 120,000 |
Intangible assets subject to amortization, Accumulated Amortization | (26,060) | (15,527) |
Intangible assets subject to amortization, Net Carrying Amount | $ 93,940 | $ 104,473 |
Weighted - Average Amortization Period (Years) | 6 years | 6 years |
Backlog | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 70,000 | |
Intangible assets subject to amortization, Accumulated Amortization | (70,000) | |
Intangible assets subject to amortization, Net Carrying Amount | ||
Weighted - Average Amortization Period (Years) | 1 year | |
Licenses | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 3,368 | $ 3,368 |
Intangible assets subject to amortization, Accumulated Amortization | (461) | (208) |
Intangible assets subject to amortization, Net Carrying Amount | $ 2,907 | $ 3,160 |
Weighted - Average Amortization Period (Years) | 5 years 7 months 6 days | 5 years 7 months 6 days |
Noncompete Agreements | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 660 | |
Intangible assets subject to amortization, Accumulated Amortization | (165) | |
Intangible assets subject to amortization, Net Carrying Amount | $ 495 | |
Weighted - Average Amortization Period (Years) | 1 year |
Intangible Assets (Details 1)
Intangible Assets (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 5,562 | $ 20,992 | $ 10,951 | $ 39,222 |
Intangible Assets (Details 2)
Intangible Assets (Details 2) $ in Thousands | Jun. 30, 2016USD ($) |
Amortization Expense Year ended December 31, | |
2,017 | $ 31,342 |
2,018 | 26,058 |
2,019 | 18,489 |
2,020 | 9,906 |
2,021 | $ 75 |
Accumulated Other Comprehensi32
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated other comprehensive income (loss) at beginning of period | $ (414,363) | $ (244,355) | ||
Current period other comprehensive loss before reclassifications | 75,457 | (33,274) | ||
Amounts reclassified into earnings | 58,547 | 48,689 | ||
Accumulated other comprehensive income (loss) at end of period | (280,359) | (228,940) | ||
Change Related to Cash Flow Hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated other comprehensive income (loss) at beginning of period | (405,945) | (234,835) | ||
Current period other comprehensive loss before reclassifications | 75,457 | (33,274) | ||
Amounts reclassified into earnings | [1] | 58,331 | 48,450 | |
Accumulated other comprehensive income (loss) at end of period | (272,157) | [2] | (219,659) | |
Change Related to Shipboard Retirement Plan | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Accumulated other comprehensive income (loss) at beginning of period | (8,418) | (9,520) | ||
Current period other comprehensive loss before reclassifications | ||||
Amounts reclassified into earnings | [3] | 216 | 239 | |
Accumulated other comprehensive income (loss) at end of period | $ (8,202) | $ (9,281) | ||
[1] | We refer you to Note 7 "Fair Value Measurements and Derivatives" for the affected line items in the consolidated statements of operations. | |||
[2] | Includes $73.6 million of loss expected to be reclassified into earnings in the next 12 months. | |||
[3] | Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. |
Accumulated Other Comprehensi33
Accumulated Other Comprehensive Income (Loss) (Parenthetical) (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Change Related to Cash Flow Hedges | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Amount expected to be reclassified into earnings in the next 12 months | $ 73.6 |
Property and Equipment net (Det
Property and Equipment net (Detail Textuals) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Seven Seas Explorer | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment net increase due to delivery and refurbishment of several ships | $ 609.7 |
Long Term Debt (Detail Textuals
Long Term Debt (Detail Textuals) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Line of Credit Facility [Line Items] | ||
Proceeds from New Term Loan A Facility and The New Revolving Loan Facility | $ 1,590 | |
5.25% senior unsecured notes | ||
Line of Credit Facility [Line Items] | ||
Debt principal amount | $ 680 | |
Interest rate | 5.25% | |
Extended maturity year | 2,019 | |
Minimum free liquidity amount required | $ 50 | |
4.625% senior unsecured notes | ||
Line of Credit Facility [Line Items] | ||
Debt principal amount | $ 600 | |
Interest rate | 4.625% | |
Extended maturity year | 2,020 | |
Minimum free liquidity amount required | $ 50 | |
Senior secured term loan facility | ||
Line of Credit Facility [Line Items] | ||
Aggregate amount of commitments | 350 | |
NCLC and Voyager Vessel Company, LLC | New Term Loan A Facility | Term Loan Facility | ||
Line of Credit Facility [Line Items] | ||
Debt principal amount | 1,510 | $ 1,160 |
Aggregate amount of commitments | $ 1,380 | 1,380 |
Extended maturity year | 2,021 | |
NCLC and Voyager Vessel Company, LLC | New Revolving Loan Facility | Revolving Loan Facility | ||
Line of Credit Facility [Line Items] | ||
Extended maturity year | 2,021 | |
Aggregate principal amount | $ 750 | $ 625 |
Long-Term Debt (Detail Textuals
Long-Term Debt (Detail Textuals 1) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Line of Credit Facility [Line Items] | |
Revolving and Term Loan facility interest rate terms | The New Term Loan A Facility and New Revolving Loan Facility bear interest at a rate per annum of (a) an adjusted LIBOR rate or (b) a base rate determined by reference to the greatest of (i) the federal funds rate plus 0.50%, (ii) the prime rate in effect on such day and (iii) the adjusted LIBOR rate plus 1%, in each case plus an applicable margin that is determined by reference to a total leverage ratio, with an applicable margin of between 2.25% and 1.50% with respect to Eurocurrency loans and between 1.25% and 0.50% with respect to base rate loans. The initial applicable margin for borrowings is 2.25% with respect to Eurocurrency borrowings and 1.25% with respect to base rate borrowings. |
Maximum commitment fee percentage of applicable margin for Eurocurrency loans | 40.00% |
Seven Seas Explorer term loan | |
Line of Credit Facility [Line Items] | |
Debt principal amount | $ 373.6 |
Interest rate | 3.43% |
Extended maturity year | 2,028 |
Percentage contract price in place of export financing | 80.00% |
New Term Loan A Facility | |
Line of Credit Facility [Line Items] | |
Frequency of Payment terms | The New Term Loan A Facility will be paid in quarterly installments commencing in September 2016, in a principal amount equal to (a) in the case of installments payable on or prior to June 6, 2018, 1.25% of the loans outstanding immediately after the closing date under the New Term Loan A Facility and (b) in the case of installments payable after June 6, 2018, 2.50% of the loans outstanding immediately after the closing date under the New Term Loan A Facility, with the remaining unpaid principal amount of loans under the New Term Loan A Facility due and payable in full at maturity on June 6, 2021. Principal amounts outstanding under the New Revolving Loan Facility are due and payable in full at maturity on June 6, 2021, subject to earlier repayment pursuant to the springing maturity date described above |
Percentage of loans outstanding for installment payable prior to maturity | 1.25% |
Percentage of loans outstanding for installment payable after maturity | 2.50% |
New Term Loan A Facility | Prime Rate | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Prime rate |
New Term Loan A Facility | London Interbank Offered Rate (LIBOR) | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Adjusted LIBOR |
Initial applicable margin rate | 1.00% |
New Term Loan A Facility | Federal Fund Rate | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Federal funds rate |
Initial applicable margin rate | 0.50% |
New Term Loan A Facility | Eurodollar | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Eurocurrency loans |
Initial applicable margin rate | 2.25% |
New Term Loan A Facility | Base Rate | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Base rate |
Initial applicable margin rate | 1.25% |
New Term Loan A Facility | Maximum | Eurodollar | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 2.25% |
New Term Loan A Facility | Maximum | Base Rate | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 1.25% |
New Term Loan A Facility | Minimum | Eurodollar | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 1.50% |
New Term Loan A Facility | Minimum | Base Rate | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 0.50% |
New Revolving Loan Facility | Prime Rate | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Prime rate |
New Revolving Loan Facility | London Interbank Offered Rate (LIBOR) | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Adjusted LIBOR |
Initial applicable margin rate | 1.00% |
New Revolving Loan Facility | Federal Fund Rate | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Federal funds rate |
Initial applicable margin rate | 0.50% |
New Revolving Loan Facility | Eurodollar | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Eurocurrency loans |
Initial applicable margin rate | 2.25% |
New Revolving Loan Facility | Base Rate | |
Line of Credit Facility [Line Items] | |
Description of variable rate basis | Base rate |
Initial applicable margin rate | 1.25% |
New Revolving Loan Facility | Maximum | Eurodollar | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 2.25% |
New Revolving Loan Facility | Maximum | Base Rate | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 1.25% |
New Revolving Loan Facility | Minimum | Eurodollar | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 1.50% |
New Revolving Loan Facility | Minimum | Base Rate | |
Line of Credit Facility [Line Items] | |
Initial applicable margin rate | 0.50% |
Fair Value Measurements and D37
Fair Value Measurements and Derivatives - Derivatives measured at fair value and discloses balance sheet location (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 31,768 | $ 3,446 |
Derivative liabilities, fair value | 206,099 | 344,619 |
Fuel Swaps | Designated as Hedging Instrument | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 15,972 | |
Fuel Swaps | Designated as Hedging Instrument | Other long-term assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 7,084 | |
Fuel Swaps | Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 82,672 | 128,740 |
Fuel Swaps | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 7,340 | |
Derivative liabilities, fair value | 79,646 | 132,494 |
Fuel Swaps | Not Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 1,801 | |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 6,135 | |
Derivative liabilities, fair value | 3,414 | |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Other long-term assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 2,577 | 3,446 |
Derivative liabilities, fair value | 386 | 1,370 |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 731 | |
Derivative liabilities, fair value | 13,514 | 8,737 |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 1,814 | 551 |
Derivative liabilities, fair value | 20,165 | 24,181 |
Foreign Currency Collar | Not Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 42,993 | |
Interest Rate Swap | Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 4,328 | 4,079 |
Interest Rate Swap | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | $ 3,973 | $ 3,395 |
Fair Value Measurements and D38
Fair Value Measurements and Derivatives - Assets and Liabilities Based on Right of Offset (Details 1) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||
Gross Amounts, Assets | $ 31,768 | $ 3,446 |
Gross Amounts Offset, Assets | (3,800) | (1,370) |
Total Net Amounts, Assets | 27,968 | 2,076 |
Gross Amounts Not Offset, Assets | (2,715) | (2,043) |
Net Amounts, Assets | 25,253 | 33 |
Gross Amounts, Liabilities | 206,099 | 344,619 |
Gross Amounts Offset, Liabilities | (9,885) | (551) |
Total Net Amounts, Liabilities | 196,214 | 344,068 |
Gross Amount Not Offset, Liabilities | (30,707) | (336,645) |
Net Amounts, Liabilities | $ 165,507 | $ 7,423 |
Fair Value Measurements and D39
Fair Value Measurements and Derivatives - Effects of Derivatives Designated as Cash flow Hedges (Details 2) - Cash Flow Hedging - Designated as Hedging Instrument - Fuel Swaps - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain recognized in other comprehensive income - effective portion | $ 85,808 | $ 34,133 | $ 76,302 | $ 31,332 |
Loss recognized in other expense - ineffective portion | (3,524) | (3,194) | (8,751) | (9,245) |
Amount reclassified from accumulated other comprehensive income (loss) into fuel expense | $ 20,440 | $ 15,297 | $ 51,577 | $ 35,833 |
Fair Value Measurements and D40
Fair Value Measurements and Derivatives -Consolidated financial statements of fuel swaps dedesignated and immediately recognized into earnings (Details 3) - Reclassification out of Accumulated Other Comprehensive Income - Fuel Swaps - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Loss recognized in other expense | $ (92) | $ (92) | ||
Amount reclassified from accumulated other comprehensive income (loss) into other expense | $ 1,465 | $ 10,000 | $ 2,994 | $ 10,000 |
Fair Value Measurements and D41
Fair Value Measurements and Derivatives - Effects of Fuel Collars Designated as Cash flow Hedges (Details 4) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Cash Flow Hedging | Designated as Hedging Instrument | Fuel Collars | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount reclassified from accumulated other comprehensive income (loss) into fuel expense | $ 10 | $ 248 |
Fair Value Measurements and D42
Fair Value Measurements and Derivatives - Effects of Foreign Currency Options Designated as Cash flow Hedges (Details 5) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Cash Flow Hedging | Designated as Hedging Instrument | Foreign Currency Options | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense | $ 330 | $ 330 | $ 660 | $ 660 |
Fair Value Measurements and D43
Fair Value Measurements and Derivatives - Effects of Foreign Currency Forward Contracts Designated as Cash flow Hedges (Details 6) - Cash Flow Hedging - Designated as Hedging Instrument - Foreign Currency Forward Contracts - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in other comprehensive income - effective portion | $ (79,900) | $ 36,928 | $ 2,611 | $ (60,447) |
Gain (loss) recognized in other expense - ineffective portion | (2) | 8 | 9 | (7) |
Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense | $ 656 | $ (63) | $ 1,301 | $ (127) |
Fair Value Measurements and D44
Fair Value Measurements and Derivatives (Details 7) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Cash Flow Hedging | Foreign Currency Forward Contracts | Designated as Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in other expense | $ (6,133) | $ 99 | $ (6,133) | $ 99 |
Fair Value Measurements and D45
Fair Value Measurements and Derivatives - Effects of Foreign Currency Collar Designated as Cash Flow Hedges (Details 8) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Cash Flow Hedging | Designated as Hedging Instrument | Foreign Currency Collar | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense | $ (91) | $ (91) | $ (182) | $ (182) |
Fair Value Measurements and D46
Fair Value Measurements and Derivatives - Effects of Foreign Currency Collar not Designated as hedging instrument (Details 9) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Cash Flow Hedging | Not Designated as Hedging Instrument | Foreign Currency Collar | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in other expense | $ (3,313) | $ 9,350 | $ 10,312 | $ (19,603) |
Fair Value Measurements and D47
Fair Value Measurements and Derivatives - Effects of Interest Rates Swaps Designated as Cash flow Hedges (Details 10) - Cash Flow Hedging - Designated as Hedging Instrument - Interest Rate Swap - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Loss recognized in other comprehensive income - effective portion | $ (901) | $ (570) | $ (3,456) | $ (4,159) |
Gain (loss) recognized in other expense - ineffective portion | (5) | 3 | (12) | |
Amount reclassified from accumulated other comprehensive income (loss) into interest expense, net | $ 981 | $ 1,081 | $ 1,981 | $ 2,018 |
Fair Value Measurements and D48
Fair Value Measurements and Derivatives - Effects of Interest Rates Swaps not Designated as hedging instrument (Details 11) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Not Designated as Hedging Instrument | Interest Rate Swap | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Loss recognized in other expense | $ (2) |
Fair Value Measurements and D49
Fair Value Measurements and Derivatives (Detail Textuals) $ in Millions, € in Billions | 6 Months Ended | ||
Jun. 30, 2016USD ($)Metric_Ton | Jun. 30, 2016EUR (€)Metric_Ton | Dec. 31, 2015USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of long-term debt | $ 6,700 | $ 6,500 | |
Fair value of long-term debt in excess of carrying value | $ 11.5 | $ 6.6 | |
Fuel Swaps | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivative maturing date | Dec. 31, 2019 | ||
Projected fuel purchases | Metric_Ton | 1,800,000 | 1,800,000 | |
Fuel Swaps | Not Designated as Hedging Instrument | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Projected fuel purchases | Metric_Ton | 22,000 | 22,000 | |
Foreign Currency Forward Contracts | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Notional amount of derivatives | $ 2,600 | € 2.3 | |
Interest Rate Swap | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Notional amount of derivatives | $ 366.3 |
Employee Benefits and Compens50
Employee Benefits and Compensation Plans - Summary of Option activity (Details) - Norwegian Cruise Line Holdings Ltd. - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | ||
Options Outstanding, Weighted- Average Contractual Term | 8 years 3 months 22 days | 8 years 7 months 2 days |
Options Outstanding, Aggregate Intrinsic Value | $ 30,800 | $ 104,864 |
Time Based Awards | ||
Number of Share Option Awards | ||
Outstanding as of December 31, 2015 | 7,702,071 | |
Granted | 1,060,000 | |
Exercised | (89,534) | |
Forfeited and cancelled | (466,527) | |
Outstanding as of June 30, 2016 | 8,206,010 | 7,702,071 |
Weighted-Average Exercise Price | ||
Outstanding as of December 31, 2015 | $ 47.35 | |
Granted | 50.13 | |
Exercised | 25.48 | |
Forfeited and cancelled | 49.10 | |
Outstanding as of June 30, 2016 | $ 47.85 | $ 47.35 |
Performance-Based Awards | ||
Number of Share Option Awards | ||
Outstanding as of December 31, 2015 | 432,752 | |
Granted | 52,083 | |
Exercised | (51,857) | |
Forfeited and cancelled | ||
Outstanding as of June 30, 2016 | 432,978 | 432,752 |
Weighted-Average Exercise Price | ||
Outstanding as of December 31, 2015 | $ 19 | |
Granted | 59.43 | |
Exercised | 19 | |
Forfeited and cancelled | ||
Outstanding as of June 30, 2016 | $ 23.86 | $ 19 |
Market-Based Awards | ||
Number of Share Option Awards | ||
Outstanding as of December 31, 2015 | 208,333 | |
Granted | ||
Exercised | ||
Forfeited and cancelled | ||
Outstanding as of June 30, 2016 | 208,333 | 208,333 |
Weighted-Average Exercise Price | ||
Outstanding as of December 31, 2015 | $ 59.43 | |
Granted | ||
Exercised | ||
Forfeited and cancelled | ||
Outstanding as of June 30, 2016 | $ 59.43 | $ 59.43 |
Employee Benefits and Compens51
Employee Benefits and Compensation Plans - Summary of Restricted Share Awards (Details 1) - Time-Based Awards - Restricted Stock - Norwegian Cruise Line Holdings Ltd. | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Number of Restricted Share | |
Non-vested as of January 1, 2016 | shares | 43,653 |
Granted | shares | |
Vested | shares | (16,830) |
Forfeited or expired | shares | (352) |
Non-vested and expected to vest as of June 30, 2016 | shares | 26,471 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 5.87 |
Granted | $ / shares | |
Vested | $ / shares | 5.85 |
Forfeited or expired | $ / shares | 2.50 |
Non-vested and expected to vest as of June 30, 2016 | $ / shares | $ 5.92 |
Employee Benefits and Compens52
Employee Benefits and Compensation Plans - Summary of Restricted Share Unit (Details 2) - Norwegian Cruise Line Holdings Ltd. - Restricted Share Unit | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Time-Based Awards | |
Number of Restricted Share | |
Non-vested as of January 1, 2016 | shares | 150,000 |
Granted | shares | 1,246,990 |
Vested | shares | (37,500) |
Forfeited or expired | shares | (50,000) |
Non-vested and expected to vest as of June 30, 2016 | shares | 1,309,490 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 59.43 |
Granted | $ / shares | 50.41 |
Vested | $ / shares | 59.43 |
Forfeited or expired | $ / shares | 50.31 |
Non-vested and expected to vest as of June 30, 2016 | $ / shares | $ 51.19 |
Performance-Based Awards | |
Number of Restricted Share | |
Non-vested as of January 1, 2016 | shares | |
Granted | shares | 12,500 |
Vested | shares | (12,500) |
Forfeited or expired | shares | |
Non-vested and expected to vest as of June 30, 2016 | shares | |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | |
Granted | $ / shares | 50 |
Vested | $ / shares | 50 |
Forfeited or expired | $ / shares | |
Non-vested and expected to vest as of June 30, 2016 | $ / shares | |
Market-Based Awards | |
Number of Restricted Share | |
Non-vested as of January 1, 2016 | shares | 50,000 |
Granted | shares | |
Vested | shares | |
Forfeited or expired | shares | |
Non-vested and expected to vest as of June 30, 2016 | shares | 50,000 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 59.43 |
Granted | $ / shares | |
Vested | $ / shares | |
Forfeited or expired | $ / shares | |
Non-vested and expected to vest as of June 30, 2016 | $ / shares | $ 59.43 |
Employee Benefits and Compens53
Employee Benefits and Compensation Plans (Detail Textuals) - USD ($) $ / shares in Units, $ in Thousands | Mar. 01, 2016 | Jun. 30, 2016 | Jun. 30, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 31,449 | $ 14,166 | |
Performance-Based Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 87,500 | ||
Marketing, general and administrative expense | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 27,700 | ||
Payroll and related expense | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 3,700 | ||
Norwegian Cruise Line Holdings Ltd. | Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 1,000,000 | ||
Exercise price per share | $ 50.31 | ||
Contractual term of shares granted | 10 years | ||
Vested period of stock-based awards | 3 years | ||
Norwegian Cruise Line Holdings Ltd. | Performance-Based Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 364,584 | ||
Exercise price per share | $ 59.43 | ||
Norwegian Cruise Line Holdings Ltd. | Restricted Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 1,200,000 | ||
Norwegian Cruise Line Holdings Ltd. | Performance-based restricted share units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares granted | 52,083 | ||
Exercise price per share | $ 59.43 |
Commitments and Contingencies (
Commitments and Contingencies (Detail Textuals) - 6 months ended Jun. 30, 2016 - Ship Construction Contracts € in Millions, $ in Millions | USD ($)Gross_TonCruiseShip | EUR (€)Gross_TonCruiseShip |
Commitments and Contingencies Disclosure [Line Items] | ||
Scheduled delivery date of ships under construction | spring of 2017, spring of 2018 and fall of 2019 | |
Cruising ships to be built | CruiseShip | 3 | 3 |
Capacity of ship, tons | Gross_Ton | 164,600 | 164,600 |
Aggregate contract price of new ships | $ 2,900 | € 2,600 |
Export credit facility financing as percentage of contract price | 80.00% | 80.00% |
Fincantieri shipyard | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Aggregate contract price of new ships | $ 468.7 | € 422 |
Export credit facility financing as percentage of contract price | 80.00% | 80.00% |
Restructuring Costs (Details)
Restructuring Costs (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Restructuring Reserve [Roll Forward] | |
Accrued expense balance as of December 31, 2015 | $ (4,144) |
Amounts paid | 4,610 |
Additional accrued expense | (2,404) |
Accrued expense balance as of June 30, 2016 | $ (1,938) |
Restructuring Costs (Detail Tex
Restructuring Costs (Detail Textuals) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||
Accrual balance for restructuring costs for severance and other employee-related costs | $ 1,938 | $ 4,144 |
Current period expense | 2,404 | |
Marketing, general and administrative expense | ||
Restructuring Cost and Reserve [Line Items] | ||
Current period expense | $ 2,400 |
Supplemental Cash Flow Inform57
Supplemental Cash Flow Information (Detail Textuals) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Supplemental Cash Flow Elements [Abstract] | ||
Non-cash investing activity in connection with capital leases | $ 32 | |
Non-cash investing activities for capital expenditures | $ 27.6 |
Revision to the Consolidated 58
Revision to the Consolidated Statement of Cash Flows (Detail Textuals) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Revisions To Consolidated Financial Statements [Abstract] | |
Increase in investing cash outflows from additions to property and equipment | $ 18.5 |
Subsequent Event (Detail Textua
Subsequent Event (Detail Textuals) - EUR (€) € in Millions | 1 Months Ended | 6 Months Ended |
Jul. 26, 2016 | Jun. 30, 2016 | |
Existing Senior Secured Credit Facility | ||
Subsequent Event [Line Items] | ||
Aggregate principal amount | € 590.5 | |
Subsequent Event | Amended Senior Secured Credit Facility | ||
Subsequent Event [Line Items] | ||
Aggregate principal amount | € 729.9 |