Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 23, 2019 | |
Cover page. | ||
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0000884887 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 1-11884 | |
Entity Registrant Name | ROYAL CARIBBEAN CRUISES LTD | |
Entity Incorporation, State or Country Code | N0 | |
Entity Tax Identification Number | 98-0081645 | |
Entity Address, Address Line One | 1050 Caribbean Way | |
Entity Address, City or Town | Miami | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33132 | |
City Area Code | 305 | |
Local Phone Number | 539-6000 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | RCL | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 209,631,168 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Total revenues | $ 3,186,850 | $ 2,796,187 | $ 8,433,248 | $ 7,161,548 |
Cruise operating expenses: | ||||
Total cruise operating expenses | 1,623,038 | 1,411,364 | 4,581,246 | 3,901,794 |
Marketing, selling and administrative expenses | 352,725 | 325,167 | 1,144,546 | 975,451 |
Depreciation and amortization expenses | 320,295 | 259,923 | 924,180 | 753,529 |
Operating Income | 890,792 | 799,733 | 1,783,276 | 1,530,774 |
Other income (expense): | ||||
Interest income | 5,625 | 5,831 | 21,751 | 26,662 |
Interest expense, net of interest capitalized | (102,038) | (86,510) | (313,757) | (236,252) |
Equity investment income | 103,654 | 95,169 | 170,393 | 168,232 |
Other expense | (7,668) | (3,832) | (34,537) | 5,923 |
Total other income (expense) | (427) | 10,658 | (156,150) | (35,435) |
Net Income | 890,365 | 810,391 | 1,627,126 | 1,495,339 |
Less: Net Income attributable to noncontrolling interest | 7,125 | 0 | 21,375 | 0 |
Net Income attributable to Royal Caribbean Cruises Ltd. | $ 883,240 | $ 810,391 | $ 1,605,751 | $ 1,495,339 |
Earnings per Share: | ||||
Basic (in dollars per share) | $ 4.21 | $ 3.88 | $ 7.67 | $ 7.08 |
Diluted (in dollars per share) | $ 4.20 | $ 3.86 | $ 7.65 | $ 7.05 |
Weighted-Average Shares Outstanding: | ||||
Basic (in shares) | 209,575 | 209,054 | 209,477 | 211,099 |
Diluted (in shares) | 210,121 | 209,928 | 210,032 | 211,973 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | $ (15,510) | $ (3,479) | $ (7,683) | $ (13,840) |
Change in defined benefit plans | (12,456) | 1,153 | (22,831) | 6,949 |
(Loss) gain on cash flow derivative hedges | (265,224) | 36,946 | (288,115) | 110,576 |
Total other comprehensive (loss) income | (293,190) | 34,620 | (318,629) | 103,685 |
Comprehensive Income | 597,175 | 845,011 | 1,308,497 | 1,599,024 |
Less: Comprehensive Income attributable to noncontrolling interest | 7,125 | 0 | 21,375 | 0 |
Comprehensive Income attributable to Royal Caribbean Cruises Ltd. | 590,050 | 845,011 | 1,287,122 | 1,599,024 |
Passenger ticket revenues | ||||
Total revenues | 2,344,779 | 2,042,911 | 6,072,599 | 5,141,125 |
Onboard and other revenues | ||||
Total revenues | 842,071 | 753,276 | 2,360,649 | 2,020,423 |
Cruise operating expenses: | ||||
Total cruise operating expenses | 200,656 | 171,028 | 510,255 | 412,805 |
Commissions, transportation and other | ||||
Cruise operating expenses: | ||||
Total cruise operating expenses | 488,921 | 430,039 | 1,279,010 | 1,078,953 |
Payroll and related | ||||
Cruise operating expenses: | ||||
Total cruise operating expenses | 263,993 | 221,205 | 799,094 | 674,676 |
Food | ||||
Cruise operating expenses: | ||||
Total cruise operating expenses | 149,621 | 133,324 | 436,002 | 381,349 |
Fuel | ||||
Cruise operating expenses: | ||||
Total cruise operating expenses | 177,677 | 182,415 | 519,772 | 515,065 |
Other operating | ||||
Cruise operating expenses: | ||||
Total cruise operating expenses | $ 342,170 | $ 273,353 | $ 1,037,113 | $ 838,946 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 276,730 | $ 287,852 |
Trade and other receivables, net | 348,991 | 324,507 |
Inventories | 167,213 | 153,573 |
Prepaid expenses and other assets | 399,390 | 456,547 |
Derivative financial instruments | 11,633 | 19,565 |
Total current assets | 1,203,957 | 1,242,044 |
Property and equipment, net | 25,005,404 | 23,466,163 |
Operating lease right-of-use assets | 697,461 | |
Goodwill | 1,373,065 | 1,378,353 |
Other assets | 1,545,574 | 1,611,710 |
Total assets | 29,825,461 | 27,698,270 |
Current liabilities | ||
Current portion of debt | 943,060 | 1,646,841 |
Commercial paper | 922,201 | 775,488 |
Current portion of operating lease liabilities | 93,058 | |
Accounts payable | 538,949 | 488,212 |
Accrued interest | 124,561 | 74,550 |
Accrued expenses and other liabilities | 979,939 | 899,761 |
Derivative financial instruments | 101,561 | 78,476 |
Customer deposits | 3,410,205 | 3,148,837 |
Total current liabilities | 7,113,534 | 7,112,165 |
Long-term debt | 8,819,212 | 8,355,370 |
Long-term operating lease liabilities | 620,570 | |
Other long-term liabilities | 731,844 | 583,254 |
Total liabilities | 17,285,160 | 16,050,789 |
Commitments and contingencies (Note 11) | ||
Redeemable noncontrolling interest | 563,394 | 542,020 |
Shareholders’ equity | ||
Preferred stock ($0.01 par value; 20,000,000 shares authorized; none outstanding) | 0 | 0 |
Common stock ($0.01 par value; 500,000,000 shares authorized; 236,494,616 and 235,847,683 shares issued, September 30, 2019 and December 31, 2018, respectively) | 2,365 | 2,358 |
Paid-in capital | 3,466,641 | 3,420,900 |
Retained earnings | 11,412,773 | 10,263,282 |
Accumulated other comprehensive loss | (946,363) | (627,734) |
Treasury stock (26,887,147 and 26,830,765 common shares at cost, at September 30, 2019 and December 31, 2018, respectively) | (1,958,509) | (1,953,345) |
Total shareholders’ equity | 11,976,907 | 11,105,461 |
Total liabilities, redeemable noncontrolling interest and shareholders’ equity | $ 29,825,461 | $ 27,698,270 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 236,494,616 | 235,847,683 |
Treasury stock, common shares (in shares) | 26,887,147 | 26,830,765 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | ||
Operating Activities | |||
Net Income | $ 1,627,126 | $ 1,495,339 | |
Adjustments: | |||
Depreciation and amortization | 924,180 | 753,529 | |
Impairment losses | 0 | 33,651 | |
Net deferred income tax expense (benefit) | 4,664 | (2,926) | |
Loss on derivative instruments not designated as hedges | 24,229 | 41,397 | |
Share-based compensation expense | 51,256 | 63,420 | |
Equity investment income | (170,393) | (168,232) | |
Amortization of debt issuance costs | 24,154 | 31,656 | |
Amortization of commercial paper notes discount | 23,583 | 3,844 | |
Loss on extinguishment of debt | 6,326 | 0 | |
Change in fair value of contingent consideration | 10,700 | 0 | |
Gain on sale of unconsolidated affiliate | 0 | (13,680) | |
Recognition of deferred gain | 0 | (21,794) | |
Changes in operating assets and liabilities: | |||
Increase in trade and other receivables, net | (36,682) | (17,141) | |
Increase in inventories | (13,640) | (21,760) | |
Decrease (increase) in prepaid expenses and other assets | 41,757 | (76,471) | |
Increase in accounts payable | 51,011 | 35,433 | |
Increase in accrued interest | 50,011 | 45,735 | |
Increase (decrease) in accrued expenses and other liabilities | 81,026 | (15,856) | |
Increase in customer deposits | 261,335 | 349,230 | |
Dividends received from unconsolidated affiliates | [1] | 148,285 | 241,697 |
Other, net | (1,860) | (10,087) | |
Net cash provided by operating activities | 3,107,068 | 2,746,984 | |
Investing Activities | |||
Purchases of property and equipment | (2,341,895) | (2,509,127) | |
Cash received on settlement of derivative financial instruments | 6,442 | 74,008 | |
Cash paid on settlement of derivative financial instruments | (86,671) | (50,891) | |
Investments in and loans to unconsolidated affiliates | (6,889) | (15,194) | |
Cash received on loans to unconsolidated affiliates | 27,697 | 49,501 | |
Proceeds from the sale of unconsolidated affiliate | 0 | 13,215 | |
Acquisition of Silversea Cruises, net of cash acquired | 0 | (916,135) | |
Other, net | (1,028) | (3,989) | |
Net cash used in investing activities | (2,402,344) | (3,358,612) | |
Financing Activities | |||
Debt proceeds | 3,080,564 | 6,626,295 | |
Debt issuance costs | (42,491) | (54,775) | |
Repayments of debt | (3,424,339) | (5,833,602) | |
Proceeds from issuance of commercial paper notes | 19,807,417 | 2,165,991 | |
Repayments of commercial paper notes | (19,684,288) | (1,171,000) | |
Purchases of treasury stock | 0 | (575,039) | |
Dividends paid | (439,543) | (381,465) | |
Proceeds from exercise of common stock options | 1,452 | 4,206 | |
Other, net | (13,681) | (14,857) | |
Net cash (used in) provided by financing activities | (714,909) | 765,754 | |
Effect of exchange rate changes on cash | (937) | (19,417) | |
Net (decrease) increase in cash and cash equivalents | (11,122) | 134,709 | |
Cash and cash equivalents at beginning of period | 287,852 | 120,112 | |
Cash and cash equivalents at end of period | 276,730 | 254,821 | |
Cash paid during the period for: | |||
Interest, net of amount capitalized | 179,497 | 154,231 | |
Non-cash Investing Activities | |||
Contingent consideration for the acquisition of Silversea Cruises | $ 0 | $ 44,000 | |
[1] | For the quarter ended September 30, 2019 , TUI Cruises paid us dividends of €80.0 million , or approximately $88.5 million , based on the exchange rate at the time of the transactions. For the nine months ended September 30, 2019 , TUI Cruises paid us dividends totaling €170.0 million , or approximately $190.3 million , based on the exchange rates at the time of the transactions. The amounts included in the table above are net of tax withholdings. |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock |
Beginning balance at Dec. 31, 2017 | $ 10,702,303 | $ 2,352 | $ 3,390,117 | $ 9,022,405 | $ (334,265) | $ (1,378,306) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Activity related to employee stock plans | 35,699 | 6 | 35,693 | |||
Common stock dividends | (400,376) | (400,376) | ||||
Changes related to cash flow derivative hedges | 110,576 | 110,576 | ||||
Change in defined benefit plans | 6,949 | 6,949 | ||||
Foreign currency translation adjustments | (13,840) | (13,840) | ||||
Net Income attributable to Royal Caribbean Cruises Ltd. | 1,495,339 | 1,495,339 | ||||
Purchases of treasury stock | (575,039) | (575,039) | ||||
Ending balance at Sep. 30, 2018 | 11,338,135 | 2,358 | 3,425,810 | 10,093,892 | (230,580) | (1,953,345) |
Beginning balance at Dec. 31, 2017 | 10,702,303 | 2,352 | 3,390,117 | 9,022,405 | (334,265) | (1,378,306) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Purchases of treasury stock | (300,000) | |||||
Ending balance at Dec. 31, 2018 | 11,105,461 | 2,358 | 3,420,900 | 10,263,282 | (627,734) | (1,953,345) |
Beginning balance at Jun. 30, 2018 | 10,773,698 | 2,358 | 3,397,561 | 9,429,784 | (265,200) | (1,790,805) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Activity related to employee stock plans | 28,249 | 0 | 28,249 | |||
Common stock dividends | (146,283) | (146,283) | ||||
Changes related to cash flow derivative hedges | 36,946 | 36,946 | ||||
Change in defined benefit plans | 1,153 | 1,153 | ||||
Foreign currency translation adjustments | (3,479) | (3,479) | ||||
Net Income attributable to Royal Caribbean Cruises Ltd. | 810,391 | 810,391 | ||||
Purchases of treasury stock | (162,540) | (162,540) | ||||
Ending balance at Sep. 30, 2018 | 11,338,135 | 2,358 | 3,425,810 | 10,093,892 | (230,580) | (1,953,345) |
Beginning balance at Dec. 31, 2018 | 11,105,461 | 2,358 | 3,420,900 | 10,263,282 | (627,734) | (1,953,345) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Activity related to employee stock plans | 40,584 | 7 | 45,741 | (5,164) | ||
Common stock dividends | (456,260) | (456,260) | ||||
Changes related to cash flow derivative hedges | (288,115) | (288,115) | ||||
Change in defined benefit plans | (22,831) | (22,831) | ||||
Foreign currency translation adjustments | (7,683) | (7,683) | ||||
Net Income attributable to Royal Caribbean Cruises Ltd. | 1,605,751 | 1,605,751 | ||||
Ending balance at Sep. 30, 2019 | 11,976,907 | 2,365 | 3,466,641 | 11,412,773 | (946,363) | (1,958,509) |
Beginning balance at Jun. 30, 2019 | 11,538,403 | 2,364 | 3,454,831 | 10,692,890 | (653,173) | (1,958,509) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Activity related to employee stock plans | 11,811 | 1 | 11,810 | |||
Common stock dividends | (163,357) | (163,357) | ||||
Changes related to cash flow derivative hedges | (265,224) | (265,224) | ||||
Change in defined benefit plans | (12,456) | (12,456) | ||||
Foreign currency translation adjustments | (15,510) | (15,510) | ||||
Net Income attributable to Royal Caribbean Cruises Ltd. | 883,240 | 883,240 | ||||
Ending balance at Sep. 30, 2019 | $ 11,976,907 | $ 2,365 | $ 3,466,641 | $ 11,412,773 | $ (946,363) | $ (1,958,509) |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Stockholders' Equity [Abstract] | |||||||||||
Common stock dividends declared (in dollars per share) | $ 0.78 | $ 0.78 | $ 0.70 | $ 0.70 | $ 0.70 | $ 0.7 | $ 0.60 | $ 0.60 | $ 0.60 | $ 2.18 | $ 1.90 |
General
General | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | General Description of Business We are a global cruise company. As of September 30, 2019 , we control and operate four global cruise brands: Royal Caribbean International, Celebrity Cruises, Azamara and Silversea Cruises (collectively, our "Global Brands"). We also own a 50% joint venture interest in the German brand TUI Cruises and a 49% interest in the Spanish brand Pullmantur (collectively, our "Partner Brands"). We account for our investments in our Partner Brands under the equity method of accounting. Basis for Preparation of Consolidated Financial Statements The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any items discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such rules and regulations. Estimates are required for the preparation of financial statements in accordance with these principles. Actual results could differ from these estimates. Refer to Note 2 . Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2018 for a discussion of our significant accounting policies. All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50% , and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 7 . Other Assets for further information regarding our variable interest entities. We consolidate the operating results of Silversea Cruises on a three -month reporting lag to allow for more timely preparation of our consolidated financial statements. No material events or other transactions involving Silversea Cruises have occurred from July 1, 2019 through September 30, 2019 that would require further disclosure or adjustment to our consolidated financial statements as of and for the quarter ended September 30, 2019 . For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50% |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Adoption of Accounting Pronouncements Leases On January 1, 2019, we adopted the guidance codified in Accounting Standard Codification ("ASC") 842, Leases ("ASC 842") using the modified retrospective approach and elected the optional transition method, which allows entities to initially apply the standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Upon adoption, we applied the guidance to all existing leases. For leases with a term greater than 12 months, the new guidance requires the lease rights and obligations arising from the leasing arrangements, including operating leases, to be recognized as assets and liabilities on the balance sheet. Upon adoption of the new guidance, the most significant impact was the recognition of right-of-use assets and lease liabilities relating to operating leases in the amounts of $801.8 million and $820.5 million , respectively, reported within Operating lease right-of-use assets and Long-term operating lease liabilities, respectively, with the current portion of the liability reported within Current portion of operating lease liabilities , in our consolidated balance sheet as of January 1, 2019. Accounting for finance leases remained substantially unchanged and continues to be reported within Property and equipmen t, net and Long-term debt, with the current portion of the debt reported within Current portion of debt , in our consolidated balance sheets. There was no cumulative effect of applying the new standard and accordingly there was no adjustment to our retained earnings upon adoption. The comparative information presented has not been restated and continues to be reported under the accounting standards in effect for those periods. For further information on leases, refer to Note 9 . Leases . This guidance did not have a material impact to our consolidated statements of comprehensive income (loss), consolidated statements of cash flows and our debt-covenants calculations under our current agreements. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326); Measurement of Credit Losses on Financial Instruments . This ASU, along with subsequent ASUs issued to clarify certain of its provisions, introduces new guidance which makes substantive changes to the accounting model for financial assets subject to credit losses that are measured at amortized cost, as well as certain off-balance sheet credit exposures. The primary updates include the introduction of a new current expected credit loss (“CECL”) model that is based on expected rather than incurred losses. This ASU and the related amendments will be effective for our annual reporting period beginning January 1, 2020. We are currently evaluating the impact of the adoption of this guidance to our consolidated financial statements. Reclassifications For the nine months ended September 30, 2019 , we separately presented Amortization of commercial paper notes discount in our consolidated statements of cash flows. As a result, the prior year amortization amount was reclassified within Operating Activities to conform to the current year presentation. |
Business Combination
Business Combination | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Business Combination | Business Combination On July 31, 2018, we acquired a 66.7% equity stake in Silversea Cruise Holding Ltd. ("Silversea Cruises"), an ultra-luxury and expedition cruise line, from Heritage Cruise Holding Ltd. ("HCH"), previously known as Silversea Cruises Group Ltd. Silversea Cruises enhances our presence in the ultra-luxury and expedition markets and provides us with an opportunity to drive long-term capacity growth in these markets. The purchase price consisted of $1.02 billion in cash, net of assumed liabilities, and contingent consideration that can range from zero up to a maximum of approximately 472,000 shares of our common stock, and is payable upon achievement of certain 2019-2020 performance metrics by Silversea Cruises. The fair value of the contingent consideration at the acquisition date was $44.0 million . Changes in the fair value of the contingent consideration are recorded in our results of operations, if any, in the period of the change. Refer to Note 14 . Fair Value Measurements and Derivative Instruments for further information on the valuation of the contingent consideration. To finance a portion of the purchase price, we drew in full on a $700 million unsecured credit agreement and the remainder of the transaction consideration was financed through the use of our revolving credit facilities. We have accounted for this transaction under the provisions of ASC 805, Business Combinations. The purchase price for the Silversea Cruises acquisition was allocated based on estimates of the fair value of assets acquired and liabilities assumed at the acquisition date, with the excess allocated to goodwill. Goodwill is not deductible for tax purposes and consisted primarily of the opportunity to expand our cruise operations in strategic growth areas. For reporting purposes, we include Silversea Cruises’ results of operations on a three -month reporting lag from April 1, 2019 through June 30, 2019 for the quarter ended September 30, 2019 and from October 1, 2018 through June 30, 2019 for the nine months ended September 30, 2019 . We have included Silversea Cruises' balance sheet as of June 30, 2019 in our consolidated balance sheet as of September 30, 2019 . Refer to Note 1 . General for further information on this three -month reporting lag. Our purchase price allocation was final as of March 31, 2019. There were no material measurement period adjustments recorded during the nine months ended September 30, 2019 . |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets consist of finite and indefinite life assets and are reported within Other assets in our consolidated balance sheets. The following is a summary of our intangible assets as of September 30, 2019 and December 31, 2018 (in thousands): September 30, 2019 Gross Carrying Value Accumulated Amortization Net Carrying Value Finite-life intangible assets: Customer relationships $ 97,400 $ 5,952 $ 91,448 Galapagos operating license 47,669 5,470 42,199 Other finite-life intangible assets 11,560 5,298 6,262 Total finite-life intangible assets 156,629 16,720 139,909 Indefinite-life intangible assets 351,725 — 351,725 Total intangible assets, net $ 508,354 $ 16,720 $ 491,634 December 31, 2018 Gross Carrying Value Accumulated Amortization Net Carrying Value Finite-life intangible assets: Customer relationships $ 97,400 $ 1,082 $ 96,318 Galapagos operating license 47,669 4,206 43,463 Other finite-life intangible assets 11,560 963 10,597 Total finite-life intangible assets 156,629 6,251 150,378 Indefinite-life intangible assets 351,725 — 351,725 Total intangible assets, net $ 508,354 $ 6,251 $ 502,103 The estimated future amortization for finite-life intangible assets for each of the next five years is as follows (in thousands): Year Remainder of 2019 $ 3,490 2020 $ 12,995 2021 $ 8,179 2022 $ 8,179 2023 $ 8,179 2024 $ 8,179 |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Revenue Recognition Revenues are measured based on consideration specified in our contracts with customers and are recognized as the related performance obligations are satisfied. The majority of our revenues are derived from passenger cruise contracts which are reported within Passenger ticket revenues in our consolidated statements of comprehensive income (loss). Our performance obligation under these contracts is to provide a cruise vacation in exchange for the ticket price. We satisfy this performance obligation and recognize revenue over the duration of each cruise, which generally range from two to 25 nights. Passenger ticket revenues include charges to our guests for port costs that vary with passenger head counts. These type of port costs, along with port costs that do not vary by passenger head counts, are included in our operating expenses. The amounts of port costs charged to our guests and included within Passenger ticket revenues on a gross basis were $184.0 million and $174.1 million for the quarters ended September 30, 2019 and 2018 , respectively, and $509.6 million and $462.2 million for the nine months ended September 30, 2019 and 2018 , respectively. Our total revenues also include onboard and other revenues, which consist primarily of revenues from the sale of goods and services onboard our ships that are not included in passenger ticket prices. We receive payment before or concurrently with the transfer of these goods and services to passengers during a cruise and recognize revenue at the time of transfer over the duration of the related cruise. Disaggregated Revenues The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues by itinerary North America (1) $ 1,617,446 $ 1,450,119 $ 4,870,273 $ 4,061,545 Asia/Pacific (2) 272,062 235,374 1,089,914 1,051,551 Europe (3) 1,060,424 968,952 1,663,118 1,566,351 Other regions (4) 102,184 28,948 461,193 207,764 Total revenues by itinerary 3,052,116 2,683,393 8,084,498 6,887,211 Other revenues (5) 134,734 112,794 348,750 274,337 Total revenues $ 3,186,850 $ 2,796,187 $ 8,433,248 $ 7,161,548 (1) Includes the United States, Canada, Mexico and the Caribbean. (2) Includes Southeast Asia (e.g., Singapore, Thailand and the Philippines), East Asia (e.g., China and Japan), South Asia (e.g., India and Pakistan) and Oceania (e.g., Australia and Fiji Islands) regions. (3) Includes European countries (e.g., Nordics, Germany, France, Italy, Spain and the United Kingdom). (4) Includes itineraries primarily in South and Latin American countries. (5) Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to our bareboat charter, procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 7 . Other Assets for more information on our unconsolidated affiliates. Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended September 30, 2019 and 2018 , our guests were sourced from the following areas: Quarter Ended September 30, 2019 2018 Passenger ticket revenues: United States 62 % 59 % United Kingdom 12 % 13 % All other countries (1) 26 % 28 % For the nine months ended September 30, 2019 and 2018 , our guests were sourced from the following areas: Nine Months Ended September 30, 2019 2018 Passenger ticket revenues: United States 65 % 60 % United Kingdom 9 % 10 % All other countries (1) 26 % 30 % (1) No other individual country's revenue exceeded 10% for the quarters and nine months ended September 30, 2019 and 2018 . Customer Deposits and Contract Liabilities Our payment terms generally require an upfront deposit to confirm a reservation, with the balance due prior to the cruise. Deposits received on sales of passenger cruises are initially recorded as Customer deposits in our consolidated balance sheets and subsequently recognized as passenger ticket revenues during the duration of the cruise. ASC 606, Revenues from Contracts with Customers , defines a “contract liability” as an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. We consider customer deposits to be a contract liability once the customer no longer retains the unilateral right, resulting from the passage of time, to cancel such customer's reservation and receive a full refund. Customer deposits presented in our consolidated balance sheets include contract liabilities of $1.9 billion as of both September 30, 2019 and December 31, 2018 , respectively. Substantially all of our contract liabilities as of December 31, 2018 were recognized and reported within Total revenues in our consolidated statement of comprehensive income (loss) for the nine months ended September 30, 2019 . Contract Receivables and Contract Assets Although we generally require full payment from our customers prior to their cruise, we grant credit terms to a relatively small portion of our revenue sourced in select markets outside of the United States. As a result, we have outstanding receivables from passenger cruise contracts in those markets. We also have receivables from credit card merchants for cruise ticket purchases and goods and services sold to guests during cruises that are collected before, during or shortly after the cruise voyage. In addition, we have receivables due from concessionaires onboard our vessels. These receivables are included within Trade and other receivables, net in our consolidated balance sheets. We have contract assets that are conditional rights to consideration for satisfying the construction services performance obligations under a service concession arrangement. As of September 30, 2019 and December 31, 2018 , our contract assets were $56.1 million and $57.8 million , respectively, and were included within Other assets in our consolidated balance sheets. Given the short duration of our cruises and our collection terms, we do not have any other significant contract assets. Assets Recognized from the Costs to Obtain a Contract with a Customer Prepaid travel agent commissions are an incremental cost of obtaining contracts with customers that we recognize as an asset and include within Prepaid expenses and other assets in our consolidated balance sheets. Prepaid travel agent commissions were $146.5 million and $153.5 million as of September 30, 2019 and December 31, 2018 , respectively. Substantially all of our prepaid travel agent commissions at December 31, 2018 were expensed and reported within Commissions, transportation and other in our consolidated statements of comprehensive income (loss) for the nine months ended September 30, 2019 . |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share A reconciliation between basic and diluted earnings per share is as follows (in thousands, except per share data): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Net Income attributable to Royal Caribbean Cruises Ltd. for basic and diluted earnings per share $ 883,240 $ 810,391 $ 1,605,751 $ 1,495,339 Weighted-average common shares outstanding 209,575 209,054 209,477 211,099 Dilutive effect of stock-based awards 546 874 555 874 Diluted weighted-average shares outstanding 210,121 209,928 210,032 211,973 Basic earnings per share $ 4.21 $ 3.88 $ 7.67 $ 7.08 Diluted earnings per share $ 4.20 $ 3.86 $ 7.65 $ 7.05 There were no antidilutive shares for the quarters and nine months ended September 30, 2019 and 2018 |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2019 | |
Other Assets [Abstract] | |
Other Assets | Other Assets A Variable Interest Entity (“VIE”) is an entity in which the equity investors have not provided enough equity to finance the entity’s activities or the equity investors: (1) cannot directly or indirectly make decisions about the entity’s activities through their voting rights or similar rights; (2) do not have the obligation to absorb the expected losses of the entity; (3) do not have the right to receive the expected residual returns of the entity; or (4) have voting rights that are not proportionate to their economic interests and the entity’s activities involve or are conducted on behalf of an investor with a disproportionately small voting interest. We have determined that TUI Cruises GmbH, our 50% -owned joint venture, which operates the brand TUI Cruises, is a VIE. As of September 30, 2019 , the net book value of our investment in TUI Cruises was $521.7 million , primarily consisting of $368.2 million in equity and a loan of €138.7 million , or approximately $151.2 million based on the exchange rate at September 30, 2019 . As of December 31, 2018 , the net book value of our investment in TUI Cruises was $578.1 million , primarily consisting of $403.0 million in equity and a loan of €150.6 million , or approximately $172.2 million based on the exchange rate at December 31, 2018 . The loan, which was made in connection with the sale of Splendour of the Seas in April 2016, accrues interest at a rate of 6.25% per annum and is payable over 10 years . This loan is 50% guaranteed by TUI AG, our joint venture partner in TUI Cruises, and is secured by a first priority mortgage on the ship. The majority of these amounts were included within Other assets in our consolidated balance sheets. In addition, we and TUI AG have each guaranteed the repayment by TUI Cruises of 50% of a bank loan. As of September 30, 2019 , the outstanding principal amount of the loan was €29.1 million , or approximately $31.7 million based on the exchange rate at September 30, 2019 . The loan amortizes quarterly and is currently secured by a first mortgage on Mein Schiff Herz . Based on current facts and circumstances, we do not believe potential obligations under our guarantee of this bank loan are probable. In addition to our guarantee of the bank loan, TUI Cruises has various ship construction and financing agreements which include certain restrictions on each of our and TUI AG’s ability to reduce our current ownership interest in TUI Cruises below 37.55% through May 2031 . Our investment amount, outstanding term loan an d the potential obligations under the bank loan guarantee are subs tantially our maximum exposure to loss in connection with our investment in TUI Cruises. We have determined that we are not the primary beneficiary of TUI Cruises. We believe that the power to direct the activities that most significantly impact TUI Cruises’ economic performance are shared between ourselves and TUI AG. All the significant operating and financial decisions of TUI Cruises require the consent of both parties, which we believe creates shared power over TUI Cruises. Accordingly, we do not consolidate this entity and account for this investment under the equity method of accounting. In March 2009, we sold Celebrity Galaxy to TUI Cruises for €224.4 million , or $290.9 million , to serve as the original Mein Schiff 1. Due to the related party nature of this transaction, the gain on the sale of the ship of $35.9 million was deferred and being recognized over the remaining life of the ship, which was estimated to be 23 years . In April 2018, TUI Cruises sold the original Mein Schiff 1 and as a result we accelerated the recognition of the remaining balance of the deferred gain, which was $21.8 million . This amount is included within Other (expense) income in our consolidated statements of comprehensive income (loss) for the nine months ended September 30, 2018. We have determined that Pullmantur Holdings S.L. ("Pullmantur Holdings"), in which we have a 49% noncontrolling interest and Springwater Capital LLC has a 51% interest, is a VIE for which we are not the primary beneficiary, as we do not have the power to direct the activities that most significantly impact the entity's economic performance. Accordingly, we do not consolidate this entity and we account for this investment under the equity method of accounting. As of September 30, 2019 and December 31, 2018 , our maximum exposure to loss in Pullmantur Holdings was $49.6 million and $58.5 million , respectively, consisting of loans and other receivables. These amounts were included within Trade and other receivables, net and Other assets in our consolidated balance sheets. We have provided a non-revolving working capital facility to a Pullmantur Holdings subsidiary in the amount of up to €15.0 million or approximately $16.4 million based on the exchange rate at September 30, 2019 . Proceeds of the facility, which were available to be drawn through December 2018, accrue interest at an interest rate of 6.5% per annum and are payable through 2022. An affiliate of Springwater Capital LLC has guaranteed repayment of 51% of the outstanding amounts under the facility. As of September 30, 2019 , €12.0 million , or approximately $13.1 million , based on the exchange rate at September 30, 2019 , was outstanding under this facility. As of December 31, 2018 , €14.0 million , or approximately $16.0 million , based on the exchange rate at December 31, 2018 , was outstanding under this facility. We have determined that Grand Bahama Shipyard Ltd. (“Grand Bahama”), a ship repair and maintenance facility in which we have a 40% noncontrolling interest, is a VIE. This facility serves cruise and cargo ships, oil and gas tankers and offshore units. We utilize this facility, among other ship repair facilities, for our regularly scheduled drydocks, ship upgrades and certain emergency repairs as may be required. During the quarter and nine months ended September 30, 2019 , we made payments of $0.4 million and $45.5 million , respectively, to Grand Bahama for ship repair and maintenance services. During the quarter and nine months ended September 30, 2018 , we made payments of $17.3 million and $41.6 million , respectively, to Grand Bahama for ship repair and maintenance services. We have determined that we are not the primary beneficiary of this facility as we do not have the power to direct the activities that most significantly impact the facility’s economic performance. Accordingly, we do not consolidate this entity and we account for this investment under the equity method of accounting. As of September 30, 2019 , the net book value of our investment in Grand Bahama was $47.8 million , consisting of $33.5 million in equity and a loan of $14.3 million . As of December 31, 2018 , the net book value of our investment in Grand Bahama was $56.1 million , consisting of $41.4 million in equity and a loan of $14.7 million . These amounts represent our maximum exposure to loss related to our investment in Grand Bahama. Our loan to Grand Bahama matures in March 2025 and bears interest at the lower of (i) LIBOR plus 3.50% and (ii) 5.50% . Interest payable on the loan is due on a semi-annual basis. During both the quarters ended September 30, 2019 and 2018 , no payments were received. During the nine months ended September 30, 2019 and 2018 , we received principal and interest payments of $7.6 million and $14.2 million , respectively. The loan balance is included within Other assets in our consolidated balance sheets. The loan is currently accruing interest under the effective yield method. In April 2019, Grand Bahama experienced an incident involving one of its drydocks where Oasis of the Seas was undergoing maintenance. The damage from the incident resulted in a write-off of the related drydock by Grand Bahama. Our equity investment income for the quarter and nine months ended September 30, 2019 reflects our equity share of the write-off and other incidental expenses. Grand Bahama's management is working with its insurance underwriter to determine coverage under their existing policies. We monitor credit risk associated with the loan through our participation on Grand Bahama’s board of directors along with our review of Grand Bahama’s financial statements and projected cash flows. Based on this review, we believe the risk of loss associated with the outstanding loan is not probable as of September 30, 2019 . In March 2018, we and Ctrip.com International Ltd. ("Ctrip") announced the decision to end the Skysea Holding International Ltd. ("Skysea Holding") venture in which we have a 36% ownership interest. As a result, we reviewed the recoverability of our investment in Skysea Holding and determined that our investment, debt facility and other receivables due from the brand were impaired and recognized an impairment charge of $23.3 million , which was included within Other (expense) income in our consolidated statement of comprehensive income (loss) for the nine months ended September 30, 2018 . The charge reflected a full impairment of our investment in Skysea Holding and other receivables due to us and reduced the debt facility and the related accrued interest due to us from Skysea Holding to its net realizable value. In December 2018, the Golden Era, the ship operated by SkySea Cruises, and owned by a wholly-owned subsidiary of Skysea Holding, was sold to an affiliate of TUI AG. Proceeds from the sale were distributed to Ctrip and us, which eliminated our net receivable balance due from Skysea Holding, resulting in no further impairment charges. As of September 30, 2019 and December 31, 2018 , we do not have any material exposures to loss related to our investment in Skysea Holding. The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Share of equity income from investments $ 103,654 $ 95,169 $ 170,393 $ 168,232 Dividends received (1) $ 67,713 $ 82,755 $ 148,285 $ 241,697 (1) For the quarter ended September 30, 2019 , TUI Cruises paid us dividends of €80.0 million , or approximately $88.5 million , based on the exchange rate at the time of the transactions. For the nine months ended September 30, 2019 , TUI Cruises paid us dividends totaling €170.0 million , or approximately $190.3 million , based on the exchange rates at the time of the transactions. The amounts included in the table above are net of tax withholdings. As of September 30, 2019 As of December 31, 2018 Total notes receivable due from equity investments $ 178,853 $ 201,979 Less-current portion (1) 19,091 19,075 Long-term portion (2) $ 159,762 $ 182,904 (1) Included within Trade and other receivables, net in our consolidated balance sheets. (2) Included within Other assets in our consolidated balance sheets. We also provide ship management services to TUI Cruises GmbH, Pullmantur Holdings and Skysea Holding (which ceased cruising operations in September 2018). Additionally, we bareboat charter to Pullmantur Holdings the vessels currently operated by its brands, which were retained by us following the sale of our 51% interest in Pullmantur Holdings. We recorded the following as it relates to these services in our operating results within our consolidated statements of comprehensive income (loss) (in thousands): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues $ 11,857 $ 12,170 $ 35,714 $ 40,400 Expenses $ 1,365 $ 1,735 $ 3,450 $ 8,643 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt In June 2018, we established a commercial paper program pursuant to which we may issue short-term unsecured notes from time to time in an aggregate amount of up to $1.2 billion , which was increased to $2.9 billion in August 2019. The commercial paper issued is backstopped by our revolving credit facilities. As of September 30, 2019 , we had $923.0 million of commercial paper notes outstanding with a weighted average interest rate of 2.36% and a weighted average maturity of approximately 34 days . As of December 31, 2018 , we had $777.0 million of commercial paper notes outstanding with a weighted average interest rate of 3.19% and a weighted average maturity of approximately 23 days . In April 2019, we amended our $1.4 billion unsecured revolving credit facility due in 2020 to extend the termination date through April 2024, increase the facility size to $1.7 billion and reduce pricing. The interest rate and facility fee vary with our senior debt rating and are currently set at LIBOR plus 1.0% per annum and 0.125% per annum, respectively. These amendments did not result in the extinguishment of debt. In addition, in May 2019, we amended our $1.15 billion unsecured revolving credit facility due in 2022 to reduce pricing to match pricing on our $1.7 billion unsecured revolving credit facility due in 2024. In April 2019, we entered into and drew in full on an unsecured three-year term loan agreement in the amount of $1.0 billion . The loan accrues interest at a floating rate of LIBOR plus an applicable margin, which varies with our senior debt rating, and is currently 1.075% per annum. Proceeds of this loan were used to repay the $700 million 364 -day loan due July 2019 related to the acquisition of Silversea Cruises and the remaining balance of the unsecured term loan originally incurred in 2010 to purchase Allure of the Seas . The repayment of these loans resulted in a total loss on the extinguishment of debt of $6.3 million , which was recognized within Other (expense) income within our consolidated statements of comprehensive income (loss) for the nine months ended September 30, 2019 . In April 2019, we took delivery of Spectrum of the Seas . To finance the purchase, we borrowed $908.0 million under a previously committed unsecured term loan which is 95% guaranteed by Euler Hermes Aktiengesellschaft, the official export credit agency of Germany. The loan amortizes semi-annually over 12 years and bears interest at a fixed rate of 3.45% per annum. In May 2019, we took delivery of Celebrity Flora . The purchase was financed through an unsecured term loan facility entered into in November 2017 in an amount up to €80.0 million , or approximately $87.2 million based on the exchange rate at September 30, 2019 . As of September 30, 2019 , we had fully drawn on this facility. The loan is due and payable at maturity in November 2024. Interest on the loan accrues at a floating rate based on EURIBOR plus the applicable margin. The applicable margin varies with our debt rating and was 1.195% as of September 30, 2019 . |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases Our operating leases primarily relate to preferred berthing arrangements, real estate and shipboard equipment and are included within Operating lease right-of-use assets , and Long-term operating lease liabilities with the current portion of the liability included within Current portion of operating lease liabilities in our consolidated balance sheet as of September 30, 2019 . Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. Refer to Note 2 . Summary of Significant Accounting Policies , for further information on the adoption of ASC 842. Finance leases are included within Property and equipment, net and Long-term debt, with the current portion of the debt reported within Current portion of debt , in our consolidated balance sheets. Our finance leases include two ships, Silver Whisper and Silver Explorer, operated by Silversea Cruises. The finance lease for Silver Whisper will expire in 2022, subject to an option to purchase the ship, and the finance lease for Silver Explorer will expire in 2021, subject to an option to extend the lease for up to an additional 6 years . In June 2019, the Company entered into a new master lease agreement (“Master Lease”) with Miami-Dade County relating to the buildings and surrounding land located at its Miami headquarters, which are classified as finance leases in accordance with ASC 842. Prior to entering into the Master Lease, the buildings were classified as operating lease assets. The finance lease for the buildings and land will expire in 2072, which includes an initial 43 years lease term and two five-year options to extend the lease. We consider the possibility of exercising the two five-year options reasonably certain. For some of our real estate leases and berthing agreements, we do have the option to extend our current lease term. For those lease agreements with renewal options, the renewal periods for real estate leases range from one to 10 years and the renewal periods for berthing agreements range from one year to 20 years . Generally, we do not include renewal options as a component of our present value calculation for berthing agreements. However, for certain real estate leases, we include them. Additionally, we do have a residual value guarantee associated with our lease of a terminal at PortMiami in Miami, Florida that approximates a percentage of cost of the asset as of the inception of the lease. We consider the possibility of incurring costs associated with the residual value guarantee to be remote. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate in determining the present value of lease payments. We estimate our incremental borrowing rates based on LIBOR and U.S. Treasury note rates corresponding to lease terms increased by the Company’s credit risk spread and reduced by the estimated impact of collateral. We used the incremental borrowing rate as of the adoption date for operating leases that commenced prior to that date. In addition, we have lease agreements with lease and non-lease components, which are generally accounted for separately. However, for berthing agreements, we account for the lease and non-lease components as a single lease component. Additionally, we bareboat charter to Pullmantur Holdings the vessels currently operated by its brands, which were retained by us following the sale of our 51% interest in Pullmantur Holdings in 2016. We account for the bareboat charters of these vessels as operating leases for which we are the lessor. The remaining payments and term of these leases are immaterial to our consolidated financial statements. Supplemental balance sheet information for leases was as follows (in thousands): As of September 30, 2019 Lease assets: Finance lease right-of-use assets, net: Property and equipment, gross $ 374,494 Accumulated depreciation (51,493 ) Property and equipment, net 323,001 Operating lease right-of-use assets 697,461 Total lease assets $ 1,020,462 Lease liabilities: Finance lease liabilities: Current portion of debt $ 34,603 Long-term debt 203,675 Total finance lease liabilities 238,278 Operating lease liabilities: Current portion of operating lease liabilities 93,058 Long-term operating lease liabilities 620,570 Total operating lease liabilities 713,628 Total lease liabilities $ 951,906 The components of lease expense were as follows (in thousands): Consolidated Statement of Comprehensive Income (Loss) Classification Quarter Ended September 30, 2019 Nine Months Ended September 30, 2019 Lease costs: Operating lease costs Commission, transportation and other $ 19,057 $ 57,170 Operating lease costs Other operating expenses 6,930 20,791 Operating lease costs Marketing, selling and administrative expenses 4,276 14,501 Finance lease costs: Amortization of right-of-use-assets Depreciation and amortization expenses 6,081 14,805 Interest on lease liabilities Interest expense, net of interest capitalized 1,514 3,680 Total lease costs $ 37,858 $ 110,947 In addition, certain of our berth agreements include variable lease costs based on the number of passengers berthed. During the quarter and nine months ended September 30, 2019 , we had $17.3 million and $73.1 million , respectively, of variable lease costs recorded within Commission, transportation and other in our consolidated statement of comprehensive income (loss). Weighted average of the remaining lease terms and weighted average discount rates are as follows: As of September 30, 2019 Weighted average of the remaining lease term Operating leases 10.5 years Finance leases 28.9 years Weighted average discount rate Operating leases 4.65 % Finance leases 4.42 % Supplemental cash flow information related to leases is as follows (in thousands): Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 94,125 Operating cash flows from finance leases $ 3,680 Financing cash flows from finance leases $ 19,009 Supplemental noncash information: Right-of-use assets obtained in exchange for lease obligations: Finance leases $ 122,237 As of September 30, 2019 , maturities related to lease liabilities were as follows (in thousands): Year Operating Leases Finance Leases Remainder of 2019 $ 30,765 $ 17,209 2020 122,718 42,912 2021 109,984 45,803 2022 103,551 22,832 2023 101,442 11,891 Thereafter 492,553 414,098 Total lease payments 961,013 554,745 Less: Interest (247,385 ) (316,467 ) Present value of lease liabilities $ 713,628 $ 238,278 Operating lease payments do not include any costs related to options to extend lease terms as none are reasonably certain of being exercised. Under ASC 840, Leases , future minimum lease payments under noncancelable operating leases as of December 31, 2018 were as follows (in thousands): Year 2019 $ 67,682 2020 64,237 2021 56,142 2022 52,759 2023 52,522 Thereafter 383,974 $ 677,316 |
Leases | Leases Our operating leases primarily relate to preferred berthing arrangements, real estate and shipboard equipment and are included within Operating lease right-of-use assets , and Long-term operating lease liabilities with the current portion of the liability included within Current portion of operating lease liabilities in our consolidated balance sheet as of September 30, 2019 . Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. Refer to Note 2 . Summary of Significant Accounting Policies , for further information on the adoption of ASC 842. Finance leases are included within Property and equipment, net and Long-term debt, with the current portion of the debt reported within Current portion of debt , in our consolidated balance sheets. Our finance leases include two ships, Silver Whisper and Silver Explorer, operated by Silversea Cruises. The finance lease for Silver Whisper will expire in 2022, subject to an option to purchase the ship, and the finance lease for Silver Explorer will expire in 2021, subject to an option to extend the lease for up to an additional 6 years . In June 2019, the Company entered into a new master lease agreement (“Master Lease”) with Miami-Dade County relating to the buildings and surrounding land located at its Miami headquarters, which are classified as finance leases in accordance with ASC 842. Prior to entering into the Master Lease, the buildings were classified as operating lease assets. The finance lease for the buildings and land will expire in 2072, which includes an initial 43 years lease term and two five-year options to extend the lease. We consider the possibility of exercising the two five-year options reasonably certain. For some of our real estate leases and berthing agreements, we do have the option to extend our current lease term. For those lease agreements with renewal options, the renewal periods for real estate leases range from one to 10 years and the renewal periods for berthing agreements range from one year to 20 years . Generally, we do not include renewal options as a component of our present value calculation for berthing agreements. However, for certain real estate leases, we include them. Additionally, we do have a residual value guarantee associated with our lease of a terminal at PortMiami in Miami, Florida that approximates a percentage of cost of the asset as of the inception of the lease. We consider the possibility of incurring costs associated with the residual value guarantee to be remote. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate in determining the present value of lease payments. We estimate our incremental borrowing rates based on LIBOR and U.S. Treasury note rates corresponding to lease terms increased by the Company’s credit risk spread and reduced by the estimated impact of collateral. We used the incremental borrowing rate as of the adoption date for operating leases that commenced prior to that date. In addition, we have lease agreements with lease and non-lease components, which are generally accounted for separately. However, for berthing agreements, we account for the lease and non-lease components as a single lease component. Additionally, we bareboat charter to Pullmantur Holdings the vessels currently operated by its brands, which were retained by us following the sale of our 51% interest in Pullmantur Holdings in 2016. We account for the bareboat charters of these vessels as operating leases for which we are the lessor. The remaining payments and term of these leases are immaterial to our consolidated financial statements. Supplemental balance sheet information for leases was as follows (in thousands): As of September 30, 2019 Lease assets: Finance lease right-of-use assets, net: Property and equipment, gross $ 374,494 Accumulated depreciation (51,493 ) Property and equipment, net 323,001 Operating lease right-of-use assets 697,461 Total lease assets $ 1,020,462 Lease liabilities: Finance lease liabilities: Current portion of debt $ 34,603 Long-term debt 203,675 Total finance lease liabilities 238,278 Operating lease liabilities: Current portion of operating lease liabilities 93,058 Long-term operating lease liabilities 620,570 Total operating lease liabilities 713,628 Total lease liabilities $ 951,906 The components of lease expense were as follows (in thousands): Consolidated Statement of Comprehensive Income (Loss) Classification Quarter Ended September 30, 2019 Nine Months Ended September 30, 2019 Lease costs: Operating lease costs Commission, transportation and other $ 19,057 $ 57,170 Operating lease costs Other operating expenses 6,930 20,791 Operating lease costs Marketing, selling and administrative expenses 4,276 14,501 Finance lease costs: Amortization of right-of-use-assets Depreciation and amortization expenses 6,081 14,805 Interest on lease liabilities Interest expense, net of interest capitalized 1,514 3,680 Total lease costs $ 37,858 $ 110,947 In addition, certain of our berth agreements include variable lease costs based on the number of passengers berthed. During the quarter and nine months ended September 30, 2019 , we had $17.3 million and $73.1 million , respectively, of variable lease costs recorded within Commission, transportation and other in our consolidated statement of comprehensive income (loss). Weighted average of the remaining lease terms and weighted average discount rates are as follows: As of September 30, 2019 Weighted average of the remaining lease term Operating leases 10.5 years Finance leases 28.9 years Weighted average discount rate Operating leases 4.65 % Finance leases 4.42 % Supplemental cash flow information related to leases is as follows (in thousands): Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 94,125 Operating cash flows from finance leases $ 3,680 Financing cash flows from finance leases $ 19,009 Supplemental noncash information: Right-of-use assets obtained in exchange for lease obligations: Finance leases $ 122,237 As of September 30, 2019 , maturities related to lease liabilities were as follows (in thousands): Year Operating Leases Finance Leases Remainder of 2019 $ 30,765 $ 17,209 2020 122,718 42,912 2021 109,984 45,803 2022 103,551 22,832 2023 101,442 11,891 Thereafter 492,553 414,098 Total lease payments 961,013 554,745 Less: Interest (247,385 ) (316,467 ) Present value of lease liabilities $ 713,628 $ 238,278 Operating lease payments do not include any costs related to options to extend lease terms as none are reasonably certain of being exercised. Under ASC 840, Leases , future minimum lease payments under noncancelable operating leases as of December 31, 2018 were as follows (in thousands): Year 2019 $ 67,682 2020 64,237 2021 56,142 2022 52,759 2023 52,522 Thereafter 383,974 $ 677,316 |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interest | 9 Months Ended |
Sep. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | Redeemable Noncontrolling Interest In connection with the acquisition of Silversea Cruises, we recorded a redeemable noncontrolling interest of $537.8 million due to the put options held by HCH. The put options may require us to purchase HCH's remaining interest, or 33.3% of Silversea Cruises, upon the occurrence or nonoccurrence of certain future events that are not solely within our control. HCH's interest is presented as Redeemable noncontrolling interest and is classified outside of shareholders' equity in our consolidated balance sheets. Additionally, the noncontrolling interest's share in the net earnings (loss) and contractual accretion requirements associated with the put options are included in Net Income attributable to noncontrolling interest in our consolidated statements of comprehensive income (loss). The following table presents changes in the redeemable noncontrolling interest as of September 30, 2019 (in thousands): Beginning balance January 1, 2019 $ 542,020 Net income attributable to noncontrolling interest, including the contractual accretion of the put options 21,375 Distribution to noncontrolling interest (501 ) Other 500 Ending balance September 30, 2019 $ 563,394 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Ship Purchase Obligations Our future capital commitments consist primarily of new ship orders. As of September 30, 2019 , our Global Brands have the following ships on order: Ship Shipyard Expected to Enter Approximate Royal Caribbean International — Oasis-class: Wonder of the Seas Chantiers de l’Atlantique 2nd Quarter 2021 5,700 Quantum-class: Odyssey of the Seas Meyer Werft 4th Quarter 2020 4,200 Icon-class: Unnamed Meyer Turku Oy 2nd Quarter 2022 5,600 Unnamed Meyer Turku Oy 2nd Quarter 2024 5,600 Celebrity Cruises — Edge-class: Celebrity Apex Chantiers de l’Atlantique 2nd Quarter 2020 2,900 Celebrity Beyond Chantiers de l’Atlantique 4th Quarter 2021 3,250 Unnamed Chantiers de l’Atlantique 4th Quarter 2022 3,250 Silversea Cruises — (1) Silver Origin De Hoop 4th Quarter 2020 100 Muse-class: Silver Moon Fincantieri 4th Quarter 2020 550 Silver Dawn Fincantieri 1st Quarter 2022 550 Evolution-class: Unnamed Meyer Werft 3rd Quarter 2022 600 Unnamed Meyer Werft 2nd Quarter 2023 600 Total Berths 32,900 (1) The "Expected to Enter Service" dates for Silversea Cruises' new ships takes into consideration the three-month reporting lag. Refer to Note 1 . General for further information. In June 2019, Silversea Cruises entered into a $300 million unsecured term loan facility for the financing of Silver Moon to pay a portion of the ship's contract price through a facility guaranteed by us. We expect to draw upon this loan when we take delivery of the ship. The loan will be due and payable at maturity in June 2028. Interest on the loan will accrue at LIBOR plus 1.50% . In September 2019, Silversea Cruises entered into two credit agreements, guaranteed by us, for the unsecured financing of the first and second Evolution-class ships for an amount of up to 80% of each ship's contract price through facilities to be guaranteed 95% by Euler Hermes Aktiengesellschaft, the official export credit agency of Germany. The maximum loan amount under each facility is not to exceed the United States dollar equivalent of €351.6 million in the case of the first Evolution-class ship and €359.0 million in the case of the second Evolution-class ship, or approximately $383.3 million and $391.4 million , respectively, based on the exchange rate at September 30, 2019 . Each loan, once funded, will amortize semi-annually and will mature 12 years following the delivery of each ship. At our election, interest on each loan will accrue either (1) at a fixed rate of 4.14% and 4.18% , respectively (inclusive of the applicable margin) or (2) at a floating rate equal to LIBOR plus 0.79% and 0.83% , respectively. As of September 30, 2019 , the aggregate cost of our ships on order presented in the table above, was $11.1 billion , of which we had deposited $705.5 million . Approximately 57.9% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at September 30, 2019 . Refer to Note 14 . Fair Value Measurements and Derivative Instruments for further information. In addition, as of September 30, 2019 , we have the following agreements in place for new ships on order for our Global Brands, which are contingent upon completion of conditions precedent and financing: Ship Shipyard Expected to Enter Approximate Royal Caribbean International — Oasis-class: Unnamed Chantiers de l’Atlantique 4th Quarter 2023 5,700 Icon-class: Unnamed Meyer Turku Oy 2nd Quarter 2025 5,600 Celebrity Cruises — Edge-class: Unnamed Chantiers de l’Atlantique 4th Quarter 2024 3,250 Litigation On August 27, 2019, two lawsuits were filed against Royal Caribbean Cruises Ltd. in the U.S. District Court for the Southern District of Florida under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act. The complaint filed by Havana Docks Corporation alleges it holds an interest in the Havana Cruise Port Terminal and the complaint filed by Javier Garcia-Bengochea alleges that he holds an interest in the Port of Santiago, Cuba, both of which were expropriated by the Cuban Government. The complaints further allege that Royal Caribbean Cruises Ltd. trafficked in those properties by embarking and disembarking passengers at these facilities. The plaintiffs seek all available statutory remedies, including the value of the expropriated property, plus interest, treble damages, attorneys’ fees and costs. Royal Caribbean Cruises Ltd. filed its answer to each complaint on October 4, 2019. We believe we have meritorious defenses to the claims, and we intend to vigorously defend ourselves against them. We believe that it is unlikely that the outcome of these matters will have a material adverse impact to our financial condition, results of operations or cash flows. However, the outcome of litigation is inherently unpredictable and subject to significant uncertainties, and there can be no assurances that the final outcome of this case will not be material. We are routinely involved in claims typical within the cruise vacation industry. The majority of these claims are covered by insurance. Although the outcome of any litigation is inherently unpredictable and subject to significant uncertainties, we believe it is unlikely that the outcome of such claims, net of expected insurance recoveries, will have a material adverse impact on our financial condition, results of operations and cash flows. Other If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24 -month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms. Our public debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade. If this were to occur, it would have an adverse impact on our liquidity and operations. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Dividends Declared In September 2019 we declared a cash dividend on our common stock of $0.78 per share, which was paid in October 2019 . During both first and second quarters of 2019 , we declared a cash dividend on our common stock of $0.70 per share, which was paid in April 2019 and July 2019 , respectively. During the first quarter of 2019 , we also paid a cash dividend on our common stock of $0.70 per share, which was declared during the fourth quarter of 2018. During the third quarter of 2018 , we declared a cash dividend on our common stock of $0.70 per share, which was paid in October 2018 . During both first and second quarters of 2018 , we declared a cash dividend on our common stock of $0.60 per share, which was paid in April 2018 and July 2018 , respectively. During the first quarter of 2018 , we also paid a cash dividend on our common stock of $0.60 per share, which was declared during the fourth quarter of 2017. For the nine months ended September 30, 2019 and 2018 , cash dividends declared but not yet paid were $163.5 million and $146.8 million , respectively. Common Stock Repurchase Program In May 2018, our board of directors authorized a 24 -month common stock repurchase program for up to $1.0 billion . The timing and number of shares to be repurchased will depend on a variety of factors, including price and market conditions. Repurchases under the program may be made at management's discretion from time to time on the open market or through privately negotiated transactions. During the quarter and nine months ended September 30, 2019 , there were no common stock repurchases under this program. During the year ended December 31, 2018 , we repurchased 2.8 million shares of our common stock under this program, for a total of approximately $300.0 million , in open market transactions. As of September 30, 2019 , we have approximately $700.0 million |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2019 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) | Changes in Accumulated Other Comprehensive Income (Loss) The following table presents the changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2019 and 2018 (in thousands): Accumulated Other Comprehensive Income (Loss) for the Nine Months Ended September 30, 2019 Accumulated Other Comprehensive Income (Loss) for the Nine Months Ended September 30, 2018 Changes related to cash flow derivative hedges Changes in defined benefit plans Foreign currency translation adjustments Accumulated other comprehensive loss Changes related to cash flow derivative hedges Changes in defined benefit plans Foreign currency translation adjustments Accumulated other comprehensive loss Accumulated comprehensive loss at beginning of the year $ (537,216 ) $ (26,023 ) $ (64,495 ) $ (627,734 ) (250,355 ) (33,666 ) (50,244 ) (334,265 ) Other comprehensive income (loss) before reclassifications (271,726 ) (23,408 ) (7,683 ) (302,817 ) 106,505 5,863 (13,840 ) 98,528 Amounts reclassified from accumulated other comprehensive loss (16,389 ) 577 — (15,812 ) 4,071 1,086 — 5,157 Net current-period other comprehensive income (loss) (288,115 ) (22,831 ) (7,683 ) (318,629 ) 110,576 6,949 (13,840 ) 103,685 Ending balance $ (825,331 ) $ (48,854 ) $ (72,178 ) $ (946,363 ) $ (139,779 ) $ (26,717 ) $ (64,084 ) $ (230,580 ) The following table presents reclassifications out of accumulated other comprehensive income (loss) for the quarters and nine months ended September 30, 2019 and 2018 (in thousands): Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income Details About Accumulated Other Comprehensive Income (Loss) Components Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Affected Line Item in Statements of Gain (loss) on cash flow derivative hedges: Interest rate swaps $ (373 ) $ (1,395 ) $ (1,173 ) $ (10,371 ) Interest expense, net of interest capitalized Foreign currency forward contracts (3,592 ) (3,157 ) (10,471 ) (9,625 ) Depreciation and amortization expenses Foreign currency forward contracts (1,251 ) (835 ) (3,866 ) 13,808 Other income (expense) Fuel swaps (472 ) 466 (1,916 ) 658 Other income (expense) Fuel swaps 2,435 4,548 33,815 1,459 Fuel (3,253 ) (373 ) 16,389 (4,071 ) Amortization of defined benefit plans: Actuarial loss (194 ) (372 ) (577 ) (1,086 ) Payroll and related (194 ) (372 ) (577 ) (1,086 ) Total reclassifications for the period $ (3,447 ) $ (745 ) $ 15,812 $ (5,157 ) |
Fair Value Measurements and Der
Fair Value Measurements and Derivative Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Derivative Instruments | Fair Value Measurements and Derivative Instruments Fair Value Measurements The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands): Fair Value Measurements at September 30, 2019 Using Fair Value Measurements at December 31, 2018 Using Description Total Carrying Amount Total Fair Value Level 1 (1) Level 2 (2) Level 3 (3) Total Carrying Amount Total Fair Value Level 1 (1) Level 2 (2) Level 3 (3) Assets: Cash and cash equivalents (4) $ 276,730 $ 276,730 $ 276,730 $ — $ — $ 287,852 $ 287,852 $ 287,852 $ — $ — Total Assets $ 276,730 $ 276,730 $ 276,730 $ — $ — $ 287,852 $ 287,852 $ 287,852 $ — $ — Liabilities: Long-term debt (including current portion of debt) (5) $ 9,523,994 $ 10,241,498 $ — $ 10,241,498 $ — $ 9,871,267 $ 10,244,214 $ — $ 10,244,214 $ — Total Liabilities $ 9,523,994 $ 10,241,498 $ — $ 10,241,498 $ — $ 9,871,267 $ 10,244,214 $ — $ 10,244,214 $ — (1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company. (3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of September 30, 2019 and December 31, 2018 . (4) Consists of cash and marketable securities with original maturities of less than 90 days. (5) Consists of unsecured revolving credit facilities, senior notes, senior debentures and term loans. These amounts do not include our capital lease obligations or commercial paper. Other Financial Instruments The carrying amounts of accounts receivable, accounts payable, accrued interest, accrued expenses and commercial paper approximate fair value at September 30, 2019 and December 31, 2018 . Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands): Fair Value Measurements at September 30, 2019 Using Fair Value Measurements at December 31, 2018 Using Description Total Level 1 (1) Level 2 (2) Level 3 (3) Total Level 1 (1) Level 2 (2) Level 3 (3) Assets: Derivative financial instruments (4) $ 30,883 $ — $ 30,883 $ — $ 65,297 $ — $ 65,297 $ — Total Assets $ 30,883 $ — $ 30,883 $ — $ 65,297 $ — $ 65,297 $ — Liabilities: Derivative financial instruments (5) $ 385,576 $ — $ 385,576 $ — $ 201,812 $ — $ 201,812 $ — Contingent consideration (6) 54,700 — — 54,700 44,000 — — 44,000 Total Liabilities $ 440,276 $ — $ 385,576 $ 54,700 $ 245,812 $ — $ 201,812 $ 44,000 (1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company. (3) Inputs that are unobservable. (4) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. (5) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. (6) The contingent consideration related to the Silversea Cruises acquisition is estimated by applying a Monte-Carlo simulation method using our closing stock price along with significant inputs not observable in the market, including the probability of achieving the milestones and estimated future operating results. The Monte-Carlo simulation is a generally accepted statistical technique used to generate a defined number of valuation paths in order to develop a reasonable estimate of fair value. Refer to Note 3. Business Combination for further information on the Silversea Cruises acquisition. For the nine months ended September 30, 2019 , we recorded a contingent consideration expense of $10.7 million within Other (expense) income in our consolidated statements of comprehensive income (loss). The reported fair values are based on a variety of factors and assumptions. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of September 30, 2019 or December 31, 2018 , or that will be realized in the future, and do not include expenses that could be incurred in an actual sale or settlement. We have master International Swaps and Derivatives Association (“ISDA”) agreements in place with our derivative instrument counterparties. These ISDA agreements generally provide for final close out netting with our counterparties for all positions in the case of default or termination of the ISDA agreement. We have determined that our ISDA agreements provide us with rights of setoff on the fair value of derivative instruments in a gain position and those in a loss position with the same counterparty. We have elected not to offset such derivative instrument fair values in our consolidated balance sheets. See Credit Related Contingent Features for further discussion on contingent collateral requirements for our derivative instruments. The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands): Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements As of September 30, 2019 As of December 31, 2018 Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Derivatives subject to master netting agreements $ 30,883 $ (30,067 ) $ — $ 816 $ 65,297 $ (60,303 ) $ — $ 4,994 Total $ 30,883 $ (30,067 ) $ — $ 816 $ 65,297 $ (60,303 ) $ — $ 4,994 The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands): Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements As of September 30, 2019 As of December 31, 2018 Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Derivatives subject to master netting agreements $ (385,576 ) $ 30,067 $ — $ (355,509 ) $ (201,812 ) $ 60,303 $ — $ (141,509 ) Total $ (385,576 ) $ 30,067 $ — $ (355,509 ) $ (201,812 ) $ 60,303 $ — $ (141,509 ) Concentrations of Credit Risk We monitor our credit risk associated with financial and other institutions with which we conduct significant business and, to minimize these risks, we select counterparties with credit risks acceptable to us and we seek to limit our exposure to an individual counterparty. Credit risk, including but not limited to counterparty nonperformance under derivative instruments, our credit facilities and new ship progress payment guarantees, is not considered significant, as we primarily conduct business with large, well-established financial institutions, insurance companies and export credit agencies many of which we have long-term relationships with and which have credit risks acceptable to us or where the credit risk is spread out among a large number of counterparties. As of September 30, 2019 and December 31, 2018 , we had counterparty credit risk exposure under our derivative instruments of $0.8 million and $5.6 million , respectively, which were limited to the cost of replacing the contracts in the event of non-performance by the counterparties to the contracts, the majority of which are currently our lending banks. We do not anticipate nonperformance by any of our significant counterparties. In addition, we have established guidelines we follow regarding credit ratings and instrument maturities to maintain safety and liquidity. We do not normally require collateral or other security to support credit relationships; however, in certain circumstances this option is available to us. Derivative Instruments We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We try to mitigate these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments pursuant to our hedging practices and policies. The financial impact of these hedging instruments is primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the notional amount, term and conditions of the derivative instrument with the underlying risk being hedged. Although certain of our derivative financial instruments do not qualify or are not accounted for under hedge accounting, our objective is not to hold or issue derivative financial instruments for trading or other speculative purposes. We enter into various forward, swap and option contracts to manage our interest rate exposure and to limit our exposure to fluctuations in foreign currency exchange rates and fuel prices. These instruments are recorded on the balance sheet at their fair value and the vast majority are designated as hedges. We also use non-derivative financial instruments designated as hedges of our net investment in our foreign operations and investments. At inception of the hedge relationship, a derivative instrument that hedges the exposure to changes in the fair value of a firm commitment or a recognized asset or liability is designated as a fair value hedge. A derivative instrument that hedges a forecasted transaction or the variability of cash flows related to a recognized asset or liability is designated as a cash flow hedge. Changes in the fair value of derivatives that are designated as fair value hedges are offset against changes in the fair value of the underlying hedged assets, liabilities or firm commitments. Gains and losses on derivatives that are designated as cash flow hedges are recorded as a component of Accumulated other comprehensive loss until the underlying hedged transactions are recognized in earnings. The foreign currency transaction gain or loss of our non-derivative financial instruments and the changes in the fair value of derivatives designated as hedges of our net investment in foreign operations and investments are recognized as a component of Accumulated other comprehensive loss along with the associated foreign currency translation adjustment of the foreign operation or investment, with the amortization of excluded components affecting earnings. On an ongoing basis, we assess whether derivatives used in hedging transactions are “highly effective” in offsetting changes in the fair value or cash flow of hedged items. For our net investment hedges, we use the dollar offset method to measure effectiveness. For all other hedging programs, we use the long-haul method to assess hedge effectiveness using regression analysis for each hedge relationship. The methodology for assessing hedge effectiveness is applied on a consistent basis for each one of our hedging programs (i.e., interest rate, foreign currency ship construction, foreign currency net investment and fuel). For our regression analyses, we use an observation period of up to three years , utilizing market data relevant to the hedge horizon of each hedge relationship. High effectiveness is achieved when a statistically valid relationship reflects a high degree of offset and correlation between the changes in the fair values of the derivative instrument and the hedged item. If it is determined that a derivative is not highly effective as a hedge or hedge accounting is discontinued, any change in fair value of the derivative since the last date at which it was determined to be effective is recognized in earnings. Cash flows from derivative instruments that are designated as fair value or cash flow hedges are classified in the same category as the cash flows from the underlying hedged items. In the event that hedge accounting is discontinued, cash flows subsequent to the date of discontinuance are classified within investing activities. Cash flows from derivative instruments not designated as hedging instruments are classified as investing activities. We consider the classification of the underlying hedged item’s cash flows in determining the classification for the designated derivative instrument’s cash flows. We classify derivative instrument cash flows from hedges of benchmark interest rate or hedges of fuel expense as operating activities due to the nature of the hedged item. Likewise, we classify derivative instrument cash flows from hedges of foreign currency risk on our newbuild ship payments as investing activities. Interest Rate Risk Our exposure to market risk for changes in interest rates primarily relates to our debt obligations including future interest payments. At September 30, 2019 and December 31, 2018 , approximately 66.1% and 59.1% , respectively, of our debt was effectively fixed. We use interest rate swap agreements to modify our exposure to interest rate movements and to manage our interest expense. Market risk associated with our fixed rate debt is the potential increase in fair value resulting from a decrease in interest rates. We use interest rate swap agreements that effectively convert a portion of our fixed-rate debt to a floating-rate basis to manage this risk. At September 30, 2019 and December 31, 2018 , we maintained interest rate swap agreements on the following fixed-rate debt instruments: Debt Instrument Swap Notional as of September 30, 2019 (In thousands) Maturity Debt Fixed Rate Swap Floating Rate: LIBOR plus All-in Swap Floating Rate as of September 30, 2019 Oasis of the Seas term loan $ 87,500 October 2021 5.41% 3.87% 6.49% Unsecured senior notes 650,000 November 2022 5.25% 3.63% 5.79% $ 737,500 These interest rate swap agreements are accounted for as fair value hedges. Market risk associated with our long-term floating rate debt is the potential increase in interest expense from an increase in interest rates. We use interest rate swap agreements that effectively convert a portion of our floating-rate debt to a fixed-rate basis to manage this risk. At September 30, 2019 and December 31, 2018 , we maintained interest rate swap agreements on the following floating-rate debt instruments: Debt Instrument Swap Notional as of September 30, 2019 (In thousands) Maturity Debt Floating Rate All-in Swap Fixed Rate Celebrity Reflection term loan $ 299,979 October 2024 LIBOR plus 0.40% 2.85% Quantum of the Seas term loan 459,375 October 2026 LIBOR plus 1.30% 3.74% Anthem of the Seas term loan 483,333 April 2027 LIBOR plus 1.30% 3.86% Ovation of the Seas term loan 622,500 April 2028 LIBOR plus 1.00% 3.16% Harmony of the Seas term loan (1) 566,959 May 2028 EURIBOR plus 1.15% 2.26% Odyssey of the Seas term loan (2) 460,000 October 2032 LIBOR plus 0.95% 3.20% $ 2,892,146 (1) Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of September 30, 2019 . (2) Interest rate swap agreements hedging the term loan for Odyssey of the Seas includes a LIBOR zero-floor matching the hedged debt LIBOR zero-floor. The anticipated unsecured term loan for the financing of Odyssey of the Seas is expected to be drawn in October 2020. These interest rate swap agreements are accounted for as cash flow hedges. The notional amount of interest rate swap agreements related to outstanding debt and our current unfunded financing arrangements as of September 30, 2019 and December 31, 2018 was $3.6 billion and $3.4 billion , respectively. Foreign Currency Exchange Rate Risk Derivative Instruments Our primary exposure to foreign currency exchange rate risk relates to our ship construction contracts denominated in Euros, our foreign currency denominated debt and our international business operations. We enter into foreign currency forward contracts to manage portions of the exposure to movements in foreign currency exchange rates. As of September 30, 2019 , the aggregate cost of our ships on order was $11.1 billion , of which we had deposited $705.5 million as of such date. These amounts do not include any ships placed on order that are contingent upon completion of conditions precedent and/or financing, any ships on order by our Partner Brands and any ships on order placed by Silversea Cruises during the reporting lag period. Refer to Note 11 . Commitments and Contingencies , for further information on our ships on order. At September 30, 2019 and December 31, 2018 , approximately 57.9% and 53.5% , respectively, of the aggregate cost of the ships under construction was exposed to fluctuations in the Euro exchange rate. Our foreign currency forward contract agreements are accounted for as cash flow or net investment hedges depending on the designation of the related hedge. On a regular basis, we enter into foreign currency forward contracts and, from time to time, we utilize cross-currency swap agreements and collar options to minimize the volatility resulting from the remeasurement of net monetary assets and liabilities denominated in a currency other than our functional currency or the functional currencies of our foreign subsidiaries. During the third quarter of 2019 , we maintained an average of approximately $725.4 million of these foreign currency forward contracts. These instruments are not designated as hedging instruments. For the quarters ended September 30, 2019 and 2018 , changes in the fair value of the foreign currency forward contracts resulted in a loss of $26.0 million and $12.1 million , respectively. For the nine months ended September 30, 2019 and 2018 , changes in the fair value of the foreign currency forward contracts resulted in a loss of $25.2 million and $43.4 million , respectively. These amounts were recognized in earnings within Other (expense) income in our consolidated statements of comprehensive income (loss). We consider our investments in our foreign operations to be denominated in relatively stable currencies and to be of a long-term nature. As of September 30, 2019 , we maintained foreign currency forward contracts and designated them as hedges of a portion of our net investments primarily in TUI Cruises of €173.0 million , or approximately $188.6 million based on the exchange rate at September 30, 2019 . These forward currency contracts mature in October 2021. The notional amount of outstanding foreign exchange contracts, excluding the forward contracts entered into to minimize remeasurement volatility, as of September 30, 2019 and December 31, 2018 was $3.0 billion and $3.2 billion , respectively. Non-Derivative Instruments We also address the exposure of our investments in foreign operations by denominating a portion of our debt in our subsidiaries’ and investments’ functional currencies and designating it as a hedge of these subsidiaries and investments. We had designated debt as a hedge of our net investments primarily in TUI Cruises of €286.0 million , or approximately $311.8 million , as of September 30, 2019 . As of December 31, 2018 , we had designated debt as a hedge of our net investments in TUI Cruises of €280.0 million , or approximately $320.2 million . Fuel Price Risk Our exposure to market risk for changes in fuel prices relates primarily to the consumption of fuel on our ships. We use fuel swap agreements to mitigate the financial impact of fluctuations in fuel prices. Our fuel swap agreements are generally accounted for as cash flow hedges. At September 30, 2019 , we have hedged the variability in future cash flows for certain forecasted fuel transactions occurring through 2023 . As of September 30, 2019 and December 31, 2018 , we had the following outstanding fuel swap agreements as hedges of our fuel exposure: Fuel Swap Agreements As of September 30, 2019 As of December 31, 2018 (metric tons) 2019 221,150 856,800 2020 830,468 830,500 2021 488,900 488,900 2022 322,900 322,900 2023 82,400 — Fuel Swap Agreements As of September 30, 2019 As of December 31, 2018 (% hedged) Projected fuel purchases: 2019 60 % 58 % 2020 55 % 54 % 2021 30 % 28 % 2022 19 % 19 % 2023 5 % — % At September 30, 2019 , $25.4 million of estimated unrealized net loss associated with our cash flow hedges pertaining to fuel swap agreements is expected to be reclassified to earnings from Accumulated other comprehensive loss within the next twelve months. Reclassification is expected to occur as the result of fuel consumption associated with our hedged forecasted fuel purchases. The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands): Fair Value of Derivative Instruments Asset Derivatives Liability Derivatives Balance Sheet Location As of September 30, 2019 As of December 31, 2018 Balance Sheet Location As of September 30, 2019 As of December 31, 2018 Fair Value Fair Value Fair Value Fair Value Derivatives designated as hedging instruments under ASC 815-20 (1) Interest rate swaps Other assets $ 1,415 $ 23,518 Other long-term liabilities $ 85,004 $ 40,467 Foreign currency forward contracts Derivative financial instruments — 4,044 Derivative financial instruments 54,985 39,665 Foreign currency forward contracts Other assets 13,351 10,844 Other long-term liabilities 144,592 16,854 Fuel swaps Derivative financial instruments 6,698 10,966 Derivative financial instruments 43,160 37,627 Fuel swaps Other assets 4,241 9,204 Other long-term liabilities 53,997 65,182 Total derivatives designated as hedging instruments under 815-20 25,705 58,576 381,738 199,795 Derivatives not designated as hedging instruments under ASC 815-20 Foreign currency forward contracts Derivative financial instruments $ 3,811 $ 1,751 Derivative financial instruments $ 3,046 $ 808 Foreign currency forward contracts Other assets — 1,579 Other long-term liabilities — 833 Fuel swaps Derivative financial instruments 1,124 2,804 Derivative financial instruments 370 376 Fuel swaps Other Assets 243 587 Other long-term liabilities 422 — Total derivatives not designated as hedging instruments under 815-20 5,178 6,721 3,838 2,017 Total derivatives $ 30,883 $ 65,297 $ 385,576 $ 201,812 (1) Accounting Standard Codification 815-20 “ Derivatives and Hedging. ” The location and amount of gain or (loss) recognized in income on fair value and cash flow hedging relationships were as follows (in thousands): Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded $177,677 $320,295 $(96,413) $(7,668) $182,415 $259,923 $(80,679) $(3,832) The effects of fair value and cash flow hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20 Interest contracts Hedged items n/a n/a $(4,116) — n/a n/a $2,124 — Derivatives designated as hedging instruments n/a n/a $2,920 — n/a n/a $(3,512) — Gain or (loss) on cash flow hedging relationships in Subtopic 815-20 Interest contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income n/a n/a $(373) n/a n/a n/a $(1,395) n/a Commodity contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income $2,435 n/a n/a $(472) $4,548 n/a n/a $466 Foreign exchange contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income n/a $(3,592) n/a $(1,251) n/a $(3,157) n/a $(835) Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded $519,772 $924,180 $(292,006) $(34,537) $515,065 $753,529 $(209,590) $5,923 The effects of fair value and cash flow hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20 Interest contracts Hedged items n/a n/a $(25,862) — n/a n/a $18,680 — Derivatives designated as hedging instruments n/a n/a $19,699 — n/a n/a $(21,392) — Gain or (loss) on cash flow hedging relationships in Subtopic 815-20 Interest contracts Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income n/a n/a $(1,173) n/a n/a n/a $(10,371) n/a Commodity contracts Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income $33,815 n/a n/a $(1,916) $1,459 n/a n/a $658 Foreign exchange contracts Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income n/a $(10,471) n/a $(3,866) n/a $(9,625) n/a $13,808 The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands): Carrying Value Non-derivative instrument designated as Balance Sheet Location As of September 30, 2019 As of December 31, 2018 Foreign currency debt Current portion of debt $ 69,399 $ 38,168 Foreign currency debt Long-term debt 242,398 281,984 $ 311,797 $ 320,152 The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive income (loss) was as follows (in thousands): Derivatives and Related Hedged Items under ASC 815-20 Fair Value Hedging Relationships Location of Gain (Loss) Recognized in Income on Derivative and Hedged Item Amount of Gain (Loss) Amount of Gain (Loss) Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Interest rate swaps Interest income (expense), net of interest capitalized $ 2,920 $ (3,512 ) $ 19,699 $ (21,392 ) $ (4,116 ) $ 2,124 $ (25,862 ) $ 18,680 $ 2,920 $ (3,512 ) $ 19,699 $ (21,392 ) $ (4,116 ) $ 2,124 $ (25,862 ) $ 18,680 The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands): Line Item in the Statement of Financial Position Where the Hedged Item is Included Carrying Amount of the Hedged Liabilities Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities As of September 30, 2019 As of December 31, 2018 As of September 30, 2019 As of December 31, 2018 Current portion of debt and Long-term debt $ 734,811 $ 725,486 $ 1,097 $ (24,766 ) $ 734,811 $ 725,486 $ 1,097 $ (24,766 ) The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands): Derivatives Amount of Gain (Loss) Recognized in Location of Amount of Gain (Loss) Reclassified from Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Interest rate swaps $ (23,488 ) $ 10,166 $ (91,949 ) $ 56,223 Interest expense, net of interest capitalized $ (373 ) $ (1,395 ) $ (1,173 ) $ (10,371 ) Foreign currency forward contracts (131,523 ) (35,397 ) (202,273 ) (133,360 ) Depreciation and amortization expenses (3,592 ) (3,157 ) (10,471 ) (9,625 ) Foreign currency forward contracts — — — — Other income (expense) (1,251 ) (835 ) (3,866 ) 13,808 Fuel swaps — — — — Other income (expense) (472 ) 466 (1,916 ) 658 Fuel swaps (113,467 ) 61,805 22,496 183,642 Fuel 2,435 4,548 33,815 1,459 $ (268,478 ) $ 36,574 $ (271,726 ) $ 106,505 $ (3,253 ) $ (373 ) $ 16,389 $ (4,071 ) The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands): Gain (Loss) Recognized in Income (Net Investment Excluded Components) Nine Months Ended September 30, 2019 Net inception fair value at January 1, 2019 $ (8,359 ) Amount of gain recognized in income on derivatives for the period ended September 30, 2019 2,790 Amount of loss remaining to be amortized in accumulated other comprehensive loss, as of September 30, 2019 (4,056 ) Fair value at September 30, 2019 $ (9,625 ) The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands): Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss) Non-derivative instruments under ASC 815-20 Net Investment Hedging Relationships Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Foreign Currency Debt $ 12,811 $ 1,700 $ 15,519 $ 9,309 $ 12,811 $ 1,700 $ 15,519 $ 9,309 There was no amount recognized in income (ineffective portion and amount excluded from effectiveness testing) for the quarters and nine months ended September 30, 2019 and 2018 . The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands): Amount of Gain (Loss) Recognized in Income on Derivatives Derivatives Not Designated as Hedging Location of Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Foreign currency forward contracts Other income (expense) $ (26,035 ) $ (12,097 ) $ (25,189 ) $ (43,356 ) Fuel swaps Fuel — 478 (14 ) 1,804 Fuel swaps Other income (expense) 1,095 (28 ) 974 155 $ (24,940 ) $ (11,647 ) $ (24,229 ) $ (41,397 ) Credit Related Contingent Features Our current interest rate derivative instruments may require us to post collateral if our Standard & Poor’s and Moody’s credit ratings are below specified levels. Specifically, if on the fifth anniversary of executing a derivative instrument, or on any succeeding fifth-year anniversary, our credit ratings for our senior unsecured debt were to be rated below BBB- by Standard & Poor’s and Baa3 by Moody’s, then the counterparty may periodically demand that we post collateral in an amount equal to the difference between (i) the net market value of all derivative transactions with such counterparty that have reached their fifth year anniversary, to the extent negative, a |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis for Preparation of Consolidated Financial Statements | Basis for Preparation of Consolidated Financial Statements The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any items discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such rules and regulations. Estimates are required for the preparation of financial statements in accordance with these principles. Actual results could differ from these estimates. Refer to Note 2 . Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2018 |
Basis of Consolidation | All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50% , and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 7 . Other Assets for further information regarding our variable interest entities. We consolidate the operating results of Silversea Cruises on a three -month reporting lag to allow for more timely preparation of our consolidated financial statements. No material events or other transactions involving Silversea Cruises have occurred from July 1, 2019 through September 30, 2019 that would require further disclosure or adjustment to our consolidated financial statements as of and for the quarter ended September 30, 2019 . For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50% , the investment is accounted for using the equity method. |
Adoption of Accounting Pronouncements; Recent Accounting Pronouncements | Adoption of Accounting Pronouncements Leases On January 1, 2019, we adopted the guidance codified in Accounting Standard Codification ("ASC") 842, Leases ("ASC 842") using the modified retrospective approach and elected the optional transition method, which allows entities to initially apply the standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Upon adoption, we applied the guidance to all existing leases. For leases with a term greater than 12 months, the new guidance requires the lease rights and obligations arising from the leasing arrangements, including operating leases, to be recognized as assets and liabilities on the balance sheet. Upon adoption of the new guidance, the most significant impact was the recognition of right-of-use assets and lease liabilities relating to operating leases in the amounts of $801.8 million and $820.5 million , respectively, reported within Operating lease right-of-use assets and Long-term operating lease liabilities, respectively, with the current portion of the liability reported within Current portion of operating lease liabilities , in our consolidated balance sheet as of January 1, 2019. Accounting for finance leases remained substantially unchanged and continues to be reported within Property and equipmen t, net and Long-term debt, with the current portion of the debt reported within Current portion of debt , in our consolidated balance sheets. There was no cumulative effect of applying the new standard and accordingly there was no adjustment to our retained earnings upon adoption. The comparative information presented has not been restated and continues to be reported under the accounting standards in effect for those periods. For further information on leases, refer to Note 9 . Leases . This guidance did not have a material impact to our consolidated statements of comprehensive income (loss), consolidated statements of cash flows and our debt-covenants calculations under our current agreements. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326); Measurement of Credit Losses on Financial Instruments . This ASU, along with subsequent ASUs issued to clarify certain of its provisions, introduces new guidance which makes substantive changes to the accounting model for financial assets subject to credit losses that are measured at amortized cost, as well as certain off-balance sheet credit exposures. The primary updates include the introduction of a new current expected credit loss (“CECL”) model that is based on expected rather than incurred losses. This ASU and the related amendments will be effective for our annual reporting period beginning January 1, 2020. We are currently evaluating the impact of the adoption of this guidance to our consolidated financial statements. |
Reclassifications | Reclassifications For the nine months ended September 30, 2019 , we separately presented Amortization of commercial paper notes discount in our consolidated statements of cash flows. As a result, the prior year amortization amount was reclassified within Operating Activities to conform to the current year presentation. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Intangible Assets | The following is a summary of our intangible assets as of September 30, 2019 and December 31, 2018 (in thousands): September 30, 2019 Gross Carrying Value Accumulated Amortization Net Carrying Value Finite-life intangible assets: Customer relationships $ 97,400 $ 5,952 $ 91,448 Galapagos operating license 47,669 5,470 42,199 Other finite-life intangible assets 11,560 5,298 6,262 Total finite-life intangible assets 156,629 16,720 139,909 Indefinite-life intangible assets 351,725 — 351,725 Total intangible assets, net $ 508,354 $ 16,720 $ 491,634 December 31, 2018 Gross Carrying Value Accumulated Amortization Net Carrying Value Finite-life intangible assets: Customer relationships $ 97,400 $ 1,082 $ 96,318 Galapagos operating license 47,669 4,206 43,463 Other finite-life intangible assets 11,560 963 10,597 Total finite-life intangible assets 156,629 6,251 150,378 Indefinite-life intangible assets 351,725 — 351,725 Total intangible assets, net $ 508,354 $ 6,251 $ 502,103 |
Finite-lived Intangible Asset Amortization Expense | The estimated future amortization for finite-life intangible assets for each of the next five years is as follows (in thousands): Year Remainder of 2019 $ 3,490 2020 $ 12,995 2021 $ 8,179 2022 $ 8,179 2023 $ 8,179 2024 $ 8,179 |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues by itinerary North America (1) $ 1,617,446 $ 1,450,119 $ 4,870,273 $ 4,061,545 Asia/Pacific (2) 272,062 235,374 1,089,914 1,051,551 Europe (3) 1,060,424 968,952 1,663,118 1,566,351 Other regions (4) 102,184 28,948 461,193 207,764 Total revenues by itinerary 3,052,116 2,683,393 8,084,498 6,887,211 Other revenues (5) 134,734 112,794 348,750 274,337 Total revenues $ 3,186,850 $ 2,796,187 $ 8,433,248 $ 7,161,548 (1) Includes the United States, Canada, Mexico and the Caribbean. (2) Includes Southeast Asia (e.g., Singapore, Thailand and the Philippines), East Asia (e.g., China and Japan), South Asia (e.g., India and Pakistan) and Oceania (e.g., Australia and Fiji Islands) regions. (3) Includes European countries (e.g., Nordics, Germany, France, Italy, Spain and the United Kingdom). (4) Includes itineraries primarily in South and Latin American countries. (5) Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to our bareboat charter, procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 7 . Other Assets for more information on our unconsolidated affiliates. Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended September 30, 2019 and 2018 , our guests were sourced from the following areas: Quarter Ended September 30, 2019 2018 Passenger ticket revenues: United States 62 % 59 % United Kingdom 12 % 13 % All other countries (1) 26 % 28 % For the nine months ended September 30, 2019 and 2018 , our guests were sourced from the following areas: Nine Months Ended September 30, 2019 2018 Passenger ticket revenues: United States 65 % 60 % United Kingdom 9 % 10 % All other countries (1) 26 % 30 % (1) No other individual country's revenue exceeded 10% for the quarters and nine months ended September 30, 2019 and 2018 . |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Reconciliation Between Basic and Diluted Earnings Per Share | A reconciliation between basic and diluted earnings per share is as follows (in thousands, except per share data): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Net Income attributable to Royal Caribbean Cruises Ltd. for basic and diluted earnings per share $ 883,240 $ 810,391 $ 1,605,751 $ 1,495,339 Weighted-average common shares outstanding 209,575 209,054 209,477 211,099 Dilutive effect of stock-based awards 546 874 555 874 Diluted weighted-average shares outstanding 210,121 209,928 210,032 211,973 Basic earnings per share $ 4.21 $ 3.88 $ 7.67 $ 7.08 Diluted earnings per share $ 4.20 $ 3.86 $ 7.65 $ 7.05 |
Other Assets (Tables)
Other Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Other Assets [Abstract] | |
Schedule of Other Nonoperating Income (Expense) | The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands): Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Share of equity income from investments $ 103,654 $ 95,169 $ 170,393 $ 168,232 Dividends received (1) $ 67,713 $ 82,755 $ 148,285 $ 241,697 (1) For the quarter ended September 30, 2019 , TUI Cruises paid us dividends of €80.0 million , or approximately $88.5 million , based on the exchange rate at the time of the transactions. For the nine months ended September 30, 2019 , TUI Cruises paid us dividends totaling €170.0 million , or approximately $190.3 million , based on the exchange rates at the time of the transactions. The amounts included in the table above are net of tax withholdings. |
Schedule of Related Party Transactions | As of September 30, 2019 As of December 31, 2018 Total notes receivable due from equity investments $ 178,853 $ 201,979 Less-current portion (1) 19,091 19,075 Long-term portion (2) $ 159,762 $ 182,904 (1) Included within Trade and other receivables, net in our consolidated balance sheets. (2) Included within Other assets in our consolidated balance sheets. Quarter Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues $ 11,857 $ 12,170 $ 35,714 $ 40,400 Expenses $ 1,365 $ 1,735 $ 3,450 $ 8,643 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information for leases was as follows (in thousands): As of September 30, 2019 Lease assets: Finance lease right-of-use assets, net: Property and equipment, gross $ 374,494 Accumulated depreciation (51,493 ) Property and equipment, net 323,001 Operating lease right-of-use assets 697,461 Total lease assets $ 1,020,462 Lease liabilities: Finance lease liabilities: Current portion of debt $ 34,603 Long-term debt 203,675 Total finance lease liabilities 238,278 Operating lease liabilities: Current portion of operating lease liabilities 93,058 Long-term operating lease liabilities 620,570 Total operating lease liabilities 713,628 Total lease liabilities $ 951,906 |
Schedule of Lease Expense and Cash Flow Information | The components of lease expense were as follows (in thousands): Consolidated Statement of Comprehensive Income (Loss) Classification Quarter Ended September 30, 2019 Nine Months Ended September 30, 2019 Lease costs: Operating lease costs Commission, transportation and other $ 19,057 $ 57,170 Operating lease costs Other operating expenses 6,930 20,791 Operating lease costs Marketing, selling and administrative expenses 4,276 14,501 Finance lease costs: Amortization of right-of-use-assets Depreciation and amortization expenses 6,081 14,805 Interest on lease liabilities Interest expense, net of interest capitalized 1,514 3,680 Total lease costs $ 37,858 $ 110,947 Supplemental cash flow information related to leases is as follows (in thousands): Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 94,125 Operating cash flows from finance leases $ 3,680 Financing cash flows from finance leases $ 19,009 Supplemental noncash information: Right-of-use assets obtained in exchange for lease obligations: Finance leases $ 122,237 |
Schedule of Lease Terms and Discount Rates | Weighted average of the remaining lease terms and weighted average discount rates are as follows: As of September 30, 2019 Weighted average of the remaining lease term Operating leases 10.5 years Finance leases 28.9 years Weighted average discount rate Operating leases 4.65 % Finance leases 4.42 % |
Schedule of Maturities, Operating Leases | As of September 30, 2019 , maturities related to lease liabilities were as follows (in thousands): Year Operating Leases Finance Leases Remainder of 2019 $ 30,765 $ 17,209 2020 122,718 42,912 2021 109,984 45,803 2022 103,551 22,832 2023 101,442 11,891 Thereafter 492,553 414,098 Total lease payments 961,013 554,745 Less: Interest (247,385 ) (316,467 ) Present value of lease liabilities $ 713,628 $ 238,278 Under ASC 840, Leases , future minimum lease payments under noncancelable operating leases as of December 31, 2018 were as follows (in thousands): Year 2019 $ 67,682 2020 64,237 2021 56,142 2022 52,759 2023 52,522 Thereafter 383,974 $ 677,316 |
Schedule of Maturities, Financial Leases | As of September 30, 2019 , maturities related to lease liabilities were as follows (in thousands): Year Operating Leases Finance Leases Remainder of 2019 $ 30,765 $ 17,209 2020 122,718 42,912 2021 109,984 45,803 2022 103,551 22,832 2023 101,442 11,891 Thereafter 492,553 414,098 Total lease payments 961,013 554,745 Less: Interest (247,385 ) (316,467 ) Present value of lease liabilities $ 713,628 $ 238,278 |
Redeemable Noncontrolling Int_2
Redeemable Noncontrolling Interest (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
Schedule of Redeemable Noncontrolling Interest | The following table presents changes in the redeemable noncontrolling interest as of September 30, 2019 (in thousands): Beginning balance January 1, 2019 $ 542,020 Net income attributable to noncontrolling interest, including the contractual accretion of the put options 21,375 Distribution to noncontrolling interest (501 ) Other 500 Ending balance September 30, 2019 $ 563,394 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Capital Commitments | Our future capital commitments consist primarily of new ship orders. As of September 30, 2019 , our Global Brands have the following ships on order: Ship Shipyard Expected to Enter Approximate Royal Caribbean International — Oasis-class: Wonder of the Seas Chantiers de l’Atlantique 2nd Quarter 2021 5,700 Quantum-class: Odyssey of the Seas Meyer Werft 4th Quarter 2020 4,200 Icon-class: Unnamed Meyer Turku Oy 2nd Quarter 2022 5,600 Unnamed Meyer Turku Oy 2nd Quarter 2024 5,600 Celebrity Cruises — Edge-class: Celebrity Apex Chantiers de l’Atlantique 2nd Quarter 2020 2,900 Celebrity Beyond Chantiers de l’Atlantique 4th Quarter 2021 3,250 Unnamed Chantiers de l’Atlantique 4th Quarter 2022 3,250 Silversea Cruises — (1) Silver Origin De Hoop 4th Quarter 2020 100 Muse-class: Silver Moon Fincantieri 4th Quarter 2020 550 Silver Dawn Fincantieri 1st Quarter 2022 550 Evolution-class: Unnamed Meyer Werft 3rd Quarter 2022 600 Unnamed Meyer Werft 2nd Quarter 2023 600 Total Berths 32,900 (1) The "Expected to Enter Service" dates for Silversea Cruises' new ships takes into consideration the three-month reporting lag. Refer to Note 1 . General for further information. |
Schedule of Contingent Capital Commitments | In addition, as of September 30, 2019 , we have the following agreements in place for new ships on order for our Global Brands, which are contingent upon completion of conditions precedent and financing: Ship Shipyard Expected to Enter Approximate Royal Caribbean International — Oasis-class: Unnamed Chantiers de l’Atlantique 4th Quarter 2023 5,700 Icon-class: Unnamed Meyer Turku Oy 2nd Quarter 2025 5,600 Celebrity Cruises — Edge-class: Unnamed Chantiers de l’Atlantique 4th Quarter 2024 3,250 |
Changes in Accumulated Other _2
Changes in Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Schedule of Changes In Accumulated Other Comprehensive Income (Loss) by Component | The following table presents the changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2019 and 2018 (in thousands): Accumulated Other Comprehensive Income (Loss) for the Nine Months Ended September 30, 2019 Accumulated Other Comprehensive Income (Loss) for the Nine Months Ended September 30, 2018 Changes related to cash flow derivative hedges Changes in defined benefit plans Foreign currency translation adjustments Accumulated other comprehensive loss Changes related to cash flow derivative hedges Changes in defined benefit plans Foreign currency translation adjustments Accumulated other comprehensive loss Accumulated comprehensive loss at beginning of the year $ (537,216 ) $ (26,023 ) $ (64,495 ) $ (627,734 ) (250,355 ) (33,666 ) (50,244 ) (334,265 ) Other comprehensive income (loss) before reclassifications (271,726 ) (23,408 ) (7,683 ) (302,817 ) 106,505 5,863 (13,840 ) 98,528 Amounts reclassified from accumulated other comprehensive loss (16,389 ) 577 — (15,812 ) 4,071 1,086 — 5,157 Net current-period other comprehensive income (loss) (288,115 ) (22,831 ) (7,683 ) (318,629 ) 110,576 6,949 (13,840 ) 103,685 Ending balance $ (825,331 ) $ (48,854 ) $ (72,178 ) $ (946,363 ) $ (139,779 ) $ (26,717 ) $ (64,084 ) $ (230,580 ) |
Schedule of Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | The following table presents reclassifications out of accumulated other comprehensive income (loss) for the quarters and nine months ended September 30, 2019 and 2018 (in thousands): Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income Details About Accumulated Other Comprehensive Income (Loss) Components Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Affected Line Item in Statements of Gain (loss) on cash flow derivative hedges: Interest rate swaps $ (373 ) $ (1,395 ) $ (1,173 ) $ (10,371 ) Interest expense, net of interest capitalized Foreign currency forward contracts (3,592 ) (3,157 ) (10,471 ) (9,625 ) Depreciation and amortization expenses Foreign currency forward contracts (1,251 ) (835 ) (3,866 ) 13,808 Other income (expense) Fuel swaps (472 ) 466 (1,916 ) 658 Other income (expense) Fuel swaps 2,435 4,548 33,815 1,459 Fuel (3,253 ) (373 ) 16,389 (4,071 ) Amortization of defined benefit plans: Actuarial loss (194 ) (372 ) (577 ) (1,086 ) Payroll and related (194 ) (372 ) (577 ) (1,086 ) Total reclassifications for the period $ (3,447 ) $ (745 ) $ 15,812 $ (5,157 ) |
Fair Value Measurements and D_2
Fair Value Measurements and Derivative Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments | |
Fair Value Measurements, Nonrecurring | The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands): Fair Value Measurements at September 30, 2019 Using Fair Value Measurements at December 31, 2018 Using Description Total Carrying Amount Total Fair Value Level 1 (1) Level 2 (2) Level 3 (3) Total Carrying Amount Total Fair Value Level 1 (1) Level 2 (2) Level 3 (3) Assets: Cash and cash equivalents (4) $ 276,730 $ 276,730 $ 276,730 $ — $ — $ 287,852 $ 287,852 $ 287,852 $ — $ — Total Assets $ 276,730 $ 276,730 $ 276,730 $ — $ — $ 287,852 $ 287,852 $ 287,852 $ — $ — Liabilities: Long-term debt (including current portion of debt) (5) $ 9,523,994 $ 10,241,498 $ — $ 10,241,498 $ — $ 9,871,267 $ 10,244,214 $ — $ 10,244,214 $ — Total Liabilities $ 9,523,994 $ 10,241,498 $ — $ 10,241,498 $ — $ 9,871,267 $ 10,244,214 $ — $ 10,244,214 $ — (1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company. (3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of September 30, 2019 and December 31, 2018 . (4) Consists of cash and marketable securities with original maturities of less than 90 days. (5) Consists of unsecured revolving credit facilities, senior notes, senior debentures and term loans. These amounts do not include our capital lease obligations or commercial paper. |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands): Fair Value Measurements at September 30, 2019 Using Fair Value Measurements at December 31, 2018 Using Description Total Level 1 (1) Level 2 (2) Level 3 (3) Total Level 1 (1) Level 2 (2) Level 3 (3) Assets: Derivative financial instruments (4) $ 30,883 $ — $ 30,883 $ — $ 65,297 $ — $ 65,297 $ — Total Assets $ 30,883 $ — $ 30,883 $ — $ 65,297 $ — $ 65,297 $ — Liabilities: Derivative financial instruments (5) $ 385,576 $ — $ 385,576 $ — $ 201,812 $ — $ 201,812 $ — Contingent consideration (6) 54,700 — — 54,700 44,000 — — 44,000 Total Liabilities $ 440,276 $ — $ 385,576 $ 54,700 $ 245,812 $ — $ 201,812 $ 44,000 (1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company. (3) Inputs that are unobservable. (4) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. (5) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. (6) The contingent consideration related to the Silversea Cruises acquisition is estimated by applying a Monte-Carlo simulation method using our closing stock price along with significant inputs not observable in the market, including the probability of achieving the milestones and estimated future operating results. The Monte-Carlo simulation is a generally accepted statistical technique used to generate a defined number of valuation paths in order to develop a reasonable estimate of fair value. Refer to Note 3. Business Combination for further information on the Silversea Cruises acquisition. For the nine months ended September 30, 2019 , we recorded a contingent consideration expense of $10.7 million within Other (expense) income in our consolidated statements of comprehensive income (loss). |
Offsetting Assets | The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands): Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements As of September 30, 2019 As of December 31, 2018 Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Derivatives subject to master netting agreements $ 30,883 $ (30,067 ) $ — $ 816 $ 65,297 $ (60,303 ) $ — $ 4,994 Total $ 30,883 $ (30,067 ) $ — $ 816 $ 65,297 $ (60,303 ) $ — $ 4,994 |
Offsetting Liabilities | The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands): Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements As of September 30, 2019 As of December 31, 2018 Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet Gross Amount of Eligible Offsetting Cash Collateral Net Amount of Derivatives subject to master netting agreements $ (385,576 ) $ 30,067 $ — $ (355,509 ) $ (201,812 ) $ 60,303 $ — $ (141,509 ) Total $ (385,576 ) $ 30,067 $ — $ (355,509 ) $ (201,812 ) $ 60,303 $ — $ (141,509 ) |
Schedule of Price Risk Derivatives | As of September 30, 2019 and December 31, 2018 , we had the following outstanding fuel swap agreements as hedges of our fuel exposure: Fuel Swap Agreements As of September 30, 2019 As of December 31, 2018 (metric tons) 2019 221,150 856,800 2020 830,468 830,500 2021 488,900 488,900 2022 322,900 322,900 2023 82,400 — Fuel Swap Agreements As of September 30, 2019 As of December 31, 2018 (% hedged) Projected fuel purchases: 2019 60 % 58 % 2020 55 % 54 % 2021 30 % 28 % 2022 19 % 19 % 2023 5 % — % |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands): Line Item in the Statement of Financial Position Where the Hedged Item is Included Carrying Amount of the Hedged Liabilities Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities As of September 30, 2019 As of December 31, 2018 As of September 30, 2019 As of December 31, 2018 Current portion of debt and Long-term debt $ 734,811 $ 725,486 $ 1,097 $ (24,766 ) $ 734,811 $ 725,486 $ 1,097 $ (24,766 ) The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands): Fair Value of Derivative Instruments Asset Derivatives Liability Derivatives Balance Sheet Location As of September 30, 2019 As of December 31, 2018 Balance Sheet Location As of September 30, 2019 As of December 31, 2018 Fair Value Fair Value Fair Value Fair Value Derivatives designated as hedging instruments under ASC 815-20 (1) Interest rate swaps Other assets $ 1,415 $ 23,518 Other long-term liabilities $ 85,004 $ 40,467 Foreign currency forward contracts Derivative financial instruments — 4,044 Derivative financial instruments 54,985 39,665 Foreign currency forward contracts Other assets 13,351 10,844 Other long-term liabilities 144,592 16,854 Fuel swaps Derivative financial instruments 6,698 10,966 Derivative financial instruments 43,160 37,627 Fuel swaps Other assets 4,241 9,204 Other long-term liabilities 53,997 65,182 Total derivatives designated as hedging instruments under 815-20 25,705 58,576 381,738 199,795 Derivatives not designated as hedging instruments under ASC 815-20 Foreign currency forward contracts Derivative financial instruments $ 3,811 $ 1,751 Derivative financial instruments $ 3,046 $ 808 Foreign currency forward contracts Other assets — 1,579 Other long-term liabilities — 833 Fuel swaps Derivative financial instruments 1,124 2,804 Derivative financial instruments 370 376 Fuel swaps Other Assets 243 587 Other long-term liabilities 422 — Total derivatives not designated as hedging instruments under 815-20 5,178 6,721 3,838 2,017 Total derivatives $ 30,883 $ 65,297 $ 385,576 $ 201,812 (1) Accounting Standard Codification 815-20 “ Derivatives and Hedging. ” |
Derivative Instruments, Gain (Loss) | The location and amount of gain or (loss) recognized in income on fair value and cash flow hedging relationships were as follows (in thousands): Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded $177,677 $320,295 $(96,413) $(7,668) $182,415 $259,923 $(80,679) $(3,832) The effects of fair value and cash flow hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20 Interest contracts Hedged items n/a n/a $(4,116) — n/a n/a $2,124 — Derivatives designated as hedging instruments n/a n/a $2,920 — n/a n/a $(3,512) — Gain or (loss) on cash flow hedging relationships in Subtopic 815-20 Interest contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income n/a n/a $(373) n/a n/a n/a $(1,395) n/a Commodity contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income $2,435 n/a n/a $(472) $4,548 n/a n/a $466 Foreign exchange contracts Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income n/a $(3,592) n/a $(1,251) n/a $(3,157) n/a $(835) Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Fuel Expense Depreciation and Amortization Expenses Interest Income (Expense) Other Income (Expense) Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded $519,772 $924,180 $(292,006) $(34,537) $515,065 $753,529 $(209,590) $5,923 The effects of fair value and cash flow hedging: Gain or (loss) on fair value hedging relationships in Subtopic 815-20 Interest contracts Hedged items n/a n/a $(25,862) — n/a n/a $18,680 — Derivatives designated as hedging instruments n/a n/a $19,699 — n/a n/a $(21,392) — Gain or (loss) on cash flow hedging relationships in Subtopic 815-20 Interest contracts Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income n/a n/a $(1,173) n/a n/a n/a $(10,371) n/a Commodity contracts Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income $33,815 n/a n/a $(1,916) $1,459 n/a n/a $658 Foreign exchange contracts Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income n/a $(10,471) n/a $(3,866) n/a $(9,625) n/a $13,808 |
Fair Value and Line Item Caption of Non-derivative Instruments | The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands): Carrying Value Non-derivative instrument designated as Balance Sheet Location As of September 30, 2019 As of December 31, 2018 Foreign currency debt Current portion of debt $ 69,399 $ 38,168 Foreign currency debt Long-term debt 242,398 281,984 $ 311,797 $ 320,152 |
Non Derivative Instruments Qualifying and Designated as Hedging Instruments in Net Investment Hedges | The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands): Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss) Non-derivative instruments under ASC 815-20 Net Investment Hedging Relationships Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Foreign Currency Debt $ 12,811 $ 1,700 $ 15,519 $ 9,309 $ 12,811 $ 1,700 $ 15,519 $ 9,309 |
Not Designated as Hedging Instrument | |
Derivative Instruments | |
Derivative Instruments, Gain (Loss) | The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands): Amount of Gain (Loss) Recognized in Income on Derivatives Derivatives Not Designated as Hedging Location of Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Foreign currency forward contracts Other income (expense) $ (26,035 ) $ (12,097 ) $ (25,189 ) $ (43,356 ) Fuel swaps Fuel — 478 (14 ) 1,804 Fuel swaps Other income (expense) 1,095 (28 ) 974 155 $ (24,940 ) $ (11,647 ) $ (24,229 ) $ (41,397 ) |
Fair Value Hedging | |
Derivative Instruments | |
Schedule of Interest Rate Derivatives | At September 30, 2019 and December 31, 2018 , we maintained interest rate swap agreements on the following fixed-rate debt instruments: Debt Instrument Swap Notional as of September 30, 2019 (In thousands) Maturity Debt Fixed Rate Swap Floating Rate: LIBOR plus All-in Swap Floating Rate as of September 30, 2019 Oasis of the Seas term loan $ 87,500 October 2021 5.41% 3.87% 6.49% Unsecured senior notes 650,000 November 2022 5.25% 3.63% 5.79% $ 737,500 |
Derivative Instruments, Gain (Loss) | The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive income (loss) was as follows (in thousands): Derivatives and Related Hedged Items under ASC 815-20 Fair Value Hedging Relationships Location of Gain (Loss) Recognized in Income on Derivative and Hedged Item Amount of Gain (Loss) Amount of Gain (Loss) Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Interest rate swaps Interest income (expense), net of interest capitalized $ 2,920 $ (3,512 ) $ 19,699 $ (21,392 ) $ (4,116 ) $ 2,124 $ (25,862 ) $ 18,680 $ 2,920 $ (3,512 ) $ 19,699 $ (21,392 ) $ (4,116 ) $ 2,124 $ (25,862 ) $ 18,680 |
Cash flow hedge | |
Derivative Instruments | |
Schedule of Interest Rate Derivatives | At September 30, 2019 and December 31, 2018 , we maintained interest rate swap agreements on the following floating-rate debt instruments: Debt Instrument Swap Notional as of September 30, 2019 (In thousands) Maturity Debt Floating Rate All-in Swap Fixed Rate Celebrity Reflection term loan $ 299,979 October 2024 LIBOR plus 0.40% 2.85% Quantum of the Seas term loan 459,375 October 2026 LIBOR plus 1.30% 3.74% Anthem of the Seas term loan 483,333 April 2027 LIBOR plus 1.30% 3.86% Ovation of the Seas term loan 622,500 April 2028 LIBOR plus 1.00% 3.16% Harmony of the Seas term loan (1) 566,959 May 2028 EURIBOR plus 1.15% 2.26% Odyssey of the Seas term loan (2) 460,000 October 2032 LIBOR plus 0.95% 3.20% $ 2,892,146 (1) Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of September 30, 2019 . (2) Interest rate swap agreements hedging the term loan for Odyssey of the Seas includes a LIBOR zero-floor matching the hedged debt LIBOR zero-floor. The anticipated unsecured term loan for the financing of Odyssey of the Seas is expected to be drawn in October 2020. |
Derivative Instruments, Gain (Loss) | The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands): Gain (Loss) Recognized in Income (Net Investment Excluded Components) Nine Months Ended September 30, 2019 Net inception fair value at January 1, 2019 $ (8,359 ) Amount of gain recognized in income on derivatives for the period ended September 30, 2019 2,790 Amount of loss remaining to be amortized in accumulated other comprehensive loss, as of September 30, 2019 (4,056 ) Fair value at September 30, 2019 $ (9,625 ) The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands): Derivatives Amount of Gain (Loss) Recognized in Location of Amount of Gain (Loss) Reclassified from Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Quarter Ended September 30, 2019 Quarter Ended September 30, 2018 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Interest rate swaps $ (23,488 ) $ 10,166 $ (91,949 ) $ 56,223 Interest expense, net of interest capitalized $ (373 ) $ (1,395 ) $ (1,173 ) $ (10,371 ) Foreign currency forward contracts (131,523 ) (35,397 ) (202,273 ) (133,360 ) Depreciation and amortization expenses (3,592 ) (3,157 ) (10,471 ) (9,625 ) Foreign currency forward contracts — — — — Other income (expense) (1,251 ) (835 ) (3,866 ) 13,808 Fuel swaps — — — — Other income (expense) (472 ) 466 (1,916 ) 658 Fuel swaps (113,467 ) 61,805 22,496 183,642 Fuel 2,435 4,548 33,815 1,459 $ (268,478 ) $ 36,574 $ (271,726 ) $ 106,505 $ (3,253 ) $ (373 ) $ 16,389 $ (4,071 ) |
General (Details)
General (Details) | Sep. 30, 2019brand |
Schedule of Equity Method Investments [Line Items] | |
Number of cruise brands | 4 |
Maximum | |
Schedule of Equity Method Investments [Line Items] | |
Investment in a joint venture, percentage of interest | 50.00% |
Minimum | |
Schedule of Equity Method Investments [Line Items] | |
Investment in a joint venture, percentage of interest | 20.00% |
TUI Cruises | |
Schedule of Equity Method Investments [Line Items] | |
Investment in a joint venture, percentage of interest | 50.00% |
Pullmantur | |
Schedule of Equity Method Investments [Line Items] | |
Investment in a joint venture, percentage of interest | 49.00% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 697,461 | |
Lease liabilities | $ 713,628 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 801,800 | |
Lease liabilities | $ 820,500 |
Business Combination (Details)
Business Combination (Details) - USD ($) | Jul. 31, 2018 | Apr. 30, 2019 |
Silversea Cruises | ||
Business Acquisition [Line Items] | ||
Percentage of interests acquired | 66.70% | |
Payments to acquire business | $ 1,020,000,000 | |
Contingent consideration | 44,000,000 | |
Silversea Cruises | ||
Business Acquisition [Line Items] | ||
Long-term debt | $ 700,000,000 | |
Silversea Cruises | Silversea Cruises | ||
Business Acquisition [Line Items] | ||
Long-term debt | $ 700,000,000 | |
Minimum | Silversea Cruises | ||
Business Acquisition [Line Items] | ||
Contingent consideration, shares (in shares) | 0 | |
Maximum | Silversea Cruises | ||
Business Acquisition [Line Items] | ||
Contingent consideration, shares (in shares) | 472,000 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-life intangible assets, gross carrying value | $ 156,629 | $ 156,629 |
Accumulated Amortization | 16,720 | 6,251 |
Finite-life intangible assets, net carrying value | 139,909 | 150,378 |
Indefinite-life intangible assets | 351,725 | 351,725 |
Gross Carrying Value | 508,354 | 508,354 |
Net Carrying Value | 491,634 | 502,103 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-life intangible assets, gross carrying value | 97,400 | 97,400 |
Accumulated Amortization | 5,952 | 1,082 |
Finite-life intangible assets, net carrying value | 91,448 | 96,318 |
Galapagos operating license | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-life intangible assets, gross carrying value | 47,669 | 47,669 |
Accumulated Amortization | 5,470 | 4,206 |
Finite-life intangible assets, net carrying value | 42,199 | 43,463 |
Other finite-life intangible assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-life intangible assets, gross carrying value | 11,560 | 11,560 |
Accumulated Amortization | 5,298 | 963 |
Finite-life intangible assets, net carrying value | $ 6,262 | $ 10,597 |
Intangible Assets - Finite-live
Intangible Assets - Finite-lived Intangible Assets Amortization Expense (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Remainder of 2019 | $ 3,490 |
2020 | 12,995 |
2021 | 8,179 |
2022 | 8,179 |
2023 | 8,179 |
2024 | $ 8,179 |
Revenues - Narrative (Details)
Revenues - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Capitalized Contract Cost [Line Items] | |||||
Passenger ticket revenues | $ 3,186,850 | $ 2,796,187 | $ 8,433,248 | $ 7,161,548 | |
Contract liability | 1,900,000 | 1,900,000 | $ 1,900,000 | ||
Contract asset | 56,100 | 56,100 | 57,800 | ||
Commission, transportation and other | |||||
Capitalized Contract Cost [Line Items] | |||||
Prepaid travel agent commissions | 146,500 | $ 146,500 | $ 153,500 | ||
Minimum | |||||
Capitalized Contract Cost [Line Items] | |||||
Length of cruise | 2 days | ||||
Maximum | |||||
Capitalized Contract Cost [Line Items] | |||||
Length of cruise | 25 days | ||||
Port Costs | |||||
Capitalized Contract Cost [Line Items] | |||||
Passenger ticket revenues | $ 184,000 | $ 174,100 | $ 509,600 | $ 462,200 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | $ 3,186,850 | $ 2,796,187 | $ 8,433,248 | $ 7,161,548 | |
Cruise Itinerary | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | 3,052,116 | 2,683,393 | 8,084,498 | 6,887,211 | |
Cruise Itinerary | North America | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | [1] | 1,617,446 | 1,450,119 | 4,870,273 | 4,061,545 |
Cruise Itinerary | Asia Pacific | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | [2] | 272,062 | 235,374 | 1,089,914 | 1,051,551 |
Cruise Itinerary | Europe | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | [3] | 1,060,424 | 968,952 | 1,663,118 | 1,566,351 |
Cruise Itinerary | Other regions | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | [4] | 102,184 | 28,948 | 461,193 | 207,764 |
Other Revenues | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenues | [5] | $ 134,734 | $ 112,794 | $ 348,750 | $ 274,337 |
Passenger Ticket | Other regions | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of revenues by country | [6] | 26.00% | 28.00% | 26.00% | 30.00% |
Passenger Ticket | United States | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of revenues by country | 62.00% | 59.00% | 65.00% | 60.00% | |
Passenger Ticket | United Kingdom | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of revenues by country | 12.00% | 13.00% | 9.00% | 10.00% | |
[1] | Includes the United States, Canada, Mexico and the Caribbean. | ||||
[2] | Includes Southeast Asia (e.g., Singapore, Thailand and the Philippines), East Asia (e.g., China and Japan), South Asia (e.g., India and Pakistan) and Oceania (e.g., Australia and Fiji Islands) regions. | ||||
[3] | Includes European countries (e.g., Nordics, Germany, France, Italy, Spain and the United Kingdom). | ||||
[4] | Includes itineraries primarily in South and Latin American countries. | ||||
[5] | Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to our bareboat charter, procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 7 . Other Assets for more information on our unconsolidated affiliates. | ||||
[6] | No other individual country's revenue exceeded 10% for the quarters and nine months ended September 30, 2019 and 2018 . |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net Income attributable to Royal Caribbean Cruises Ltd. for basic and diluted earnings per share | $ 883,240 | $ 810,391 | $ 1,605,751 | $ 1,495,339 |
Weighted-average common shares outstanding (in shares) | 209,575,000 | 209,054,000 | 209,477,000 | 211,099,000 |
Dilutive effect of stock-based awards and stock options (in shares) | 546,000 | 874,000 | 555,000 | 874,000 |
Diluted weighted-average shares outstanding (in shares) | 210,121,000 | 209,928,000 | 210,032,000 | 211,973,000 |
Basic earnings per share (in dollars per share) | $ 4.21 | $ 3.88 | $ 7.67 | $ 7.08 |
Diluted earnings per share (in dollars per share) | $ 4.20 | $ 3.86 | $ 7.65 | $ 7.05 |
Antidilutive securities (in shares) | 0 | 0 | 0 | 0 |
Other Assets - Narrative (Detai
Other Assets - Narrative (Details) € in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||
Apr. 30, 2016 | Mar. 31, 2009USD ($) | Mar. 31, 2009EUR (€) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019EUR (€) | Dec. 31, 2018USD ($) | Dec. 31, 2018EUR (€) | Mar. 31, 2018 | |
Other Assets | |||||||||||
Gain on sale of equipment | $ 0 | $ 21,794,000 | |||||||||
Proceeds from collection of advance to affiliate | $ 27,697,000 | 49,501,000 | |||||||||
Mein Schiff 1 | |||||||||||
Other Assets | |||||||||||
Useful life | 23 years | 23 years | |||||||||
TUI Cruises GmbH joint venture | |||||||||||
Other Assets | |||||||||||
Percentage of ownership interest | 50.00% | 50.00% | 50.00% | ||||||||
Investments in entity | $ 521,700,000 | $ 521,700,000 | $ 578,100,000 | ||||||||
Underlying equity in net assets | 368,200,000 | 368,200,000 | 403,000,000 | ||||||||
Advances to affiliate | 151,200,000 | $ 151,200,000 | € 138.7 | 172,200,000 | € 150.6 | ||||||
Debt, guaranteed percentage | 50.00% | ||||||||||
Additional amount outstanding on line of credit provided to TUI Cruises | $ 31,700,000 | $ 31,700,000 | € 29.1 | ||||||||
Proceeds from sale of equipment | $ 290,900,000 | € 224.4 | |||||||||
Deferred gain on sale | $ 35,900,000 | ||||||||||
Gain on sale of equipment | 21,800,000 | ||||||||||
TUI Cruises GmbH joint venture | TUI cruise ships | |||||||||||
Other Assets | |||||||||||
Restriction on reduction of current ownership interest (as a percent) | 37.55% | 37.55% | 37.55% | ||||||||
TUI Cruises GmbH joint venture | Splendour of the Seas | |||||||||||
Other Assets | |||||||||||
Long term debt, term | 10 years | ||||||||||
Pullmantur | |||||||||||
Other Assets | |||||||||||
Percentage of ownership interest | 49.00% | 49.00% | 49.00% | ||||||||
Advances to affiliate | $ 16,400,000 | $ 16,400,000 | € 15 | ||||||||
Interest rate on loan provided to related party (as a percent) | 6.50% | 6.50% | 6.50% | ||||||||
Debt, guaranteed percentage | 51.00% | ||||||||||
Retained ownership percentage of subsidiary after sale | 49.00% | ||||||||||
Maximum loss exposure | $ 49,600,000 | $ 49,600,000 | 58,500,000 | ||||||||
Proceeds from credit facility | $ 13,100,000 | $ 13,100,000 | € 12 | 16,000,000 | € 14 | ||||||
Percentage of subsidiary which has been sold | 51.00% | 51.00% | 51.00% | ||||||||
Grand Bahamas Shipyard Ltd. | |||||||||||
Other Assets | |||||||||||
Proceeds from collection of advance to affiliate | $ 0 | $ 0 | $ 7,600,000 | 14,200,000 | |||||||
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | |||||||||||
Other Assets | |||||||||||
Percentage of ownership interest | 40.00% | 40.00% | 40.00% | ||||||||
Investments in entity | $ 47,800,000 | $ 47,800,000 | 56,100,000 | ||||||||
Underlying equity in net assets | 33,500,000 | 33,500,000 | 41,400,000 | ||||||||
Related party transaction, payment amount for ship repair and maintenance | 400,000 | $ 17,300,000 | 45,500,000 | 41,600,000 | |||||||
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Non-accrual status of advances to affiliates | |||||||||||
Other Assets | |||||||||||
Advances to affiliate | $ 14,300,000 | $ 14,300,000 | $ 14,700,000 | ||||||||
Interest rate on loan provided to related party (as a percent) | 5.50% | 5.50% | 5.50% | ||||||||
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Non-accrual status of advances to affiliates | LIBOR | |||||||||||
Other Assets | |||||||||||
Debt instrument, basis spread on variable rate | 3.50% | ||||||||||
Skysea Holding | |||||||||||
Other Assets | |||||||||||
Impairment charge | $ 23,300,000 | ||||||||||
Skysea Holding | Not Primary Beneficiary | |||||||||||
Other Assets | |||||||||||
Percentage of ownership interest | 36.00% | ||||||||||
Splendour of the Seas | TUI Cruises GmbH joint venture | |||||||||||
Other Assets | |||||||||||
Interest rate on loan provided to related party (as a percent) | 6.25% | ||||||||||
Debt, guaranteed percentage | 50.00% | ||||||||||
Springwater Capital LLC | Pullmantur | |||||||||||
Other Assets | |||||||||||
Percentage of ownership interest | 51.00% | 51.00% | 51.00% |
Other Assets - Share of Equity
Other Assets - Share of Equity Income From Investments (Details) $ in Thousands, € in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2019USD ($) | Sep. 30, 2019EUR (€) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019EUR (€) | Sep. 30, 2018USD ($) | ||
Schedule of Investments [Line Items] | |||||||
Share of equity income from investments | $ 103,654 | $ 95,169 | $ 170,393 | $ 168,232 | |||
Dividends received | [1] | 67,713 | $ 82,755 | 148,285 | $ 241,697 | ||
TUI Cruises | |||||||
Schedule of Investments [Line Items] | |||||||
Dividends received | [1] | $ 88,500 | € 80 | $ 190,300 | € 170 | ||
[1] | For the quarter ended September 30, 2019 , TUI Cruises paid us dividends of €80.0 million , or approximately $88.5 million , based on the exchange rate at the time of the transactions. For the nine months ended September 30, 2019 , TUI Cruises paid us dividends totaling €170.0 million , or approximately $190.3 million , based on the exchange rates at the time of the transactions. The amounts included in the table above are net of tax withholdings. |
Other Assets - Notes Receivable
Other Assets - Notes Receivable Due From Equity Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Other Assets [Abstract] | |||
Total notes receivable due from equity investments | $ 178,853 | $ 201,979 | |
Less-current portion | [1] | 19,091 | 19,075 |
Long-term portion | [2] | $ 159,762 | $ 182,904 |
[1] | Included within Trade and other receivables, net in our consolidated balance sheets. | ||
[2] | Included within Other assets in our consolidated balance sheets. |
Other Assets - Related Party Tr
Other Assets - Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Other Assets [Abstract] | ||||
Revenues | $ 11,857 | $ 12,170 | $ 35,714 | $ 40,400 |
Expenses | $ 1,365 | $ 1,735 | $ 3,450 | $ 8,643 |
Debt (Details)
Debt (Details) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019USD ($) | Apr. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | May 31, 2019USD ($) | Mar. 31, 2019USD ($) | Nov. 30, 2017EUR (€) | |
Long-Term Debt | |||||||||
Short-term debt amount outstanding | $ 2,900,000,000 | $ 1,200,000,000 | |||||||
Loss on extinguishment of debt | $ 6,326,000 | $ 0 | |||||||
Commercial Paper | |||||||||
Long-Term Debt | |||||||||
Borrowings outstanding | $ 923,000,000 | $ 923,000,000 | $ 777,000,000 | ||||||
Weighted average interest rate | 2.36% | 2.36% | 3.19% | ||||||
Long term debt, term | 34 days | 23 days | |||||||
Loans Payable | |||||||||
Long-Term Debt | |||||||||
Loss on extinguishment of debt | $ 6,300,000 | ||||||||
$1.4 billion Unsecured Revolving Credit Facility | Revolving Credit Facility | |||||||||
Long-Term Debt | |||||||||
Long-term debt | $ 1,700,000,000 | $ 1,400,000,000 | |||||||
Facility fee | 0.125% | ||||||||
Unsecured Revolving Credit Facility Due 2022 | Revolving Credit Facility | |||||||||
Long-Term Debt | |||||||||
Long-term debt | $ 1,150,000,000 | ||||||||
Term Loan | Loans Payable | |||||||||
Long-Term Debt | |||||||||
Long term debt, term | 3 years | ||||||||
Long-term debt | $ 1,000,000,000 | ||||||||
Silversea Cruises | |||||||||
Long-Term Debt | |||||||||
Long-term debt | $ 700,000,000 | ||||||||
Novation Agreement | Unsecured Debt | |||||||||
Long-Term Debt | |||||||||
Long term debt, term | 12 years | ||||||||
Unsecured debt | $ 908,000,000 | ||||||||
Interest rate | 3.45% | ||||||||
Unsecured Term Loan Facility | |||||||||
Long-Term Debt | |||||||||
Long-term debt | $ 87,200,000 | $ 87,200,000 | |||||||
Unsecured Term Loan Facility | Unsecured Debt | |||||||||
Long-Term Debt | |||||||||
Long-term debt | € | € 80,000,000 | ||||||||
LIBOR | $1.4 billion Unsecured Revolving Credit Facility | Revolving Credit Facility | |||||||||
Long-Term Debt | |||||||||
Debt instrument, basis spread on variable rate | 1.00% | ||||||||
LIBOR | Term Loan | Loans Payable | |||||||||
Long-Term Debt | |||||||||
Debt instrument, basis spread on variable rate | 1.075% | ||||||||
EURIBOR | Unsecured Term Loan Facility | Unsecured Debt | |||||||||
Long-Term Debt | |||||||||
Debt instrument, basis spread on variable rate | 1.195% | ||||||||
Euler Hermes | Unsecured Debt | |||||||||
Long-Term Debt | |||||||||
Percentage guaranteed by export credit agency | 95.00% | ||||||||
Euler Hermes | Novation Agreement | Unsecured Debt | |||||||||
Long-Term Debt | |||||||||
Percentage guaranteed by export credit agency | 95.00% |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019USD ($)ship | Sep. 30, 2019USD ($)shipextension_option | |
Lessee, Lease, Description [Line Items] | ||
Variable lease cost | $ | $ 17.3 | $ 73.1 |
Pullmantur | ||
Lessee, Lease, Description [Line Items] | ||
Percentage of subsidiary which has been sold | 51.00% | 51.00% |
Cruise ships | ||
Lessee, Lease, Description [Line Items] | ||
Number of ships under finance leases | ship | 2 | 2 |
Additional lease term | 6 years | 6 years |
Real Estate | ||
Lessee, Lease, Description [Line Items] | ||
Additional lease term | 5 years | 5 years |
Finance lease term | 43 years | 43 years |
Number of extension options | extension_option | 2 | |
Minimum | Real Estate | ||
Lessee, Lease, Description [Line Items] | ||
Renewal term | 1 year | 1 year |
Minimum | Berthing Agreement | ||
Lessee, Lease, Description [Line Items] | ||
Renewal term | 1 year | 1 year |
Maximum | Real Estate | ||
Lessee, Lease, Description [Line Items] | ||
Renewal term | 10 years | 10 years |
Maximum | Berthing Agreement | ||
Lessee, Lease, Description [Line Items] | ||
Renewal term | 20 years | 20 years |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Finance lease right-of-use assets, net: | |
Property and equipment, gross | $ 374,494 |
Accumulated depreciation | (51,493) |
Property and equipment, net | 323,001 |
Operating lease right-of-use assets | 697,461 |
Total lease assets | 1,020,462 |
Finance lease liabilities: | |
Current portion of debt | 34,603 |
Long-term debt | 203,675 |
Total finance lease liabilities | 238,278 |
Operating lease liabilities: | |
Current portion of operating lease liabilities | 93,058 |
Long-term operating lease liabilities | 620,570 |
Total operating lease liabilities | 713,628 |
Total lease liabilities | $ 951,906 |
Leases - Schedule of Lease Expe
Leases - Schedule of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Financial lease costs | ||
Amortization of right-of-use-assets | $ 6,081 | $ 14,805 |
Interest on lease liabilities | 1,514 | 3,680 |
Total lease costs | 37,858 | 110,947 |
Commission, transportation and other | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease costs | 19,057 | 57,170 |
Other operating expenses | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease costs | 6,930 | 20,791 |
Marketing, selling and administrative expenses | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease costs | $ 4,276 | $ 14,501 |
Leases - Schedule of Lease Term
Leases - Schedule of Lease Terms and Discount Rates (Details) | Sep. 30, 2019 |
Weighted average of the remaining lease term | |
Operating leases | 10 years 6 months |
Finance leases | 28 years 10 months 24 days |
Weighted average discount rate | |
Operating leases | 4.65% |
Finance leases | 4.42% |
Leases - Supplemental Noncash I
Leases - Supplemental Noncash Information (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Leases [Abstract] | |
Operating cash flows from operating leases | $ 94,125 |
Operating cash flows from finance leases | 3,680 |
Financing cash flows from finance leases | 19,009 |
Right-of-use assets obtained in exchange for lease obligations: | |
Finance leases | $ 122,237 |
Leases - Schedule of Lease Matu
Leases - Schedule of Lease Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Operating Leases | ||
Remainder of 2019 | $ 30,765 | |
2020 | 122,718 | |
2021 | 109,984 | |
2022 | 103,551 | |
2023 | 101,442 | |
Thereafter | 492,553 | |
Total lease payments | 961,013 | |
Less: Interest | (247,385) | |
Present value of lease liabilities | 713,628 | |
Finance Leases | ||
Remainder of 2019 | 17,209 | |
2020 | 42,912 | |
2021 | 45,803 | |
2022 | 22,832 | |
2023 | 11,891 | |
Thereafter | 414,098 | |
Total lease payments | 554,745 | |
Less: Interest | (316,467) | |
Present value of lease liabilities | $ 238,278 | |
Operating Leases | ||
2019 | $ 67,682 | |
2020 | 64,237 | |
2021 | 56,142 | |
2022 | 52,759 | |
2023 | 52,522 | |
Thereafter | 383,974 | |
Total | $ 677,316 |
Redeemable Noncontrolling Int_3
Redeemable Noncontrolling Interest - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Jul. 31, 2018 |
Royal Caribbean International | Silversea Cruises Group | ||
Redeemable Noncontrolling Interest [Line Items] | ||
Ownership percentage by noncontrolling owners | 33.30% | |
Silversea Cruises | ||
Redeemable Noncontrolling Interest [Line Items] | ||
Redeemable noncontrolling interest | $ 537.8 |
Redeemable Noncontrolling Int_4
Redeemable Noncontrolling Interest - Schedule of Redeemable Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Beginning balance January 1, 2019 | $ 542,020 | |||
Net income attributable to noncontrolling interest, including the contractual accretion of the put options | $ 7,125 | $ 0 | 21,375 | $ 0 |
Distribution to noncontrolling interest | (501) | |||
Other | 500 | |||
Ending balance September 30, 2019 | $ 563,394 | $ 563,394 |
Commitments and Contingencies -
Commitments and Contingencies - Future Commitments (Details) | Sep. 30, 2019berth | |
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 32,900 | |
Royal Caribbean International | Wonder of the Seas | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 5,700 | |
Royal Caribbean International | Odyssey of the Seas | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 4,200 | |
Royal Caribbean International | Icon Class Ship One | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 5,600 | |
Royal Caribbean International | Icon Class Ship Two | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 5,600 | |
Celebrity Cruises | Celebrity Apex | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 2,900 | |
Celebrity Cruises | Celebrity Beyond | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 3,250 | |
Celebrity Cruises | Edge Class Ship Two | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 3,250 | |
Silversea Cruises | Silver Origin | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 100 | [1] |
Silversea Cruises | Silver Moon | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 550 | [1] |
Silversea Cruises | Silver Dawn | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 550 | [1] |
Silversea Cruises | Evolution Class Ship One | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 600 | [1] |
Silversea Cruises | Evolution Class Ship Two | ||
Long-term Purchase Commitment [Line Items] | ||
Ship passenger capacity berths | 600 | [1] |
[1] | The "Expected to Enter Service" dates for Silversea Cruises' new ships takes into consideration the three-month reporting lag. Refer to Note 1 . General for further information. |
Commitments and Contingencies_2
Commitments and Contingencies - Narrative (Details) € in Millions | Aug. 27, 2019lawsuit | Sep. 30, 2019USD ($)agreement | Jun. 30, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019EUR (€) | Dec. 31, 2018 |
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Number of claims filed | lawsuit | 2 | |||||
Number of months considered to determine requirement of prepayment of debts | 24 months | |||||
Cruise ships on order | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Aggregate cost of ships on order, not including TUI cruises on order | $ 11,100,000,000 | |||||
Deposit for the purchase of ships expected to enter service | $ 705,500,000 | $ 705,500,000 | ||||
Percentage of aggregate cost exposed to fluctuations in the euro exchange rate | 57.90% | 57.90% | 57.90% | 53.50% | ||
Line of Credit | Minimum | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Debt instrument covenant, minimum percentage of ownership by a person | 50.00% | 50.00% | 50.00% | |||
Debt Securities | Minimum | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Debt instrument covenant, minimum percentage of ownership by a person | 50.00% | 50.00% | 50.00% | |||
Unsecured Debt | Silver Moon Credit Agreement | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Long-term debt | $ 300,000,000 | |||||
Unsecured Debt | Silversea Cruises | Line of Credit | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Number of credit agreements | agreement | 2 | |||||
Unsecured Debt | Silversea Cruises | Evolution Class Ship One | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Maximum contract price financed, percentage | 80.00% | |||||
Unsecured term loan, maximum borrowing commitment | $ 383,300,000 | $ 383,300,000 | € 351.6 | |||
Long term debt, term | 12 years | |||||
Interest rate | 4.14% | 4.14% | 4.14% | |||
Unsecured Debt | Silversea Cruises | Evolution Class Ship Two | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Maximum contract price financed, percentage | 80.00% | |||||
Unsecured term loan, maximum borrowing commitment | $ 391,400,000 | $ 391,400,000 | € 359 | |||
Long term debt, term | 12 years | |||||
Interest rate | 4.18% | 4.18% | 4.18% | |||
Unsecured Debt | Euler Hermes | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Percentage guaranteed by export credit agency | 95.00% | |||||
LIBOR | Unsecured Debt | Silver Moon Credit Agreement | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Debt Floating Rate | 1.50% | |||||
LIBOR | Unsecured Debt | Silversea Cruises | Evolution Class Ship One | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Debt Floating Rate | 0.79% | |||||
LIBOR | Unsecured Debt | Silversea Cruises | Evolution Class Ship Two | ||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||||||
Debt Floating Rate | 0.83% |
Commitments and Contingencies_3
Commitments and Contingencies - Contingent Capital Commitments (Details) | Sep. 30, 2019berth |
Unrecorded Unconditional Purchase Obligation [Line Items] | |
Ship passenger capacity berths | 32,900 |
Cruise ships on order | Royal Caribbean International Cruise Ships | Oasis-class | |
Unrecorded Unconditional Purchase Obligation [Line Items] | |
Ship passenger capacity berths | 5,700 |
Cruise ships on order | Royal Caribbean International Cruise Ships | Icon-class | |
Unrecorded Unconditional Purchase Obligation [Line Items] | |
Ship passenger capacity berths | 5,600 |
Cruise ships on order | Royal Caribbean International Cruise Ships | Edge-class | |
Unrecorded Unconditional Purchase Obligation [Line Items] | |
Ship passenger capacity berths | 3,250 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||
Oct. 31, 2019 | Sep. 30, 2019 | Jul. 31, 2019 | Apr. 30, 2019 | Oct. 31, 2018 | Jul. 31, 2018 | May 31, 2018 | Apr. 30, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Subsequent Event [Line Items] | |||||||||||||||||||
Dividend declared (in dollars per share) | $ 0.78 | $ 0.78 | $ 0.70 | $ 0.70 | $ 0.70 | $ 0.7 | $ 0.60 | $ 0.60 | $ 0.60 | $ 2.18 | $ 1.90 | ||||||||
Common stock, dividends, per share, cash paid (in dollars per share) | $ 0.70 | $ 0.70 | $ 0.7 | $ 0.60 | $ 0.60 | $ 0.70 | $ 0.60 | ||||||||||||
Dividends declared | $ 163,500,000 | $ 163,500,000 | $ 146,800,000 | $ 163,500,000 | $ 146,800,000 | ||||||||||||||
Length of repurchase program | 24 months | ||||||||||||||||||
Common stock repurchase program, authorized amount | $ 1,000,000,000 | ||||||||||||||||||
Treasury stock, shares, acquired (in shares) | 0 | 0 | 2,800,000 | ||||||||||||||||
Treasury stock, value, acquired, cost method | $ 162,540,000 | $ 575,039,000 | $ 300,000,000 | ||||||||||||||||
Remaining authorized repurchase amount | $ 700,000,000 | $ 700,000,000 | $ 700,000,000 | ||||||||||||||||
Forecast | Subsequent Event | |||||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||||
Common stock, dividends, per share, cash paid (in dollars per share) | $ 0.78 |
Changes in Accumulated Other _3
Changes in Accumulated Other Comprehensive Income (Loss) - Changes in AOCI by Component (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Changes in accumulated other comprehensive loss by component | ||||
Total other comprehensive (loss) income | $ (293,190) | $ 34,620 | $ (318,629) | $ 103,685 |
Changes related to cash flow derivative hedges | ||||
Changes in accumulated other comprehensive loss by component | ||||
Accumulated comprehensive loss at beginning of the year | (537,216) | (250,355) | ||
Other comprehensive income (loss) before reclassifications | (271,726) | 106,505 | ||
Amounts reclassified from accumulated other comprehensive loss | (16,389) | 4,071 | ||
Total other comprehensive (loss) income | (288,115) | 110,576 | ||
Ending balance | (825,331) | (139,779) | (825,331) | (139,779) |
Changes in defined benefit plans | ||||
Changes in accumulated other comprehensive loss by component | ||||
Accumulated comprehensive loss at beginning of the year | (26,023) | (33,666) | ||
Other comprehensive income (loss) before reclassifications | (23,408) | 5,863 | ||
Amounts reclassified from accumulated other comprehensive loss | 577 | 1,086 | ||
Total other comprehensive (loss) income | (22,831) | 6,949 | ||
Ending balance | (48,854) | (26,717) | (48,854) | (26,717) |
Foreign currency translation adjustments | ||||
Changes in accumulated other comprehensive loss by component | ||||
Accumulated comprehensive loss at beginning of the year | (64,495) | (50,244) | ||
Other comprehensive income (loss) before reclassifications | (7,683) | (13,840) | ||
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | ||
Total other comprehensive (loss) income | (7,683) | (13,840) | ||
Ending balance | (72,178) | (64,084) | (72,178) | (64,084) |
Accumulated other comprehensive loss | ||||
Changes in accumulated other comprehensive loss by component | ||||
Accumulated comprehensive loss at beginning of the year | (627,734) | (334,265) | ||
Other comprehensive income (loss) before reclassifications | (302,817) | 98,528 | ||
Amounts reclassified from accumulated other comprehensive loss | (15,812) | 5,157 | ||
Total other comprehensive (loss) income | (318,629) | 103,685 | ||
Ending balance | $ (946,363) | $ (230,580) | $ (946,363) | $ (230,580) |
Changes in Accumulated Other _4
Changes in Accumulated Other Comprehensive Income (Loss) - Reclassifications (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Reclassifications out of accumulated other comprehensive loss | ||||
Interest expense, net of interest capitalized | $ 102,038 | $ 86,510 | $ 313,757 | $ 236,252 |
Depreciation and amortization | 320,295 | 259,923 | 924,180 | 753,529 |
Other income (expense) | (7,668) | (3,832) | (34,537) | 5,923 |
Fuel | 177,677 | 182,415 | 519,772 | 515,065 |
Net income | 883,240 | 810,391 | 1,605,751 | 1,495,339 |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Net income | (3,447) | (745) | 15,812 | (5,157) |
Gain (loss) on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Net income | (3,253) | (373) | 16,389 | (4,071) |
Gain (loss) on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | Interest rate swaps | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Interest expense, net of interest capitalized | (373) | (1,395) | (1,173) | (10,371) |
Gain (loss) on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | Foreign currency forward contracts | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Depreciation and amortization | (3,592) | (3,157) | (10,471) | (9,625) |
Other income (expense) | (1,251) | (835) | (3,866) | 13,808 |
Gain (loss) on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | Fuel swaps | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Other income (expense) | (472) | 466 | (1,916) | 658 |
Fuel | 2,435 | 4,548 | 33,815 | 1,459 |
Actuarial loss | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Payroll and related | (194) | (372) | (577) | (1,086) |
Changes in defined benefit plans | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | ||||
Reclassifications out of accumulated other comprehensive loss | ||||
Net income | $ (194) | $ (372) | $ (577) | $ (1,086) |
Fair Value Measurements and D_3
Fair Value Measurements and Derivative Instruments - Estimated Fair Value (Details) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Level 1 | |||
Assets: | |||
Cash and cash equivalents | [1],[2] | $ 276,730 | $ 287,852 |
Total Assets | [2] | 276,730 | 287,852 |
Liabilities: | |||
Long-term debt (including current portion of long-term debt) | [2],[3] | 0 | 0 |
Total Liabilities | [2] | 0 | 0 |
Level 2 | |||
Assets: | |||
Cash and cash equivalents | [1],[4] | 0 | 0 |
Total Assets | [4] | 0 | 0 |
Liabilities: | |||
Long-term debt (including current portion of long-term debt) | [3],[4] | 10,241,498 | 10,244,214 |
Total Liabilities | [4] | 10,241,498 | 10,244,214 |
Level 3 | |||
Assets: | |||
Cash and cash equivalents | [1],[5] | 0 | 0 |
Total Assets | [5] | 0 | 0 |
Liabilities: | |||
Long-term debt (including current portion of long-term debt) | [3],[5] | 0 | 0 |
Total Liabilities | [5] | 0 | 0 |
Total Carrying Amount | |||
Assets: | |||
Cash and cash equivalents | [1] | 276,730 | 287,852 |
Total Assets | 276,730 | 287,852 | |
Liabilities: | |||
Long-term debt (including current portion of long-term debt) | [3] | 9,523,994 | 9,871,267 |
Total Liabilities | 9,523,994 | 9,871,267 | |
Total Fair Value | |||
Assets: | |||
Cash and cash equivalents | [1] | 276,730 | 287,852 |
Total Assets | 276,730 | 287,852 | |
Liabilities: | |||
Long-term debt (including current portion of long-term debt) | [3] | 10,241,498 | 10,244,214 |
Total Liabilities | $ 10,241,498 | $ 10,244,214 | |
[1] | Consists of cash and marketable securities with original maturities of less than 90 days. | ||
[2] | Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. | ||
[3] | Consists of unsecured revolving credit facilities, senior notes, senior debentures and term loans. These amounts do not include our capital lease obligations or commercial paper. | ||
[4] | Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company. | ||
[5] | Inputs that are unobservable. The Company did not use any Level 3 inputs as of September 30, 2019 and December 31, 2018 . |
Fair Value Measurements and D_4
Fair Value Measurements and Derivative Instruments - Recurring (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | ||
Liabilities: | ||||
Contingent consideration expense | $ 10,700 | $ 0 | ||
Fair Value, Measurements, Recurring | Level 1 | ||||
Assets: | ||||
Derivative financial instruments | [1],[2] | 0 | $ 0 | |
Total Assets | [2] | 0 | 0 | |
Liabilities: | ||||
Derivative financial instruments | [2],[3] | 0 | 0 | |
Contingent consideration | [2],[4] | 0 | 0 | |
Total Liabilities | [2] | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | ||||
Assets: | ||||
Derivative financial instruments | [1],[5] | 30,883 | 65,297 | |
Total Assets | [5] | 30,883 | 65,297 | |
Liabilities: | ||||
Derivative financial instruments | [3],[5] | 385,576 | 201,812 | |
Contingent consideration | [4],[5] | 0 | 0 | |
Total Liabilities | [5] | 385,576 | 201,812 | |
Fair Value, Measurements, Recurring | Level 3 | ||||
Assets: | ||||
Derivative financial instruments | [1],[6] | 0 | 0 | |
Total Assets | [6] | 0 | 0 | |
Liabilities: | ||||
Derivative financial instruments | [3],[6] | 0 | 0 | |
Contingent consideration | [4],[6] | 54,700 | 44,000 | |
Total Liabilities | [6] | 54,700 | 44,000 | |
Total | Fair Value, Measurements, Recurring | ||||
Assets: | ||||
Derivative financial instruments | [1] | 30,883 | 65,297 | |
Total Assets | 30,883 | 65,297 | ||
Liabilities: | ||||
Derivative financial instruments | [3] | 385,576 | 201,812 | |
Contingent consideration | [4] | 54,700 | 44,000 | |
Total Liabilities | $ 440,276 | $ 245,812 | ||
[1] | Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. | |||
[2] | Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. | |||
[3] | Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. | |||
[4] | The contingent consideration related to the Silversea Cruises acquisition is estimated by applying a Monte-Carlo simulation method using our closing stock price along with significant inputs not observable in the market, including the probability of achieving the milestones and estimated future operating results. The Monte-Carlo simulation is a generally accepted statistical technique used to generate a defined number of valuation paths in order to develop a reasonable estimate of fair value. Refer to Note 3. Business Combination for further information on the Silversea Cruises acquisition. For the nine months ended September 30, 2019 , we recorded a contingent consideration expense of $10.7 million within Other (expense) income in our consolidated statements of comprehensive income (loss). | |||
[5] | Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company. | |||
[6] | Inputs that are unobservable. |
Fair Value Measurements and D_5
Fair Value Measurements and Derivative Instruments - Offsetting of Derivative Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Offsetting of Financial Assets under Master Netting Agreements [Abstract] | ||
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | $ 30,883 | $ 65,297 |
Offsetting of Financial Liabilities under Master Netting Agreements [Abstract] | ||
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | (385,576) | (201,812) |
External Counterparties | ||
Offsetting of Financial Assets under Master Netting Agreements [Abstract] | ||
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | 30,883 | 65,297 |
Gross Amount of Eligible Offsetting Recognized Derivative Liabilities | (30,067) | (60,303) |
Cash Collateral Received | 0 | 0 |
Net Amount of Derivative Assets | 816 | 4,994 |
Offsetting of Financial Liabilities under Master Netting Agreements [Abstract] | ||
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | (385,576) | (201,812) |
Gross Amount of Eligible Offsetting Recognized Derivative Assets | 30,067 | 60,303 |
Cash Collateral Pledged | 0 | 0 |
Net Amount of Derivative Liabilities | $ (355,509) | $ (141,509) |
Fair Value Measurements and D_6
Fair Value Measurements and Derivative Instruments - Derivative Instruments, Interest Rate Risk, Foreign Currency Exchange Rate Risk (Narrative) (Details) $ in Thousands, € in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019EUR (€) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2018EUR (€) | Sep. 30, 2019EUR (€) | |
Gains and losses from derivatives involved in hedging relationships | ||||||||
Derivative instrument, credit risk exposure | $ 800 | $ 5,600 | ||||||
Maximum length of time hedged in derivative contract | 3 years | 3 years | ||||||
Percentage of debt bearing fixed interest | 66.10% | 66.10% | 59.10% | 66.10% | ||||
Interest rate swaps | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Derivative, notional amount | $ 3,600,000 | $ 3,600,000 | $ 3,400,000 | |||||
Forward Contracts | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Change in fair value of foreign currency forward contracts recognized in earnings | (26,000) | $ (12,100) | (25,200) | $ (43,400) | ||||
Forward Contracts | Not Designated | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Derivative, notional amount | 725,400 | 725,400 | ||||||
Foreign exchange contracts | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Derivative, notional amount | 3,000,000 | 3,000,000 | $ 3,200,000 | |||||
Cruise ships on order | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Aggregate cost of ships on order, not including partner brands on order | 11,100,000 | |||||||
Amount deposited for cost of ships on order | $ 705,500 | $ 705,500 | ||||||
Percentage of aggregate cost exposed to fluctuations in the euro exchange rate | 57.90% | 57.90% | 53.50% | 57.90% | ||||
TUI Cruises | Forward Contracts | Designated as Hedging Instrument | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Derivative, notional amount | $ 188,600 | $ 188,600 | € 173 | |||||
Foreign currency debt | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Carrying value of non-derivative instrument designated as hedging instrument | 311,797 | $ 320,152 | ||||||
Foreign currency debt | TUI Cruises | ||||||||
Gains and losses from derivatives involved in hedging relationships | ||||||||
Carrying value of non-derivative instrument designated as hedging instrument | $ 311,800 | € 286 | $ 320,200 | € 280 |
Fair Value Measurements and D_7
Fair Value Measurements and Derivative Instruments - Interest Rate Risk (Details) - Interest rate swaps | 9 Months Ended | |
Sep. 30, 2019USD ($) | ||
Fair Value Hedging | ||
Interest Rate Fair Value Hedges [Abstract] | ||
Long-term debt | $ 737,500,000 | |
Fair Value Hedging | Oasis of the Seas term loan | ||
Interest Rate Fair Value Hedges [Abstract] | ||
Long-term debt | $ 87,500,000 | |
Debt Fixed Rate | 5.41% | |
Fair Value Hedging | Unsecured senior notes | ||
Interest Rate Fair Value Hedges [Abstract] | ||
Long-term debt | $ 650,000,000 | |
Debt Fixed Rate | 5.25% | |
Cash flow hedge | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 2,892,146,000 | |
Cash flow hedge | Celebrity Reflection term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 299,979,000 | |
All-in Swap Fixed Rate | 2.85% | |
Cash flow hedge | Quantum of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 459,375,000 | |
All-in Swap Fixed Rate | 3.74% | |
Cash flow hedge | Anthem of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 483,333,000 | |
All-in Swap Fixed Rate | 3.86% | |
Cash flow hedge | Ovation of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 622,500,000 | |
All-in Swap Fixed Rate | 3.16% | |
Cash flow hedge | Harmony of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 566,959,000 | [1] |
All-in Swap Fixed Rate | 2.26% | [1] |
Cash flow hedge | Odyssey of the Seas | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Swap notional amount | $ 460,000,000 | [2] |
All-in Swap Fixed Rate | 3.20% | [2] |
LIBOR | Fair Value Hedging | Oasis of the Seas term loan | ||
Interest Rate Fair Value Hedges [Abstract] | ||
Swap Floating Rate: LIBOR plus | 3.87% | |
All-in swap floating rate | 6.49% | |
LIBOR | Fair Value Hedging | Unsecured senior notes | ||
Interest Rate Fair Value Hedges [Abstract] | ||
Swap Floating Rate: LIBOR plus | 3.63% | |
All-in swap floating rate | 5.79% | |
LIBOR | Cash flow hedge | Celebrity Reflection term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Debt Floating Rate | 0.40% | |
LIBOR | Cash flow hedge | Quantum of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Debt Floating Rate | 1.30% | |
LIBOR | Cash flow hedge | Anthem of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Debt Floating Rate | 1.30% | |
LIBOR | Cash flow hedge | Ovation of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Debt Floating Rate | 1.00% | |
LIBOR | Cash flow hedge | Odyssey of the Seas | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Debt Floating Rate | 0.95% | [2] |
EURIBOR | Cash flow hedge | Harmony of the Seas term loan | ||
Interest Rate Cash Flow Hedges [Abstract] | ||
Debt Floating Rate | 1.15% | [1] |
[1] | Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of September 30, 2019 . | |
[2] | Interest rate swap agreements hedging the term loan for Odyssey of the Seas includes a LIBOR zero-floor matching the hedged debt LIBOR zero-floor. The anticipated unsecured term loan for the financing of Odyssey of the Seas is expected to be drawn in October 2020. |
Fair Value Measurements and D_8
Fair Value Measurements and Derivative Instruments - Fuel Price Risk (Details) - Fuel Swap Agreements $ in Millions | Sep. 30, 2019USD ($)T | Dec. 31, 2018T |
Derivative Instruments | ||
Estimated unrealized net loss associated with cash flow hedges pertaining to fuel swap agreements expected to be reclassified to earnings from accumulated other comprehensive income loss | $ | $ 25.4 | |
2019 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 221,150 | 856,800 |
Percentage of projected requirements | 60.00% | 58.00% |
2020 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 830,468 | 830,500 |
Percentage of projected requirements | 55.00% | 54.00% |
2021 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 488,900 | 488,900 |
Percentage of projected requirements | 30.00% | 28.00% |
2022 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 322,900 | 322,900 |
Percentage of projected requirements | 19.00% | 19.00% |
2023 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 82,400 | 0 |
Percentage of projected requirements | 5.00% | 0.00% |
Fair Value Measurements and D_9
Fair Value Measurements and Derivative Instruments - Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Asset Derivatives | |||
Asset Derivatives | $ 30,883 | $ 65,297 | |
Liability Derivatives | |||
Liability Derivatives | 385,576 | 201,812 | |
Designated as Hedging Instrument | |||
Asset Derivatives | |||
Asset Derivatives | [1] | 25,705 | 58,576 |
Liability Derivatives | |||
Liability Derivatives | [1] | 381,738 | 199,795 |
Notional Disclosures | |||
Carrying Amount of the Hedged Liabilities | 734,811 | 725,486 | |
Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities | 1,097 | (24,766) | |
Not Designated as Hedging Instrument | |||
Asset Derivatives | |||
Asset Derivatives | 5,178 | 6,721 | |
Liability Derivatives | |||
Liability Derivatives | 3,838 | 2,017 | |
Interest rate swaps | Designated as Hedging Instrument | Other assets | |||
Asset Derivatives | |||
Asset Derivatives | [1] | 1,415 | 23,518 |
Interest rate swaps | Designated as Hedging Instrument | Other long-term liabilities | |||
Liability Derivatives | |||
Liability Derivatives | [1] | 85,004 | 40,467 |
Foreign currency forward contracts | Designated as Hedging Instrument | Other assets | |||
Asset Derivatives | |||
Asset Derivatives | [1] | 13,351 | 10,844 |
Foreign currency forward contracts | Designated as Hedging Instrument | Derivative financial instruments | |||
Asset Derivatives | |||
Asset Derivatives | [1] | 0 | 4,044 |
Liability Derivatives | |||
Liability Derivatives | [1] | 54,985 | 39,665 |
Foreign currency forward contracts | Designated as Hedging Instrument | Other long-term liabilities | |||
Liability Derivatives | |||
Liability Derivatives | [1] | 144,592 | 16,854 |
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other assets | |||
Asset Derivatives | |||
Asset Derivatives | 0 | 1,579 | |
Foreign currency forward contracts | Not Designated as Hedging Instrument | Derivative financial instruments | |||
Asset Derivatives | |||
Asset Derivatives | 3,811 | 1,751 | |
Liability Derivatives | |||
Liability Derivatives | 3,046 | 808 | |
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other long-term liabilities | |||
Liability Derivatives | |||
Liability Derivatives | 0 | 833 | |
Fuel swaps | Designated as Hedging Instrument | Other assets | |||
Asset Derivatives | |||
Asset Derivatives | [1] | 4,241 | 9,204 |
Fuel swaps | Designated as Hedging Instrument | Derivative financial instruments | |||
Asset Derivatives | |||
Asset Derivatives | [1] | 6,698 | 10,966 |
Liability Derivatives | |||
Liability Derivatives | [1] | 43,160 | 37,627 |
Fuel swaps | Designated as Hedging Instrument | Other long-term liabilities | |||
Liability Derivatives | |||
Liability Derivatives | [1] | 53,997 | 65,182 |
Fuel swaps | Not Designated as Hedging Instrument | Other assets | |||
Asset Derivatives | |||
Asset Derivatives | 243 | 587 | |
Fuel swaps | Not Designated as Hedging Instrument | Derivative financial instruments | |||
Asset Derivatives | |||
Asset Derivatives | 1,124 | 2,804 | |
Liability Derivatives | |||
Liability Derivatives | 370 | 376 | |
Fuel swaps | Not Designated as Hedging Instrument | Other long-term liabilities | |||
Liability Derivatives | |||
Liability Derivatives | $ 422 | $ 0 | |
[1] | Accounting Standard Codification 815-20 “ Derivatives and Hedging. ” |
Fair Value Measurements and _10
Fair Value Measurements and Derivative Instruments - Income Statement Hedging Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Fuel | $ 177,677 | $ 182,415 | $ 519,772 | $ 515,065 |
Depreciation and amortization | 320,295 | 259,923 | 924,180 | 753,529 |
Interest Income (Expense) | (96,413) | (80,679) | (292,006) | (209,590) |
Other income (expense) | (7,668) | (3,832) | (34,537) | 5,923 |
Fair Value Hedging | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | (4,116) | 2,124 | (25,862) | 18,680 |
Amount of Gain (Loss) Recognized in Income on Derivative | 2,920 | (3,512) | 19,699 | (21,392) |
Fair Value Hedging | Interest contracts | Interest income (expense), net of interest capitalized | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | (4,116) | 2,124 | (25,862) | 18,680 |
Amount of Gain (Loss) Recognized in Income on Derivative | 2,920 | (3,512) | 19,699 | (21,392) |
Fair Value Hedging | Interest contracts | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | 0 | 0 | 0 | 0 |
Amount of Gain (Loss) Recognized in Income on Derivative | 0 | 0 | 0 | 0 |
Fair Value Hedging | Interest rate swaps | Interest income (expense), net of interest capitalized | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | (4,116) | 2,124 | (25,862) | 18,680 |
Amount of Gain (Loss) Recognized in Income on Derivative | 2,920 | (3,512) | 19,699 | (21,392) |
Cash flow hedge | Interest contracts | Interest income (expense), net of interest capitalized | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income | (373) | (1,395) | (1,173) | (10,371) |
Cash flow hedge | Fuel swaps | Fuel cost | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income | 2,435 | 4,548 | 33,815 | 1,459 |
Cash flow hedge | Fuel swaps | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income | (472) | 466 | (1,916) | 658 |
Cash flow hedge | Foreign exchange contracts | Depreciation and amortization expenses | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income | (3,592) | (3,157) | (10,471) | (9,625) |
Cash flow hedge | Foreign exchange contracts | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) into income | $ (1,251) | $ (835) | $ (3,866) | $ 13,808 |
Fair Value Measurements and _11
Fair Value Measurements and Derivative Instruments - Balance Sheet Hedging Instruments (Details) - Foreign currency debt - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Derivative Instruments | ||
Carrying value of non-derivative instrument designated as hedging instrument | $ 311,797 | $ 320,152 |
Current portion of debt | ||
Derivative Instruments | ||
Carrying value of non-derivative instrument designated as hedging instrument | 69,399 | 38,168 |
Long-term debt | ||
Derivative Instruments | ||
Carrying value of non-derivative instrument designated as hedging instrument | $ 242,398 | $ 281,984 |
Fair Value Measurements and _12
Fair Value Measurements and Derivative Instruments - Designated Cash Flow Hedges (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative | $ (268,478) | $ 36,574 | $ (271,726) | $ 106,505 | |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (3,253) | (373) | 16,389 | (4,071) | |
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net [Abstract] | |||||
Net inception fair value at January 1, 2019 | $ (8,359) | ||||
Amount of gain recognized in income on derivatives for the period ended September 30, 2019 | 2,790 | ||||
Amount of loss remaining to be amortized in accumulated other comprehensive loss, as of September 30, 2019 | (4,056) | ||||
Fair value at September 30, 2019 | (9,625) | (9,625) | |||
Interest rate swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative | (23,488) | 10,166 | (91,949) | 56,223 | |
Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative | (131,523) | (35,397) | (202,273) | (133,360) | |
Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative | 0 | 0 | 0 | 0 | |
Fuel swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative | 0 | 0 | 0 | 0 | |
Fuel swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative | (113,467) | 61,805 | 22,496 | 183,642 | |
Interest income (expense), net of interest capitalized | Interest rate swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (373) | (1,395) | (1,173) | (10,371) | |
Depreciation and amortization expenses | Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (3,592) | (3,157) | (10,471) | (9,625) | |
Other income (expense) | Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (1,251) | (835) | (3,866) | 13,808 | |
Other income (expense) | Fuel swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | (472) | 466 | (1,916) | 658 | |
Fuel | Fuel swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | $ 2,435 | $ 4,548 | $ 33,815 | $ 1,459 |
Fair Value Measurements and _13
Fair Value Measurements and Derivative Instruments - Non-Derivative Net Investment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Foreign Currency Debt | ||||
Net investment hedge | ||||
Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss) | $ 12,811 | $ 1,700 | $ 15,519 | $ 9,309 |
Fair Value Measurements and _14
Fair Value Measurements and Derivative Instruments - Derivatives Not Designated as Hedging Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | $ (24,940) | $ (11,647) | $ (24,229) | $ (41,397) |
Foreign currency forward contracts | Other income (expense) | ||||
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | (26,035) | (12,097) | (25,189) | (43,356) |
Fuel swaps | Other income (expense) | ||||
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | 1,095 | (28) | 974 | 155 |
Fuel swaps | Fuel cost | ||||
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | $ 0 | $ 478 | $ (14) | $ 1,804 |
Fair Value Measurements and _15
Fair Value Measurements and Derivative Instruments - Credit Features (Details) | Sep. 30, 2019derivative |
Fair Value Disclosures [Abstract] | |
Number of derivatives matured | 5 |
Uncategorized Items - a2019q310
Label | Element | Value |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (23,476,000) |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (23,476,000) |