Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 16, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | NCL CORP Ltd. | ||
Entity Central Index Key | 1,318,742 | ||
Trading Symbol | nclc | ||
Entity Current Reporting Status | No | ||
Entity Voluntary Filers | Yes | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Common Stock Shares Outstanding | 31,164,004 | ||
Entity Public Float | $ 0 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | |||
Passenger ticket | $ 3,750,030 | $ 3,388,954 | $ 3,129,075 |
Onboard and other | 1,646,145 | 1,485,386 | 1,215,973 |
Total revenue | 5,396,175 | 4,874,340 | 4,345,048 |
Cruise operating expense | |||
Commissions, transportation and other | 894,406 | 813,559 | 765,298 |
Onboard and other | 319,293 | 298,886 | 272,802 |
Payroll and related | 803,632 | 746,142 | 666,110 |
Fuel | 361,032 | 335,174 | 358,650 |
Food | 198,357 | 200,071 | 179,641 |
Other | 486,924 | 456,393 | 412,948 |
Total cruise operating expense | 3,063,644 | 2,850,225 | 2,655,449 |
Other operating expense | |||
Marketing, general and administrative | 771,122 | 662,671 | 551,180 |
Depreciation and amortization | 509,957 | 432,495 | 432,114 |
Total other operating expense | 1,281,079 | 1,095,166 | 983,294 |
Operating income | 1,051,452 | 928,949 | 706,305 |
Non-operating income (expense) | |||
Interest expense, net | (267,782) | (276,859) | (221,859) |
Other income (expense), net | (10,401) | (8,302) | (46,668) |
Total non-operating income (expense) | (278,183) | (285,161) | (268,527) |
Net income before income taxes | 773,269 | 643,788 | 437,778 |
Income tax benefit (expense) | (14,474) | (65) | 22 |
Net income | $ 758,795 | $ 643,723 | $ 437,800 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net income | $ 758,795 | $ 643,723 | $ 437,800 |
Other comprehensive income (loss): | |||
Shipboard Retirement Plan | (40) | 497 | 1,102 |
Cash flow hedges: | |||
Net unrealized gain (loss) related to cash flow hedges | 304,684 | 1,711 | (262,852) |
Amount realized and reclassified into earnings | 36,795 | 95,969 | 91,742 |
Total other comprehensive income (loss) | 341,439 | 98,177 | (170,008) |
Total comprehensive income | $ 1,100,234 | $ 741,900 | $ 267,792 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 170,757 | $ 126,041 |
Accounts receivable, net | 43,961 | 63,215 |
Inventories | 82,121 | 66,255 |
Prepaid expenses and other assets | 216,111 | 153,168 |
Total current assets | 512,950 | 408,679 |
Property and equipment, net | 11,040,488 | 10,117,689 |
Goodwill | 1,388,931 | 1,388,931 |
Tradenames | 817,525 | 817,525 |
Other long-term assets | 310,445 | 218,295 |
Total assets | 14,070,339 | 12,951,119 |
Current liabilities: | ||
Current portion of long-term debt | 619,373 | 560,193 |
Accounts payable | 53,317 | 37,946 |
Accrued expenses and other liabilities | 512,504 | 541,906 |
Due to NCLH | 61,732 | 44,104 |
Advance ticket sales | 1,303,498 | 1,172,870 |
Total current liabilities | 2,550,424 | 2,357,019 |
Long-term debt | 5,688,392 | 5,838,494 |
Other long-term liabilities | 162,919 | 267,933 |
Total liabilities | 8,401,735 | 8,463,446 |
Commitments and contingencies (Note 11) | ||
Shareholders' equity: | ||
Ordinary shares, $.0012 par value; 40,000,000 shares authorized; 31,164,004 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively | 37 | 37 |
Additional paid-in capital | 3,874,586 | 3,796,042 |
Accumulated other comprehensive income (loss) | 25,253 | (316,186) |
Retained earnings | 1,768,728 | 1,007,780 |
Total shareholders' equity | 5,668,604 | 4,487,673 |
Total liabilities and shareholders' equity | $ 14,070,339 | $ 12,951,119 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Ordinary shares, par value (in dollars per share) | $ 0.0012 | $ 0.0012 |
Ordinary shares, authorized | 40,000,000 | 40,000,000 |
Ordinary shares, issued | 31,164,004 | 31,164,004 |
Ordinary shares, outstanding | 31,164,004 | 31,164,004 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities | |||
Net income | $ 758,795 | $ 643,723 | $ 437,800 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization expense | 521,484 | 445,635 | 450,335 |
(Gain) loss on derivatives | (103) | 79 | 26,525 |
Deferred income taxes, net | 10,849 | (3,594) | (363) |
Gain on contingent consideration | (43,400) | ||
Write-off of financing fees | 6,705 | 18,930 | 4,070 |
Provision for bad debts and inventory | 2,431 | 3,866 | 5,029 |
Share-based compensation expense | 87,039 | 66,414 | 42,209 |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | 15,050 | (20,983) | (14,803) |
Inventories | (17,129) | (9,184) | (4,408) |
Prepaid expenses and other assets | (22,868) | (18,472) | (10,321) |
Accounts payable | 13,987 | (5,794) | (52,740) |
Accrued expenses and other liabilities | 64,766 | (3,679) | (2,246) |
Advance ticket sales | 154,012 | 134,971 | 218,260 |
Payment of original issue discount | (1,647) | ||
Net cash provided by operating activities | 1,595,018 | 1,251,912 | 1,054,300 |
Cash flows from investing activities | |||
Additions to property and equipment, net | (1,372,214) | (1,092,091) | (1,121,984) |
Net proceeds from sale of Hawaii land-based operations | 499 | ||
Promissory note | 165 | ||
Cash received on settlement of derivatives | 2,346 | 131 | 2,832 |
Cash paid on settlement of derivatives | (35,694) | (36,954) | (86,351) |
Investment in trademark | (750) | ||
Net cash used in investing activities | (1,404,898) | (1,128,914) | (1,206,253) |
Cash flows from financing activities | |||
Repayments of long-term debt | (1,916,885) | (3,744,029) | (1,569,313) |
Repayments to Affiliate | (18,522) | (37,042) | |
Proceeds from long-term debt | 1,816,390 | 3,753,928 | 1,855,809 |
Dividends | (64,000) | (85,999) | |
Net share settlement of restricted share units | (6,342) | ||
Due to NCLH | 17,628 | 11,372 | 35,814 |
Deferred financing fees and other | (56,195) | (48,889) | (16,995) |
Net cash provided by (used in) financing activities | (145,404) | (110,140) | 182,274 |
Net increase in cash and cash equivalents | 44,716 | 12,858 | 30,321 |
Cash and cash equivalents at beginning of year | 126,041 | 113,183 | 82,862 |
Cash and cash equivalents at end of year | $ 170,757 | $ 126,041 | $ 113,183 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Ordinary Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total |
Balance at Dec. 31, 2014 | $ 37 | $ 3,687,419 | $ (244,355) | $ 76,256 | $ 3,519,357 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 42,209 | 42,209 | |||
Dividends | (85,999) | (85,999) | |||
Other comprehensive income (loss) | (170,008) | (170,008) | |||
Net income | 437,800 | 437,800 | |||
Balance at Dec. 31, 2015 | 37 | 3,729,628 | (414,363) | 428,057 | 3,743,359 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 66,414 | 66,414 | |||
Dividends | (64,000) | (64,000) | |||
Other comprehensive income (loss) | 98,177 | 98,177 | |||
Net income | 643,723 | 643,723 | |||
Balance at Dec. 31, 2016 | 37 | 3,796,042 | (316,186) | 1,007,780 | 4,487,673 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation | 87,039 | 87,039 | |||
Change in accounting policy (share-based forfeitures) | (2,153) | 2,153 | |||
Net share settlement of restricted share units | (6,342) | (6,342) | |||
Other comprehensive income (loss) | 341,439 | 341,439 | |||
Net income | 758,795 | 758,795 | |||
Balance at Dec. 31, 2017 | $ 37 | $ 3,874,586 | $ 25,253 | $ 1,768,728 | $ 5,668,604 |
Description of Business and Org
Description of Business and Organization | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Organization | 1. Description of Business and Organization We are a leading global cruise company which operates the Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises brands. As of December 31, 2017, we had 25 ships with approximately 50,400 Berths. We plan to introduce seven additional ships through 2025 and we have an option to introduce two additional ships for delivery in 2026 and 2027, subject to certain conditions. Norwegian Bliss and Norwegian Encore are on order for delivery in the spring of 2018 and fall of 2019, respectively. We also have an Explorer Class Ship, Seven Seas Splendor, on order for delivery in the winter of 2020. Project Leonardo will introduce an additional four ships with expected delivery dates through 2025. These additions to our fleet (exclusive of the option for two additional ships) will increase our total Berths to approximately 72,300. Norwegian commenced operations from Miami in 1966. In February 2000, Genting HK acquired control of and subsequently became the sole owner of the Norwegian operations. In January 2008, the Apollo Holders acquired 50% of the outstanding ordinary share capital of NCLC. As part of this investment, the Apollo Holders assumed control of NCLC’s Board of Directors. Also, in January 2008, the TPG Viking Funds acquired, in the aggregate, 12.5% of NCLC’s outstanding share capital from the Apollo Holders. In February 2011, NCLH, a Bermuda limited company, was formed with the issuance to the Sponsors of, in aggregate, 10,000 ordinary shares, with a par value of $.001 per share. In January 2013, NCLH completed its IPO, pursuant to which it sold 27,058,824 ordinary shares for net proceeds, after deducting underwriting discounts and commissions and expenses, of approximately $473.9 million. In connection with the consummation of the IPO, the Sponsors’ ordinary shares in NCLC were exchanged for the ordinary shares of NCLH, and NCLH became the owner of 100% of the ordinary shares and parent company of NCLC (the “Corporate Reorganization”). At the same time, NCLH contributed $460.0 million to NCLC and the historical financial statements of NCLC became those of NCLH. The Corporate Reorganization was effected solely for the purpose of reorganizing our corporate structure. NCLH had not, prior to the completion of the Corporate Reorganization, conducted any activities other than those incidental to its formation and to prepare for the Corporate Reorganization and the IPO. As the economic position of the investors did not change as part of the Corporate Reorganization it was considered a nonstubstantive merger from an accounting perspective. In November 2014, we completed the Acquisition of Prestige. We believe that the combination of Norwegian and Prestige creates a cruise operating company with a rich product portfolio and strong market presence. The Sponsors have completed numerous Secondary Equity Offerings and as of December 31, 2017 have reduced their ownership to 16.8% of NCLH’s ordinary shares (we refer you to Note 7— “Related Party Disclosures”). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and contain all normal recurring adjustments necessary for a fair presentation of the results for the periods presented. Estimates are required for the preparation of consolidated financial statements in accordance with generally accepted accounting principles and actual results could differ from these estimates. All significant intercompany accounts and transactions are eliminated in consolidation. Reclassification Certain amounts in prior periods have been reclassified to properly reflect promotional discounts allocated between passenger ticket revenue to onboard and other revenue. During the fourth quarter of 2017 we reclassified $21.9 million of revenue from passenger ticket revenue to onboard and other revenue for the prior three quarters. This cumulative adjustment for 2017 amends the multi-element allocation of revenue between these two financial statement line items. This change does not impact total revenue or net income, nor did it impact any periods in 2016 or 2015. Cash and Cash Equivalents Cash and cash equivalents are stated at cost, and include cash and investments with original maturities of three months or less at acquisition and also include amounts due from credit card processors. Restricted Cash Restricted cash consists of cash collateral in respect of certain agreements and is included in prepaid expenses and other assets and other long-term assets in our consolidated balance sheets. Accounts Receivable, Net Accounts receivable are shown net of an allowance for doubtful accounts of $5.9 million and $4.7 million as of December 31, 2017 and 2016, respectively. Inventories Inventories mainly consist of provisions, supplies and fuel and are carried at the lower of cost or net realizable value using the first-in, first-out method of accounting. Advertising Costs Advertising costs are expensed as incurred except for those that result in tangible assets, including brochures, which are treated as prepaid expenses and charged to expense as consumed. Advertising costs of $2.4 million and $1.3 million as of December 31, 2017 and 2016, respectively, are included in prepaid expenses and other assets. Expenses related to advertising costs totaled $289.1 million, $270.5 million and $232.2 million for the years ended December 31, 2017, 2016 and 2015, respectively. Property and Equipment, Net Property and equipment are recorded at cost. Major renewals and improvements that we believe add value to our ships are capitalized as a cost of the ship while costs of repairs and maintenance, including Dry-dock costs, are charged to expense as incurred. During ship construction, certain interest is capitalized as a cost of the ship. Gains or losses on the sale of property and equipment are recorded as a component of operating income (expense) in our consolidated statements of operations. Depreciation is computed on the straight-line basis over the estimated useful lives of the assets, after a 15% reduction for the estimated residual values of ships as follows: Useful Life Ships 30 years Computer hardware and software 3-10 years Other property and equipment 3-40 years Leasehold improvements Shorter of lease term or asset life Ship improvements Shorter of asset life or life of the ship Long-lived assets are reviewed for impairment, based on estimated future undiscounted cash flows, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Assets are grouped and evaluated at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets. We consider historical performance and future estimated results in our evaluation of potential impairment and then compare the carrying amount of the asset to the estimated future cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds estimated expected undiscounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value. We estimate fair value based on the best information available utilizing estimates, judgments and projections as necessary. Our estimate of fair value is generally measured by discounting expected future cash flows at discount rates commensurate with the associated risk. Goodwill and Tradenames Goodwill represents the excess of cost over the fair value of net assets acquired. Goodwill and other indefinite-lived assets, principally tradenames, are reviewed for impairment on an annual basis or earlier if there is an event or change in circumstances that would indicate that the carrying value of these assets may not be fully recoverable. We use the Step 0 Test which allows us to first assess qualitative factors to determine whether it is more likely than not (i.e., more than 50%) that the fair value of a reporting unit is less than its carrying value. For tradenames we also provide a qualitative assessment to determine if there is any indication of impairment. In order to make this evaluation, we consider the following circumstances as well as others: · Changes in general macroeconomic conditions such as a deterioration in general economic conditions; limitations on accessing capital; fluctuations in foreign exchange rates; or other developments in equity and credit markets; · Changes in industry and market conditions such as a deterioration in the environment in which an entity operates; an increased competitive environment; a decline in market-dependent multiples or metrics (in both absolute terms and relative to peers); a change in the market for an entity’s products or services; or a regulatory or political development; · Changes in cost factors that have a negative effect on earnings and cash flows; · Decline in overall financial performance (for both actual and expected performance); · Entity and reporting unit specific events such as changes in management, key personnel, strategy, or customers; litigation; or a change in the composition or carrying amount of net assets; and · Decline in share price (in both absolute terms and relative to peers). We have concluded that our business has three reporting units. Each brand, Norwegian, Regent and Oceania Cruises, constitutes a business for which discrete financial information is available and management regularly reviews the operating results and, therefore, each brand is considered an operating segment. For our annual impairment evaluation, we performed a Step 0 Test for the Norwegian, Regent Seven Seas and Oceania Cruises reporting units. As of December 31, 2017, there was $523.0 million, $462.1 million and $403.8 million of goodwill for the Oceania Cruises, Regent Seven Seas and Norwegian reporting units, respectively. As of December 31, 2017, our annual review consisting of the Step 0 Test supports the carrying value of these assets. Revenue and Expense Recognition Deposits received from guests for future voyages are recorded as advance ticket sales and are subsequently recognized as passenger ticket revenue on a pro-rata basis over the period of the voyage, concurrent with recognition of onboard and other revenue and with recognition of all associated direct costs of a voyage as cruise operating expenses. Guest cancellation fees are recognized in passenger ticket revenue in the month of the cancellation. Certain of our product offerings are accounted for under the guidance included within multi-element arrangements and result in an allocation of the fair value between passenger ticket revenue and onboard and other revenue. Revenue and expenses include port fees and taxes. The amounts included on a gross basis are $327.4 million, $286.6 million and $243.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. Debt Issuance Costs Debt issuance costs related to a recognized debt liability are presented in the consolidated balance sheets as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. For line of credit arrangements and for those debt facilities not fully drawn we defer and present debt issuance costs as an asset. These deferred issuance costs are amortized over the life of the loan agreement. The amortization of deferred financing fees is included in depreciation and amortization expense in the consolidated statements of cash flows; however, for purposes of the consolidated statements of operations it is included in interest expense, net. Foreign Currency The majority of our transactions are settled in U.S. dollars. Gains or losses resulting from transactions denominated in other currencies are recognized in income at each balance sheet date. We recognized losses for the year ended December 31, 2017 of $14.2 million and gains were approximately $4.5 million and $11.0 million for the years ended December 31, 2016 and 2015, respectively. Derivative Instruments and Hedging Activity We enter into derivative contracts to reduce our exposure to fluctuations in foreign currency exchange rates, interest rates and fuel prices. The criteria used to determine whether a transaction qualifies for hedge accounting treatment includes the correlation between fluctuations in the fair value of the hedged item and the fair value of the related derivative instrument and its effectiveness as a hedge. As the derivative is marked to fair value, we elected an accounting policy to net the fair value of our derivatives when a master netting arrangement exists with our counterparties. A derivative instrument that hedges a forecasted transaction or the variability of cash flows related to a recognized asset or liability may be designated as a cash flow hedge. Changes in fair value of derivative instruments that are designated as cash flow hedges are recorded as a component of accumulated other comprehensive income (loss) until the underlying hedged transactions are recognized in earnings. To the extent that an instrument is not effective as a hedge, gains and losses are recognized in other income (expense), net in our consolidated statements of operations. Realized gains and losses related to our effective fuel hedges are recognized in fuel expense. For presentation in our consolidated statements of cash flows, we have elected to classify the cash flows from our cash flow hedges in the same category as the cash flows from the items being hedged. Concentrations of Credit Risk We monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. Credit risk, including but not limited to counterparty non-performance under derivative instruments, our New Revolving Loan Facility and new ship progress payment guarantees, is not considered significant, as we primarily conduct business with large, well-established financial institutions and insurance companies that we have well-established relationships with and that have credit risks acceptable to us or the credit risk is spread out among a large number of creditors. We do not anticipate non-performance by any of our significant counterparties. Insurance We use a combination of insurance and self-insurance for a number of risks including claims related to crew and guests, hull and machinery, war risk, workers’ compensation, property damage, employee healthcare and general liability. Liabilities associated with certain of these risks, including crew and passenger claims, are estimated actuarially based upon known facts, historical trends and a reasonable estimate of future expenses. While we believe these accruals are adequate, the ultimate losses incurred may differ from those recorded. Income Taxes Deferred tax assets and liabilities are calculated in accordance with the liability method. Deferred taxes are recorded using the currently enacted tax rates that apply in the periods that the differences are expected to reverse. Deferred taxes are not discounted. We provide a valuation allowance on deferred tax assets when it is more likely than not that such assets will not be realized. With respect to acquired deferred tax assets, future reversals of the valuation allowance will first be applied against goodwill and other intangible assets before recognition of a benefit in our consolidated statements of operations. Share-Based Compensation We recognize expense for our share-based compensation awards using a fair-value-based method. Share-based compensation expense is recognized over the requisite service period for awards that are based on a service period and not contingent upon any future performance. We refer you to Note 9—“Employee Benefits and Share-Based Compensation.” Segment Reporting We have concluded that our business has a single reportable segment. Each brand, Norwegian, Oceania Cruises and Regent constitutes a business for which discrete financial information is available and management regularly reviews the operating results and, therefore, each brand is considered an operating segment. Our operating segments have similar economic and qualitative characteristics, including similar long-term margins and similar products and services; therefore, we aggregate all of the operating segments into one reportable segment. Although we sell cruises on an international basis, our passenger ticket revenue is primarily attributed to U.S.-sourced guests who make reservations in the U.S. Revenue attributable to U.S.-sourced guests was 77%, 81% and 75% for the years ended December 31, 2017, 2016 and 2015, respectively. No other individual country’s revenues exceeded 10% in any of our last three years. Revenues by destination were as follows (in thousands): Year Ended December 31, 2017 2016 2015 North America $ 3,285,903 $ 3,132,208 $ 2,743,007 Europe 1,347,381 1,148,403 1,120,705 Asia-Pacific 394,631 196,978 198,131 Other 368,260 396,751 283,205 Total Revenues $ 5,396,175 $ 4,874,340 $ 4,345,048 Substantially all of our long- lived assets are located outside of the U.S. and consist primarily of our ships. We have 17 ships with Bahamas registry with a carrying value of $8.0 billion as of December 31, 2017 and 16 ships with Bahamas registry with a carrying value of $7.1 billion as of December 31, 2016. We have seven ships with Marshall Island registry with a carrying value of $1.9 billion as of December 31, 2017 and 2016. We also have one ship with U.S. registry with a carrying value of $0.3 billion as of December 31, 2017 and 2016. Recently Issued Accounting Guidance In December 2017, the Tax Cuts and Jobs Act (“the Act”) was enacted. Among other provisions, the Act reduces the U.S. federal corporate tax rate from 35% to 21%. The SEC staff issued SAB No. 118, which addresses how a company recognizes provisional amounts when a company does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the effect of the changes in the Act. The measurement period ends when a company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. As of December 31, 2017, we have not completed the accounting for the tax effects of enactment of the Act; however, as described below, we have made a reasonable estimate of the effects on existing deferred tax balances. These amounts are provisional and subject to change. The most significant impact of the Act for the Company was a $4.5 million reduction of the value of net deferred tax liabilities (which represent future tax expenses) that was recorded as a discrete tax benefit as a result of lowering the U.S. corporate income tax rate from 35% to 21%. The tax benefit represents a provisional amount and the Company’s current best estimates. Any adjustments recorded to the provisional amount through the end of 2018 will be included in income from operations as an adjustment to tax expense. The provisional amounts incorporate assumptions made based upon the Company’s current interpretation of the Act and may change as the Company receives additional clarification and implementation guidance. Other aspects of the Act are either not applicable or not expected to have a material impact on the Company’s financial statements. In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-12. The objectives of this ASU are to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements and to make certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. This ASU is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. We will adopt in the first quarter of 2018. For cash flow hedges, a cumulative-effect adjustment relating to the elimination of the separate measurement of ineffectiveness to accumulated other comprehensive income is required with a corresponding adjustment to the opening balance of retained earnings. The presentation and disclosure guidance is required prospectively. In January 2017, the FASB issued ASU No. 2017-04 which simplifies the test for goodwill impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The guidance is effective for annual or any interim goodwill impairment tests in years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect to early adopt this guidance. We will evaluate the impact upon adoption of this guidance to our consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16 which requires companies to recognize the income-tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than when the asset has been sold to an outside party. We will adopt the new standard effective January 1, 2018. No cumulative-effect adjustment is necessary as the Company did not have previously unamortized deferred income tax expense from past intra-entity transfers. In August 2016, the FASB issued ASU No. 2016-15 which amends Topic 230 (Statement of Cash Flows) to eliminate discrepancies in reporting certain items in the statement of cash flows. We will adopt a retrospective application in the first quarter of 2018. Currently, the only transactions that will require a reclassification is in connection with our debt extinguishment and deferred financing fees. In February 2016, the FASB issued ASU No. 2016-02 which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The ASU requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The ASU further modifies lessors’ classification criteria for leases and the accounting for sales-type and direct financing leases. The ASU will also require qualitative and quantitative disclosures designed to give financial statement users additional information on the amount, timing, and uncertainty of cash flows arising from leases. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2018 with early adoption permitted. The ASU is to be applied using a modified retrospective approach. To evaluate the impact of the adoption of this guidance, we are currently reviewing our existing leases and evaluating contracts to determine what might be considered a lease under the new guidance. In May 2014, the FASB issued ASU No. 2014-09 which requires entities to recognize revenue through the application of a five-step model, including identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligation and recognition of revenue as the entity satisfies the performance obligations. We will adopt a modified retrospective application in the first quarter of 2018. We have reviewed our contract and business processes and we are concluding on changes to our controls to support recognition and disclosure requirements. Based on our evaluation to date, we determined no significant changes are required to our business processes, systems and controls to effectively report revenue recognition under the new standard. Upon adoption we will reclassify to prepaid expenses and other assets from advanced ticket sales certain deferred costs incurred to obtain our contracts. Adoption of the new standard will require additional disclosures, however, it is not expected to materially change the timing, classification or amount of revenue recognized in our consolidated financial statements. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 3. Goodwill and Intangible Assets Goodwill and tradenames are not subject to amortization. As of December 31, 2017 and 2016, the carrying values were $1.4 billion for goodwill and $0.8 billion for tradenames. The gross carrying amounts of intangible assets included within other long-term assets, the related accumulated amortization, the net carrying amounts and the weighted-average amortization periods of the Company’s intangible assets are listed in the following tables (in thousands, except amortization period): December 31, 2017 Gross Carrying Accumulated Net Carrying Weighted- Customer relationship $ 120,000 $ (66,866 ) $ 53,134 6.0 Licenses 3,368 (1,601 ) 1,767 5.6 Non-compete agreements 660 (660 ) — 1.0 Total intangible assets subject to amortization $ 124,028 $ (69,127 ) $ 54,901 December 31, 2016 Gross Carrying Accumulated Net Carrying Weighted- Customer relationship $ 120,000 $ (36,593 ) $ 83,407 6.0 Licenses 3,368 (807 ) 2,561 5.6 Non-compete agreements 660 (495 ) 165 1.0 Total intangible assets subject to amortization $ 124,028 $ (37,895 ) $ 86,133 License (Indefinite-lived) $ 4,427 $ — $ — The aggregate amortization expense is as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amortization expense $ 31,232 $ 22,160 $ 73,207 The following table sets forth the Company’s estimated aggregate amortization expense for each of the five years below (in thousands): Year ended December 31, Amortization 2018 $ 26,163 2019 18,489 2020 9,906 2021 75 2022 75 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | 4. Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive income (loss) for the year ended December 31, 2017 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (316,186 ) $ (308,265 ) $ (7,921 ) Current period other comprehensive income before reclassifications 304,226 304,684 (458 ) Amounts reclassified 37,213 36,795 (1) 418 (2) Accumulated other comprehensive income (loss) at end of period $ 25,253 $ 33,214 (3) $ (7,961 ) (1) We refer you to Note 8—“Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. (3) Of the existing amounts related to derivatives designated as cash flow hedges, approximately $9.4 million of gain is expected to be reclassified into earnings in the next 12 months. Accumulated other comprehensive income (loss) for the year ended December 31, 2016 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (414,363 ) $ (405,945 ) $ (8,418 ) Current period other comprehensive income before reclassifications 1,776 1,711 65 Amounts reclassified 96,401 95,969 (1) 432 (2) Accumulated other comprehensive income (loss) at end of period $ (316,186 ) $ (308,265 ) $ (7,921 ) (1) We refer you to Note 8—“Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. Accumulated other comprehensive income (loss) for the year ended December 31, 2015 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (244,355 ) $ (234,835 ) $ (9,520 ) Current period other comprehensive income (loss) before reclassifications (262,227 ) (262,852 ) 625 Amounts reclassified 92,219 91,742 (1) 477 (2) Accumulated other comprehensive income (loss) at end of period $ (414,363 ) $ (405,945 ) $ (8,418 ) (1) We refer you to Note 8—“Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment, Net [Abstract] | |
Property and Equipment, Net | 5. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): December 31, 2017 2016 Ships $ 11,814,409 $ 10,781,703 Ships improvements 1,060,049 807,233 Ships under construction 521,597 450,372 Land and land improvements 37,535 37,535 Other 487,921 483,744 13,921,511 12,560,587 Less: accumulated depreciation (2,881,023 ) (2,442,898 ) Property and equipment, net $ 11,040,488 $ 10,117,689 The increase in ships was primarily due to the addition of Norwegian Joy. Depreciation and amortization expense for the years ended December 31, 2017, 2016 and 2015 was $510.0 million, $432.5 million and $432.1 million, respectively. Repairs and maintenance expenses including Dry-dock expenses were $157.2 million, $155.4 million and $124.8 million for the years ended December 31, 2017, 2016 and 2015, respectively, and were recorded within other cruise operating expense. Ships under construction include progress payments to the shipyard, planning and design fees and other associated costs. Capitalized interest costs which were primarily associated with the construction or revitalization of ships amounted to $29.0 million, $33.7 million and $31.9 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 6. Long-Term Debt Long-term debt consisted of the following: Interest Rate Maturities Balance 2017 2016 Through 2017 2016 (in thousands) $875.0 million senior secured revolving credit facility 3.27 % — 2021 $ 78,000 $ — $750.0 million senior secured revolving credit facility — 2.70 % 2021 — 129,000 Term Loan A 3.32 % — 2021 1,385,196 — $1,506.6 million term loan A facility — 2.77 % 2021 — 1,459,033 $375.0 million Term Loan B (1) 3.18 % — 2021 371,914 — $700.0 million 4.750% senior unsecured notes 4.75 % 4.75 % 2021 693,413 691,767 $600.0 million 4.625% senior unsecured notes — 4.63 % 2020 — 592,031 €662.9 million Norwegian Epic term loan (2) 3.44 % 3.00 % 2022 328,646 395,830 €308.1 million Pride of Hawai’i loan (2) 2.31 % 1.83 % 2018 18,438 54,601 $334.1 million Norwegian Jewel term loan — 1.83 % 2017 — 26,919 €258.0 million Pride of America Hermes loan (2) — 1.90 % 2017 — 12,654 €529.8 million Breakaway one loan (2) 2.97 % 2.49 % 2025 415,039 469,100 €529.8 million Breakaway two loan (2) 4.50 % 4.50 % 2026 482,133 537,478 €590.5 million Breakaway three loan (2) 2.98 % 2.98 % 2027 595,494 653,474 €729.9 million Breakaway four loan (2) 2.98 % 2.98 % 2029 758,595 150,834 €126 million Norwegian Jewel term loan (2) — 1.82 % 2017 — 7,260 €126 million Norwegian Jade term loan (2) — 1.82 % 2017 — 7,531 €666 million Seahawk 1 term loan (2) 3.92 % 3.92 % 2030 184,837 137,514 €666 million Seahawk 2 term loan (2) 3.92 % 3.92 % 2031 90,351 42,083 Sirena loan 2.75 % 2.75 % 2019 27,344 40,465 Explorer newbuild loan 3.43 % 3.43 % 2028 295,093 320,821 Marina newbuild loan (3) 2.00 % 1.54 % 2023 245,706 290,416 Riviera newbuild loan (4) 2.11 % 1.81 % 2024 292,183 337,174 Capital lease and license obligations Various Various 2028 45,383 42,702 Total debt 6,307,765 6,398,687 Less: current portion of long-term debt (619,373 ) (560,193 ) Total long-term debt $ 5,688,392 $ 5,838,494 (1) Includes original issue discount of $0.9 million as of December 31, 2017. (2) Currently U.S. dollar-denominated. (3) Includes premium of $0.2 million as of December 31, 2017 and 2016. (4) Includes premium of $0.2 million and $0.3 million as of December 31, 2017 and 2016, respectively. NCLC, a subsidiary of NCLH, entered into a Third Amended and Restated Credit Agreement, dated as of October 10, 2017, with a subsidiary of NCLC, as co-borrower and JPMorgan Chase Bank, N.A. (“JPM”), as administrative agent. This facility revised the $750.0 million senior secured credit facility to, among other things, (a) reprice and increase the existing $750 million revolving credit facility to a new $875 million revolving credit facility (the “New Revolving Loan Facility”), (b) reprice the approximately $1,412 million principal amount outstanding under the existing senior secured term A facility to (the “New Term A Loan Facility”), and (c) add a new $375 million term B loan facility due 2021 (the “New Term B Loan Facility”). The applicable margin under the New Term A Loan Facility and New Revolving Loan Facility is determined by reference to a total leverage ratio, with an applicable margin of between 2.00% and 1.25% with respect to Eurocurrency loans and between 1.00% and 0.25% with respect to base rate loans. The margin for borrowings under the New Term A Loan Facility and New Revolving Loan Facility is 1.75% with respect to Eurocurrency borrowings and 0.75% with respect to base rate borrowings. The applicable margin under the New Term B Loan Facility is 1.75% with respect to Eurocurrency loans and 0.75% with respect to base rate loans. NCLC used proceeds from the New Term B Loan Facility and cash on hand for the Redemption (as defined below). Concurrent with the refinancing of its loan facilities as described above, on October 10, 2017, NCLC completed the redemption of all its outstanding 4.625% Senior Notes due 2020 (“Notes”), at a price including accrued and unpaid interest, of $1,044.41 per $1,000 of outstanding principal amount of Notes so redeemed (the “Redemption”) using the proceeds from the New Term Loan B Facility and cash on hand. No Notes remained outstanding after the redemption. Interest expense, net for the year ended December 31, 2017 was $267.8 million which included $32.5 million of amortization of deferred financing fees and a $23.9 million loss on extinguishment of debt. Interest expense, net for the year ended December 31, 2016 was $276.9 million which included $34.7 million of amortization of deferred financing fees and a $27.7 million loss on extinguishment of debt. Interest expense, net for the year ended December 31, 2015 was $221.9 million which included $36.7 million of amortization of deferred financing fees and a $12.7 million loss on extinguishment of debt. Certain of our debt agreements contain covenants that, among other things, require us to maintain a minimum level of liquidity, as well as limit our net funded debt-to-capital ratio, maintain certain other ratios and restrict our ability to pay dividends. Substantially all of our ships and other property and equipment are pledged as collateral for certain of our debt. We believe we were in compliance with our covenants as of December 31, 2017. The following are scheduled principal repayments on long-term debt including capital lease obligations as of December 31, 2017 for each of the next five years (in thousands): Year Amount 2018 $ 619,373 2019 626,334 2020 622,129 2021 2,571,257 2022 431,674 Thereafter 1,553,815 Total $ 6,424,582 We had an accrued interest liability of $31.9 million and $32.5 million as of December 31, 2017 and 2016, respectively. |
Related Party Disclosures
Related Party Disclosures | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Disclosures | 7. Related Party Disclosures Transactions with Genting HK and the Apollo Holders As of December 31, 2017, the ownership percentages of NCLH’s ordinary shares were as follows: Shareholder Number of Percentage Apollo Holders (1) 25,478,782 11.2 % Genting HK (2) 12,898,307 5.6 % (1) The Apollo Holders include NCL Athene LLC, AIF VI NCL (AIV), L.P., AIF VI NCL (AIV II), L.P., AIF VI NCL (AIV III), L.P., AIF VI NCL (AIV IV), L.P., Apollo Overseas Partners (Delaware) VI, L.P., Apollo Overseas Partners (Delaware 892) VI, L.P., Apollo Overseas Partners VI, L.P., Apollo Overseas Partners (Germany) VI, L.P., AAA Guarantor—Co-Invest VII, L.P., AIF VI Euro Holdings, L.P., AIF VII Euro Holdings, L.P., Apollo Alternative Assets, L.P., Apollo Management VI, L.P. and Apollo Management VII, L.P. (2) Genting HK owns our ordinary share indirectly through Star NCLC Holdings Ltd., a Bermuda wholly-owned subsidiary. In December 2015, NCLH repurchased 348,553 ordinary shares under NCLH’s repurchase program as a part of a Secondary Equity Offering by the Apollo Holders and Genting HK for approximately $20.0 million. In June 2012, we exercised our option with Genting HK to purchase Norwegian Sky. We paid the total amount of $259.3 million to Genting HK in connection with the Norwegian Sky Purchase Agreement as of December 31, 2016 and no further payments are due. |
Fair Value Measurements and Der
Fair Value Measurements and Derivatives | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Derivatives | 8. Fair Value Measurements and Derivatives Fair value is defined as the price at which an orderly transaction to sell an asset or to transfer a liability would take place between market participants at the measurement date under current market conditions (that is, an exit price at the measurement date from the perspective of a market participant that holds the asset or owes the liability). Fair Value Hierarchy The following hierarchy for inputs used in measuring fair value should maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs be used when available: Level 1 Quoted prices in active markets for identical assets or liabilities that are accessible at the measurement dates. Level 2 Significant other observable inputs that are used by market participants in pricing the asset or liability based on market data obtained from independent sources. Level 3 Significant unobservable inputs we believe market participants would use in pricing the asset or liability based on the best information available. Derivatives We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We attempt to minimize these risks through a combination of our normal operating and financing activities and through the use of derivatives. We assess whether derivatives used in hedging transactions are “highly effective” in offsetting changes in the cash flow of our hedged forecasted transactions. We use regression analysis for this hedge relationship and high effectiveness is achieved when a statistically valid relationship reflects a high degree of offset and correlation between the fair values of the derivative and the hedged forecasted transaction. Cash flows from the derivatives are classified in the same category as the cash flows from the underlying hedged transaction. The determination of ineffectiveness is based on the amount of dollar offset between the cumulative change in fair value of the derivative and the cumulative change in fair value of the hedged transaction at the end of the reporting period. If it is determined that a derivative is not highly effective as a hedge, or if the hedged forecasted transaction is no longer probable of occurring, then the amount recognized in accumulated other comprehensive income (loss) is released to earnings. In addition, the ineffective portion of our highly effective hedges is recognized in earnings immediately and reported in other income (expense), net in our consolidated statements of operations. There are no amounts excluded from the assessment of hedge effectiveness and there are no credit-risk-related contingent features in our derivative agreements. We monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. Credit risk, including but not limited to counterparty non-performance under derivatives is not considered significant, as we primarily conduct business with large, well-established financial institutions that we have established relationships with and that have credit risks acceptable to us or the credit risk is spread out among a large number of creditors. We do not anticipate non-performance by any of our significant counterparties. The following table sets forth our derivatives measured at fair value and discloses the balance sheet location (in thousands): Asset Liability Balance Sheet location December 31, December 31, December 31, December 31, Fuel swaps designated as hedging instruments Prepaid expenses and other assets $ 19,220 $ 20,288 $ 2,406 $ — Other long-term assets 19,854 — 3,469 — Accrued expenses and other liabilities — — 3,348 44,271 Other long-term liabilities 576 13,237 2,148 38,608 Foreign currency forward contracts designated as hedging instruments Prepaid expenses and other assets 52,300 — 730 — Other long-term assets 85,081 14 — — Accrued expenses and other liabilities — — — 61,788 Other long-term liabilities — — — 88,920 Interest rate swaps designated as hedging instruments Accrued expenses and other liabilities — — 1,020 3,331 Other long-term liabilities — — — 1,151 The fair values of swap and forward contracts are determined based on observable inputs and utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity and other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest yield curves. The Company determines the value of options and collars utilizing an option pricing model based on inputs that are either readily available in public markets or can be derived from information available in publicly quoted markets. The option pricing model used by the Company is an industry standard model for valuing options and is used by the broker/dealer community. The inputs to this option pricing model are the option strike price, underlying price, risk-free rate of interest, time to expiration, and volatility. The fair value of option contracts considers both the intrinsic value and any remaining time value associated with those derivatives that have not yet settled. The Company also considers counterparty credit risk and its own credit risk in its determination of all estimated fair values. Our derivatives and financial instruments were categorized as Level 2 in the fair value hierarchy, and we had no derivatives or financial instruments categorized as Level 1 or Level 3. Our derivative contracts include rights of offset with our counterparties. We have elected to net certain assets and liabilities within counterparties when the rights of offset exist. We are not required to post cash collateral related to our derivative instruments. The following table discloses the gross and net amounts recognized within assets and liabilities (in thousands): December 31, 2017 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 176,455 $ (6,605 ) $ 169,850 $ (127,924 ) $ 41,926 Liabilities 6,516 (576 ) 5,940 (1,020 ) 4,920 December 31, 2016 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 20,302 $ — $ 20,302 $ (14 ) $ 20,288 Liabilities 238,069 (13,237 ) 224,832 (155,190 ) 69,642 Fuel Swaps As of December 31, 2017, we had fuel swaps maturing through December 31, 2020 which are used to mitigate the financial impact of volatility in fuel prices pertaining to approximately 1.2 million metric tons of our projected fuel purchases. The effects on the consolidated financial statements of the fuel swaps which were designated as cash flow hedges were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 50,263 $ 127,470 $ (173,513 ) Loss recognized in other income (expense), net – ineffective portion (317 ) (12,850 ) (16,011 ) Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 29,721 85,448 75,808 We had fuel swaps that matured which were not designated as cash flow hedges. These fuel swaps were previously designated as cash flow hedges and were dedesignated due to a change in our expected future fuel purchases mix. The effects on the consolidated financial statements of the fuel swaps which were dedesignated and recognized into earnings were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into other income (expense), net $ — $ 2,994 $ 10,000 Loss recognized in other income (expense), net — (271 ) (4,727 ) Foreign Currency Options We had foreign currency options that matured which consisted of call options with deferred premiums. These options were used to mitigate the financial impact of volatility in foreign currency exchange rates related to our ship construction contracts denominated in euros. If the spot rate at the date the ships were delivered was less than the strike price under these option contracts, we would have paid the deferred premium and would not exercise the foreign currency options. The effects on the consolidated financial statements of the foreign currency options which were designated as cash flow hedges were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense $ 1,320 $ 1,320 $ 1,320 Foreign Currency Forward Contracts As of December 31, 2017, we had foreign currency forward contracts which are used to mitigate the financial impact of volatility in foreign currency exchange rates related to our ship construction contracts denominated in euros. The notional amount of our foreign currency forward contracts was €1.9 billion, or $2.3 billion based on the euro/U.S. dollar exchange rate as of December 31, 2017. The effects on the consolidated financial statements of the foreign currency forward contracts which were designated as cash flow hedges were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 254,070 $ (124,058 ) $ (84,187 ) Loss recognized in other income (expense), net – ineffective portion (73 ) (270 ) (343 ) Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense 3,121 2,625 116 The effects on the consolidated financial statements of the foreign currency forward contracts which were not designated as hedging instruments were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other income (expense), net $ — $ (6,133 ) $ 684 Foreign Currency Collar We had foreign currency collars that matured and were used to mitigate the volatility of foreign currency exchange rates related to our ship construction contracts denominated in euros. The effects on the consolidated financial statements of the foreign currency collar which was designated as a cash flow hedge was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense $ (364 ) $ (364 ) $ (364 ) The effect on the consolidated financial statements of the foreign currency collar which was not designated as a cash flow hedge was as follows (in thousands): Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other income (expense), net $ — $ 10,312 $ (26,249 ) Interest Rate Swaps As of December 31, 2017, we had interest rate swap agreements to hedge our exposure to interest rate movements and to manage our interest expense. The notional amount of outstanding debt associated with the interest rate swap agreements was $218.6 million as of December 31, 2017. The effects on the consolidated financial statements of the interest rate swaps which were designated as cash flow hedges were as follows (in thousands): Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 351 $ (1,701 ) $ (5,152 ) Gain (loss) recognized in other income (expense), net – ineffective portion — 3 (23 ) Amount reclassified from other comprehensive income (loss) into interest expense, net 2,997 3,946 4,614 Other The carrying amounts reported in the consolidated balance sheets of all other financial assets and liabilities approximate fair value. Long-Term Debt As of December 31, 2017 and 2016, the fair value of our long-term debt, including the current portion, was $6,448.6 million and $6,525.7 million, respectively, which was $23.5 million higher and $11.6 million higher, respectively, than the carrying values. The difference between the fair value and carrying value of our long-term debt is due to our fixed and variable rate debt obligations carrying interest rates that are above or below market rates at the measurement dates. The fair value of our long-term debt was calculated based on estimated rates for the same or similar instruments with similar terms and remaining maturities resulting in Level 2 inputs in the fair value hierarchy. Market risk associated with our long-term variable rate debt is the potential increase in interest expense from an increase in interest rates. The calculation of the fair value of our long-term debt is considered a Level 2 input. Non-recurring Measurements of Non-financial Assets Goodwill and other indefinite-lived assets, principally tradenames, are reviewed for impairment on an annual basis or earlier if there is an event or change in circumstances that would indicate that the carrying value of these assets may not be fully recoverable. We believe our estimates and judgments with respect to our long-lived assets, principally ships, and goodwill and other indefinite-lived intangible assets are reasonable. Nonetheless, if there was a material change in assumptions used in the determination of such fair values or if there is a material change in the conditions or circumstances that influence such assets, we could be required to record an impairment charge. We estimate fair value based on the best information available utilizing estimates, judgments and projections as necessary. As of December 31, 2017, our annual review supports the carrying value of these assets. |
Employee Benefits and Share-Bas
Employee Benefits and Share-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employee Benefits and Share-Based Compensation | 9. Employee Benefits and Share-Based Compensation Share-Based Compensation As a result of NCLH’s adoption of ASU No. 2016-09, beginning in the first quarter of 2017, NCLH began accounting for forfeitures as they occur, rather than estimating expected forfeitures. Pursuant to the modified-retrospective application, the net cumulative effect of this change was recognized as a $2.2 million increase to retained earnings as of January 1, 2017 (we refer you to our consolidated statements of changes in shareholders’ equity). Amended and Restated 2013 Performance Incentive Plan (“Restated 2013 Plan”) In January 2013, NCLH adopted the 2013 Performance Incentive Plan which provided for the issuance of up to 15,035,106 of NCLH’s ordinary shares pursuant to awards granted under the plan, with no more than 5,000,000 shares being granted to one individual in any calendar year. In May 2016, the plan was amended and restated pursuant to approval from the Board of Directors and NCLH’s shareholders. Among other things, under the Restated 2013 Plan, the number of NCLH’s ordinary shares that may be delivered pursuant to all awards granted under the plan was increased by an additional 12,430,000 shares to a new maximum aggregate limit of 27,465,106 shares. Additionally, the expiration date of the Restated 2013 Plan was extended to March 30, 2026. Share options under the plan are granted with an exercise price equal to the closing market price of NCLH shares at the date of grant. The vesting period for time-based options is typically set at 3, 4 or 5 years with a contractual life ranging from 7 to 10 years. The vesting period for time-based restricted share units is generally 3 years. Forfeited awards will be available for subsequent awards under the Restated 2013 Plan. Share Option Awards No share option awards were granted in 2017. The fair value of each time-based option award is estimated on the date of grant using the Black-Scholes option-pricing model. The estimated fair value of the share options, less estimated forfeitures, is amortized over the vesting period using the straight-line vesting method. The assumptions used within the option-pricing model for the time-based awards are as follows: 2016 2015 Dividend yield —% —% Expected share price volatility 30.36%-33.01% 32.32%-45.33% Risk-free interest rate 1.20%-1.48% 1.34%-1.92% Expected term 6.00 years 6.00-6.50 years Expected volatility was determined based on the historical share prices in our industry. The risk-free rate was based on U.S. Treasury zero coupon issues with a remaining term equal to the expected option term at grant date. The expected term was calculated under the simplified method. The performance-based options awarded to our President and Chief Executive Officer in August 2015 are subject to performance conditions such that the number of awards that ultimately vest depends on the adjusted earnings per share (“Adjusted EPS”) and adjusted return on invested capital (“Adjusted ROIC”) achieved by the Company during the performance period compared to targets established at the award date. Because the terms of the performance-based awards provide discretion to make certain adjustments to the performance calculation, the service inception date of these awards precedes the grant date. Accordingly, the Company recognizes compensation expense beginning on the service inception date and remeasures the fair value of the awards until a grant date is established. The estimate of the awards’ fair values will be fixed in the period in which the grant date occurs, and cumulative compensation expense will be adjusted based on the fair values calculated using the Black-Scholes option-pricing model at the grant date. The fair value for the option awards for which a grant date has not been established is estimated on the last date of the reporting period using the Black-Scholes option-pricing model. The estimated fair value of the share options is amortized over the requisite service period using the straight-line vesting method. The assumptions used within the option-pricing model for the performance-based awards for which share-based compensation expense was recognized during 2017, 2016 and 2015 are as follows: 2017 2016 2015 Dividend yield —% —% —% Expected share price volatility 25.97% 25.97%-30.21% 29.31%-29.86% Risk-free interest rate 1.81% 1.01%-1.93% 1.76% Expected term 4.20 years 4.38-5.13 years 4.88-5.38 years Expected volatility was determined based on the historical share prices in our industry. The risk-free rate was based on U.S. Treasury zero coupon issues with a remaining term equal to the expected option term at grant date. The expected term was calculated under the simplified method. The fair value of the market-based share option awards awarded to our President and Chief Executive Officer is estimated using a Monte-Carlo model which values financial instruments whose value is dependent on share price by sampling random paths for share price. The key inputs for the simulation include current share price, risk free rate, and share price volatility. For each simulated path, the model checks if the simulated share price reaches the vesting threshold during the performance period. For each path that reaches the vesting threshold, the payoff upon vesting is calculated. The fair value of the equity award is determined by averaging the expected payoff across all simulated paths and discounting the average to the valuation date. The below table summarizes the key inputs used in the Monte-Carlo simulation: 2015 Dividend yield —% Expected share price volatility 30.00% Risk-free interest rate 1.34% Expected term Mid-point from vesting to assumed options expiration Expected volatility was determined based on the historical share prices in our industry. The risk-free rate was based on U.S. Treasury zero coupon issues with a remaining term equal to the remaining term of the measurement period. The following is a summary of option activity under NCLH’s Amended and Restated 2013 Performance Incentive Plan for the year ended December 31, 2017 (excludes the impact of 208,335 previously awarded performance-based options as no grant date has been established): Number of Share Option Weighted-Average Exercise Weighted- Aggregate Intrinsic Value Time- Performance- Market- Time- Performance- Market- (years) (in thousands) Outstanding as of January 1, 2017 7,775,058 432,978 208,333 $ 48.04 $ 23.86 $ 59.43 7.81 $ 35,429 Granted — 156,249 — — 59.43 — Exercised (738,672 ) (121,509 ) — 34.02 19.00 — Forfeited and cancelled (455,488 ) (93,749 ) — 54.27 59.43 — Outstanding as of December 31, 2017 6,580,898 373,969 208,333 $ 49.18 $ 31.39 $ 59.43 6.99 $ 50,021 Vested and expected to vest as of December 31, 2017 6,580,898 373,969 — $ 49.18 $ 31.39 $ — 6.98 $ 50,021 Exercisable as of December 31, 2017 4,061,424 373,969 — $ 47.98 $ 31.39 $ — 6.69 $ 39,115 The weighted-average grant-date fair value of time-based options granted during the years 2016 and 2015 was $17.11 and $20.90, respectively. The weighted-average reporting period date/established grant-date fair value of performance-based options for which share-based compensation was recognized during 2017, 2016 and 2015 was $8.55, $8.67 and $17.07, respectively. The weighted-average grant-date fair value of market-based options granted during the year 2015 was $12.37. The total intrinsic value of share options exercised during the years 2017, 2016 and 2015 was $18.9 million, $5.2 million and $68.0 million and total cash received by the Company from exercises was $27.4 million, $7.6 million and $69.1 million, respectively. As of December 31, 2017, there was approximately $27.6 million, $0, and $0 of total unrecognized compensation cost, related to time-based, performance-based with an established grant date, and market-based options, respectively, granted under our share-based incentive plans which is expected to be recognized over a weighted-average period of 0.9 years, 0 years, and 0 years, respectively. Restricted Ordinary Share Awards The following is a summary of restricted share activity of NCLH shares for the year ended December 31, 2017: Number of Weighted- Non-vested as of January 1, 2016 16,872 $ 7.63 Vested (16,014 ) 4.91 Non-vested and expected to vest as of December 31, 2017 858 $ 58.33 As of December 31, 2017, there was $25 thousand of total unrecognized compensation cost related to non-vested restricted ordinary share awards. The cost is expected to be recognized over a weighted-average period of 1.0 year. Restricted shares, with the exception of those related to the Management Exchange Agreement (which maintained their original vesting conditions of time and performance and have all vested or been forfeited as of December 31, 2017) vest in substantially equal quarterly installments over 1 or 2 years or in annual installments over 4 years. The total fair value of shares vested during 2017, 2016, and 2015 was $0.1 million, $1.1 million, and $40.9 million, respectively. Restricted Share Units (“RSUs”) On August 1, 2017, NCLH awarded a target number of 79,073 performance-based RSU’s to our President and Chief Executive Officer. The exact number of shares delivered in satisfaction of the performance-based RSUs will be determined based on the achievement of certain pre-established performance targets. On March 1, 2017, NCLH awarded 1.7 million time-based RSUs to our employees which vest equally over three years. Additionally, on March 1, 2017, NCLH awarded 121,000 performance-based RSUs to certain members of our management team which vest upon the achievement of certain pre-established performance targets. The fair value of the time-based and performance-based RSUs is equal to the closing market price of NCLH shares at the date of grant. The performance-based RSUs awarded to our President and Chief Executive Officer are subject to performance conditions such that the number of awards that ultimately vest depends on the Adjusted EPS and Adjusted ROIC achieved by the Company during the performance period compared to targets established at the award date. Because the terms of the performance-based awards provide discretion to make certain adjustments to the performance calculation, the service inception date of these awards precedes the grant date. Accordingly, the Company recognizes share-based compensation expense beginning on the service inception date and remeasures the fair value of the awards until a grant date occurs. The estimate of the awards’ fair value will be fixed in the period in which the grant date occurs, and cumulative share-based compensation expense will be adjusted based on the fair value at the grant date. The fair value of the market-based RSUs awarded to our President and Chief Executive Officer is estimated using a Monte-Carlo model which values financial instruments whose value is dependent on share price by sampling random paths for share price. The key inputs for the simulation include current share price, risk free rate, and share price volatility. For each simulated path, the model checks if the simulated share price reaches the vesting threshold during the performance period. For each path that reaches the vesting threshold, the payoff upon vesting is calculated. The fair value of the equity grant is determined by averaging the expected payoff across all simulated paths and discounting the average to the valuation date. The below table summarizes the key inputs used in the Monte-Carlo simulation: 2015 Dividend yield 0% Expected share price volatility 30.00% Risk-free interest rate 1.34% Expected term Mid-point from vesting to assumed awards expiration Expected volatility was determined based on the historical share prices in our industry. The risk-free rate was based on U.S. Treasury zero coupon issues with a remaining term equal to the remaining term of the measurement period. The following is a summary of the RSUs activity for the year ended December 31, 2017 (excludes the impact of 329,146 performance-based RSUs as no grant date was established): Number of Weighted- Number of Weighted- Number of Weighted- Non-vested as of January 1, 2017 1,305,335 $ 50.38 — $ — 50,000 $ 59.43 Granted 1,803,327 $ 51.13 37,500 $ 49.76 — — Vested (447,669 ) $ 50.55 (15,000 ) $ 49.76 — — Forfeited or expired (105,516 ) $ 50.76 (22,500 ) $ 49.76 — — Non-vested as of December 31, 2017 2,555,477 $ 50.86 — $ — 50,000 $ 59.43 Non-vested and expected to vest as of December 31, 2017 2,555,477 $ 50.86 — — — $ — As of December 31, 2017, there was $89.1 million, $0 and $0 of total unrecognized compensation cost related to non-vested time-based, non-vested performance-based awards with an established grant date and market-based RSUs, respectively. The cost is expected to be recognized over a weighted-average period of 1.9 years, 0 years and 0 years, respectively, for the time-based, performance-based and market-based RSUs. Total taxes paid pursuant to net share settlements in 2017 were $6.3 million. Employee Stock Purchase Plan (“ESPP”) In April 2014, NCLH’s shareholders approved the ESPP. The purpose of the ESPP is to provide eligible employees with an opportunity to purchase NCLH’s ordinary shares at a favorable price and upon favorable terms in consideration of the participating employees’ continued services. A maximum of 2,000,000 of NCLH’s ordinary shares may be purchased under the ESPP. To be eligible to participate in an offering period, on the grant date of that period, an individual must be customarily employed by the Company or a participating subsidiary for more than twenty hours per week and for more than five months per calendar year. Participation in the ESPP is also subject to certain limitations. The ESPP is considered to be compensatory based on: a) the 15% purchase price discount and b) the look-back purchase price feature. Since the plan is compensatory, compensation expense must be recorded in the consolidated statements of operations on a straight-line basis over the six-month withholding period. As of December 31, 2017 and 2016, we had a $1.5 million and $1.3 million liability, respectively, for payroll withholdings received. The compensation expense recognized for share-based compensation for the years ended December 31, 2017, 2016 and 2015 was as follows: Share-Based Compensation Expense Classification of expense 2017 2016 2015 (In thousands) Payroll and related (1) $ 9,455 $ 7,793 $ — Marketing, general and administrative (2) 77,584 58,621 42,209 Total share-based compensation expense $ 87,039 $ 66,414 $ 42,209 (1) Amounts relate to equity granted to certain of our shipboard officers. (2) Amounts relate to equity granted to certain of our corporate employees. Employee Benefit Plans We offer annual incentive bonuses pursuant to our Restated 2013 Plan for our executive officers and other key employees. Bonuses under the plan become earned and payable based on NCLH’s performance during the applicable performance period and the individual’s continued employment. Company performance criteria include the attainment of certain financial targets and other strategic objectives. Certain employees are employed pursuant to agreements that provide for severance payments. Severance is generally only payable upon an involuntary termination of the employment by us without cause or a termination by the employee for good reason. Severance generally includes a series of cash payments based on the employee’s base salary (and in some cases, bonus), and our payment of the employee’s continued medical benefits for the applicable severance period. We maintain a 401(k) Plan for our shoreside employees, including our executive officers. Participants may contribute up to 100% of eligible compensation each pay period, subject to certain limitations. We make matching contributions equal to 100% of the first 3% and 50% of amounts greater than 3% to and including 10% of each participant’s contributions subject to certain limitations. In addition, we may make discretionary supplemental contributions to the Plan, which shall be allocated pro rata to each eligible participant based on the compensation of the participant relevant to the total compensation of all participants. Our matching contributions are vested according to a five-year schedule. The 401(k) Plan is subject to the provisions of ERISA and is intended to be qualified under section 401(a) of the U.S. Internal Revenue Code (the “Code”). Our matching contributions are reduced by amounts forfeited by those employees who leave the 401(k) Plan prior to vesting fully in the matching contributions. Forfeited contributions of $0.3 million, $0.1 million and $0.4 million were utilized in the years ended December 31, 2017, 2016 and 2015, respectively. We maintained a Supplemental Executive Retirement Plan (“SERP”), which is a legacy unfunded defined contribution plan for certain executives who were employed by the Company in an executive capacity prior to 2008. The SERP was frozen to future participation following that date. The SERP provided for Company contributions on behalf of the participants to compensate them for the benefits that are limited under the 401(k) Plan. We credited participants under the SERP for amounts that would have been contributed by us to the Company’s previous Defined Contribution Retirement Plan and the former 401(k) Plan without regard to any limitations imposed by the Code. Participants did not make any elective contributions under this plan. We have discontinued this plan following the 2015 contributions and we paid the previously deferred contributions to participants in early 2017 following the expiration of the required twelve month waiting period. As of December 31, 2016, the aggregate balance of participants’ deferred compensation accounts under the SERP Plan was $0.5 million. We recorded combined total expenses related to the above 401(k) Plan and SERP of $7.3 million, $6.4 million and $5.3 million for the years ended December 31, 2017, 2016 and 2015, respectively. Effective January 2009, we implemented the Shipboard Retirement Plan which computes benefits based on years of service, subject to eligibility requirements of the Shipboard Retirement Plan. The Shipboard Retirement Plan is unfunded with no plan assets. The current portion of the projected benefit obligation of $1.1 million and $1.2 million was included in accrued expenses and other liabilities as of December 31, 2017 and 2016, respectively, and $23.5 million and $21.4 million was included in other long-term liabilities in our consolidated balance sheets as of December 31, 2017 and 2016, respectively. The amounts related to the Shipboard Retirement Plan were as follows (in thousands): As of or for the Year Ended December 31, 2017 2016 2015 Pension expense: Service cost $ 1,987 $ 1,863 $ 1,793 Interest cost 887 874 738 Amortization of prior service cost 378 378 378 Amortization of actuarial loss 40 54 99 Total pension expense $ 3,292 $ 3,169 $ 3,008 Change in projected benefit obligation: Projected benefit obligation at beginning of year $ 22,605 $ 21,078 $ 19,730 Service cost 1,987 1,863 1,793 Interest cost 887 874 738 Actuarial gain (loss) 458 (65 ) (625 ) Direct benefit payments (1,350 ) (1,145 ) (558 ) Projected benefit obligation at end of year $ 24,587 $ 22,605 $ 21,078 Amounts recognized in the consolidated balance sheets: Projected benefit obligation $ 24,587 $ 22,605 $ 21,078 For the Year Ended December 31, 2017 2016 2015 Amounts recognized in accumulated other comprehensive income (loss): Prior service cost $ (4,537 ) $ (4,915 ) $ (5,293 ) Accumulated actuarial loss (3,426 ) (3,008 ) (3,126 ) Accumulated other comprehensive income (loss) $ (7,963 ) $ (7,923 ) $ (8,419 ) The discount rates used in the net periodic benefit cost calculation for the years ended December 31, 2017, 2016 and 2015 were 4.0%, 4.3% and 3.8%, respectively, and the actuarial loss is amortized over 18.85 years. The discount rate is used to measure and recognize obligations, including adjustments to other comprehensive income (loss), and to determine expense during the periods. It is determined by using bond indices which reflect yields on a broad maturity and industry universe of high-quality corporate bonds. The pension benefits expected to be paid in each of the next five years and in aggregate for the five years thereafter are as follows (in thousands): Year Amount 2018 $ 1,050 2019 1,032 2020 1,035 2021 1,126 2022 1,217 Next five years 8,691 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. Income Taxes We are incorporated in Bermuda. Under current Bermuda law, we are not subject to tax on income and capital gains. We have received from the Minister of Finance under The Exempted Undertakings Tax Protection Act 1966, as amended, an assurance that, in the event that Bermuda enacts legislation imposing tax computed on profits, income, any capital asset, gain or appreciation, or any tax in the nature of estate duty or inheritance, then the imposition of any such tax shall not be applicable to us or to any of our operations or shares, debentures or other obligations, until March 31, 2035. For the taxable years ended 2015, 2016 and 2017, NCLC was treated as a disregarded entity for U.S. federal income tax purposes and will be going forward. One of NCLC’s subsidiaries files a U.S. federal and Hawaii income tax return. The components of net income before income taxes consist of the following (in thousands): Year Ended 2017 2016 2015 Bermuda $ — $ — $ — Foreign - Other 773,269 643,788 437,778 Total 773,269 643,788 437,778 The components of the provision for income taxes consisted of the following (expenses) benefits (in thousands): Year Ended 2017 2016 2015 Current: Bermuda $ — $ — $ — United States 1,026 (36 ) (36 ) Foreign - Other (4,616 ) (3,623 ) (305 ) Total current: (3,590 ) (3,659 ) (341 ) Deferred: Bermuda — — — United States (11,370 ) 3,594 363 Foreign - Other 486 — — Total deferred: (10,884 ) 3,594 363 Income tax benefit (expense) $ (14,474 ) $ (65 ) $ 22 Our reconciliation of income tax expense computed by applying our Bermuda statutory rate and reported income tax expense was as follows (in thousands): Year Ended 2017 2016 2015 Tax at Bermuda statutory rate $ — $ — $ — Foreign income taxes at different rates (17,978 ) (2,383 ) 58 Tax contingencies 946 (286 ) (36 ) Return to provision adjustments (2,192 ) (990 ) — Benefit from change in tax rate 4,750 — — Valuation allowance — 3,594 — Total $ (14,474 ) $ (65 ) $ 22 Deferred tax assets and liabilities were as follows (in thousands): As of December 31, 2017 2016 Deferred tax assets: Loss carryforwards $ 58,291 $ 102,636 Other 1,825 1,429 Valuation allowance (42,154 ) (64,573 ) Total net deferred tax assets 17,962 39,492 Deferred tax liabilities: Property and equipment (26,321 ) (37,001 ) Total deferred tax liabilities (26,321 ) (37,001 ) Net deferred tax asset (liability) $ (8,359 ) $ 2,491 NCLC has U.S. net operating loss carryforwards of $254.8 million and $256.3 million, for the years ended December 31, 2017 and 2016, respectively, which begin to expire in 2023. In 2016, based on the weight of available evidence, the Company reversed a valuation allowance in the amount of $3.6 million with respect to the U.S. deferred tax assets of one of our U.S. subsidiaries. Included above are deferred tax assets associated with our operations in Norway for which we have provided a full valuation allowance. NCLC has Norway net operating loss carryforwards of $13.9 million and $22.9 million for the years ended December 31, 2017 and 2016, respectively, which can be carried forward indefinitely. Included above are deferred tax assets associated with our branch operations in the U.K. for which we have provided a full valuation allowance. NCLC has U.K. net operating loss carryforwards of $8.3 million and $9.5 million for the years ended December 31, 2017 and 2016, respectively, which can be carried forward indefinitely. Included above are deferred tax assets associated with Prestige for which we have provided a full valuation allowance. We have U.S. net operating loss carryforwards of $177.8 million and $151.2 million for the years ended December 31, 2017 and 2016, respectively, which begin to expire in 2023. Section 382 of the Code may limit the amount of taxable income that can be offset by the Prestige NOL carryforwards. The Act was enacted on December 22, 2017. Among other provisions, the Act reduces the U.S. federal corporate tax rate from 35% to 21%. The SEC staff issued SAB No. 118, which addresses how a company recognizes provisional amounts when a company does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the effect of the changes in the Act. The measurement period ends when a company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. As of December 31, 2017, we have not completed the accounting for the tax effects of enactment of the Act; however, as described below, we have made a reasonable estimate of the effects on existing deferred tax balances. These amounts are provisional and subject to change. The most significant impact of the Act for the Company was a $4.5 million reduction of the value of net deferred tax liabilities (which represent future tax expenses) that was recorded as a discrete tax benefit as a result of lowering the U.S. corporate income tax rate from 35% to 21%. The tax benefit represents a provisional amount and the Company’s current best estimate. Any adjustments recorded to the provisional amount through the end of 2018 will be included in income from operations as an adjustment to tax expense. The provisional amounts incorporate assumptions made based upon the Company’s current interpretation of the Act and may change as the Company receives additional clarification and implementation guidance. Other aspects of the Act are either not applicable or not expected to have a material impact on the Company’s consolidated financial statements. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in thousands): As of December 31, 2017 2016 Unrecognized tax benefits, beginning of the year $ 1,644 $ 1,394 Gross increases in tax positions from prior periods 300 250 Settlement of tax positions (250 ) — Lapse of statute of limitations (1,162 ) — Unrecognized tax benefits, end of year $ 532 $ 1,644 During the year, $1.2 million of unrecognized tax benefits were reversed due to the expiration of the statute of limitations. If the $0.5 million of unrecognized tax benefits at December 31, 2017 were recognized, our effective tax rate would be minimally affected. We believe that there will not be a significant increase or decrease to the tax positions within 12 months of the reporting date. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. We file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions and foreign jurisdictions. We are generally no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by authorities for years prior to 2014, except for years in which NOLs generated prior to 2014 are utilized. Due to our international structure as well as the existence of international tax treaties that exempt taxation on certain activities, the repatriation of earnings from our subsidiaries would have no tax impact. We derive our income from the international operation of ships. We are engaged in a trade or business in the U.S. and receive income from sources within the U.S. Under Section 883, certain foreign corporations are exempt from U. S. federal income or branch profits tax on U.S.-source income derived from or incidental to the international operation of ships. Applicable U.S. treasury regulations provide that a foreign corporation will qualify for the benefits of Section 883 if, in relevant part: (i) the foreign country in which the corporation is organized grants an equivalent exemption for income from the operation of ships of sufficiently broad scope to corporations organized in the U.S., and (ii) the foreign corporation has one or more classes of stock that are “primarily and regularly traded on an established securities market” in the U.S. or another qualifying country. We believe that we qualify for the benefits of Section 883 because we are incorporated in qualifying countries and our ordinary shares are primarily and regularly traded on an established securities market in the U.S. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Operating Leases Total expense under non-cancelable operating lease commitments, primarily for offices, motor vehicles and office equipment was $17.0 million, $15.0 million and $12.6 million for the years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017, minimum annual rentals for non-cancelable leases with initial or remaining terms in excess of one year were as follows (in thousands): Year Amount 2018 $ 15,204 2019 14,788 2020 14,185 2021 13,227 2022 13,277 Thereafter 61,110 Total minimum annual rentals $ 131,791 Rental payments applicable to such operating leases are recognized on a straight-line basis over the term of the lease. Ship Construction Contracts Project Leonardo will introduce an additional four ships with expected delivery dates through 2025 and we have an option to introduce two additional ships for delivery in 2026 and 2027, subject to certain conditions. The four Leonardo ships are each approximately 140,000 Gross Tons with approximately 3,300 Berths. We have an Explorer Class Ship, Seven Seas Splendor, on order for delivery in the winter of 2020. This ship is approximately 55,000 Gross Tons and 750 Berths. We have two Breakaway Plus Class Ships, Norwegian Bliss and Norwegian Encore, on order for delivery in the spring of 2018 and fall of 2019, respectively. These ships are approximately 168,000 Gross Tons each with approximately 4,000 Berths each. The combined contract price of the seven ships on order was approximately €5.5 billion, or $6.6 billion based on the euro/U.S. dollar exchange rate as of December 31, 2017. We have obtained export credit financing for each of the ships which is expected to fund approximately 80% of the contract price of each ship expected to be delivered through 2025, subject to certain conditions. For ships expected to be delivered after 2023, the contract prices are subject to adjustment under certain circumstances. In connection with the contracts to build the ships, we do not anticipate any contractual breaches or cancellation to occur. However, if any such events were to occur, it could result in, among other things, the forfeiture of prior deposits or payments made by us and potential claims and impairment losses which may materially impact our business, financial condition and results of operations. As of December 31, 2017, minimum annual payments for non-cancelable ship construction contracts with initial or remaining terms in excess of one year were as follows (in thousands): Year Amount 2018 $ 1,016,892 2019 893,881 2020 469,334 2021 172,872 2022 968,340 Thereafter 2,616,900 Total minimum annual payments $ 6,138,219 Port Facility Commitments As of December 31, 2017, future commitments to pay for usage of certain port facilities were as follows (in thousands): Year Amount 2018 $ 30,509 2019 21,460 2020 21,928 2021 18,179 2022 5,137 Thereafter 41,095 Total port facility future commitments $ 138,308 Other Commitments The FMC requires evidence of financial responsibility for those offering transportation on passenger ships operating out of U.S. ports to indemnify passengers in the event of non-performance of the transportation. Accordingly, each of our three brands are required to maintain a $30.0 million third-party performance guarantee in respect of liabilities for non-performance of transportation and other obligations to passengers. The guarantee requirements are subject to additional consumer price index-based adjustments. Also, each of our brands have a legal requirement to maintain a security guarantee based on cruise business originated from the U.K. As of December 31, 2017, approximately British Pound Sterling 11.8 million was in place as to support our security guarantees. We also are required by other jurisdictions to establish financial responsibility to meet liability in the event of non-performance of our obligations to passengers from those jurisdictions. From time to time, various other regulatory and legislative changes have been or may in the future be proposed that may have an effect on our operations in the U.S. and the cruise industry in general. Litigation In the normal course of our business, various claims and lawsuits have been filed or are pending against us. Most of these claims and lawsuits are covered by insurance and, accordingly, the maximum amount of our liability is typically limited to our deductible amount. Nonetheless, the ultimate outcome of these claims and lawsuits that are not covered by insurance cannot be determined at this time. We have evaluated our overall exposure with respect to all of our threatened and pending litigation and, to the extent required, we have accrued amounts for all estimable probable losses associated with our deemed exposure. We are currently unable to estimate any other potential contingent losses beyond those accrued, as discovery is not complete nor is adequate information available to estimate such range of loss or potential recovery. However, based on our current knowledge, we do not believe that the aggregate amount or range of reasonably possible losses with respect to these matters will be material to our consolidated results of operations, financial condition or cash flows. We intend to vigorously defend our legal position on all claims and, to the extent necessary, seek recovery. |
Other Income (Expense), Net
Other Income (Expense), Net | 12 Months Ended |
Dec. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | 12. Other Income (Expense), Net Other income (expense), net was $10.4 million in 2017, $8.3 million in 2016 and $46.7 million in 2015. In 2017, the expense was primarily due to foreign currency exchange losses. In 2016, the expense was primarily related to $16.1 million of unrealized and realized losses on fuel swap derivative hedge contracts partially offset by $4.5 million of gains on foreign currency exchange and $3.9 million of gains on foreign currency exchange derivative hedge contracts. In 2015, the expense was primarily related to $30.7 million of losses from the dedesignation of certain fuel swap derivative hedge contracts and the ineffectiveness of settled fuel swaps in 2015. Also included in 2015 was an expense of $26.2 million related to the fair value adjustment of a foreign exchange collar which did not receive hedge accounting treatment partially offset by $11.0 million of foreign currency transaction gains. |
Concentration Risk
Concentration Risk | 12 Months Ended |
Dec. 31, 2017 | |
Risks and Uncertainties [Abstract] | |
Concentration Risk | 13. Concentration Risk We contract with a single vendor to provide many of our hotel and restaurant services including both food and labor costs. We incurred expenses of $152.3 million, $137.2 million and $122.4 million for the years ended December 31, 2017, 2016 and 2015, respectively, which are recorded in payroll and related in our consolidated statements of operations. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | 14. Supplemental Cash Flow Information For the years ended December 31, 2017, 2016 and 2015, we paid interest and related fees of $313.8 million, $303.2 million and $218.3 million, respectively. For the year ended December 31, 2017, we had non-cash investing activities for property and equipment of $20.0 million and non-cash investing activities in connection with capital leases of $13.3 million. For the year ended December 31, 2016, we had non-cash investing activities in connection with property and equipment of $26.7 million. For the year ended December 31, 2015, we had non-cash investing activities in connection with capital leases of $31.1 million and non-cash investing activities for capital expenditures of $41.1 million. For the years ended December 31, 2017, 2016 and 2015, we paid income taxes of $11.7 million, $8.8 million and $10.3 million, respectively. |
Quarterly Selected Financial Da
Quarterly Selected Financial Data (Unaudited) (in thousands) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Selected Financial Data (Unaudited) (in thousands) | 15. Quarterly Selected Financial Data (Unaudited) (in thousands) First Quarter Second Quarter Third Quarter Fourth Quarter 2017 2016 2017 2016 2017 2016 2017 2016 Total revenue $ 1,150,781 $ 1,077,632 $ 1,344,103 $ 1,186,835 $ 1,651,738 $ 1,484,736 $ 1,249,553 $ 1,125,137 Operating income 120,232 132,266 275,755 227,756 477,453 414,260 178,012 154,667 Net income 63,138 74,973 201,441 148,099 396,227 346,003 97,989 74,648 The seasonality of the North American cruise industry generally results in the greatest demand for cruises during the Northern Hemisphere’s summer months. This predictable seasonality in demand has resulted in fluctuations in our revenue and results of operations. The seasonality of our results is increased due to ships being taken out of service for regularly scheduled Dry-docks, which we typically scheduled during non-peak demand periods. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Event | 16. Subsequent Event On January 30, 2018, the Company and Wendy A. Beck, the Company’s Executive Vice President and Chief Financial Officer, announced that Ms. Beck would be leaving the Company to pursue other career opportunities. Ms. Beck has agreed to continue in her current position as Executive Vice President and Chief Financial Officer through September 30, 2018 or any earlier date as may be determined by the Company (the “Succession Date”). On February 2, 2018, a subsidiary of the Company entered into a Transition, Release and Consulting Agreement (the “Transition Agreement”) with Ms. Beck. Pursuant to the terms of the Transition Agreement, subject to Ms. Beck not voluntarily terminating her employment prior to the Succession Date, following the Succession Date, Ms. Beck will be entitled to receive the following benefits: (i) an amount equal to two times her base salary, which will be paid over a 12-month period, (ii) in recognition of her service and tenure, an amount equal to $4 million, paid in quarterly installments through December 30, 2019, (iii) continued COBRA benefits at the same cost as active employees (or pay in lieu of such benefits if the Company cannot provide such benefits) for up to 36 months, (iv) full acceleration of her outstanding time-based equity awards, (v) continued opportunity to vest in her only outstanding performance-based equity award, subject to the satisfaction of the applicable financial performance conditions for 2018, (vi) pro-rata portion of any bonus actually earned based on performance for 2018, and (vii) an executive-level cruise. Pursuant to the terms of the Transition Agreement, Ms. Beck has agreed to provide consulting services to the Company for two years following the Succession Date to help with the transition and integrate her successor. Ms. Beck will receive $2 million, paid in six equal quarterly installments through December 30, 2019, for her consulting services. |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2017 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II Valuation and Qualifying Accounts | Schedule II Valuation and Qualifying Accounts (in thousands) Additions Description Balance Charged to Charged to Deductions Balance Valuation allowance on deferred tax assets $ 81,704 $ — $ — $ (20,267 ) $ 61,437 Description Balance Charged to Charged to Deductions Balance Valuation allowance on deferred tax assets $ 61,437 $ — $ 9,382 $ (6,246 ) $ 64,573 Description Balance Charged to Charged to Deductions (a) Balance Valuation allowance on deferred tax assets $ 64,573 $ — $ — $ (22,419 ) $ 42,154 (a) Amount relates to (i) utilization of deferred tax assets and (ii) an adjustment due to a change in tax rates resulting from U.S. tax reform. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and contain all normal recurring adjustments necessary for a fair presentation of the results for the periods presented. Estimates are required for the preparation of consolidated financial statements in accordance with generally accepted accounting principles and actual results could differ from these estimates. All significant intercompany accounts and transactions are eliminated in consolidation. |
Reclassification | Reclassification Certain amounts in prior periods have been reclassified to properly reflect promotional discounts allocated between passenger ticket revenue to onboard and other revenue. During the fourth quarter of 2017 we reclassified $21.9 million of revenue from passenger ticket revenue to onboard and other revenue for the prior three quarters. This cumulative adjustment for 2017 amends the multi-element allocation of revenue between these two financial statement line items. This change does not impact total revenue or net income, nor did it impact any periods in 2016 or 2015. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are stated at cost, and include cash and investments with original maturities of three months or less at acquisition and also include amounts due from credit card processors. |
Restricted Cash | Restricted Cash Restricted cash consists of cash collateral in respect of certain agreements and is included in prepaid expenses and other assets and other long-term assets in our consolidated balance sheets. |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable are shown net of an allowance for doubtful accounts of $5.9 million and $4.7 million as of December 31, 2017 and 2016, respectively. |
Inventories | Inventories Inventories mainly consist of provisions, supplies and fuel and are carried at the lower of cost or net realizable value using the first-in, first-out method of accounting. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred except for those that result in tangible assets, including brochures, which are treated as prepaid expenses and charged to expense as consumed. Advertising costs of $2.4 million and $1.3 million as of December 31, 2017 and 2016, respectively, are included in prepaid expenses and other assets. Expenses related to advertising costs totaled $289.1 million, $270.5 million and $232.2 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are recorded at cost. Major renewals and improvements that we believe add value to our ships are capitalized as a cost of the ship while costs of repairs and maintenance, including Dry-dock costs, are charged to expense as incurred. During ship construction, certain interest is capitalized as a cost of the ship. Gains or losses on the sale of property and equipment are recorded as a component of operating income (expense) in our consolidated statements of operations. Depreciation is computed on the straight-line basis over the estimated useful lives of the assets, after a 15% reduction for the estimated residual values of ships as follows: Useful Life Ships 30 years Computer hardware and software 3-10 years Other property and equipment 3-40 years Leasehold improvements Shorter of lease term or asset life Ship improvements Shorter of asset life or life of the ship Long-lived assets are reviewed for impairment, based on estimated future undiscounted cash flows, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Assets are grouped and evaluated at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets. We consider historical performance and future estimated results in our evaluation of potential impairment and then compare the carrying amount of the asset to the estimated future cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds estimated expected undiscounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value. We estimate fair value based on the best information available utilizing estimates, judgments and projections as necessary. Our estimate of fair value is generally measured by discounting expected future cash flows at discount rates commensurate with the associated risk. |
Goodwill and Tradenames | Goodwill and Tradenames Goodwill represents the excess of cost over the fair value of net assets acquired. Goodwill and other indefinite-lived assets, principally tradenames, are reviewed for impairment on an annual basis or earlier if there is an event or change in circumstances that would indicate that the carrying value of these assets may not be fully recoverable. We use the Step 0 Test which allows us to first assess qualitative factors to determine whether it is more likely than not (i.e., more than 50%) that the fair value of a reporting unit is less than its carrying value. For tradenames we also provide a qualitative assessment to determine if there is any indication of impairment. In order to make this evaluation, we consider the following circumstances as well as others: · Changes in general macroeconomic conditions such as a deterioration in general economic conditions; limitations on accessing capital; fluctuations in foreign exchange rates; or other developments in equity and credit markets; · Changes in industry and market conditions such as a deterioration in the environment in which an entity operates; an increased competitive environment; a decline in market-dependent multiples or metrics (in both absolute terms and relative to peers); a change in the market for an entity’s products or services; or a regulatory or political development; · Changes in cost factors that have a negative effect on earnings and cash flows; · Decline in overall financial performance (for both actual and expected performance); · Entity and reporting unit specific events such as changes in management, key personnel, strategy, or customers; litigation; or a change in the composition or carrying amount of net assets; and · Decline in share price (in both absolute terms and relative to peers). We have concluded that our business has three reporting units. Each brand, Norwegian, Regent and Oceania Cruises, constitutes a business for which discrete financial information is available and management regularly reviews the operating results and, therefore, each brand is considered an operating segment. For our annual impairment evaluation, we performed a Step 0 Test for the Norwegian, Regent Seven Seas and Oceania Cruises reporting units. As of December 31, 2017, there was $523.0 million, $462.1 million and $403.8 million of goodwill for the Oceania Cruises, Regent Seven Seas and Norwegian reporting units, respectively. As of December 31, 2017, our annual review consisting of the Step 0 Test supports the carrying value of these assets. |
Revenue and Expense Recognition | Revenue and Expense Recognition Deposits received from guests for future voyages are recorded as advance ticket sales and are subsequently recognized as passenger ticket revenue on a pro-rata basis over the period of the voyage, concurrent with recognition of onboard and other revenue and with recognition of all associated direct costs of a voyage as cruise operating expenses. Guest cancellation fees are recognized in passenger ticket revenue in the month of the cancellation. Certain of our product offerings are accounted for under the guidance included within multi-element arrangements and result in an allocation of the fair value between passenger ticket revenue and onboard and other revenue. Revenue and expenses include port fees and taxes. The amounts included on a gross basis are $327.4 million, $286.6 million and $243.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs related to a recognized debt liability are presented in the consolidated balance sheets as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. For line of credit arrangements and for those debt facilities not fully drawn we defer and present debt issuance costs as an asset. These deferred issuance costs are amortized over the life of the loan agreement. The amortization of deferred financing fees is included in depreciation and amortization expense in the consolidated statements of cash flows; however, for purposes of the consolidated statements of operations it is included in interest expense, net. |
Foreign Currency | Foreign Currency The majority of our transactions are settled in U.S. dollars. Gains or losses resulting from transactions denominated in other currencies are recognized in income at each balance sheet date. We recognized losses for the year ended December 31, 2017 of $14.2 million and gains were approximately $4.5 million and $11.0 million for the years ended December 31, 2016 and 2015, respectively. |
Derivative Instruments and Hedging Activity | Derivative Instruments and Hedging Activity We enter into derivative contracts to reduce our exposure to fluctuations in foreign currency exchange rates, interest rates and fuel prices. The criteria used to determine whether a transaction qualifies for hedge accounting treatment includes the correlation between fluctuations in the fair value of the hedged item and the fair value of the related derivative instrument and its effectiveness as a hedge. As the derivative is marked to fair value, we elected an accounting policy to net the fair value of our derivatives when a master netting arrangement exists with our counterparties. A derivative instrument that hedges a forecasted transaction or the variability of cash flows related to a recognized asset or liability may be designated as a cash flow hedge. Changes in fair value of derivative instruments that are designated as cash flow hedges are recorded as a component of accumulated other comprehensive income (loss) until the underlying hedged transactions are recognized in earnings. To the extent that an instrument is not effective as a hedge, gains and losses are recognized in other income (expense), net in our consolidated statements of operations. Realized gains and losses related to our effective fuel hedges are recognized in fuel expense. For presentation in our consolidated statements of cash flows, we have elected to classify the cash flows from our cash flow hedges in the same category as the cash flows from the items being hedged. |
Concentrations of Credit Risk | Concentrations of Credit Risk We monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. Credit risk, including but not limited to counterparty non-performance under derivative instruments, our New Revolving Loan Facility and new ship progress payment guarantees, is not considered significant, as we primarily conduct business with large, well-established financial institutions and insurance companies that we have well-established relationships with and that have credit risks acceptable to us or the credit risk is spread out among a large number of creditors. We do not anticipate non-performance by any of our significant counterparties. |
Insurance | Insurance We use a combination of insurance and self-insurance for a number of risks including claims related to crew and guests, hull and machinery, war risk, workers’ compensation, property damage, employee healthcare and general liability. Liabilities associated with certain of these risks, including crew and passenger claims, are estimated actuarially based upon known facts, historical trends and a reasonable estimate of future expenses. While we believe these accruals are adequate, the ultimate losses incurred may differ from those recorded. |
Income Taxes | Income Taxes Deferred tax assets and liabilities are calculated in accordance with the liability method. Deferred taxes are recorded using the currently enacted tax rates that apply in the periods that the differences are expected to reverse. Deferred taxes are not discounted. We provide a valuation allowance on deferred tax assets when it is more likely than not that such assets will not be realized. With respect to acquired deferred tax assets, future reversals of the valuation allowance will first be applied against goodwill and other intangible assets before recognition of a benefit in our consolidated statements of operations. |
Share-Based Compensation | Share-Based Compensation We recognize expense for our share-based compensation awards using a fair-value-based method. Share-based compensation expense is recognized over the requisite service period for awards that are based on a service period and not contingent upon any future performance. We refer you to Note 9—“Employee Benefits and Share-Based Compensation.” |
Segment Reporting | Segment Reporting We have concluded that our business has a single reportable segment. Each brand, Norwegian, Oceania Cruises and Regent constitutes a business for which discrete financial information is available and management regularly reviews the operating results and, therefore, each brand is considered an operating segment. Our operating segments have similar economic and qualitative characteristics, including similar long-term margins and similar products and services; therefore, we aggregate all of the operating segments into one reportable segment. Although we sell cruises on an international basis, our passenger ticket revenue is primarily attributed to U.S.-sourced guests who make reservations in the U.S. Revenue attributable to U.S.-sourced guests was 77%, 81% and 75% for the years ended December 31, 2017, 2016 and 2015, respectively. No other individual country’s revenues exceeded 10% in any of our last three years. Revenues by destination were as follows (in thousands): Year Ended December 31, 2017 2016 2015 North America $ 3,285,903 $ 3,132,208 $ 2,743,007 Europe 1,347,381 1,148,403 1,120,705 Asia-Pacific 394,631 196,978 198,131 Other 368,260 396,751 283,205 Total Revenues $ 5,396,175 $ 4,874,340 $ 4,345,048 Substantially all of our long- lived assets are located outside of the U.S. and consist primarily of our ships. We have 17 ships with Bahamas registry with a carrying value of $8.0 billion as of December 31, 2017 and 16 ships with Bahamas registry with a carrying value of $7.1 billion as of December 31, 2016. We have seven ships with Marshall Island registry with a carrying value of $1.9 billion as of December 31, 2017 and 2016. We also have one ship with U.S. registry with a carrying value of $0.3 billion as of December 31, 2017 and 2016. |
Recently Issued Accounting Guidance | Recently Issued Accounting Guidance In December 2017, the Tax Cuts and Jobs Act (“the Act”) was enacted. Among other provisions, the Act reduces the U.S. federal corporate tax rate from 35% to 21%. The SEC staff issued SAB No. 118, which addresses how a company recognizes provisional amounts when a company does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the effect of the changes in the Act. The measurement period ends when a company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. As of December 31, 2017, we have not completed the accounting for the tax effects of enactment of the Act; however, as described below, we have made a reasonable estimate of the effects on existing deferred tax balances. These amounts are provisional and subject to change. The most significant impact of the Act for the Company was a $4.5 million reduction of the value of net deferred tax liabilities (which represent future tax expenses) that was recorded as a discrete tax benefit as a result of lowering the U.S. corporate income tax rate from 35% to 21%. The tax benefit represents a provisional amount and the Company’s current best estimates. Any adjustments recorded to the provisional amount through the end of 2018 will be included in income from operations as an adjustment to tax expense. The provisional amounts incorporate assumptions made based upon the Company’s current interpretation of the Act and may change as the Company receives additional clarification and implementation guidance. Other aspects of the Act are either not applicable or not expected to have a material impact on the Company’s financial statements. In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-12. The objectives of this ASU are to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements and to make certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. This ASU is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. We will adopt in the first quarter of 2018. For cash flow hedges, a cumulative-effect adjustment relating to the elimination of the separate measurement of ineffectiveness to accumulated other comprehensive income is required with a corresponding adjustment to the opening balance of retained earnings. The presentation and disclosure guidance is required prospectively. In January 2017, the FASB issued ASU No. 2017-04 which simplifies the test for goodwill impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The guidance is effective for annual or any interim goodwill impairment tests in years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not expect to early adopt this guidance. We will evaluate the impact upon adoption of this guidance to our consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16 which requires companies to recognize the income-tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than when the asset has been sold to an outside party. We will adopt the new standard effective January 1, 2018. No cumulative-effect adjustment is necessary as the Company did not have previously unamortized deferred income tax expense from past intra-entity transfers. In August 2016, the FASB issued ASU No. 2016-15 which amends Topic 230 (Statement of Cash Flows) to eliminate discrepancies in reporting certain items in the statement of cash flows. We will adopt a retrospective application in the first quarter of 2018. Currently, the only transactions that will require a reclassification is in connection with our debt extinguishment and deferred financing fees. In February 2016, the FASB issued ASU No. 2016-02 which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The ASU requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The ASU further modifies lessors’ classification criteria for leases and the accounting for sales-type and direct financing leases. The ASU will also require qualitative and quantitative disclosures designed to give financial statement users additional information on the amount, timing, and uncertainty of cash flows arising from leases. The ASU is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2018 with early adoption permitted. The ASU is to be applied using a modified retrospective approach. To evaluate the impact of the adoption of this guidance, we are currently reviewing our existing leases and evaluating contracts to determine what might be considered a lease under the new guidance. In May 2014, the FASB issued ASU No. 2014-09 which requires entities to recognize revenue through the application of a five-step model, including identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligation and recognition of revenue as the entity satisfies the performance obligations. We will adopt a modified retrospective application in the first quarter of 2018. We have reviewed our contract and business processes and we are concluding on changes to our controls to support recognition and disclosure requirements. Based on our evaluation to date, we determined no significant changes are required to our business processes, systems and controls to effectively report revenue recognition under the new standard. Upon adoption we will reclassify to prepaid expenses and other assets from advanced ticket sales certain deferred costs incurred to obtain our contracts. Adoption of the new standard will require additional disclosures, however, it is not expected to materially change the timing, classification or amount of revenue recognized in our consolidated financial statements. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of estimated residual values of ships | Useful Life Ships 30 years Computer hardware and software 3-10 years Other property and equipment 3-40 years Leasehold improvements Shorter of lease term or asset life Ship improvements Shorter of asset life or life of the ship |
Schedule of revenues by destination | Year Ended December 31, 2017 2016 2015 North America $ 3,285,903 $ 3,132,208 $ 2,743,007 Europe 1,347,381 1,148,403 1,120,705 Asia-Pacific 394,631 196,978 198,131 Other 368,260 396,751 283,205 Total Revenues $ 5,396,175 $ 4,874,340 $ 4,345,048 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of gross carrying amounts included within goodwill and intangible assets, related accumulated amortization and the weighted average amortization periods of intangible assets | December 31, 2017 Gross Carrying Accumulated Net Carrying Weighted- Customer relationship $ 120,000 $ (66,866 ) $ 53,134 6.0 Licenses 3,368 (1,601 ) 1,767 5.6 Non-compete agreements 660 (660 ) — 1.0 Total intangible assets subject to amortization $ 124,028 $ (69,127 ) $ 54,901 December 31, 2016 Gross Carrying Accumulated Net Carrying Weighted- Customer relationship $ 120,000 $ (36,593 ) $ 83,407 6.0 Licenses 3,368 (807 ) 2,561 5.6 Non-compete agreements 660 (495 ) 165 1.0 Total intangible assets subject to amortization $ 124,028 $ (37,895 ) $ 86,133 License (Indefinite-lived) $ 4,427 $ — $ — |
Schedule of Aggregate amortization expense | Year Ended December 31, 2017 2016 2015 Amortization expense $ 31,232 $ 22,160 $ 73,207 |
Schedule of estimated aggregate amortization expense | Year ended December 31, Amortization 2018 $ 26,163 2019 18,489 2020 9,906 2021 75 2022 75 |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) for the year ended December 31, 2017 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (316,186 ) $ (308,265 ) $ (7,921 ) Current period other comprehensive income before reclassifications 304,226 304,684 (458 ) Amounts reclassified 37,213 36,795 (1) 418 (2) Accumulated other comprehensive income (loss) at end of period $ 25,253 $ 33,214 (3) $ (7,961 ) (1) We refer you to Note 8—“Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. (3) Of the existing amounts related to derivatives designated as cash flow hedges, approximately $9.4 million of gain is expected to be reclassified into earnings in the next 12 months. Accumulated other comprehensive income (loss) for the year ended December 31, 2016 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (414,363 ) $ (405,945 ) $ (8,418 ) Current period other comprehensive income before reclassifications 1,776 1,711 65 Amounts reclassified 96,401 95,969 (1) 432 (2) Accumulated other comprehensive income (loss) at end of period $ (316,186 ) $ (308,265 ) $ (7,921 ) (1) We refer you to Note 8—“Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. Accumulated other comprehensive income (loss) for the year ended December 31, 2015 was as follows (in thousands): Accumulated Change Change Accumulated other comprehensive income (loss) at beginning of period $ (244,355 ) $ (234,835 ) $ (9,520 ) Current period other comprehensive income (loss) before reclassifications (262,227 ) (262,852 ) 625 Amounts reclassified 92,219 91,742 (1) 477 (2) Accumulated other comprehensive income (loss) at end of period $ (414,363 ) $ (405,945 ) $ (8,418 ) (1) We refer you to Note 8—“Fair Value Measurements and Derivatives” for the affected line items in the consolidated statements of operations. (2) Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | December 31, 2017 2016 Ships $ 11,814,409 $ 10,781,703 Ships improvements 1,060,049 807,233 Ships under construction 521,597 450,372 Land and land improvements 37,535 37,535 Other 487,921 483,744 13,921,511 12,560,587 Less: accumulated depreciation (2,881,023 ) (2,442,898 ) Property and equipment, net $ 11,040,488 $ 10,117,689 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Interest Rate Maturities Balance 2017 2016 Through 2017 2016 (in thousands) $875.0 million senior secured revolving credit facility 3.27 % — 2021 $ 78,000 $ — $750.0 million senior secured revolving credit facility — 2.70 % 2021 — 129,000 Term Loan A 3.32 % — 2021 1,385,196 — $1,506.6 million term loan A facility — 2.77 % 2021 — 1,459,033 $375.0 million Term Loan B (1) 3.18 % — 2021 371,914 — $700.0 million 4.750% senior unsecured notes 4.75 % 4.75 % 2021 693,413 691,767 $600.0 million 4.625% senior unsecured notes — 4.63 % 2020 — 592,031 €662.9 million Norwegian Epic term loan (2) 3.44 % 3.00 % 2022 328,646 395,830 €308.1 million Pride of Hawai’i loan (2) 2.31 % 1.83 % 2018 18,438 54,601 $334.1 million Norwegian Jewel term loan — 1.83 % 2017 — 26,919 €258.0 million Pride of America Hermes loan (2) — 1.90 % 2017 — 12,654 €529.8 million Breakaway one loan (2) 2.97 % 2.49 % 2025 415,039 469,100 €529.8 million Breakaway two loan (2) 4.50 % 4.50 % 2026 482,133 537,478 €590.5 million Breakaway three loan (2) 2.98 % 2.98 % 2027 595,494 653,474 €729.9 million Breakaway four loan (2) 2.98 % 2.98 % 2029 758,595 150,834 €126 million Norwegian Jewel term loan (2) — 1.82 % 2017 — 7,260 €126 million Norwegian Jade term loan (2) — 1.82 % 2017 — 7,531 €666 million Seahawk 1 term loan (2) 3.92 % 3.92 % 2030 184,837 137,514 €666 million Seahawk 2 term loan (2) 3.92 % 3.92 % 2031 90,351 42,083 Sirena loan 2.75 % 2.75 % 2019 27,344 40,465 Explorer newbuild loan 3.43 % 3.43 % 2028 295,093 320,821 Marina newbuild loan (3) 2.00 % 1.54 % 2023 245,706 290,416 Riviera newbuild loan (4) 2.11 % 1.81 % 2024 292,183 337,174 Capital lease and license obligations Various Various 2028 45,383 42,702 Total debt 6,307,765 6,398,687 Less: current portion of long-term debt (619,373 ) (560,193 ) Total long-term debt $ 5,688,392 $ 5,838,494 (1) Includes original issue discount of $0.9 million as of December 31, 2017. (2) Currently U.S. dollar-denominated. (3) Includes premium of $0.2 million as of December 31, 2017 and 2016. (4) Includes premium of $0.2 million and $0.3 million as of December 31, 2017 and 2016, respectively. |
Schedule of principal repayments on long-term debt | Year Amount 2018 $ 619,373 2019 626,334 2020 622,129 2021 2,571,257 2022 431,674 Thereafter 1,553,815 Total $ 6,424,582 |
Related Party Disclosures (Tabl
Related Party Disclosures (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of transactions with Genting HK, the Apollo Funds and the TPG Viking Funds | Shareholder Number of Percentage Apollo Holders (1) 25,478,782 11.2 % Genting HK (2) 12,898,307 5.6 % (1) The Apollo Holders include NCL Athene LLC, AIF VI NCL (AIV), L.P., AIF VI NCL (AIV II), L.P., AIF VI NCL (AIV III), L.P., AIF VI NCL (AIV IV), L.P., Apollo Overseas Partners (Delaware) VI, L.P., Apollo Overseas Partners (Delaware 892) VI, L.P., Apollo Overseas Partners VI, L.P., Apollo Overseas Partners (Germany) VI, L.P., AAA Guarantor—Co-Invest VII, L.P., AIF VI Euro Holdings, L.P., AIF VII Euro Holdings, L.P., Apollo Alternative Assets, L.P., Apollo Management VI, L.P. and Apollo Management VII, L.P. (2) Genting HK owns our ordinary share indirectly through Star NCLC Holdings Ltd., a Bermuda wholly-owned subsidiary. |
Fair Value Measurements and D32
Fair Value Measurements and Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Schedule of derivatives measured at fair value and disclosed by balance sheet location | Asset Liability Balance Sheet location December 31, December 31, December 31, December 31, Fuel swaps designated as hedging instruments Prepaid expenses and other assets $ 19,220 $ 20,288 $ 2,406 $ — Other long-term assets 19,854 — 3,469 — Accrued expenses and other liabilities — — 3,348 44,271 Other long-term liabilities 576 13,237 2,148 38,608 Foreign currency forward contracts designated as hedging instruments Prepaid expenses and other assets 52,300 — 730 — Other long-term assets 85,081 14 — — Accrued expenses and other liabilities — — — 61,788 Other long-term liabilities — — — 88,920 Interest rate swaps designated as hedging instruments Accrued expenses and other liabilities — — 1,020 3,331 Other long-term liabilities — — — 1,151 |
Schedule of gross and net amounts recognized within assets and liabilities | December 31, 2017 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 176,455 $ (6,605 ) $ 169,850 $ (127,924 ) $ 41,926 Liabilities 6,516 (576 ) 5,940 (1,020 ) 4,920 December 31, 2016 Gross Amounts Gross Total Net Gross Net Amounts Assets $ 20,302 $ — $ 20,302 $ (14 ) $ 20,288 Liabilities 238,069 (13,237 ) 224,832 (155,190 ) 69,642 |
Designated as Hedging Instrument | Fuel swaps | |
Schedule of effects of derivatives designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 50,263 $ 127,470 $ (173,513 ) Loss recognized in other income (expense), net – ineffective portion (317 ) (12,850 ) (16,011 ) Amount reclassified from accumulated other comprehensive income (loss) into fuel expense 29,721 85,448 75,808 |
Designated as Hedging Instrument | Foreign Currency Options | |
Schedule of effects of derivatives designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense $ 1,320 $ 1,320 $ 1,320 |
Designated as Hedging Instrument | Foreign Currency Forward Contracts | |
Schedule of effects of derivatives designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 254,070 $ (124,058 ) $ (84,187 ) Loss recognized in other income (expense), net – ineffective portion (73 ) (270 ) (343 ) Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense 3,121 2,625 116 |
Designated as Hedging Instrument | Foreign Currency Collar | |
Schedule of effects of derivatives designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense $ (364 ) $ (364 ) $ (364 ) |
Designated as Hedging Instrument | Interest Rate Swaps | |
Schedule of effects of derivatives designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other comprehensive income (loss) – effective portion $ 351 $ (1,701 ) $ (5,152 ) Gain (loss) recognized in other income (expense), net – ineffective portion — 3 (23 ) Amount reclassified from other comprehensive income (loss) into interest expense, net 2,997 3,946 4,614 |
Not Designated as Hedging Instrument | Fuel swaps | |
Schedule of effective of derivative dedesignated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Amount reclassified from accumulated other comprehensive income (loss) into other income (expense), net $ — $ 2,994 $ 10,000 Loss recognized in other income (expense), net — (271 ) (4,727 ) |
Not Designated as Hedging Instrument | Foreign Currency Forward Contracts | |
Schedule of effects of derivatives not designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other income (expense), net $ — $ (6,133 ) $ 684 |
Not Designated as Hedging Instrument | Foreign Currency Collar | |
Schedule of effects of derivatives not designated as cash flow hedges | Year Ended December 31, 2017 2016 2015 Gain (loss) recognized in other income (expense), net $ — $ 10,312 $ (26,249 ) |
Employee Benefits and Share-B33
Employee Benefits and Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of summary of option activity | Number of Share Option Weighted-Average Exercise Weighted- Aggregate Intrinsic Value Time- Performance- Market- Time- Performance- Market- (years) (in thousands) Outstanding as of January 1, 2017 7,775,058 432,978 208,333 $ 48.04 $ 23.86 $ 59.43 7.81 $ 35,429 Granted — 156,249 — — 59.43 — Exercised (738,672 ) (121,509 ) — 34.02 19.00 — Forfeited and cancelled (455,488 ) (93,749 ) — 54.27 59.43 — Outstanding as of December 31, 2017 6,580,898 373,969 208,333 $ 49.18 $ 31.39 $ 59.43 6.99 $ 50,021 Vested and expected to vest as of December 31, 2017 6,580,898 373,969 — $ 49.18 $ 31.39 $ — 6.98 $ 50,021 Exercisable as of December 31, 2017 4,061,424 373,969 — $ 47.98 $ 31.39 $ — 6.69 $ 39,115 |
Schedule of restricted share activity of NCLH shares | Number of Weighted- Non-vested as of January 1, 2016 16,872 $ 7.63 Vested (16,014 ) 4.91 Non-vested and expected to vest as of December 31, 2017 858 $ 58.33 |
Schedule of amounts related to the Shipboard Retirement Plan | As of or for the Year Ended December 31, 2017 2016 2015 Pension expense: Service cost $ 1,987 $ 1,863 $ 1,793 Interest cost 887 874 738 Amortization of prior service cost 378 378 378 Amortization of actuarial loss 40 54 99 Total pension expense $ 3,292 $ 3,169 $ 3,008 Change in projected benefit obligation: Projected benefit obligation at beginning of year $ 22,605 $ 21,078 $ 19,730 Service cost 1,987 1,863 1,793 Interest cost 887 874 738 Actuarial gain (loss) 458 (65 ) (625 ) Direct benefit payments (1,350 ) (1,145 ) (558 ) Projected benefit obligation at end of year $ 24,587 $ 22,605 $ 21,078 Amounts recognized in the consolidated balance sheets: Projected benefit obligation $ 24,587 $ 22,605 $ 21,078 For the Year Ended December 31, 2017 2016 2015 Amounts recognized in accumulated other comprehensive income (loss): Prior service cost $ (4,537 ) $ (4,915 ) $ (5,293 ) Accumulated actuarial loss (3,426 ) (3,008 ) (3,126 ) Accumulated other comprehensive income (loss) $ (7,963 ) $ (7,923 ) $ (8,419 ) |
Schedule of pension benefits expected to be paid in each of the next five years and in aggregate for the five years thereafter | Year Amount 2018 $ 1,050 2019 1,032 2020 1,035 2021 1,126 2022 1,217 Next five years 8,691 |
Schedule of compensation expense recognized for share-based compensation | Share-Based Compensation Expense Classification of expense 2017 2016 2015 (In thousands) Payroll and related (1) $ 9,455 $ 7,793 $ — Marketing, general and administrative (2) 77,584 58,621 42,209 Total share-based compensation expense $ 87,039 $ 66,414 $ 42,209 (1) Amounts relate to equity granted to certain of our shipboard officers. (2) Amounts relate to equity granted to certain of our corporate employees. |
Time Based Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of assumptions used within the option-pricing model | 2016 2015 Dividend yield —% —% Expected share price volatility 30.36%-33.01% 32.32%-45.33% Risk-free interest rate 1.20%-1.48% 1.34%-1.92% Expected term 6.00 years 6.00-6.50 years |
Performance-Based Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of assumptions used within the option-pricing model | 2017 2016 2015 Dividend yield —% —% —% Expected share price volatility 25.97% 25.97%-30.21% 29.31%-29.86% Risk-free interest rate 1.81% 1.01%-1.93% 1.76% Expected term 4.20 years 4.38-5.13 years 4.88-5.38 years |
Market based share option awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of assumptions used within the option-pricing model | 2015 Dividend yield —% Expected share price volatility 30.00% Risk-free interest rate 1.34% Expected term Mid-point from vesting to assumed options expiration |
Restricted Share Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted share activity of NCLH shares | Number of Weighted- Number of Weighted- Number of Weighted- Non-vested as of January 1, 2017 1,305,335 $ 50.38 — $ — 50,000 $ 59.43 Granted 1,803,327 $ 51.13 37,500 $ 49.76 — — Vested (447,669 ) $ 50.55 (15,000 ) $ 49.76 — — Forfeited or expired (105,516 ) $ 50.76 (22,500 ) $ 49.76 — — Non-vested as of December 31, 2017 2,555,477 $ 50.86 — $ — 50,000 $ 59.43 Non-vested and expected to vest as of December 31, 2017 2,555,477 $ 50.86 — — — $ — |
Schedule of restricted share units valuation assumption | 2015 Dividend yield 0% Expected share price volatility 30.00% Risk-free interest rate 1.34% Expected term Mid-point from vesting to assumed awards expiration |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of net income before income taxes | Year Ended 2017 2016 2015 Bermuda $ — $ — $ — Foreign - Other 773,269 643,788 437,778 Total 773,269 643,788 437,778 |
Schedule of components of the provision for income taxes | Year Ended 2017 2016 2015 Current: Bermuda $ — $ — $ — United States 1,026 (36 ) (36 ) Foreign - Other (4,616 ) (3,623 ) (305 ) Total current: (3,590 ) (3,659 ) (341 ) Deferred: Bermuda — — — United States (11,370 ) 3,594 363 Foreign - Other 486 — — Total deferred: (10,884 ) 3,594 363 Income tax benefit (expense) $ (14,474 ) $ (65 ) $ 22 |
Schedule of reconciliation of income tax expense computed by applying our Bermuda statutory rate and reported income tax expense | Year Ended 2017 2016 2015 Tax at Bermuda statutory rate $ — $ — $ — Foreign income taxes at different rates (17,978 ) (2,383 ) 58 Tax contingencies 946 (286 ) (36 ) Return to provision adjustments (2,192 ) (990 ) — Benefit from change in tax rate 4,750 — — Valuation allowance — 3,594 — Total $ (14,474 ) $ (65 ) $ 22 |
Schedule of deferred tax assets and liabilities | As of December 31, 2017 2016 Deferred tax assets: Loss carryforwards $ 58,291 $ 102,636 Other 1,825 1,429 Valuation allowance (42,154 ) (64,573 ) Total net deferred tax assets 17,962 39,492 Deferred tax liabilities: Property and equipment (26,321 ) (37,001 ) Total deferred tax liabilities (26,321 ) (37,001 ) Net deferred tax asset (liability) $ (8,359 ) $ 2,491 |
Schedule of reconciliation of the total amounts of unrecognized tax benefits | As of December 31, 2017 2016 Unrecognized tax benefits, beginning of the year $ 1,644 $ 1,394 Gross increases in tax positions from prior periods 300 250 Settlement of tax positions (250 ) — Lapse of statute of limitations (1,162 ) — Unrecognized tax benefits, end of year $ 532 $ 1,644 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Schedule of minimum annual payments | Year Amount 2018 $ 15,204 2019 14,788 2020 14,185 2021 13,227 2022 13,277 Thereafter 61,110 Total minimum annual rentals $ 131,791 |
Ship Construction Contracts | |
Schedule of minimum annual payments | Year Amount 2018 $ 1,016,892 2019 893,881 2020 469,334 2021 172,872 2022 968,340 Thereafter 2,616,900 Total minimum annual payments $ 6,138,219 |
Port Facility Commitments | |
Schedule of minimum annual payments | Year Amount 2018 $ 30,509 2019 21,460 2020 21,928 2021 18,179 2022 5,137 Thereafter 41,095 Total port facility future commitments $ 138,308 |
Quarterly Selected Financial 36
Quarterly Selected Financial Data (Unaudited) (in thousands) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | First Quarter Second Quarter Third Quarter Fourth Quarter 2017 2016 2017 2016 2017 2016 2017 2016 Total revenue $ 1,150,781 $ 1,077,632 $ 1,344,103 $ 1,186,835 $ 1,651,738 $ 1,484,736 $ 1,249,553 $ 1,125,137 Operating income 120,232 132,266 275,755 227,756 477,453 414,260 178,012 154,667 Net income 63,138 74,973 201,441 148,099 396,227 346,003 97,989 74,648 |
Description of Business and O37
Description of Business and Organization (Detail Textuals) | 12 Months Ended |
Dec. 31, 2017CruiseShipBerth | |
Description Of Business And Organization [Line Items] | |
Number of cruise ships | 25 |
Capacity of ship, berths | Berth | 50,400 |
Project Leonardo | |
Description Of Business And Organization [Line Items] | |
Increased number of berths | Berth | 72,300 |
Ships launching period through 2025 | |
Description Of Business And Organization [Line Items] | |
Number of additional ships | 7 |
Ships launching period through 2025 | Project Leonardo | |
Description Of Business And Organization [Line Items] | |
Number of cruise ships | 4 |
Capacity of ship, berths | Berth | 3,300 |
Number of additional ships | 4 |
Ships launching period in 2026 and 2027 | |
Description Of Business And Organization [Line Items] | |
Number of additional ships | 2 |
Ship order delivery in winter 2020 | |
Description Of Business And Organization [Line Items] | |
Capacity of ship, berths | Berth | 750 |
Description of Business and O38
Description of Business and Organization (Detail Textuals 1) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | |||||
Jan. 31, 2013 | Feb. 28, 2011 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 31, 2008 | ||
Description Of Business And Organization [Line Items] | ||||||
Ordinary shares, par value (in dollars per share) | $ 0.0012 | $ 0.0012 | ||||
Apollo Holders | ||||||
Description Of Business And Organization [Line Items] | ||||||
Ordinary shares ownership percentage | 11.20% | [1] | 50.00% | |||
Tpg Viking Funds | ||||||
Description Of Business And Organization [Line Items] | ||||||
Ordinary shares ownership percentage | 12.50% | |||||
Norwegian Cruise Line Holdings Ltd. | ||||||
Description Of Business And Organization [Line Items] | ||||||
Number of ordinary shares issued (in shares) | 10,000 | |||||
Ordinary shares, par value (in dollars per share) | $ 0.001 | |||||
Norwegian Cruise Line Holdings Ltd. | IPO | ||||||
Description Of Business And Organization [Line Items] | ||||||
Ordinary shares ownership percentage | 100.00% | |||||
Contribution to NCLC | $ 460 | |||||
Number of ordinary shares issued (in shares) | 27,058,824 | |||||
Net proceeds from ordinary shares sale | $ 473.9 | |||||
Norwegian Cruise Line Holdings Ltd. | Sponsors | ||||||
Description Of Business And Organization [Line Items] | ||||||
Ordinary shares ownership percentage | 16.80% | |||||
[1] | The Apollo Holders include NCL Athene LLC, AIF VI NCL (AIV), L.P., AIF VI NCL (AIV II), L.P., AIF VI NCL (AIV III), L.P., AIF VI NCL (AIV IV), L.P., Apollo Overseas Partners (Delaware) VI, L.P., Apollo Overseas Partners (Delaware 892) VI, L.P., Apollo Overseas Partners VI, L.P., Apollo Overseas Partners (Germany) VI, L.P., AAA Guarantor Co-Invest VII, L.P., AIF VI Euro Holdings, L.P., AIF VII Euro Holdings, L.P., Apollo Alternative Assets, L.P., Apollo Management VI, L.P. and Apollo Management VII, L.P. |
Summary of Significant Accoun39
Summary of Significant Accounting Policies - Summary of estimated useful lives of assets (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Ships | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | 30 years |
Computer hardware and software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | 3 years |
Computer hardware and software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | 10 years |
Other property and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | 3 years |
Other property and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | 40 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | Shorter of lease term or asset life |
Ship Improvements | |
Property, Plant and Equipment [Line Items] | |
Property plant and equipment, useful life | Shorter of asset life or life of the ship |
Summary of Significant Accoun40
Summary of Significant Accounting Policies - Revenues by destination (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule Of Significant Accounting Policies [Line Items] | |||||||||||
Revenues | $ 1,249,553 | $ 1,651,738 | $ 1,344,103 | $ 1,150,781 | $ 1,125,137 | $ 1,484,736 | $ 1,186,835 | $ 1,077,632 | $ 5,396,175 | $ 4,874,340 | $ 4,345,048 |
North America | |||||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||||
Revenues | 3,285,903 | 3,132,208 | 2,743,007 | ||||||||
Europe | |||||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||||
Revenues | 1,347,381 | 1,148,403 | 1,120,705 | ||||||||
Asia-Pacific | |||||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||||
Revenues | 394,631 | 196,978 | 198,131 | ||||||||
Other | |||||||||||
Schedule Of Significant Accounting Policies [Line Items] | |||||||||||
Revenues | $ 368,260 | $ 396,751 | $ 283,205 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies (Detail Textuals) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($)CruiseShipSegment | Dec. 31, 2016USD ($)CruiseShip | Dec. 31, 2015USD ($) | |
Schedule Of Significant Accounting Policies [Line Items] | |||
Reclassification of revenue from passenger ticket revenue to onboard and other revenue | $ 21,900 | ||
Allowance for doubtful accounts receivable | 5,900 | $ 4,700 | |
Advertising costs included in prepaid expenses and other assets | 2,400 | 1,300 | |
Expenses related to advertising costs | 289,100 | 270,500 | $ 232,200 |
Goodwill | $ 1,388,931 | 1,388,931 | |
Reduction in estimated residual values, percentage | 15.00% | ||
Gross basis revenue and expenses include port fees and taxes | $ 327,400 | 286,600 | 243,800 |
Foreign currency transaction gain (loss) | $ (14,200) | 4,500 | $ 11,000 |
Number of reportable segments | Segment | 1 | ||
Number of cruise ships | CruiseShip | 25 | ||
Ship, carrying value | $ 11,040,488 | $ 10,117,689 | |
US corporate income tax rate | 35.00% | ||
Income tax expense due to reduction of deferred tax liabilities | $ 4,500 | ||
Corporate income tax rate effective in 2018 | 21.00% | ||
Oceania Cruises | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Goodwill | $ 523,000 | ||
Regent | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Goodwill | 462,100 | ||
Norwegian | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Goodwill | $ 403,800 | ||
Bahamas registry | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Number of cruise ships | CruiseShip | 17 | 16 | |
Ship, carrying value | $ 8,000,000 | $ 7,100,000 | |
Marshall Island registry | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Number of cruise ships | CruiseShip | 7 | ||
Ship, carrying value | $ 1,900,000 | 1,900,000 | |
U.S. registry | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Number of cruise ships | CruiseShip | 1 | ||
Ship, carrying value | $ 300,000 | $ 300,000 | |
Revenue | |||
Schedule Of Significant Accounting Policies [Line Items] | |||
Percentage of revenue attributable to U.S.- sourced passengers | 77.00% | 81.00% | 75.00% |
Concentration risk, benchmark | No other individual country's revenues exceeded 10% in any of our last three years. | No other individual country's revenues exceeded 10% in any of our last three years. | No other individual country's revenues exceeded 10% in any of our last three years. |
Goodwill and Intangible Asset42
Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 124,028 | $ 124,028 |
Intangible assets subject to amortization, Accumulated Amortization | (69,127) | (37,895) |
Intangible assets subject to amortization, Net Carrying Amount | 54,901 | 86,133 |
License (Indefinite-lived) | 4,427 | |
Customer relationship | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | 120,000 | 120,000 |
Intangible assets subject to amortization, Accumulated Amortization | (66,866) | (36,593) |
Intangible assets subject to amortization, Net Carrying Amount | $ 53,134 | $ 83,407 |
Weighted - Average Amortization Period (Years) | 6 years | 6 years |
Licenses | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 3,368 | $ 3,368 |
Intangible assets subject to amortization, Accumulated Amortization | (1,601) | (807) |
Intangible assets subject to amortization, Net Carrying Amount | $ 1,767 | $ 2,561 |
Weighted - Average Amortization Period (Years) | 5 years 7 months 6 days | 5 years 7 months 6 days |
Non-compete agreements | ||
Schedule Of Intangible Assets [Line Items] | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 660 | $ 660 |
Intangible assets subject to amortization, Accumulated Amortization | (660) | (495) |
Intangible assets subject to amortization, Net Carrying Amount | $ 0 | $ 165 |
Weighted - Average Amortization Period (Years) | 1 year | 1 year |
Goodwill and Intangible Asset43
Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 31,232 | $ 22,160 | $ 73,207 |
Goodwill and Intangible Asset44
Goodwill and Intangible Assets (Details 2) $ in Thousands | Dec. 31, 2017USD ($) |
Amortization Expense | |
2,018 | $ 26,163 |
2,019 | 18,489 |
2,020 | 9,906 |
2,021 | 75 |
2,022 | $ 75 |
Goodwill and Intangible Asset45
Goodwill and Intangible Assets (Detail Textuals) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule Of Intangible Assets [Line Items] | ||
Carrying values | $ 4,427 | |
Goodwill | ||
Schedule Of Intangible Assets [Line Items] | ||
Carrying values | $ 1,400,000 | 1,400,000 |
Tradenames | ||
Schedule Of Intangible Assets [Line Items] | ||
Carrying values | $ 800,000 | $ 800,000 |
Accumulated Other Comprehensi46
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income (loss) at beginning of period | $ (316,186) | $ (414,363) | $ (244,355) | ||
Current period other comprehensive income (loss) before reclassifications | 304,226 | 1,776 | (262,227) | ||
Amounts reclassified | 37,213 | 96,401 | 92,219 | ||
Accumulated other comprehensive income (loss) at end of period | 25,253 | (316,186) | (414,363) | ||
Change Related to Cash Flow Hedges | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income (loss) at beginning of period | (308,265) | (405,945) | (234,835) | ||
Current period other comprehensive income (loss) before reclassifications | 304,684 | 1,711 | (262,852) | ||
Amounts reclassified | [1] | 36,795 | 95,969 | 91,742 | |
Accumulated other comprehensive income (loss) at end of period | 33,214 | [2] | (308,265) | (405,945) | |
Change Related to Shipboard Retirement Plan | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Accumulated other comprehensive income (loss) at beginning of period | (7,921) | (8,418) | (9,520) | ||
Current period other comprehensive income (loss) before reclassifications | (458) | 65 | 625 | ||
Amounts reclassified | [3] | 418 | 432 | 477 | |
Accumulated other comprehensive income (loss) at end of period | $ (7,961) | $ (7,921) | $ (8,418) | ||
[1] | We refer you to Note 8-"Fair Value Measurements and Derivatives" for the affected line items in the consolidated statements of operations. | ||||
[2] | Of the existing amounts related to derivatives designated as cash flow hedges, approximately $9.4 million of gain is expected to be reclassified into earnings in the next 12 months. | ||||
[3] | Amortization of prior-service cost and actuarial loss reclassified to payroll and related expense. |
Accumulated Other Comprehensi47
Accumulated Other Comprehensive Income (Loss) (Parentheticals) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Change Related to Cash Flow Hedges | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Amount expected to be reclassified into earnings | $ 9.4 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 13,921,511 | $ 12,560,587 |
Less: accumulated depreciation | (2,881,023) | (2,442,898) |
Property and equipment, net | 11,040,488 | 10,117,689 |
Ships | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 11,814,409 | 10,781,703 |
Ships improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 1,060,049 | 807,233 |
Ships under construction | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 521,597 | 450,372 |
Land and land improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 37,535 | 37,535 |
Other | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 487,921 | $ 483,744 |
Property and Equipment, Net (49
Property and Equipment, Net (Detail Textuals) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense | $ 509,957 | $ 432,495 | $ 432,114 |
Repairs and maintenance expenses including Dry-docking expenses | 157,200 | 155,400 | 124,800 |
Interest costs associated with construction of ship | $ 29,000 | $ 33,700 | $ 31,900 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | ||
Debt Instrument [Line Items] | |||
Total debt | $ 6,307,765 | $ 6,398,687 | |
Less: current portion of long-term debt | (619,373) | (560,193) | |
Total long-term debt | $ 5,688,392 | $ 5,838,494 | |
$875.0 million senior secured revolving credit facility | |||
Debt Instrument [Line Items] | |||
Interest Rate | 3.27% | 0.00% | |
Extended maturity year | 2,021 | ||
Total debt | $ 78,000 | $ 0 | |
$750.0 million senior secured revolving credit facility | |||
Debt Instrument [Line Items] | |||
Interest Rate | 0.00% | 2.70% | |
Extended maturity year | 2,021 | ||
Total debt | $ 0 | $ 129,000 | |
Term Loan A | |||
Debt Instrument [Line Items] | |||
Interest Rate | 3.32% | 0.00% | |
Extended maturity year | 2,021 | ||
Total debt | $ 1,385,196 | $ 0 | |
$1,506.6 million term loan A facility | |||
Debt Instrument [Line Items] | |||
Interest Rate | 0.00% | 2.77% | |
Extended maturity year | 2,021 | ||
Total debt | $ 0 | $ 1,459,033 | |
$375.0 million Term Loan B | |||
Debt Instrument [Line Items] | |||
Interest Rate | [1] | 3.18% | 0.00% |
Extended maturity year | [1] | 2,021 | |
Total debt | [1] | $ 371,914 | $ 0 |
$700.0 million 4.750% senior unsecured notes | |||
Debt Instrument [Line Items] | |||
Interest Rate | 4.75% | 4.75% | |
Extended maturity year | 2,021 | ||
Total debt | $ 693,413 | $ 691,767 | |
$600.0 million 4.625% senior unsecured notes | |||
Debt Instrument [Line Items] | |||
Interest Rate | 0.00% | 4.63% | |
Extended maturity year | 2,020 | ||
Total debt | $ 0 | $ 592,031 | |
Norwegian Epic term loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 3.44% | 3.00% |
Extended maturity year | [2] | 2,022 | |
Total debt | [2] | $ 328,646 | $ 395,830 |
Pride of Hawaii loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 2.31% | 1.83% |
Extended maturity year | [2] | 2,018 | |
Total debt | [2] | $ 18,438 | $ 54,601 |
Norwegian Jewel term loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | 0.00% | 1.83% | |
Extended maturity year | 2,017 | ||
Total debt | $ 0 | $ 26,919 | |
Pride of America Hermes Loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 0.00% | 1.90% |
Extended maturity year | [2] | 2,017 | |
Total debt | [2] | $ 0 | $ 12,654 |
Breakaway one loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 2.97% | 2.49% |
Extended maturity year | [2] | 2,025 | |
Total debt | [2] | $ 415,039 | $ 469,100 |
Breakaway two loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 4.50% | 4.50% |
Extended maturity year | [2] | 2,026 | |
Total debt | [2] | $ 482,133 | $ 537,478 |
Breakaway three loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 2.98% | 2.98% |
Extended maturity year | [2] | 2,027 | |
Total debt | [2] | $ 595,494 | $ 653,474 |
Breakaway four loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 2.98% | 2.98% |
Extended maturity year | [2] | 2,029 | |
Total debt | [2] | $ 758,595 | $ 150,834 |
Norwegian Jewel term loan one | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 0.00% | 1.82% |
Extended maturity year | [2] | 2,017 | |
Total debt | [2] | $ 0 | $ 7,260 |
Norwegian Jade Term Loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 0.00% | 1.82% |
Extended maturity year | [2] | 2,017 | |
Total debt | [2] | $ 0 | $ 7,531 |
Seahawk 1 term loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 3.92% | 3.92% |
Extended maturity year | [2] | 2,030 | |
Total debt | [2] | $ 184,837 | $ 137,514 |
Seahawk 2 term loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [2] | 3.92% | 3.92% |
Extended maturity year | [2] | 2,031 | |
Total debt | [2] | $ 90,351 | $ 42,083 |
Sirena loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | 2.75% | 2.75% | |
Extended maturity year | 2,019 | ||
Total debt | $ 27,344 | $ 40,465 | |
Explorer newbuild loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | 3.43% | 3.43% | |
Extended maturity year | 2,028 | ||
Total debt | $ 295,093 | $ 320,821 | |
Marina newbuild loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [3] | 2.00% | 1.54% |
Extended maturity year | [3] | 2,023 | |
Total debt | [3] | $ 245,706 | $ 290,416 |
Riviera newbuild loan | |||
Debt Instrument [Line Items] | |||
Interest Rate | [4] | 2.11% | 1.81% |
Extended maturity year | [4] | 2,024 | |
Total debt | [4] | $ 292,183 | $ 337,174 |
Capital lease obligations | |||
Debt Instrument [Line Items] | |||
Extended maturity year | 2,028 | ||
Total debt | $ 45,383 | $ 42,702 | |
[1] | Includes original issue discount of $0.9 million as of December 31, 2017. | ||
[2] | Currently U.S. dollar-denominated. | ||
[3] | Includes premium of $0.2 million as of December 31, 2017 and 2016. | ||
[4] | Includes premium of $0.2 million and $0.3 million as of December 31, 2017 and 2016, respectively. |
Long-Term Debt (Parentheticals)
Long-Term Debt (Parentheticals) (Details) € in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2017EUR (€) | Dec. 31, 2016EUR (€) | |
$875.0 million senior secured revolving credit facility | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | $ 875 | |||
$750.0 million senior secured revolving credit facility | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | $ 750 | |||
$1,506.6 million term loan A facility | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | 1,506.6 | |||
$375.0 million Term Loan B | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | 375 | |||
Net unamortized premium | $ | 0.9 | |||
$700.0 million 4.750% senior unsecured notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | $ 700 | $ 700 | ||
Interest rate | 4.75% | 4.75% | ||
$600.0 million 4.625% senior unsecured notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | $ 600 | |||
Interest rate | 4.625% | |||
Norwegian Epic term loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | € 662.9 | € 662.9 | ||
Pride of Hawaii loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 308.1 | 308.1 | ||
Norwegian Jewel term loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ | $ 334.1 | |||
Pride of America Hermes Loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 258 | |||
Breakaway one loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 529.8 | 529.8 | ||
Breakaway two loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 529.8 | 529.8 | ||
Breakaway three loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 590.5 | 590.5 | ||
Breakaway four loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 729.9 | 729.9 | ||
Norwegian Jewel term loan one | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 126 | |||
Norwegian Jade Term Loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 126 | |||
Seahawk 1 term loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 666 | 666 | ||
Seahawk 2 term loan | ||||
Debt Instrument [Line Items] | ||||
Principal amount | € 666 | € 666 | ||
Marina newbuild loan | ||||
Debt Instrument [Line Items] | ||||
Net unamortized premium | $ | $ 0.2 | 0.2 | ||
Riviera newbuild loan | ||||
Debt Instrument [Line Items] | ||||
Net unamortized premium | $ | $ 0.2 | $ 0.3 |
Long-Term Debt- Summary of prin
Long-Term Debt- Summary of principal repayments on Long-Term Debt (Details 1) $ in Thousands | Dec. 31, 2017USD ($) |
Debt Disclosure [Abstract] | |
2,018 | $ 619,373 |
2,019 | 626,334 |
2,020 | 622,129 |
2,021 | 2,571,257 |
2,022 | 431,674 |
Thereafter | 1,553,815 |
Total | $ 6,424,582 |
Long-Term Debt (Detail Textuals
Long-Term Debt (Detail Textuals) - USD ($) | Oct. 10, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||||
Interest expense, net | $ 267,800,000 | $ 276,900,000 | $ 221,900,000 | |
Amortization of deferred financing costs | 32,500,000 | 34,700,000 | 36,700,000 | |
Loss on extinguishment of debt | 23,900,000 | 27,700,000 | $ 12,700,000 | |
Accrued interest liability | $ 31,900,000 | 32,500,000 | ||
New Term Loan A Facility | ||||
Debt Instrument [Line Items] | ||||
Extended maturity year | 2,021 | |||
New Revolving Loan Facility | New Term Loan A Facility | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Eurocurrency loans | |||
Initial applicable margin rate | 1.75% | |||
New Revolving Loan Facility | New Term Loan A Facility | Eurodollar | Maximum | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Eurocurrency loans | |||
Initial applicable margin rate | 2.00% | |||
New Revolving Loan Facility | New Term Loan A Facility | Eurodollar | Minimum | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Eurocurrency loans | |||
Initial applicable margin rate | 1.25% | |||
New Revolving Loan Facility | New Term Loan A Facility | Base Rate | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Base rate loans | |||
Initial applicable margin rate | 0.75% | |||
New Revolving Loan Facility | New Term Loan A Facility | Base Rate | Maximum | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Base rate loans | |||
Initial applicable margin rate | 1.00% | |||
New Revolving Loan Facility | New Term Loan A Facility | Base Rate | Minimum | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Base rate loans | |||
Initial applicable margin rate | 0.25% | |||
New Revolving Loan Facility | New Term Loan B Facility | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Eurocurrency loans | |||
Initial applicable margin rate | 1.75% | |||
New Revolving Loan Facility | New Term Loan B Facility | Base Rate | ||||
Debt Instrument [Line Items] | ||||
Description of variable rate basis | Base rate loans | |||
Initial applicable margin rate | 0.75% | |||
NCLH | New Term Loan A Facility | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 1,412,000,000 | |||
NCLH | New Term Loan B Facility | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 375,000,000 | |||
Extended maturity year | 2,021 | |||
NCLH | 4.625% Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Extended maturity year | 2,020 | |||
Interest rate | 4.625% | |||
Redemption price including accrued and unpaid interest | $ 1,044.41 | |||
Outstanding principal amount of notes | 1,000 | |||
NCLH | New Revolving Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Aggregate amount of commitments | $ 875,000,000 | $ 750,000,000 |
Related Party Disclosures (Deta
Related Party Disclosures (Details) - shares | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 31, 2008 | ||
Related Party Transaction [Line Items] | |||||
Number of Shares | 31,164,004 | 31,164,004 | |||
Apollo Holders | |||||
Related Party Transaction [Line Items] | |||||
Number of Shares | [1] | 25,478,782 | |||
Percentage Ownership | 11.20% | [1] | 50.00% | ||
Genting HK | |||||
Related Party Transaction [Line Items] | |||||
Number of Shares | [2] | 12,898,307 | |||
Percentage Ownership | [2] | 5.60% | |||
[1] | The Apollo Holders include NCL Athene LLC, AIF VI NCL (AIV), L.P., AIF VI NCL (AIV II), L.P., AIF VI NCL (AIV III), L.P., AIF VI NCL (AIV IV), L.P., Apollo Overseas Partners (Delaware) VI, L.P., Apollo Overseas Partners (Delaware 892) VI, L.P., Apollo Overseas Partners VI, L.P., Apollo Overseas Partners (Germany) VI, L.P., AAA Guarantor Co-Invest VII, L.P., AIF VI Euro Holdings, L.P., AIF VII Euro Holdings, L.P., Apollo Alternative Assets, L.P., Apollo Management VI, L.P. and Apollo Management VII, L.P. | ||||
[2] | Genting HK owns our ordinary share indirectly through Star NCLC Holdings Ltd., a Bermuda wholly-owned subsidiary. |
Related Party Disclosures (De55
Related Party Disclosures (Detail Textuals) - USD ($) $ in Millions | 1 Months Ended | |
Dec. 31, 2015 | Jun. 30, 2012 | |
Genting HK | Norwegian Sky | ||
Related Party Transaction [Line Items] | ||
Purchase price of acquisition | $ 259.3 | |
Apollo Holders And Genting HK | Norwegian Cruise Line Holdings Ltd. | Secondary Equity Offering | ||
Related Party Transaction [Line Items] | ||
Stock repurchase, shares | 348,553 | |
Stock repurchase, value | $ 20 |
Fair Value Measurements and D56
Fair Value Measurements and Derivatives - Derivatives measured at fair value and discloses balance sheet location (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 176,455 | $ 20,302 |
Derivative liabilities, fair value | 6,516 | 238,069 |
Fuel swaps | Designated as Hedging Instrument | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 19,220 | 20,288 |
Derivative liabilities, fair value | 2,406 | 0 |
Fuel swaps | Designated as Hedging Instrument | Other long-term assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 19,854 | 0 |
Derivative liabilities, fair value | 3,469 | 0 |
Fuel swaps | Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0 | 0 |
Derivative liabilities, fair value | 3,348 | 44,271 |
Fuel swaps | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 576 | 13,237 |
Derivative liabilities, fair value | 2,148 | 38,608 |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Prepaid expenses and other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 52,300 | 0 |
Derivative liabilities, fair value | 730 | 0 |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Other long-term assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 85,081 | 14 |
Derivative liabilities, fair value | 0 | 0 |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0 | 0 |
Derivative liabilities, fair value | 0 | 61,788 |
Foreign Currency Forward Contracts | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0 | 0 |
Derivative liabilities, fair value | 0 | 88,920 |
Interest Rate Swaps | Designated as Hedging Instrument | Accrued expenses and other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0 | 0 |
Derivative liabilities, fair value | 1,020 | 3,331 |
Interest Rate Swaps | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0 | 0 |
Derivative liabilities, fair value | $ 0 | $ 1,151 |
Fair Value Measurements and D57
Fair Value Measurements and Derivatives - Amounts Recognized Within Assets and Liabilities Based on Right of Offset (Details 1) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value Disclosures [Abstract] | ||
Gross Amounts, Assets | $ 176,455 | $ 20,302 |
Gross Amounts Offset, Assets | (6,605) | 0 |
Total Net Amounts, Assets | 169,850 | 20,302 |
Gross Amounts Not Offset, Assets | (127,924) | (14) |
Net Amounts, Assets | 41,926 | 20,288 |
Gross Amounts, Liabilities | 6,516 | 238,069 |
Gross Amounts Offset, Liabilities | (576) | (13,237) |
Total Net Amounts, Liabilities | 5,940 | 224,832 |
Gross Amount Not Offset, Liabilities | (1,020) | (155,190) |
Net Amounts, Liabilities | $ 4,920 | $ 69,642 |
Fair Value Measurements and D58
Fair Value Measurements and Derivatives - Effects of Derivatives Designated as Cash flow Hedges (Details 2) - Cash Flow Hedging - Designated as Hedging Instrument - Fuel swaps - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other comprehensive income (loss) effective portion | $ 50,263 | $ 127,470 | $ (173,513) |
Loss recognized in other income (expense), net ineffective portion | (317) | (12,850) | (16,011) |
Amount reclassified from accumulated other comprehensive income (loss) into fuel expense | $ 29,721 | $ 85,448 | $ 75,808 |
Fair Value Measurements and D59
Fair Value Measurements and Derivatives - Consolidated financial statements of fuel swaps dedesignated and immediately recognized into earnings (Details 3) - Cash Flow Hedging - Fuel swaps - Dedesignated as Hedging Instrument - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Amount reclassified from accumulated other comprehensive income (loss) into other income (expense), net | $ 0 | $ 2,994 | $ 10,000 |
Loss recognized in other income (expense), net | $ 0 | $ (271) | $ (4,727) |
Fair Value Measurements and D60
Fair Value Measurements and Derivatives - Effects of Foreign Currency Options Designated as Cash flow Hedges (Details 4) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flow Hedging | Designated as Hedging Instrument | Foreign Currency Options | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense | $ 1,320 | $ 1,320 | $ 1,320 |
Fair Value Measurements and D61
Fair Value Measurements and Derivatives - Effects of Foreign Currency Forward Contracts Designated as Cash flow Hedges (Details 5) - Cash Flow Hedging - Designated as Hedging Instrument - Foreign Currency Forward Contracts - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other comprehensive income (loss) effective portion | $ 254,070 | $ (124,058) | $ (84,187) |
Loss recognized in other income (expense), net ineffective portion | (73) | (270) | (343) |
Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense | $ 3,121 | $ 2,625 | $ 116 |
Fair Value Measurements and D62
Fair Value Measurements and Derivatives - Effects of Foreign Currency Forward Contracts not Designated as Cash flow Hedges (Details 6) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flow Hedging | Not Designated as Hedging Instrument | Foreign Currency Forward Contracts | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other income (expense), net | $ 0 | $ (6,133) | $ 684 |
Fair Value Measurements and D63
Fair Value Measurements and Derivatives - Effects of Foreign Currency Collar Designated as Cash Flow Hedges (Details 7) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flow Hedging | Designated as Hedging Instrument | Foreign Currency Collar | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount reclassified from accumulated comprehensive income (loss) into depreciation and amortization expense | $ (364) | $ (364) | $ (364) |
Fair Value Measurements and D64
Fair Value Measurements and Derivatives - Effects of Foreign Currency Collar not Designated as hedging instrument (Details 8) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Flow Hedging | Not Designated as Hedging Instrument | Foreign Currency Collar | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other income (expense), net | $ 0 | $ 10,312 | $ (26,249) |
Fair Value Measurements and D65
Fair Value Measurements and Derivatives - Effects of Interest Rates Swaps Designated as Cash flow Hedges (Details 9) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other income (expense), net ineffective portion | $ 30,700 | ||
Cash Flow Hedging | Designated as Hedging Instrument | Interest Rate Swaps | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) recognized in other comprehensive income (loss) effective portion | $ 351 | $ (1,701) | (5,152) |
Gain (loss) recognized in other income (expense), net ineffective portion | 0 | 3 | 23 |
Amount reclassified from other comprehensive income (loss) into interest expense, net | $ 2,997 | $ 3,946 | $ 4,614 |
Fair Value Measurements and D66
Fair Value Measurements and Derivatives (Detail Textuals) $ in Millions, € in Billions | 12 Months Ended | ||
Dec. 31, 2017USD ($)Metric_Ton | Dec. 31, 2017EUR (€)Metric_Ton | Dec. 31, 2016USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of long-term debt | $ 6,448.6 | $ 6,525.7 | |
Fair value of long-term debt in excess of carrying value | $ 23.5 | $ 11.6 | |
Fuel swaps | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Derivative maturing date | Dec. 31, 2020 | ||
Projected fuel purchases | Metric_Ton | 1.2 | 1.2 | |
Foreign Currency Forward Contracts | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Notional amount of derivatives | $ 2,300 | € 1.9 | |
Interest Rate Swaps | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Notional amount of derivatives | $ 218.6 |
Employee Benefits and Share-B67
Employee Benefits and Share-Based Compensation - Summary of assumptions used within Option-Pricing Model (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Time Based Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | |
Expected stock price volatility, minimum | 30.36% | 32.32% | |
Expected stock price volatility, maximum | 33.01% | 45.33% | |
Risk-free interest rate, minimum | 1.20% | 1.34% | |
Risk-free interest rate, maximum | 1.48% | 1.92% | |
Expected term | 6 years | ||
Time Based Options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 6 years | ||
Time Based Options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 6 years 6 months | ||
Performance Based Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected stock price volatility, minimum | 25.97% | 29.31% | |
Expected stock price volatility, maximum | 30.21% | 29.86% | |
Expected stock price volatility | 25.97% | ||
Risk-free interest rate, minimum | 1.01% | ||
Risk-free interest rate, maximum | 1.93% | ||
Risk-free interest rate | 1.81% | 1.76% | |
Expected term | 4 years 2 months 12 days | ||
Performance Based Options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 4 years 4 months 17 days | 4 years 10 months 17 days | |
Performance Based Options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 5 years 1 month 17 days | 5 years 4 months 17 days | |
Market based share option awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | ||
Expected stock price volatility | 30.00% | ||
Risk-free interest rate | 1.34% | ||
Expected term, description | Mid-point from vesting to assumed options expiration |
Employee Benefits and Share-B68
Employee Benefits and Share-Based Compensation - Summary of Option activity (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Weighted-Average Contractual Term (Years) | ||
Outstanding as of December 31, 2017 | 6 years 11 months 27 days | 7 years 9 months 22 days |
Vested and expected to vest as of December 31, 2017 | 6 years 11 months 23 days | |
Exercisable as of December 31, 2017 | 6 years 8 months 9 days | |
Aggregate Intrinsic Value | ||
Outstanding as of December 31, 2017 | $ 50,021 | $ 35,429 |
Vested and expected to vest as of December 31, 2017 | 50,021 | |
Exercisable as of December 31, 2017 | $ 39,115 | |
Time Based Options | ||
Number of Share Option Awards | ||
Outstanding as of January 1, 2017 | 7,775,058 | |
Granted | 0 | |
Exercised | (738,672) | |
Forfeited and cancelled | (455,488) | |
Outstanding as of December 31, 2017 | 6,580,898 | 7,775,058 |
Vested and expected to vest as of December 31, 2017 | 6,580,898 | |
Exercisable as of December 31, 2017 | 4,061,424 | |
Weighted-Average Exercise Price | ||
Outstanding as of January 1, 2017 | $ 48.04 | |
Granted | 0 | |
Exercised | 34.02 | |
Forfeited and cancelled | 54.27 | |
Outstanding as of December 31, 2017 | 49.18 | $ 48.04 |
Vested and expected to vest as of December 31, 2017 | 49.18 | |
Exercisable as of December 31, 2017 | $ 47.98 | |
Performance Based Options | ||
Number of Share Option Awards | ||
Outstanding as of January 1, 2017 | 432,978 | |
Granted | 156,249 | |
Exercised | (121,509) | |
Forfeited and cancelled | (93,749) | |
Outstanding as of December 31, 2017 | 373,969 | 432,978 |
Vested and expected to vest as of December 31, 2017 | 373,969 | |
Exercisable as of December 31, 2017 | 373,969 | |
Weighted-Average Exercise Price | ||
Outstanding as of January 1, 2017 | $ 23.86 | |
Granted | 59.43 | |
Exercised | 19 | |
Forfeited and cancelled | 59.43 | |
Outstanding as of December 31, 2017 | 31.39 | $ 23.86 |
Vested and expected to vest as of December 31, 2017 | 31.39 | |
Exercisable as of December 31, 2017 | $ 31.39 | |
Market based share option awards | ||
Number of Share Option Awards | ||
Outstanding as of January 1, 2017 | 208,333 | |
Granted | 0 | |
Exercised | 0 | |
Forfeited and cancelled | 0 | |
Outstanding as of December 31, 2017 | 208,333 | 208,333 |
Vested and expected to vest as of December 31, 2017 | 0 | |
Exercisable as of December 31, 2017 | 0 | |
Weighted-Average Exercise Price | ||
Outstanding as of January 1, 2017 | $ 59.43 | |
Granted | 0 | |
Exercised | 0 | |
Forfeited and cancelled | 0 | |
Outstanding as of December 31, 2017 | 59.43 | $ 59.43 |
Vested and expected to vest as of December 31, 2017 | 0 | |
Exercisable as of December 31, 2017 | $ 0 |
Employee Benefits and Share-B69
Employee Benefits and Share-Based Compensation - Summary of Restricted Share Awards (Detail 2) - Time Based Awards - Restricted Stock - Norwegian Cruise Line Holdings Ltd. | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Number of Restricted Share | |
Non-vested as of January 1, 2017 | shares | 16,872 |
Vested | shares | (16,014) |
Non-vested and expected to vest as of December 31, 2017 | shares | 858 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 7.63 |
Vested | $ / shares | 4.91 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | $ 58.33 |
Employee Benefits and Share-B70
Employee Benefits and Share-Based Compensation - Fair value assumptions of RSUs (Details 3) - Restricted Share Units | 12 Months Ended |
Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield | 0.00% |
Expected stock price volatility | 35.00% |
Risk-free interest rate | 1.34% |
Expected term | Mid-point from vesting to assumed awards expiration |
Employee Benefits and Share-B71
Employee Benefits and Share-Based Compensation - Summary of RSUs activity (Details 4) - Restricted Share Units - Norwegian Cruise Line Holdings Ltd. | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Time Based Awards | |
Number of Restricted Share | |
Non-vested as of January 1, 2017 | shares | 1,305,335 |
Granted | shares | 1,803,327 |
Vested | shares | (447,669) |
Forfeited or expired | shares | (105,516) |
Non-vested and expected to vest as of December 31, 2017 | shares | 2,555,477 |
Non-vested and expected to vest as of December 31, 2017 | shares | 2,555,477 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 50.38 |
Granted | $ / shares | 51.13 |
Vested | $ / shares | 50.55 |
Forfeited or expired | $ / shares | 50.76 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | 50.86 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | $ 50.86 |
Performance-Based Awards | |
Number of Restricted Share | |
Non-vested as of January 1, 2017 | shares | 0 |
Granted | shares | 37,500 |
Vested | shares | (15,000) |
Forfeited or expired | shares | (22,500) |
Non-vested and expected to vest as of December 31, 2017 | shares | 0 |
Non-vested and expected to vest as of December 31, 2017 | shares | 0 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 0 |
Granted | $ / shares | 49.76 |
Vested | $ / shares | 49.76 |
Forfeited or expired | $ / shares | 49.76 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | 0 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | $ 0 |
Market-based RSUs | |
Number of Restricted Share | |
Non-vested as of January 1, 2017 | shares | 50,000 |
Granted | shares | 0 |
Vested | shares | 0 |
Forfeited or expired | shares | 0 |
Non-vested and expected to vest as of December 31, 2017 | shares | 50,000 |
Non-vested and expected to vest as of December 31, 2017 | shares | 0 |
Weighted-Average Grant-Date Fair Value | |
Non-vested as of January 1, 2016 | $ / shares | $ 59.43 |
Granted | $ / shares | 0 |
Vested | $ / shares | 0 |
Forfeited or expired | $ / shares | 0 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | 59.43 |
Non-vested and expected to vest as of December 31, 2017 | $ / shares | $ 0 |
Employee Benefits and Share-B72
Employee Benefits and Share-Based Compensation - Summary of compensation expense recognized for share-based compensation (Details 5) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ 42,209 | $ 66,414 | $ 42,209 | |
Payroll and related | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | [1] | 9,455 | 7,793 | 0 |
Marketing, general and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | [2] | $ 77,584 | $ 58,621 | $ 42,209 |
[1] | Amounts relate to equity granted to certain of our shipboard officers. | |||
[2] | Amounts relate to equity granted to certain of our corporate employees. |
Employee Benefits and Share-B73
Employee Benefits and Share-Based Compensation - Summary related to Shipboard Retirement Plan (Details 6) - Shipboard Retirement Plan - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Pension expense: | |||
Service cost | $ 1,987 | $ 1,863 | $ 1,793 |
Interest cost | 887 | 874 | 738 |
Amortization of prior service cost | 378 | 378 | 378 |
Amortization of actuarial loss | 40 | 54 | 99 |
Total pension expense | 3,292 | 3,169 | 3,008 |
Change in projected benefit obligation: | |||
Projected benefit obligation at beginning of year | 22,605 | 21,078 | 19,730 |
Service cost | 1,987 | 1,863 | 1,793 |
Interest cost | 887 | 874 | 738 |
Actuarial gain (loss) | 458 | (65) | (625) |
Direct benefit payments | (1,350) | (1,145) | (558) |
Projected benefit obligation at end of year | 24,587 | 22,605 | 21,078 |
Amounts recognized in the consolidated balance sheets: | |||
Projected benefit obligation | 24,587 | 22,605 | 21,078 |
Amounts recognized in accumulated other comprehensive income (loss): | |||
Prior service cost | (4,537) | (4,915) | (5,293) |
Accumulated actuarial loss | (3,426) | (3,008) | (3,126) |
Accumulated other comprehensive income (loss) | $ (7,963) | $ (7,923) | $ (8,419) |
Employee Benefits and Share-B74
Employee Benefits and Share-Based Compensation - Summary of pension benefits expected to be paid (Details 7) $ in Thousands | Dec. 31, 2017USD ($) |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
2,018 | $ 1,050 |
2,019 | 1,032 |
2,020 | 1,035 |
2,021 | 1,126 |
2,022 | 1,217 |
Next five years | $ 8,691 |
Employee Benefits and Share-B75
Employee Benefits and Share-Based Compensation - (Detail Textuals) - USD ($) $ / shares in Units, $ in Thousands | Mar. 01, 2017 | May 31, 2016 | Jan. 31, 2013 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total intrinsic value of options exercised | $ 18,900 | $ 5,200 | $ 68,000 | |||
Total taxes paid pursuant to net share settlements | 6,300 | |||||
Retained Earnings | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Change in accounting policy (share-based forfeitures) | $ 2,153 | |||||
Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of shares granted | 7 years | |||||
Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of shares granted | 10 years | |||||
Restated 2013 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share options and ordinary shares, authorized | 12,430,000 | |||||
Maximum number of shares that can be granted to one individual | 27,465,106 | |||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share based award, vesting period | 4 years | |||||
Total unrecognized compensation cost related to share options granted | $ 25 | |||||
Weighted average period for recognition of unrecognized compensation expense | 1 year | |||||
Total fair value of shares vested | $ 100 | $ 1,100 | $ 40,090 | |||
Time Based Awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share based award, vesting period | 3 years | 5 years | ||||
Weighted-average grant-date fair value of options granted | $ 17.11 | $ 20.90 | ||||
Total unrecognized compensation cost related to share options granted | $ 89,100 | |||||
Weighted average period for recognition of unrecognized compensation expense | 10 months 24 days | |||||
Performance-Based Awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Weighted-average grant-date fair value of options granted | $ 8.55 | $ 8.67 | 17.07 | |||
Total unrecognized compensation cost related to share options granted | $ 0 | |||||
Weighted average period for recognition of unrecognized compensation expense | 0 years | |||||
Performance-Based Awards | Restricted Share Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 329,146 | |||||
Performance-Based Awards | Amended Employment Agreement | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 208,335 | |||||
Market based share option awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 0 | |||||
Exercise price per share | $ 0 | |||||
Weighted-average grant-date fair value of options granted | $ 12.37 | |||||
Total unrecognized compensation cost related to share options granted | $ 0 | |||||
Weighted average period for recognition of unrecognized compensation expense | 0 years | |||||
Time Based Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares granted | 0 | |||||
Exercise price per share | $ 0 | |||||
Total unrecognized compensation cost related to share options granted | $ 27,600 | |||||
Weighted average period for recognition of unrecognized compensation expense | 10 months 24 days | |||||
Time Based Options | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of shares granted | 7 years | |||||
Time Based Options | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of shares granted | 10 years | |||||
NCLH | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of stock option | 3.00% | |||||
Proceeds from the exercise of share options | $ 27,400 | $ 7,600 | $ 69,100 | |||
NCLH | Performance Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share options and ordinary shares, authorized | 15,035,106 | |||||
Maximum number of shares that can be granted to one individual | 5,000,000 | |||||
NCLH | Performance Incentive Plan | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of shares granted | 7 years | |||||
NCLH | Performance Incentive Plan | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of shares granted | 10 years | |||||
NCLH | Share Option Awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage of stock option | 3.00% | |||||
NCLH | Time Based Awards | Restricted Share Units | Employee | Awarded on March 1, 2017 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted share unit awards granted | 1,700,000 | |||||
NCLH | Performance-Based Awards | Restricted Share Units | Chief Executive Officer | Awarded On August 1, 2017 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted share unit awards granted | 79,073 | |||||
NCLH | Performance-Based Awards | Restricted Share Units | Members of management team | Awarded on March 1, 2017 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Restricted share unit awards granted | 121,000 | |||||
NCLH | Time Based Options | Restricted Share Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share based award, vesting period | 3 years |
Employee Benefits and Share-B76
Employee Benefits and Share-Based Compensation - (Detail Textuals 1) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 30, 2014 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | $ 42,209 | $ 66,414 | $ 42,209 | |
Forfeited contributions utilized | $ 300,000 | $ 100,000 | $ 400,000 | |
Discount rates used in net periodic benefit cost calculation | 4.00% | 4.30% | 3.80% | |
Amortization period of actuarial loss | 18 years 10 months 6 days | |||
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Contribution percentage of employee eligible compensation | 100.00% | |||
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Deferred compensation amount under Supplemental Executive retirement Plan | $ 500 | |||
Recorded expenses related to 401k plan and SERP | $ 7,300 | 6,400 | $ 5,300 | |
Maximum ordinary shares purchased | 2,000,000 | |||
Percentage of purchase price discount | 15.00% | |||
Accrued payroll liability | $ 1,500 | 1,300 | ||
First 3% of Each Participant's Contributions | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employer matching contribution percent | 100.00% | |||
Defined contribution plan, percentage of employee contribution | 3.00% | |||
Next 4% - 10% of Each Participants Contribution | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employer matching contribution percent | 50.00% | |||
Next 4% - 10% of Each Participants Contribution | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Defined contribution plan, percentage of employee contribution | 3.00% | |||
Next 4% - 10% of Each Participants Contribution | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Defined contribution plan, percentage of employee contribution | 10.00% | |||
Shipboard Retirement Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Projected benefit obligation included in accrued expenses and other liabilities | $ 1,100 | 1,200 | ||
Projected benefit obligation included in other long-term liabilities | $ 23,500 | $ 21,400 |
Income Taxes - Components of ne
Income Taxes - Components of net income before income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Components Of Net Income Before Income Taxes [Line Items] | |||
Net income before income taxes | $ 773,269 | $ 643,788 | $ 437,778 |
Bermuda | |||
Components Of Net Income Before Income Taxes [Line Items] | |||
Net income before income taxes | 0 | 0 | 0 |
Foreign - Other | |||
Components Of Net Income Before Income Taxes [Line Items] | |||
Net income before income taxes | $ 773,269 | $ 643,788 | $ 437,778 |
Income Taxes - Components of th
Income Taxes - Components of the provision for income taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
United States | $ 1,026 | $ (36) | $ (36) |
Total current: | (3,590) | (3,659) | (341) |
Deferred: | |||
United States | (11,370) | 3,594 | 363 |
Total deferred: | (10,884) | 3,594 | 363 |
Income tax benefit (expense) | (14,474) | (65) | 22 |
Bermuda | |||
Current: | |||
Foreign | 0 | 0 | 0 |
Deferred: | |||
Foreign | 0 | 0 | 0 |
Foreign - Other | |||
Current: | |||
Foreign | (4,616) | (3,623) | (305) |
Deferred: | |||
Foreign | $ 486 | $ 0 | $ 0 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of income tax expense computed by applying our Bermuda statutory rate and reported income tax expense (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Tax at Bermuda statutory rate | 0.00% | 0.00% | 0.00% |
Foreign income taxes at different rates | $ (17,978) | $ (2,383) | $ 58 |
Tax contingencies | 946 | (286) | (36) |
Return to provision adjustments | (2,192) | (990) | 0 |
Benefit from change in tax rate | 4,750 | 0 | 0 |
Valuation allowance | 0 | 3,594 | 0 |
Total | $ (14,474) | $ (65) | $ 22 |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Tax Assets and Liabilities (Details 3) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Loss carryforwards | $ 58,291 | $ 102,636 |
Other | 1,825 | 1,429 |
Valuation allowance | (42,154) | (64,573) |
Total net deferred tax assets | 17,962 | 39,492 |
Deferred tax liabilities: | ||
Property and equipment | (26,321) | (37,001) |
Total deferred tax liabilities | (26,321) | (37,001) |
Net deferred tax asset (liability) | $ (8,359) | $ 2,491 |
Income Taxes - Reconciliation81
Income Taxes - Reconciliation of the total amounts of unrecognized tax benefits (Details 4) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Unrecognized tax benefits, beginning of the year | $ 1,644 | $ 1,394 |
Gross increases in tax positions from prior periods | 300 | 250 |
Settlement of tax positions | (250) | |
Lapse of statute of limitations | (1,162) | |
Unrecognized tax benefits, end of year | $ 532 | $ 1,644 |
Income Taxes (Detail Textuals)
Income Taxes (Detail Textuals) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Line Items] | |||
Valuation allowance | $ 0 | $ (3,594) | $ 0 |
US corporate income tax rate | 35.00% | ||
Corporate income tax rate effective in 2018 | 21.00% | ||
Income tax expense due to reduction of deferred tax liabilities | $ 4,500 | ||
Unrecognized tax benefits, reversed | (1,162) | ||
Unrecognized tax benefits | 532 | 1,644 | $ 1,394 |
Prestige | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 177,800 | 151,200 | |
U.S. federal and state net operating loss carryforwards, expiration year | 2,023 | ||
NORWAY | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 13,900 | 22,900 | |
U.K | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | 8,300 | 9,500 | |
NCLC | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards | $ 254,800 | $ 256,300 | |
U.S. federal and state net operating loss carryforwards, expiration year | 2,023 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of minimum annual rentals for non-cancelable leases (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,018 | $ 15,204 |
2,019 | 14,788 |
2,020 | 14,185 |
2,021 | 13,227 |
2,022 | 13,277 |
Thereafter | 61,110 |
Total minimum annual rentals | $ 131,791 |
Commitments and Contingencies84
Commitments and Contingencies - Summary of minimum annual payments for Non-Cancelable Ship Construction Contracts (Details 1) - Ship Construction Contracts $ in Thousands | Dec. 31, 2017USD ($) |
Other Commitments [Line Items] | |
2,018 | $ 1,016,892 |
2,019 | 893,881 |
2,020 | 469,334 |
2,021 | 172,872 |
2,022 | 968,340 |
Thereafter | 2,616,900 |
Total minimum annual payments | $ 6,138,219 |
Commitments and Contingencies85
Commitments and Contingencies -Summary of future commitments to pay for usage of certain port facilities (Details 2) - Port Facility Commitments $ in Thousands | Dec. 31, 2017USD ($) |
Other Commitments [Line Items] | |
2,018 | $ 30,509 |
2,019 | 21,460 |
2,020 | 21,928 |
2,021 | 18,179 |
2,022 | 5,137 |
Thereafter | 41,095 |
Total port facility future commitments | $ 138,308 |
Commitments and Contingencies86
Commitments and Contingencies (Detail Textuals) £ in Millions, $ in Millions, € in Billions | 12 Months Ended | ||||
Dec. 31, 2017USD ($)CruiseShipBerthGross_Ton | Dec. 31, 2017GBP (£)CruiseShip | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2017EUR (€)CruiseShipBerthGross_Ton | |
Commitments and Contingencies Disclosure [Line Items] | |||||
Expenses under non-cancelable operating lease commitments | $ | $ 17 | $ 15 | $ 12.6 | ||
Number of cruise ships | 25 | 25 | |||
Capacity of ship, berths | Berth | 50,400 | 50,400 | |||
Ships launching period through 2025 | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Export credit facility financing as percentage of contract price | 80.00% | 80.00% | |||
Number of additional ships | 7 | 7 | |||
Ships launching period through 2025 | Project Leonardo | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Number of cruise ships | 4 | 4 | |||
Capacity of ship, tons | Gross_Ton | 140,000 | 140,000 | |||
Capacity of ship, berths | Berth | 3,300 | 3,300 | |||
Number of additional ships | 4 | 4 | |||
Ships launching period in 2026 and 2027 | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Number of additional ships | 2 | 2 | |||
Ship order delivery in winter 2020 | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Capacity of ship, tons | Gross_Ton | 55,000 | 55,000 | |||
Capacity of ship, berths | Berth | 750 | 750 | |||
Ship Construction Contracts | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Number of cruise ships | 7 | 7 | |||
Scheduled delivery date of ships under construction | spring of 2018 and fall of 2019 | spring of 2018 and fall of 2019 | |||
Aggregate contract price of new ships based on the euro/U.S. dollar exchange rate | $ 6,600 | € 5.5 | |||
Ship Construction Contracts | Breakaway Plus Class Ships | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Number of cruise ships | 2 | 2 | |||
Capacity of ship, tons | Gross_Ton | 168,000 | 168,000 | |||
Capacity of ship, berths | Berth | 4,000 | 4,000 | |||
Other Commitments | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Performance guarantee required to be maintained | $ | $ 30 | ||||
Security guarantee | £ | £ 11.8 |
Other Income (Expense), Net (De
Other Income (Expense), Net (Detail Textuals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Income and Expenses [Abstract] | |||
Other income (expense), net | $ 10.4 | $ 8.3 | $ 46.7 |
Unrealized and realized losses on fuel swap derivative hedge contracts | 16.1 | ||
Gains on foreign currency exchange | 4.5 | 11 | |
Gains (losses) on foreign currency exchange derivative hedge contracts | $ 3.9 | ||
Losses from dedesignation of fuel swap derivative hedge contracts and ineffectiveness of settled fuel swaps | 30.7 | ||
Fair value adjustment of foreign exchange collar | $ 26.2 |
Concentration Risk (Detail Text
Concentration Risk (Detail Textuals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Risks and Uncertainties [Abstract] | |||
Food and labor cost | $ 152.3 | $ 137.2 | $ 122.4 |
Supplemental Cash Flow Inform89
Supplemental Cash Flow Information (Detail Textuals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |||
Interest and related fees | $ 313.8 | $ 303.2 | $ 218.3 |
Non-cash investing activity in connection with property and equipment | 20 | 26.7 | |
Non-cash investing activities in connection with capital leases | 13.3 | 31.1 | |
Non-cash investing activities for capital expenditures | 41.1 | ||
Income taxes paid | $ 11.7 | $ 8.8 | $ 10.3 |
Quarterly Selected Financial 90
Quarterly Selected Financial Data (Unaudited) (in thousands) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total revenue | $ 1,249,553 | $ 1,651,738 | $ 1,344,103 | $ 1,150,781 | $ 1,125,137 | $ 1,484,736 | $ 1,186,835 | $ 1,077,632 | $ 5,396,175 | $ 4,874,340 | $ 4,345,048 |
Operating income | 178,012 | 477,453 | 275,755 | 120,232 | 154,667 | 414,260 | 227,756 | 132,266 | 1,051,452 | 928,949 | 706,305 |
Net income | $ 97,989 | $ 396,227 | $ 201,441 | $ 63,138 | $ 74,648 | $ 346,003 | $ 148,099 | $ 74,973 | $ 758,795 | $ 643,723 | $ 437,800 |
Subsequent Event (Detail Textua
Subsequent Event (Detail Textuals) - Subsequent Event - Wendy A. Beck - Transition agreement $ in Millions | Feb. 02, 2018USD ($)TimesInstallment |
Subsequent Event [Line Items] | |
Number of times base salary as compensation to be paid after succession date | Times | 2 |
Term for number of times base salary as compensation to be paid after succession date | 12 months |
Compensation to be paid in recognition of service and tenure after succession date | $ 4 |
Frequency of installments for compensation to be paid after succession date | quarterly |
Maximum period for continuation of COBRA benefits as active employee | 36 months |
Term of agreement | 2 years |
Consulting fees paid pursuant to agreement | $ 2 |
Number of equal quarterly installments for payment of consulting fees | Installment | 6 |
Schedule II Valuation and Qua92
Schedule II Valuation and Qualifying Accounts (Details) - Valuation allowance on deferred tax assets - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Balance | $ 64,573 | $ 61,437 | $ 81,704 | |
Additions Charged to costs and expenses | 0 | 0 | 0 | |
Additions Charged to other accounts | 0 | 9,382 | 0 | |
Deductions | (22,419) | [1] | (6,246) | (20,267) |
Balance | $ 42,154 | $ 64,573 | $ 61,437 | |
[1] | Amount relates to (i) utilization of deferred tax assets and (ii) an adjustment due to a change in tax rates resulting from U.S. tax reform. |