Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Jul. 31, 2015 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Norwegian Cruise Line Holdings Ltd. | |
Entity Central Index Key | 1,513,761 | |
Trading Symbol | nclh | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock Shares Outstanding | 229,147,263 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,015 | |
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, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Revenue | ||||
Passenger ticket | $ 787,991 | $ 528,782 | $ 1,458,474 | $ 977,362 |
Onboard and other | 297,442 | 237,145 | 565,141 | 452,593 |
Total revenue | 1,085,433 | 765,927 | 2,023,615 | 1,429,955 |
Cruise operating expense | ||||
Commissions, transportation and other | 192,438 | 114,712 | 364,265 | 231,522 |
Onboard and other | 67,885 | 55,467 | 126,530 | 103,391 |
Payroll and related | 161,930 | 106,352 | 319,559 | 205,418 |
Fuel | 91,581 | 77,832 | 178,955 | 156,872 |
Food | 43,699 | 42,734 | 85,550 | 80,417 |
Other | 98,746 | 73,699 | 205,120 | 139,086 |
Total cruise operating expense | 656,279 | 470,796 | 1,279,979 | 916,706 |
Other operating expense | ||||
Marketing, general and administrative | 107,164 | 83,084 | 261,321 | 166,473 |
Depreciation and amortization | 104,607 | 63,459 | 204,583 | 125,099 |
Total other operating expense | 211,771 | 146,543 | 465,904 | 291,572 |
Operating income | 217,383 | 148,588 | 277,732 | 221,677 |
Non-operating income (expense) | ||||
Interest expense, net | (52,446) | (31,860) | (103,435) | (63,032) |
Other income (expense) | (3,717) | (325) | (33,856) | 63 |
Total non-operating income (expense) | (56,163) | (32,185) | (137,291) | (62,969) |
Net income before income taxes | 161,220 | 116,403 | 140,441 | 158,708 |
Income tax benefit (expense) | (2,726) | (3,124) | (3,403) | 6,263 |
Net income | 158,494 | 113,279 | 137,038 | 164,971 |
Net income attributable to non-controlling interest | 1,663 | 2,088 | ||
Net income attributable to Norwegian Cruise Line Holdings Ltd. | $ 158,494 | $ 111,616 | $ 137,038 | $ 162,883 |
Weighted-average shares outstanding | ||||
Basic (in shares) | 225,698,078 | 204,965,718 | 225,003,460 | 205,063,870 |
Diluted (in shares) | 230,228,144 | 210,472,991 | 229,664,210 | 210,742,655 |
Earnings per share | ||||
Basic (in dollars per share) | $ 0.70 | $ 0.54 | $ 0.61 | $ 0.79 |
Diluted (in dollars per share) | $ 0.69 | $ 0.54 | $ 0.60 | $ 0.78 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net income | $ 158,494 | $ 113,279 | $ 137,038 | $ 164,971 |
Other comprehensive income (loss): | ||||
Shipboard Retirement Plan | 120 | 95 | 239 | 189 |
Cash flow hedges: | ||||
Net unrealized income (loss) | 70,491 | 8,797 | (33,274) | (6,559) |
Amount realized and reclassified into earnings | 26,564 | (147) | 48,450 | 6 |
Total other comprehensive income (loss) | 97,175 | 8,745 | 15,415 | (6,364) |
Total comprehensive income | $ 255,669 | 122,024 | $ 152,453 | 158,607 |
Comprehensive income attributable to non-controlling interest | 1,757 | 2,045 | ||
Total comprehensive income attributable to Norwegian Cruise Line Holdings Ltd. | $ 255,669 | $ 120,267 | $ 152,453 | $ 156,562 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 172,958 | $ 84,824 |
Accounts receivable, net | 36,801 | 32,432 |
Inventories | 59,801 | 56,555 |
Prepaid expenses and other assets | 130,357 | 109,924 |
Total current assets | 399,917 | 283,735 |
Property and equipment, net | 8,674,815 | 8,623,773 |
Goodwill | 1,388,931 | 1,388,931 |
Intangible assets | 958,394 | 994,997 |
Other long-term assets | 265,330 | 281,641 |
Total assets | 11,687,387 | 11,573,077 |
Current liabilities: | ||
Current portion of long-term debt | 585,875 | 576,947 |
Accounts payable | 55,061 | 101,983 |
Accrued expenses and other liabilities | 581,216 | 552,514 |
Due to Affiliate | 38,737 | 37,948 |
Advance ticket sales | 1,213,199 | 817,207 |
Total current liabilities | 2,474,088 | 2,086,599 |
Long-term debt | 5,178,044 | 5,607,157 |
Due to Affiliate | 18,544 | |
Other long-term liabilities | 294,800 | 341,964 |
Total liabilities | $ 7,946,932 | $ 8,054,264 |
Commitments and contingencies (Note 9) | ||
Shareholders' equity: | ||
Ordinary shares, $.001 par value; 490,000,000 shares authorized; 232,281,275 shares issued and 229,128,505 shares outstanding at June 30, 2015 and 230,116,780 shares issued and 227,630,430 shares outstanding at December 31, 2014 | $ 232 | $ 230 |
Additional paid-in capital | 3,771,531 | 3,702,344 |
Accumulated other comprehensive income (loss) | (227,227) | (242,642) |
Retained earnings | 277,919 | 140,881 |
Treasury shares (3,152,770 and 2,486,350 ordinary shares at June 30, 2015 and December 31, 2014, respectively, at cost) | (82,000) | (82,000) |
Total shareholders' equity | 3,740,455 | 3,518,813 |
Total liabilities and shareholders' equity | $ 11,687,387 | $ 11,573,077 |
Consolidated Balance Sheets (U5
Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | Jun. 30, 2015 | Dec. 31, 2014 |
Statement Of Financial Position [Abstract] | ||
Ordinary shares, par value (in dollars per shares) | $ 0.001 | $ 0.001 |
Ordinary shares, authorized | 490,000,000 | 490,000,000 |
Ordinary shares, issued | 232,281,275 | 230,116,780 |
Ordinary shares, outstanding | 229,128,505 | 227,630,430 |
Ordinary shares, treasury stock | 3,152,770 | 2,486,350 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities | ||
Net income | $ 137,038 | $ 164,971 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization expense | 214,717 | 141,228 |
Loss (gain) on derivatives | 27,475 | (62) |
Deferred income taxes, net | 424 | 2,786 |
Contingent consideration | (43,400) | |
Write-off of deferred financing fees | 195 | |
Share-based compensation expense | 14,166 | 5,079 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (4,369) | (8,885) |
Inventories | (3,246) | (8,851) |
Prepaid expenses and other assets | (15,472) | (8,943) |
Accounts payable | (47,038) | 15,967 |
Accrued expenses and other liabilities | (949) | 20,905 |
Advance ticket sales | 412,602 | 194,913 |
Net cash provided by operating activities | 692,143 | 519,108 |
Cash flows from investing activities | ||
Additions to property and equipment | (186,504) | (787,566) |
Net cash used in investing activities | (186,504) | (787,566) |
Cash flows from financing activities | ||
Repayments of long-term debt | (791,403) | (540,237) |
Repayments to Affiliate | (18,522) | (18,521) |
Proceeds from long-term debt | 340,060 | 914,545 |
Proceeds from the exercise of share options | 55,023 | 2,158 |
Purchases of treasury shares | (79,155) | |
NCLC partnership tax distributions | (3,115) | |
Deferred financing fees and other | (2,663) | (201) |
Net cash provided by (used in) financing activities | (417,505) | 275,474 |
Net increase in cash and cash equivalents | 88,134 | 7,016 |
Cash and cash equivalents at beginning of period | 84,824 | 56,467 |
Cash and cash equivalents at end of period | $ 172,958 | $ 63,483 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Ordinary Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Deficit) | Treasury Shares | Non-controlling Interest | Total |
Balance at Dec. 31, 2013 | $ 205 | $ 2,822,864 | $ (16,690) | $ (197,471) | $ 22,358 | $ 2,631,266 | |
Share-based compensation | 5,079 | 5,079 | |||||
Transactions with Affiliates, net | (59) | (59) | |||||
NCLC partnership tax distributions | (3,115) | (3,115) | |||||
Proceeds from the exercise of share options | 2,158 | 2,158 | |||||
Purchases of treasury shares | $ (79,155) | (79,155) | |||||
Other comprehensive loss | (6,321) | (43) | (6,364) | ||||
Net income | 162,883 | 2,088 | 164,971 | ||||
Transfers to non-controlling interest | (7,834) | 7,834 | |||||
Balance at Jun. 30, 2014 | 205 | 2,822,208 | (23,011) | (34,588) | (791,550) | $ 29,122 | 2,714,781 |
Balance at Dec. 31, 2014 | 230 | 3,702,344 | (242,642) | 140,881 | (82,000) | 3,518,813 | |
Share-based compensation | 14,166 | 14,166 | |||||
Proceeds from the exercise of share options | 2 | 55,021 | 55,023 | ||||
Other comprehensive loss | 15,415 | 15,415 | |||||
Net income | 137,038 | 137,038 | |||||
Balance at Jun. 30, 2015 | $ 232 | $ 3,771,531 | $ (227,227) | $ 277,919 | $ (82,000) | $ 3,740,455 |
Corporate Reorganization
Corporate Reorganization | 6 Months Ended |
Jun. 30, 2015 | |
Corporate Reorganization [Abstract] | |
Corporate Reorganization | 1. Corporate Reorganization In February 2011, NCLH, a Bermuda limited company, was formed with the issuance to the Sponsors of, in aggregate, 10,000 ordinary shares, with a par value of $.001 per share. On January 24, 2013, NCLH consummated its initial public offering (“IPO”). In connection with the consummation of the IPO, the Sponsors’ ordinary shares in NCLC were exchanged for the ordinary shares of NCLH at a share exchange ratio of 1.0 to 8.42565 and NCLH became the owner of 100% of the ordinary shares and parent company of NCLC (the “Corporate Reorganization”). Accordingly, NCLH contributed $460.0 million to NCLC and the historical financial statements of NCLC became those of NCLH. The Corporate Reorganization was effected solely for the purpose of reorganizing our corporate structure. NCLH had not prior to the completion of the Corporate Reorganization conducted any activities other than those incidental to its formation and to preparations for the Corporate Reorganization and IPO. The Corporate Reorganization resulted in all parties being in the same economic position as they were immediately prior to the IPO. As the economic position of the investors did not change as part of the Corporate Reorganization it is considered a nonsubstantive merger from an accounting perspective. As a result of the Corporate Reorganization, NCLC was treated as a partnership for U.S. federal income tax purposes, and the terms of the partnership (including the economic rights with respect thereto) are set forth in an amended and restated tax agreement for NCLC. Economic interests in NCLC were represented by the partnership interests established under the tax agreement, which we refer to as “NCL Corporation Units.” The NCL Corporation Units held by NCLH (as a result of its ownership of 100% of the ordinary shares of NCLC) represented a 97.3% economic interest in NCLC as of the consummation of the IPO. The remaining 2.7% economic interest in NCLC as of the consummation of the IPO was in the form of Management NCL Corporation Units held by management (or former management). In the fourth quarter of 2014, all Management NCL Corporation Units were exchanged for NCLH ordinary shares and restricted ordinary shares. NCLH became the sole member and 100% owner of the economic interests in NCLC and the non-controlling interest no longer exists. Accordingly, NCLC is now treated as a disregarded entity for U.S. federal income tax purposes. No new NCLC profits interests or Management NCL Corporation Units will be issued; however, NCLH has granted, and expects to continue to grant to our management team, options to acquire its ordinary shares under its long-term incentive plan. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2015 | |
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 summer months. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2014, which are included in our most recently filed Annual Report on Form 10-K. During the three months ended June 30, 2015, we revised for the year ended December 31, 2014, the classification of goodwill and intangible assets to separately present goodwill and intangible assets, net. The revision was not deemed material to the Consolidated Balance Sheet. Reclassification Certain amounts in prior periods have been reclassified to conform to the current period presentation. Shareholders’ Equity In connection with the Corporate Reorganization, previously granted profits interests to employees were exchanged for Management NCL Corporation Units (“Units”), and the vested Unit holders gained proportionate rights to distributions of NCLC and were therefore allocated a proportionate share of NCLC’s equity. The effect of this change was a $20.2 million increase in the non-controlling interest. During the six months ended June 30, 2014, following the effectiveness of NCLH’s registration statement on Form S-3, additional performance-based Units became eligible to participate in the earnings of NCLC, and as a result, a proportionate amount of NCLC’s equity was allocated to the additional non-controlling interest. Each Unit holder had the right, subject to the same time-based and performance-based vesting requirements of the profits interests, to exchange Units for NCLH’s ordinary shares at a rate equal to one ordinary share for every Unit. When such an exchange occurred, this resulted in the exchange of non-controlling interest to controlling interest. Accordingly, upon the exchange of a Unit for an ordinary share of NCLH, a portion of the non-controlling interest balance was reclassified to additional paid-in capital. As of June 30, 2014, there was $7.8 million transferred to non-controlling interest. As of June 30, 2014, Management NCL Corporation Unit holders were distributed cash to facilitate partnership tax payments of $3.1 million and $2.8 million of these distributions were subsequently repaid to NCLC upon exchange of each Unit holders’ Units. In the fourth quarter of 2014, all Management NCL Corporation Units were exchanged for NCLH ordinary shares and restricted ordinary shares. We refer you to Note 1— “Corporate Reorganization”. On April 29, 2014, NCLH’s Board of Directors authorized, and NCLH announced, a three-year share repurchase program for up to $500.0 million. NCLH may make repurchases in the open market, in privately negotiated transactions, in accelerated repurchase programs or in structured share repurchase programs, and any repurchases may be made pursuant to Rule 10b5-1 plans. During the three months ended June 30, 2014, NCLH repurchased approximately 2.4 million ordinary shares under its share repurchase program for $79.2 million, which shares are reflected as treasury shares at cost on the consolidated balance sheet as of June 30, 2014 included in NCLH’s Quarterly Report on Form 10-Q filed on July 31, 2014. There was no share repurchase activity during the three and six months ended June 30, 2015, and as of June 30, 2015, $418.0 million remained available for repurchases of our outstanding ordinary shares under the share repurchase program. The increase in treasury shares reported in NCLH’s consolidated balance sheets as of June 30, 2015 relates to certain forfeitures of restricted ordinary shares held by management or former management of NCLH. Earnings Per Share A reconciliation between basic and diluted earnings per share was as follows (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended 2015 2014 2015 2014 Net income attributable to Norwegian Cruise Line Holdings Ltd. $ 158,494 $ 111,616 $ 137,038 $ 162,883 Net income $ 158,494 $ 113,279 $ 137,038 $ 164,971 Basic weighted-average shares outstanding 225,698,078 204,965,718 225,003,460 205,063,870 Dilutive effect of share awards 4,530,066 5,507,273 4,660,750 5,678,785 Diluted weighted-average shares outstanding 230,228,144 210,472,991 229,664,210 210,742,655 Basic earnings per share $ 0.70 $ 0.54 $ 0.61 $ 0.79 Diluted earnings per share $ 0.69 $ 0.54 $ 0.60 $ 0.78 Revenue and Expense Recognition Revenue and expense includes taxes assessed by governmental authorities that are directly imposed on a revenue-producing transaction between a seller and a customer. The amounts included in revenue and expense on a gross basis were $62.4 million and $44.6 million for the three months ended June 30, 2015 and 2014, respectively, and $114.3 million and $82.5 million for the six months ended June 30, 2015 and 2014, respectively. Guest cancellation penalties are recognized in passenger ticket revenue at the time of the cancellation. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU No. 2014-09 requires entities to recognize revenue through the application of a five-step model, which includes 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. The FASB approved a one-year deferral of the effective date. 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 newly issued guidance to our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03 which was issued to simplify the presentation of debt issuance costs. The guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by these amendments. This guidance should be applied on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. The guidance will be effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-05 which was issued 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. Early adoption is permitted. An entity can elect to adopt the amendments either prospectively or retrospectively. We are currently evaluating the impact, if any, of the adoption of this newly issued guidance to our consolidated financial statements. |
The Acquisition of Prestige
The Acquisition of Prestige | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
The Acquisition of Prestige | 3. The Acquisition of Prestige On November 19, 2014, we completed the Acquisition of Prestige. Consideration for the Acquisition of Prestige includes a cash payment of up to $50 million upon achievement of certain 2015 net revenue milestones. The contingent consideration is valued using various projected 2015 net revenue scenarios weighted by the likelihood of each scenario occurring. The probability-weighted payout is then discounted at an appropriate discount rate commensurate for the risk of meeting the probabilistic cash flows. As the fair value is measured based upon significant inputs that are unobservable in the market, it was classified as Level 3 in the fair value hierarchy. Level 3 consists of significant unobservable inputs we believe market participants would use in pricing the asset or liability based on the best information available. The significant unobservable inputs used in the fair value measurement of the Company’s contingent consideration are the estimated annual net revenue and the probabilities associated with attaining the threshold and target net revenue as defined by the Merger Agreement. A significant increase in the estimated net revenue or an increase in the probability associated with reaching the target would result in a significantly higher fair value measurement. The maximum fair value would not be able to exceed $50 million, while an amount of net revenue less than 98% of target would result in no payout. For the six months ended June 30, 2015, the fair value of the contingent consideration was reduced to zero based upon updates to the probability-weighted assessment of various projected revenue scenarios. We do not believe that the net revenue target will be met, and accordingly, we recognized a $43.4 million fair value adjustment in the six months ended June 30, 2015, which was included in marketing, general and administrative expense. The following table summarizes the change in fair value of the contingent consideration liability (in thousands): Contingent Consideration Liability Balance as of December 31, 2014 $ 43,400 Fair value adjustment (Level 3) (43,400 ) Balance as of June 30, 2015 $ — |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Jun. 30, 2015 | |
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, 2015 was as follows (in thousands): Accumulated Other Comprehensive Income (Loss) Change Related to Cash Flow Hedges Change Related to Shipboard Retirement Plan Accumulated other comprehensive income (loss) at beginning of period $ (242,642 ) $ (234,188 ) $ (8,454 ) 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 $ (227,227 ) $ (219,012 )(3) $ (8,215 ) (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 $63.0 million of losses expected to be reclassified into earnings in the next 12 months. Accumulated other comprehensive income (loss) for the six months ended June 30, 2014 was as follows (in thousands): Accumulated Other Comprehensive Income (Loss) Change Related to Cash Flow Hedges Change Related to Shipboard Retirement Plan Accumulated other comprehensive income (loss) at beginning of period $ (16,690 ) $ (10,532 ) $ (6,158 ) Current period other comprehensive loss before reclassifications (6,515 ) (6,515 ) — Amounts reclassified into earnings 194 6 (1) 188 (2) Accumulated other comprehensive income (loss) at end of period $ (23,011 ) $ (17,041 ) $ (5,970 ) (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. |
Related Party Disclosures
Related Party Disclosures | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Disclosures | 5. Related Party Disclosures In May 2015, the Selling Shareholders sold 20,000,000 ordinary shares of NCLH in a Secondary Equity Offering. In March 2015, Genting HK and the TPG Viking Funds sold 12,500,000 ordinary shares of NCLH in a Secondary Equity Offering. The Company did not receive any proceeds from these offerings. As of June 30, 2015, the relative ownership percentages of NCLH’s ordinary shares were as follows: Genting HK (17.7%), the Apollo Holders (20.6%), the TPG Viking Funds (3.2%), and public shareholders (58.5%). In March 2015, we entered into an agreement with SWB Yankees, LLC related to sponsorship of and advertising with the Scranton/Wilkes-Barre RailRiders, a Minor League Baseball team. Pursuant to the agreement, we will pay an annual fee to SWB Yankees, LLC of $200,000. Mr. David M. Abrams, one of our directors, is the co-managing partner of the Scranton/Wilkes-Barre RailRiders. |
Income Tax Benefit (Expense)
Income Tax Benefit (Expense) | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Tax Benefit (Expense) | 6. Income Tax Benefit (Expense) NCLH is treated as a corporation for U.S. federal income tax purposes. For the three months ended June 30, 2015, we had an income tax expense of $2.7 million compared to $3.1 million for the three months ended June 30, 2014. For the six months ended June 30, 2015 we had an income tax expense of $3.4 million compared to an income tax benefit of $6.3 million for the six months ended June 30, 2014. The benefit for 2014 includes a $6.7 million non-recurring benefit associated with the election of a tax method to calculate deductible interest expense. |
Fair Value Measurements and Der
Fair Value Measurements and Derivatives | 6 Months Ended |
Jun. 30, 2015 | |
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 revolving credit 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, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Fuel swaps designated as hedging instruments Accrued expenses and other liabilities $ 1,744 $ — $ 52,407 $ 111,304 Other long-term liabilities 1,075 190 44,419 77,250 Fuel swaps not designated as hedging instruments Accrued expenses and other liabilities — — 18,319 — Foreign currency forward contracts designated as hedging instruments Prepaid expenses and other assets 3,077 — — — Other long-term assets 1,730 — — — Accrued expenses and other liabilities — — 84,588 29,498 Other long-term liabilities — — 11,330 118 Foreign currency forward contracts not designated as hedging instruments Prepaid expenses and other assets 99 — — — Foreign currency collar not designated as a hedging instrument Other long-term liabilities — — 36,347 16,744 Interest rate swaps designated as hedging instruments Accrued expenses and other liabilities — — 6,100 5,736 Other long-term liabilities — — 4,114 3,104 Interest rate swap not designated as a hedging instrument Accrued expenses and other liabilities — — — 3,823 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 as of June 30, 2015 and December 31, 2014. Our derivative contracts include rights of offset with our counterparties. We have elected to net certain assets and liabilities within counterparties. We are not required to post cash collateral related to our derivative instruments. The following table discloses the amounts recognized within the consolidated balance sheets (in thousands): June 30, 2015 Gross Amounts Gross Amounts Offset Total Net Amounts Gross Amounts Not Offset Net Amounts Assets $ 4,906 $ — $ 4,906 $ (4,906) $ — Liabilities 257,624 (2,819 ) 254,805 (142,479 ) 112,326 December 31, 2014 Gross Amounts Gross Amounts Offset Total Net Amounts Gross Amounts Not Offset Net Amounts Liabilities $ 247,577 $ (190 ) $ 247,387 $ (59,023 ) $ 188,364 Fuel Swaps As of June 30, 2015, we had fuel swaps maturing through December 31, 2018 which are used to mitigate the financial impact of volatility in fuel prices pertaining to approximately 1.1 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 June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain recognized in other comprehensive income (loss) – effective portion $ 34,133 $ 11,610 $ 31,332 $ 1,839 Gain (loss) recognized in other income (expense) – ineffective portion (3,194 ) 451 (9,245 ) 35 Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 15,297 (1,218 ) 35,833 (1,923 ) As of June 30, 2015, we had fuel swaps pertaining to approximately 100,000 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 immediately recognized into earnings were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Amount reclassified from accumulated other comprehensive income (loss) into other income (expense) $ 10,000 $ — $ 10,000 $ — Fuel Collars and Options We had fuel collars and fuel options maturing through December 2014, which 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 June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ — $ 15 $ — $ (309 ) Gain (loss) recognized in other income (expense) – ineffective portion — (1 ) — 107 Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 10 371 248 741 The effects on the consolidated financial statements of the fuel options which were not designated as hedging instruments were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain recognized in other income (expense) $ — $ 101 $ — $ 186 Foreign Currency Options We had foreign currency options that matured through January 2014, 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 June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other comprehensive income (loss) – effective portion $ — $ — $ — $ (1,157 ) Loss recognized in other income (expense) – ineffective portion — — — (241 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense 330 329 660 608 Foreign Currency Forward Contracts As of June 30, 2015, we had foreign currency forward contracts which were 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 €0.9 billion, or $1.0 billion based on the euro/U.S. dollar exchange rate as of June 30, 2015. 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 June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 36,928 $ 88 $ (60,447 ) $ (988 ) Gain (loss) recognized in other income (expense) – ineffective portion 8 — (7 ) (1 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense (63 ) (64 ) (127 ) (117 ) As of June 30, 2015, we had a foreign currency forward contract related to a foreign currency financial instrument denominated in Norwegian kroner (“NOK”) which is an economic hedge. The notional amount of our foreign currency forward contract was NOK 124.8 million, or $15.9 million based on the NOK/U.S. dollar exchange rate as of June 30, 2015. The effects on the consolidated financial statements of the foreign currency forward contract which was not designated as a cash flow hedge was as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain recognized in other income (expense) $ 99 $ — $ 99 $ — Foreign Currency Collar We had a foreign currency collar that matured in January 2014, which was 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 June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other comprehensive income (loss) – effective portion $ — $ — $ — $ (1,588 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense (91 ) (91 ) (182 ) (151 ) As of June 30, 2015, we had a foreign currency collar which was used to mitigate the financial impact of volatility in foreign currency exchange rates related to a ship construction contract. The notional amount of our foreign currency collar was €274.4 million, or $305.9 million based on the euro/U.S. dollar exchange rate as of June 30, 2015. The effect on the consolidated financial statements of the foreign currency collar contract which was not designated as a cash flow hedge was as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain (loss) recognized in other income (expense) $ 9,350 $ — $ (19,603 ) $ — Interest Rate Swaps As of June 30, 2015, we had interest rate swap agreements to mitigate 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 $1.2 billion. The effects on the consolidated financial statements of the interest rates swaps which were designated as cash flow hedges were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other comprehensive income (loss) – effective portion $ (570 ) $ (2,916 ) $ (4,159 ) $ (4,356 ) Loss recognized in other income (expense) – ineffective portion (5 ) — (12 ) — Amount reclassified from accumulated other comprehensive income (loss) into interest expense, net 1,081 526 2,018 848 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 which was not designated as a cash flow hedge was as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other income (expense) $ — $ — $ (2 ) $ — Long-Term Debt As of June 30, 2015 and December 31, 2014, the fair value of our long-term debt, including the current portion, was $5,812.0 million and $6,229.1 million, which was $48.9 million and $45.0 million higher, 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. 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 financial assets and liabilities other than our long-term debt approximate fair value. |
Employee Benefits and Share Opt
Employee Benefits and Share Option Plans | 6 Months Ended |
Jun. 30, 2015 | |
Postemployment Benefits [Abstract] | |
Employee Benefits and Share Option Plans | 8. Employee Benefits and Share Option Plans Share Option Awards The following is a summary of option activity under our share option plan for the six months ended June 30, 2015: Number of Share Option Awards Weighted-Average Exercise Price Weighted- Average Contractual Term Aggregate Intrinsic Value Time-Based Awards Performance- Based Awards Time-Based Awards Performance- Based Awards (years) (in thousands) Outstanding as of January 1, 2015 6,079,881 1,457,314 $ 29.92 $ 19.00 7.61 $ 142,831 Granted 250,000 — 47.67 — Exercised (1,799,944 ) (341,300 ) 26.97 19.00 Forfeited and cancelled (819,137 ) (477,611 ) 31.99 19.00 Outstanding as of June 30, 2015 3,710,800 638,403 32.09 19.00 7.61 112,508 The total intrinsic value of options exercised during the three and six months ended June 30, 2015 was $4.7 million and $49.5 million, respectively, and total cash received by the Company from options exercised was $3.2 million and $55.0 million for the three and six months ended June 30, 2015, respectively. Share-based compensation expense for the three months ended June 30, 2015 was $2.2 million and for the six months ended June 30, 2015 was $14.2 million, which includes $8.2 million related to the acceleration of certain equity awards of the former President and Chief Executive Officer, and was recorded in marketing, general and administrative expense. On July 1, 2015, we granted approximately 3.4 million share option awards to our employees at an exercise price of $56.19 with a contractual term of ten years. On August 4, 2015, we granted to our employees approximately 689.0 thousand share option awards at an exercise price of $59.43 with a contractual term of ten years. The share option awards vest equally over three years. In addition, on August 4, 2015, we entered into an amendment to the employment agreement with our President and Chief Executive Officer pursuant to which we granted 625.0 thousand time-based share option awards and 625.0 thousand performance-based share option awards at an exercise price of $59.43 with a contractual term of ten years. The time-based share option awards vest 50% on June 30, 2017 and 50% on June 30, 2019. The performance-based share option awards vest upon certain hurdles being achieved. We also granted to our President and Chief Executive Officer 150.0 thousand restricted share units which ratably vest over four years through June 30, 2019 and 150.0 thousand performance-based restricted share units which vest upon certain hurdles being achieved. Restricted Ordinary Share Awards The following is a summary of restricted ordinary share activity for the six months ended June 30, 2015: Number of Time-Based Awards Weighted- Average Grant Date Fair Value Number of Performance- Based Awards Weighted- Average Grant Date Fair Value Non-vested as of January 1, 2015 196,644 $ 3.43 1,208,608 $ 3.37 Granted 4,815 46.70 — — Vested (26,059 ) 10.38 (56,687 ) 4.13 Forfeited or Expired (73,476 ) 2.68 (587,869 ) 2.79 Non-vested and expected to vest as of June 30, 2015 101,924 4.24 564,052 3.90 Other Employee Matters On January 8, 2015, Kevin M. Sheehan resigned as President and Chief Executive Officer of the Company, together with all of his positions and offices with the Company and its subsidiaries or affiliates, effective immediately. In connection with Mr. Sheehan’s resignation from the Company, Mr. Sheehan and the Company entered into a Separation Agreement and Release (the “Separation Agreement”). The Separation Agreement sets forth the terms of Mr. Sheehan’s resignation from the Company, including, among other things, a general release of claims in favor of the Company and certain non-competition, non-solicitation, confidentiality and cooperation undertakings. The Separation Agreement also provides that Mr. Sheehan will receive (i) all of his accrued and unpaid base salary (and accrued and unpaid vacation time) through January 8, 2015 (the “Effective Date”), (ii) his previously approved bonus payment for fiscal year 2014 of $1,627,500, (iii) a one-time cash separation payment in an amount equal to his base salary and target bonus and (iv) vesting of a portion of his outstanding unvested equity-based awards as of the Effective Date, and all remaining unvested equity-based awards shall immediately terminate, expire and be forfeited as of the Effective Date. This resulted in a total severance expense of $13.4 million of which $8.2 million was due to the acceleration of the equity-based awards which was recorded in marketing, general and administrative expense in January 2015. Effective as of January 8, 2015, Frank J. Del Rio was appointed President and Chief Executive Officer of the Company. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Ship Construction Contracts We have four Breakaway Plus Class Ships on order with Meyer Werft shipyard for delivery in the fall of 2015, spring of 2017, spring of 2018 and fall of 2019. These ships will be the largest in our fleet, reaching approximately 164,600 Gross Tons and up to 4,200 Berths each and will be similar in design and innovation to our Breakaway Class Ships. The combined contract price of these four ships is approximately €3.1 billion, or $3.5 billion based on the euro/U.S. dollar exchange rate as of June 30, 2015. We have export credit financing in place that provides financing for 80% of their contract prices. We also have a contract with Fincantieri shipyard to build a luxury cruise ship to be named Seven Seas Explorer. The contract price of the ship is approximately €343.0 million, or approximately $382.3 million based on the euro/U.S. dollar exchange rate as of June 30, 2015. We have export credit financing in place that provides financing for 80% of the ship’s contract price. Seven Seas Explorer is expected to be delivered in the summer of 2016. In connection with the contracts to build the 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 and potential claims and impairment losses which may materially impact our business, financial condition and results of operations. Litigation In 2015, the Alaska Department of Environmental Conservation issued Notices of Violations to major cruise lines that operated in the state of Alaska, including Norwegian, for alleged violations of the Alaska Marine Vessel Visible Emission Standards that occurred over the last several years. We are cooperating with the state of Alaska and conducting our own internal investigation into these matters. However, we do not believe the ultimate outcome will have a material impact on our financial condition, results of operations or cash flows. 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, 2015 | |
Restructuring Costs [Abstract] | |
Restructuring Costs | 10. Restructuring Costs Due to the Acquisition of Prestige, a number of employee positions were consolidated. As of June 30, 2015, we had an accrual balance of $7.2 million for restructuring costs for severance and other employee-related costs. The expense of $11.2 million for the six months ended June 30, 2015 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, 2014 $ (7,956 ) Amounts paid 11,991 Additional accrued expense (11,244 ) Accrued expense balance as of June 30, 2015 $ (7,209 ) |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Jun. 30, 2015 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | 11. Supplemental Cash Flow Information For the six months ended June 30, 2015, we had non-cash investing activities in connection with a capital lease of $27.6 million. |
Revision to the Consolidated St
Revision to the Consolidated Statement of Cash Flows | 6 Months Ended |
Jun. 30, 2015 | |
Revision To Consolidated Statement Of Cash Flows [Abstract] | |
Revision to the Consolidated Statement of Cash Flows | 12. Revision to the Consolidated Statement of Cash Flows During the three months ended June 30, 2015, we determined that for the year ended December 31, 2014, non-cash transactions related to the financing of one of our ships was reported as cash used for additions to property and equipment and cash provided by proceeds from long-term debt. The Consolidated Statement of Cash Flows, for the year ended December 31, 2014, will be revised in our Form 10-K for the year ending December 31, 2015, by decreasing cash used for additions to property and equipment and cash provided by proceeds from long-term debt by $82.0 million. We have determined that the revision is not material to our consolidated financial statements. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
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 summer months. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2014, which are included in our most recently filed Annual Report on Form 10-K. During the three months ended June 30, 2015, we revised for the year ended December 31, 2014, the classification of goodwill and intangible assets to separately present goodwill and intangible assets, net. The revision was not deemed material to the Consolidated Balance Sheet. |
Reclassification | Reclassification Certain amounts in prior periods have been reclassified to conform to the current period presentation. |
Shareholders' Equity | Shareholders’ Equity In connection with the Corporate Reorganization, previously granted profits interests to employees were exchanged for Management NCL Corporation Units (“Units”), and the vested Unit holders gained proportionate rights to distributions of NCLC and were therefore allocated a proportionate share of NCLC’s equity. The effect of this change was a $20.2 million increase in the non-controlling interest. During the six months ended June 30, 2014, following the effectiveness of NCLH’s registration statement on Form S-3, additional performance-based Units became eligible to participate in the earnings of NCLC, and as a result, a proportionate amount of NCLC’s equity was allocated to the additional non-controlling interest. Each Unit holder had the right, subject to the same time-based and performance-based vesting requirements of the profits interests, to exchange Units for NCLH’s ordinary shares at a rate equal to one ordinary share for every Unit. When such an exchange occurred, this resulted in the exchange of non-controlling interest to controlling interest. Accordingly, upon the exchange of a Unit for an ordinary share of NCLH, a portion of the non-controlling interest balance was reclassified to additional paid-in capital. As of June 30, 2014, there was $7.8 million transferred to non-controlling interest. As of June 30, 2014, Management NCL Corporation Unit holders were distributed cash to facilitate partnership tax payments of $3.1 million and $2.8 million of these distributions were subsequently repaid to NCLC upon exchange of each Unit holders’ Units. In the fourth quarter of 2014, all Management NCL Corporation Units were exchanged for NCLH ordinary shares and restricted ordinary shares. We refer you to Note 1— “Corporate Reorganization”. On April 29, 2014, NCLH’s Board of Directors authorized, and NCLH announced, a three-year share repurchase program for up to $500.0 million. NCLH may make repurchases in the open market, in privately negotiated transactions, in accelerated repurchase programs or in structured share repurchase programs, and any repurchases may be made pursuant to Rule 10b5-1 plans. During the three months ended June 30, 2014, NCLH repurchased approximately 2.4 million ordinary shares under its share repurchase program for $79.2 million, which shares are reflected as treasury shares at cost on the consolidated balance sheet as of June 30, 2014 included in NCLH’s Quarterly Report on Form 10-Q filed on July 31, 2014. There was no share repurchase activity during the three and six months ended June 30, 2015, and as of June 30, 2015, $418.0 million remained available for repurchases of our outstanding ordinary shares under the share repurchase program. The increase in treasury shares reported in NCLH’s consolidated balance sheets as of June 30, 2015 relates to certain forfeitures of restricted ordinary shares held by management or former management of NCLH. |
Earnings (Loss) Per Share | Earnings Per Share A reconciliation between basic and diluted earnings per share was as follows (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended 2015 2014 2015 2014 Net income attributable to Norwegian Cruise Line Holdings Ltd. $ 158,494 $ 111,616 $ 137,038 $ 162,883 Net income $ 158,494 $ 113,279 $ 137,038 $ 164,971 Basic weighted-average shares outstanding 225,698,078 204,965,718 225,003,460 205,063,870 Dilutive effect of share awards 4,530,066 5,507,273 4,660,750 5,678,785 Diluted weighted-average shares outstanding 230,228,144 210,472,991 229,664,210 210,742,655 Basic earnings per share $ 0.70 $ 0.54 $ 0.61 $ 0.79 Diluted earnings per share $ 0.69 $ 0.54 $ 0.60 $ 0.78 |
Revenue and Expense Recognition | Revenue and Expense Recognition Revenue and expense includes taxes assessed by governmental authorities that are directly imposed on a revenue-producing transaction between a seller and a customer. The amounts included in revenue and expense on a gross basis were $62.4 million and $44.6 million for the three months ended June 30, 2015 and 2014, respectively, and $114.3 million and $82.5 million for the six months ended June 30, 2015 and 2014, respectively. Guest cancellation penalties are recognized in passenger ticket revenue at the time of the cancellation. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU No. 2014-09 requires entities to recognize revenue through the application of a five-step model, which includes 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. The FASB approved a one-year deferral of the effective date. 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 newly issued guidance to our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03 which was issued to simplify the presentation of debt issuance costs. The guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by these amendments. This guidance should be applied on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. The guidance will be effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. We are currently evaluating the impact of the adoption of this newly issued guidance to our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-05 which was issued 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. Early adoption is permitted. An entity can elect to adopt the amendments either prospectively or retrospectively. We are currently evaluating the impact, if any, of the adoption of this newly issued guidance to our consolidated financial statements. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Reconciliation between basic and diluted earnings per share | Three Months Ended June 30, Six Months Ended 2015 2014 2015 2014 Net income attributable to Norwegian Cruise Line Holdings Ltd. $ 158,494 $ 111,616 $ 137,038 $ 162,883 Net income $ 158,494 $ 113,279 $ 137,038 $ 164,971 Basic weighted-average shares outstanding 225,698,078 204,965,718 225,003,460 205,063,870 Dilutive effect of share awards 4,530,066 5,507,273 4,660,750 5,678,785 Diluted weighted-average shares outstanding 230,228,144 210,472,991 229,664,210 210,742,655 Basic earnings per share $ 0.70 $ 0.54 $ 0.61 $ 0.79 Diluted earnings per share $ 0.69 $ 0.54 $ 0.60 $ 0.78 |
The Acquisition of Prestige (Ta
The Acquisition of Prestige (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Schedule of changes in the fair value of the contingent consideration liability | Contingent Consideration Liability Balance as of December 31, 2014 $ 43,400 Fair value adjustment (Level 3) (43,400 ) Balance as of June 30, 2015 $ — |
Accumulated Other Comprehensi23
Accumulated Other Comprehensive Income (Loss) (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) for the six months ended June 30, 2015 was as follows (in thousands): Accumulated Other Comprehensive Income (Loss) Change Related to Cash Flow Hedges Change Related to Shipboard Retirement Plan Accumulated other comprehensive income (loss) at beginning of period $ (242,642 ) $ (234,188 ) $ (8,454 ) 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 $ (227,227 ) $ (219,012 )(3) $ (8,215 ) (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 $63.0 million of losses expected to be reclassified into earnings in the next 12 months. Accumulated other comprehensive income (loss) for the six months ended June 30, 2014 was as follows (in thousands): Accumulated Other Comprehensive Income (Loss) Change Related to Cash Flow Hedges Change Related to Shipboard Retirement Plan Accumulated other comprehensive income (loss) at beginning of period $ (16,690 ) $ (10,532 ) $ (6,158 ) Current period other comprehensive loss before reclassifications (6,515 ) (6,515 ) — Amounts reclassified into earnings 194 6 (1) 188 (2) Accumulated other comprehensive income (loss) at end of period $ (23,011 ) $ (17,041 ) $ (5,970 ) (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, 2015 | |
Schedule of derivatives measured at fair value and disclosed by balance sheet location | Asset Liability Balance Sheet location June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Fuel swaps designated as hedging instruments Accrued expenses and other liabilities $ 1,744 $ — $ 52,407 $ 111,304 Other long-term liabilities 1,075 190 44,419 77,250 Fuel swaps not designated as hedging instruments Accrued expenses and other liabilities — — 18,319 — Foreign currency forward contracts designated as hedging instruments Prepaid expenses and other assets 3,077 — — — Other long-term assets 1,730 — — — Accrued expenses and other liabilities — — 84,588 29,498 Other long-term liabilities — — 11,330 118 Foreign currency forward contracts not designated as hedging instruments Prepaid expenses and other assets 99 — — — Foreign currency collar not designated as a hedging instrument Other long-term liabilities — — 36,347 16,744 Interest rate swaps designated as hedging instruments Accrued expenses and other liabilities — — 6,100 5,736 Other long-term liabilities — — 4,114 3,104 Interest rate swap not designated as a hedging instrument Accrued expenses and other liabilities — — — 3,823 |
Schedule of amounts recognized within assets and liabilities | June 30, 2015 Gross Amounts Gross Amounts Offset Total Net Amounts Gross Amounts Not Offset Net Amounts Assets $ 4,906 $ — $ 4,906 $ (4,906) $ — Liabilities 257,624 (2,819 ) 254,805 (142,479 ) 112,326 December 31, 2014 Gross Amounts Gross Amounts Offset Total Net Amounts Gross Amounts Not Offset Net Amounts Liabilities $ 247,577 $ (190 ) $ 247,387 $ (59,023 ) $ 188,364 |
Fuel Swaps | |
Schedule of effects of derivatives dedesignated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Amount reclassified from accumulated other comprehensive income (loss) into other income (expense) $ 10,000 $ — $ 10,000 $ — |
Fuel Swaps | Designated as Hedging Instrument | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain recognized in other comprehensive income (loss) – effective portion $ 34,133 $ 11,610 $ 31,332 $ 1,839 Gain (loss) recognized in other income (expense) – ineffective portion (3,194 ) 451 (9,245 ) 35 Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 15,297 (1,218 ) 35,833 (1,923 ) |
Fuel Collars and Options | Designated as Hedging Instrument | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ — $ 15 $ — $ (309 ) Gain (loss) recognized in other income (expense) – ineffective portion — (1 ) — 107 Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 10 371 248 741 |
Fuel Options | Not Designated as Hedging Instrument | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain recognized in other income (expense) $ — $ 101 $ — $ 186 |
Foreign Exchange Option | Designated as Hedging Instrument | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other comprehensive income (loss) – effective portion $ — $ — $ — $ (1,157 ) Loss recognized in other income (expense) – ineffective portion — — — (241 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense 330 329 660 608 |
Foreign Exchange Forward | Designated as Hedging Instrument | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 36,928 $ 88 $ (60,447 ) $ (988 ) Gain (loss) recognized in other income (expense) – ineffective portion 8 — (7 ) (1 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense (63 ) (64 ) (127 ) (117 ) |
Foreign Exchange Forward | Not Designated as Hedging Instrument | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain recognized in other income (expense) $ 99 $ — $ 99 $ — |
Foreign Currency Collar | Designated as Hedging Instrument | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other comprehensive income (loss) – effective portion $ — $ — $ — $ (1,588 ) Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense (91 ) (91 ) (182 ) (151 ) |
Foreign Currency Collar | Not Designated as Hedging Instrument | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Gain (loss) recognized in other income (expense) $ 9,350 $ — $ (19,603 ) $ — |
Interest Rate Swap | Designated as Hedging Instrument | |
Schedule of effects of derivatives designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other comprehensive income (loss) – effective portion $ (570 ) $ (2,916 ) $ (4,159 ) $ (4,356 ) Loss recognized in other income (expense) – ineffective portion (5 ) — (12 ) — Amount reclassified from accumulated other comprehensive income (loss) into interest expense, net 1,081 526 2,018 848 |
Interest Rate Swap | Not Designated as Hedging Instrument | |
Schedule of effects of derivatives not designated as cash flow hedges | Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Loss recognized in other income (expense) $ — $ — $ (2 ) $ — |
Employee Benefits and Share O25
Employee Benefits and Share Option Plans (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Postemployment Benefits [Abstract] | |
Summary of stock option activity | Number of Share Option Awards Weighted-Average Exercise Price Weighted- Average Contractual Term Aggregate Intrinsic Value Time-Based Awards Performance- Based Awards Time-Based Awards Performance- Based Awards (years) (in thousands) Outstanding as of January 1, 2015 6,079,881 1,457,314 $ 29.92 $ 19.00 7.61 $ 142,831 Granted 250,000 — 47.67 — Exercised (1,799,944 ) (341,300 ) 26.97 19.00 Forfeited and cancelled (819,137 ) (477,611 ) 31.99 19.00 Outstanding as of June 30, 2015 3,710,800 638,403 32.09 19.00 7.61 112,508 |
Summary of restricted share activity | Number of Time-Based Awards Weighted- Average Grant Date Fair Value Number of Performance- Based Awards Weighted- Average Grant Date Fair Value Non-vested as of January 1, 2015 196,644 $ 3.43 1,208,608 $ 3.37 Granted 4,815 46.70 — — Vested (26,059 ) 10.38 (56,687 ) 4.13 Forfeited or Expired (73,476 ) 2.68 (587,869 ) 2.79 Non-vested and expected to vest as of June 30, 2015 101,924 4.24 564,052 3.90 |
Restructuring Costs (Tables)
Restructuring Costs (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Restructuring Costs [Abstract] | |
Summary of changes in the accrual for restructuring costs | Restructuring costs Accrued expense balance as of December 31, 2014 $ (7,956 ) Amounts paid 11,991 Additional accrued expense (11,244 ) Accrued expense balance as of June 30, 2015 $ (7,209 ) |
Corporate Reorganization (Detai
Corporate Reorganization (Detail Textuals) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | |||
Jan. 24, 2013 | Feb. 28, 2011 | Jun. 30, 2015 | Dec. 31, 2014 | |
Corporate Reorganization [Line Items] | ||||
Ordinary shares, par value (in dollars per shares) | $ 0.001 | $ 0.001 | ||
Ncl Corporation Ltd | ||||
Corporate Reorganization [Line Items] | ||||
Number of ordinary shares issued | 10,000 | |||
Ordinary shares, par value (in dollars per shares) | $ 0.001 | |||
Share exchange ratio | 1.0 to 8.42565 | |||
Ownership percentage | 100.00% | |||
Contribution to NCLC | $ 460 | |||
Percentage of economic interest | 97.30% | 100.00% | ||
Remaining percentage of economic interest held by former management | 2.70% |
Summary of Significant Accoun28
Summary of Significant Accounting Policies - Reconciliation between Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to Norwegian Cruise Line Holdings Ltd. | $ 158,494 | $ 111,616 | $ 137,038 | $ 162,883 |
Net income | $ 158,494 | $ 113,279 | $ 137,038 | $ 164,971 |
Basic weighted-average shares outstanding | 225,698,078 | 204,965,718 | 225,003,460 | 205,063,870 |
Dilutive effect of share awards | 4,530,066 | 5,507,273 | 4,660,750 | 5,678,785 |
Diluted weighted-average shares outstanding | 230,228,144 | 210,472,991 | 229,664,210 | 210,742,655 |
Basic earnings per share (in dollars per share) | $ 0.70 | $ 0.54 | $ 0.61 | $ 0.79 |
Diluted earnings per share (in dollars per share) | $ 0.69 | $ 0.54 | $ 0.60 | $ 0.78 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Detail Textuals 1) - USD ($) $ in Thousands, shares in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Apr. 29, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Accounting Policies [Line Items] | |||||
Partnership tax payments distribution | $ (3,115) | ||||
Amounts of tax included on a gross basis | $ 62,400 | $ 44,600 | $ 114,300 | 82,500 | |
Share repurchase program | |||||
Accounting Policies [Line Items] | |||||
Period of stock repurchase program | 3 years | ||||
Stock repurchase program, amount authorized | $ 500,000 | ||||
Number of shares repurchased | 2.4 | ||||
Value of shares repurchased | $ 79,200 | ||||
Remaining authorized amount to be repurchased | $ 418,000 | 418,000 | |||
Ncl Corporation Ltd | |||||
Accounting Policies [Line Items] | |||||
Increase in non-controlling interest | 20,200 | ||||
Transfers to non-controlling interest | $ 7,800 | ||||
Partnership tax payments distribution | 3,100 | ||||
Partnership tax distribution repaid | $ 2,800 |
The Acquisition of Prestige (De
The Acquisition of Prestige (Details) - Prestige Brands - Level 3 - Contingent Consideration Liability $ in Thousands | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance as of December 31, 2014 | $ 43,400 |
Fair value adjustment (Level 3) | $ (43,400) |
Balance as of June 30, 2015 |
The Acquisition of Prestige (31
The Acquisition of Prestige (Detail Textuals) - Prestige Brands - USD ($) | 1 Months Ended | 6 Months Ended |
Nov. 19, 2014 | Jun. 30, 2015 | |
Business Acquisition [Line Items] | ||
Cash payment of achievement of certain 2015 revenue milestones | $ 50,000,000 | |
Fair value measurement, with the maximum fair value not able to exceed | $ 50,000,000 | |
Net revenue percentage of target, result in no payout | 98.00% | |
Reduced fair value of contingent consideration | $ 0 | |
Marketing, general and administrative expense | ||
Business Acquisition [Line Items] | ||
Fair value adjustment recognized | $ 43,400,000 |
Accumulated Other Comprehensi32
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss) at beginning of period | $ (242,642) | $ (16,690) | ||
Current period other comprehensive loss before reclassifications | (33,274) | (6,515) | ||
Amounts reclassified into earnings | 48,689 | 194 | ||
Accumulated other comprehensive income (loss) at end of period | (227,227) | (23,011) | ||
Change Related to Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss) at beginning of period | (234,188) | (10,532) | ||
Current period other comprehensive loss before reclassifications | (33,274) | (6,515) | ||
Amounts reclassified into earnings | [1] | 48,450 | 6 | |
Accumulated other comprehensive income (loss) at end of period | (219,012) | [2] | (17,041) | |
Change Related to Shipboard Retirement Plan | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss) at beginning of period | $ (8,454) | $ (6,158) | ||
Current period other comprehensive loss before reclassifications | ||||
Amounts reclassified into earnings | [3] | $ 239 | $ 188 | |
Accumulated other comprehensive income (loss) at end of period | $ (8,215) | $ (5,970) | ||
[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 $63.0 million of losses 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) (Parentheticals) (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Change Related to Cash Flow Hedges | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Amount expected to be reclassified into earnings | $ 63 |
Related Party Disclosures - Add
Related Party Disclosures - Additional Information (Detail Textuals) - USD ($) | 1 Months Ended | ||
May. 31, 2015 | Mar. 31, 2015 | Jun. 30, 2015 | |
Norwegian Cruise Line Holdings Ltd. | |||
Related Party Transaction [Line Items] | |||
Common stock shares sold in Secondary Equity Offering | 20,000,000 | ||
SWB Yankees, LLC | |||
Related Party Transaction [Line Items] | |||
Payment of annual fee for sponsorship and advertising | $ 200,000 | ||
Genting Hk | Norwegian Cruise Line Holdings Ltd. | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership | 17.70% | ||
Apollo Funds | Norwegian Cruise Line Holdings Ltd. | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership | 20.60% | ||
TPG Viking Funds | Norwegian Cruise Line Holdings Ltd. | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership | 3.20% | ||
Public shareholders | Norwegian Cruise Line Holdings Ltd. | |||
Related Party Transaction [Line Items] | |||
Percentage of ownership | 58.50% | ||
Genting HK And TPG Viking Funds | Norwegian Cruise Line Holdings Ltd. | |||
Related Party Transaction [Line Items] | |||
Common stock shares sold in Secondary Equity Offering | 12,500,000 |
Income Tax Benefit (Expense) -
Income Tax Benefit (Expense) - Additional Information (Detail Textuals) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||||
Income tax benefit (expense) | $ (2,726) | $ (3,124) | $ (3,403) | $ 6,263 | |
Benefit for non-recurring benefit associated | $ 6,700 |
Fair Value Measurements and D36
Fair Value Measurements and Derivatives - Derivatives Measured at Fair Value and Disclosed by Balance Sheet Location (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 4,906 | |
Derivative liabilities, fair value | 257,624 | $ 247,577 |
Designated as Hedging Instrument | Fuel Swaps | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 1,744 | |
Derivative liabilities, fair value | 52,407 | $ 111,304 |
Designated as Hedging Instrument | Fuel Swaps | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 1,075 | 190 |
Derivative liabilities, fair value | $ 44,419 | $ 77,250 |
Designated as Hedging Instrument | Foreign Currency Forward Contracts | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 84,588 | $ 29,498 |
Designated as Hedging Instrument | Foreign Currency Forward Contracts | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 11,330 | $ 118 |
Designated as Hedging Instrument | Foreign Currency Forward Contracts | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 3,077 | |
Derivative liabilities, fair value | ||
Designated as Hedging Instrument | Foreign Currency Forward Contracts | Other long-term assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 1,730 | |
Derivative liabilities, fair value | ||
Designated as Hedging Instrument | Interest Rate Swap | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 6,100 | $ 5,736 |
Designated as Hedging Instrument | Interest Rate Swap | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 4,114 | $ 3,104 |
Not Designated as Hedging Instrument | Fuel Swaps | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 18,319 | |
Not Designated as Hedging Instrument | Foreign Currency Forward Contracts | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 99 | |
Derivative liabilities, fair value | ||
Not Designated as Hedging Instrument | Foreign Currency Collar | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 36,347 | $ 16,744 |
Not Designated as Hedging Instrument | Interest Rate Swap | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | ||
Derivative liabilities, fair value | $ 3,823 |
Fair Value Measurements and D37
Fair Value Measurements and Derivatives - Amounts Recognized Within Assets and Liabilities Based on Right of Offset (Details 1) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Fair Value Disclosures [Abstract] | ||
Gross Amounts, Assets | $ 4,906 | |
Gross Amounts Offset, Assets | ||
Total Net Amounts, Assets | $ 4,906 | |
Gross Amounts Not Offset, Assets | $ (4,906) | |
Total Net Amounts, Assets | ||
Gross Amounts, Liabilities | $ 257,624 | $ 247,577 |
Gross Amounts Offset, Liabilities | (2,819) | (190) |
Total Net Amounts, Liabilities | 254,805 | 247,387 |
Gross Amounts Not Offset, Liabilities | (142,479) | (59,023) |
Total Net Amounts, Liabilities | $ 112,326 | $ 188,364 |
Fair Value Measurements and D38
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, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain recognized in other comprehensive income (loss) - effective portion | $ 34,133 | $ 11,610 | $ 31,332 | $ 1,839 |
Gain (loss) recognized in other income (expense) - ineffective portion | (3,194) | 451 | (9,245) | 35 |
Amount reclassified from accumulated other comprehensive income (loss) into fuel expense | $ 15,297 | $ (1,218) | $ 35,833 | $ (1,923) |
Fair Value Measurements and D39
Fair Value Measurements and Derivatives - Consolidated financial statements of fuel swaps dedesignated and immediately recognized into earnings (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reclassification out of Accumulated Other Comprehensive Income | Fuel Swaps | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Amount reclassified from accumulated other comprehensive income (loss) into other income (expense) | $ 10,000 | $ 10,000 |
Fair Value Measurements and D40
Fair Value Measurements and Derivatives - Effects of Fuel Collars Designated as Cash flow Hedges (Details 4) - Cash Flow Hedging - Designated as Hedging Instrument - Fuel Collars and Options - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in other comprehensive income (loss) - effective portion | $ 15 | $ (309) | ||
Gain (loss) recognized in other income (expense) - ineffective portion | (1) | 107 | ||
Amount reclassified from accumulated other comprehensive income (loss) into fuel expense | $ 10 | $ 371 | $ 248 | $ 741 |
Fair Value Measurements and D41
Fair Value Measurements and Derivatives - Effects of Fuel Options Which Were Not Designated as Hedging Instruments (Details 5) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Not Designated as Hedging Instrument | Fuel Options | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain recognized in other income (expense) | $ 101 | $ 101 |
Fair Value Measurements and D42
Fair Value Measurements and Derivatives - Effects of Foreign Currency Options Designated as Cash Flow Hedges (Details 6) - Cash Flow Hedging - Designated as Hedging Instrument - Foreign Currency Options - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Loss recognized in other comprehensive income (loss) - effective portion | $ (1,157) | |||
Loss recognized in other income (expense) - ineffective portion | (241) | |||
Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense | $ 330 | $ 329 | $ 660 | $ 608 |
Fair Value Measurements and D43
Fair Value Measurements and Derivatives - Effects of Foreign Currency Forward Contracts Designated as Cash Flow Hedges (Details 7) - Cash Flow Hedging - Designated as Hedging Instrument - Foreign Currency Forward Contracts - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in other comprehensive income (loss) - effective portion | $ 36,928 | $ 88 | $ (60,447) | $ (988) |
Gain (loss) recognized in other income (expense) - ineffective portion | 8 | (7) | (1) | |
Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense | $ (63) | $ (64) | $ (127) | $ (117) |
Fair Value Measurements and D44
Fair Value Measurements and Derivatives - Foreign currency forward contract not designated as cash flow hedge (Details 8) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Not Designated as Hedging Instrument | Foreign Currency Forward Contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gain recognized in other income (expense) | $ 99 | $ 99 |
Fair Value Measurements and D45
Fair Value Measurements and Derivatives - Effects of Foreign Currency Collar Designated as Cash Flow Hedges (Details 9) - Cash Flow Hedging - Designated as Hedging Instrument - Foreign Currency Collar - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Loss recognized in other comprehensive income (loss) - effective portion | $ (1,588) | |||
Amount reclassified from accumulated other comprehensive income (loss) into depreciation and amortization expense | $ (91) | $ (91) | $ (182) | $ (151) |
Fair Value Measurements and D46
Fair Value Measurements and Derivatives - Effects of Foreign Currency Which Was not Designated As Cash Flow Hedge (Details 10) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Not Designated as Hedging Instrument | Foreign Currency Collar | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Gain (loss) recognized in other income (expense) | $ 9,350 | $ (19,603) |
Fair Value Measurements and D47
Fair Value Measurements and Derivatives - Effects of Interest Rates Swaps Designated as Cash Flow Hedges (Details 11) - Cash Flow Hedging - Designated as Hedging Instrument - Interest Rate Swap - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Loss recognized in other comprehensive income (loss) - effective portion | $ (570) | $ (2,916) | $ (4,159) | $ (4,356) |
Loss recognized in other income (expense) - ineffective portion | (5) | (12) | ||
Amount reclassified from accumulated other comprehensive income (loss) into interest expense, net | $ 1,081 | $ 526 | $ 2,018 | $ 848 |
Fair Value Measurements and D48
Fair Value Measurements and Derivatives - Effects of Interest Rates Swaps Which Was Not Designated As Cash Flow Hedge (Details 12) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Not Designated as Hedging Instrument | Interest Rate Swap | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Loss recognized in other income (expense) | $ (2) |
Fair Value Measurements and D49
Fair Value Measurements and Derivatives (Detail Textuals) € in Millions, NOK in Millions, $ in Millions | 6 Months Ended | |||
Jun. 30, 2015USD ($)Metric_Ton | Jun. 30, 2015EUR (€)Metric_Ton | Jun. 30, 2015NOKMetric_Ton | Dec. 31, 2014USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Fair value of long-term debt | $ 5,812 | $ 6,229.1 | ||
Fair value of long-term debt in excess of carrying value | $ 48.9 | $ 45 | ||
Fuel Swaps | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Derivative maturing date | Dec. 31, 2018 | |||
Projected fuel purchases | Metric_Ton | 1,100,000 | 1,100,000 | 1,100,000 | |
Fuel Swaps | Not Designated as Hedging Instrument | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Projected fuel purchases | Metric_Ton | 100,000 | 100,000 | 100,000 | |
Interest Rate Swap | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notional amount of derivatives | $ 1,200 | |||
Foreign Currency Forward Contracts | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notional amount of derivatives | 1,000 | € 900 | ||
Notional amount of derivatives | 15.9 | NOK 124.8 | ||
Foreign Currency Collar | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notional amount of derivatives | $ 305.9 | € 274.4 |
Employee Benefits and Share O50
Employee Benefits and Share Option Plans - Summary of Share Option Awards (Details ) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2015 | |
Weighted- Average Contractual Term (years) | |
Outstanding as of January 1, 2015 and June 30, 2015 | 7 years 7 months 10 days |
Aggregate intrinsic Value | |
Outstanding as of January 1, 2015 | $ 142,831 |
Outstanding as of June 30, 2015 | $ 112,508 |
Time Based Options | |
Number of Share Option Awards | |
Outstanding as of January 1, 2015 | 6,079,881 |
Number of shares granted | 250,000 |
Exercised | (1,799,944) |
Forfeited and cancelled | (819,137) |
Outstanding as of June 30, 2015 | 3,710,800 |
Weighted-Average Exercise Price | |
Outstanding as of January 1, 2015 | $ 29.92 |
Granted | 47.67 |
Exercised | 26.97 |
Forfeited and cancelled | 31.99 |
Outstanding as of June 30, 2015 | $ 32.09 |
Performance Based Options | |
Number of Share Option Awards | |
Outstanding as of January 1, 2015 | 1,457,314 |
Number of shares granted | |
Exercised | (341,300) |
Forfeited and cancelled | (477,611) |
Outstanding as of June 30, 2015 | 638,403 |
Weighted-Average Exercise Price | |
Outstanding as of January 1, 2015 | $ 19 |
Granted | |
Exercised | $ 19 |
Forfeited and cancelled | 19 |
Outstanding as of June 30, 2015 | $ 19 |
Employee Benefits and Share O51
Employee Benefits and Share Option Plans - Summary of Restricted Share Activity (Details 1) - 6 months ended Jun. 30, 2015 - Restricted Stock - $ / shares | Total |
Time-Based Awards | |
Number of Restricted Share Awards | |
Non-vested as of January 1, 2015 | 196,644 |
Granted | 4,815 |
Vested | (26,059) |
Forfeited or Expired | (73,476) |
Non-vested and expected to vest as of June 30, 2015 | 101,924 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2015 | $ 3.43 |
Granted | 46.70 |
Vested | 10.38 |
Forfeited or Expired | 2.68 |
Non-vested and expected to vest as of June 30, 2015 | $ 4.24 |
Performance-Based Awards | |
Number of Restricted Share Awards | |
Non-vested as of January 1, 2015 | 1,208,608 |
Granted | |
Vested | (56,687) |
Forfeited or Expired | (587,869) |
Non-vested and expected to vest as of June 30, 2015 | 564,052 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2015 | $ 3.37 |
Granted | |
Vested | $ 4.13 |
Forfeited or Expired | 2.79 |
Non-vested and expected to vest as of June 30, 2015 | $ 3.90 |
Employee Benefits and Share O52
Employee Benefits and Share Option Plans (Detail Textuals) - USD ($) $ / shares in Units, shares in Thousands | Jul. 01, 2015 | Jan. 08, 2015 | Aug. 04, 2015 | Jun. 30, 2015 | Jun. 30, 2015 | Jun. 30, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total intrinsic value of stock options exercised | $ 4,700,000 | $ 49,500,000 | ||||
Proceeds from the exercise of share options | 3,200,000 | 55,023,000 | $ 2,158,000 | |||
Share-based Compensation | $ 2,200,000 | 14,166,000 | $ 5,079,000 | |||
Subsequent Event | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 3,400 | 689 | ||||
Exercise price per share | $ 56.19 | $ 59.43 | ||||
Contractual term of shares granted | 10 years | 10 years | ||||
Vested period of stock option | 3 years | 3 years | ||||
Marketing, general and administrative expense | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Acceleration of certain equity awards of the former President and Chief Executive Officer | $ 8,200,000 | |||||
Separation Agreement | Kevin M. Sheehan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Previously approved bonus payment for fiscal year 2014 | $ 1,627,500 | |||||
Severance expense | $ 13,400,000 | |||||
Amended employment agreement | Subsequent Event | Time-Based Awards | Vested June 30, 2017 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of stock option | 50.00% | |||||
Amended employment agreement | Subsequent Event | Time-Based Awards | Vested June 30, 2019 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of stock option | 50.00% | |||||
Amended employment agreement | Subsequent Event | Performance-Based Awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 150 | |||||
Amended employment agreement | Subsequent Event | Restricted share units | Vested June 30, 2017 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 150 | |||||
Vested period of stock option | 4 years | |||||
Amended employment agreement | President and Chief Executive Officer | Subsequent Event | Time-Based Awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 625 | |||||
Exercise price per share | $ 59.43 | |||||
Contractual term of shares granted | 10 years | |||||
Amended employment agreement | President and Chief Executive Officer | Subsequent Event | Performance-Based Awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 625 | |||||
Exercise price per share | $ 59.43 | |||||
Contractual term of shares granted | 10 years |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail Textuals) - Jun. 30, 2015 - Ship Construction Contracts € in Millions, $ in Millions | USD ($)CruiseShipGross_TonBerth | EUR (€)CruiseShipGross_TonBerth |
Commitments and Contingencies Disclosure [Line Items] | ||
Scheduled delivery date of ships under construction | fall of 2015, spring of 2017, spring of 2018 and fall of 2019 | |
Cruise ships to be built | 4 | 4 |
Capacity of ship, tons | Gross_Ton | 164,600 | 164,600 |
Capacity of ship, berths | Berth | 4,200 | 4,200 |
Aggregate contract price of new ships | $ 3,500 | € 3,100 |
Export credit facility financing as percentage of contract prices | 80.00% | 80.00% |
Fincantieri Shipyard | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Aggregate contract price of new ships | $ 382 | € 343 |
Restructuring Costs (Details)
Restructuring Costs (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Restructuring Reserve [Roll Forward] | |
Accrued Expense balance as of December 31, 2014 | $ (7,956) |
Amounts paid | 11,991 |
Additional accrued expense | (11,244) |
Accrued Expense balance as of June 30, 2015 | $ (7,209) |
Restructuring Costs (Detail Tex
Restructuring Costs (Detail Textuals) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Restructuring Cost and Reserve [Line Items] | ||
Accrual balance for restructuring costs for severance and other employee-related costs | $ 7,209 | $ 7,956 |
Restructuring expense | $ 11,244 |
Supplemental Cash Flow Inform56
Supplemental Cash Flow Information (Detail Textuals) $ in Millions | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Supplemental Cash Flow Information [Abstract] | |
Non-cash investing activity in connection with capital leases | $ 27.6 |
Revision to the Consolidated 57
Revision to the Consolidated Statement of Cash Flows (Detail Textuals) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | |
Revision To Consolidated Statement Of Cash Flows [Abstract] | |||
Proceeds from long-term debt | $ 82,000 | $ 340,060 | $ 914,545 |