Cover Page
Cover Page - shares | 3 Months Ended | |
Feb. 29, 2020 | Mar. 25, 2020 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Entity Central Index Key | 0000815097 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --11-30 | |
Document Quarterly Report | true | |
Document Period End Date | Feb. 29, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-9610 | |
Entity Registrant Name | Carnival Corporation | |
Entity Incorporation, State or Country Code | R1 | |
Entity Tax Identification Number | 59-1562976 | |
Entity Address, Address Line One | 3655 N.W. 87th Avenue | |
Entity Address, City or Town | Miami, | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 33178-2428 | |
City Area Code | (305) | |
Local Phone Number | 599-2600 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 527,817,680 | |
Common Stock | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock ($0.01 par value) | |
Trading Symbol | CCL | |
Security Exchange Name | NYSE | |
1.625% Senior Notes Due 2021 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.625% Senior Notes due 2021 | |
Trading Symbol | CCL21 | |
Security Exchange Name | NYSE | |
Carnival PLC | ||
Entity Information [Line Items] | ||
Entity Central Index Key | 0001125259 | |
Current Fiscal Year End Date | --11-30 | |
Entity File Number | 001-15136 | |
Entity Registrant Name | Carnival plc | |
Entity Incorporation, State or Country Code | X0 | |
Entity Tax Identification Number | 98-0357772 | |
Entity Address, Address Line One | Carnival House, 100 Harbour Parade | |
Entity Address, City or Town | Southampton | |
Entity Address, Country | GB | |
Entity Address, Postal Zip Code | SO15 1ST | |
City Area Code | 011 | |
Local Phone Number | 44 23 8065 5000 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 182,536,832 | |
Carnival PLC | Ordinary Shares | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Ordinary Shares ($1.66 par value) | |
Trading Symbol | CUK | |
Security Exchange Name | NYSE | |
Carnival PLC | 1.875% Senior Notes Due 2022 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.875% Senior Notes due 2022 | |
Trading Symbol | CUK22 | |
Security Exchange Name | NYSE | |
Carnival PLC | 1.000% Senior Notes Due 2029 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.000% Senior Notes due 2029 | |
Trading Symbol | CUK29 | |
Security Exchange Name | NYSE |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Revenues | ||
Revenues | $ 4,789 | $ 4,673 |
Cost of Revenue [Abstract] | ||
Selling and administrative | 678 | 629 |
Depreciation and amortization | 570 | 516 |
Goodwill impairment | 731 | 0 |
Operating costs and expenses | 5,502 | 4,287 |
Operating Income (Loss) | (713) | 386 |
Nonoperating Income (Expense) | ||
Interest income | 5 | 4 |
Interest expense, net of capitalized interest | (55) | (51) |
Other income (expense), net | (7) | (2) |
Nonoperating Income (Expense) | (57) | (49) |
Income (Loss) Before Income Taxes | (770) | 338 |
Income Tax Expense, Net | (11) | (2) |
Net Income (Loss) | $ (781) | $ 336 |
Earnings Per Share | ||
Basic (in dollars per share) | $ (1.14) | $ 0.48 |
Diluted (in dollars per share) | $ (1.14) | $ 0.48 |
Cruise | ||
Cost of Revenue [Abstract] | ||
Commissions, transportation and other | $ 766 | $ 709 |
Onboard and other | 471 | 467 |
Payroll and related | 610 | 557 |
Fuel | 396 | 381 |
Food | 277 | 268 |
Other operating | 1,001 | 759 |
Operating costs and expenses | 3,523 | 3,142 |
Cruise passenger ticket | ||
Revenues | ||
Revenues | 3,234 | 3,199 |
Cruise onboard and other | ||
Revenues | ||
Revenues | $ 1,556 | $ 1,474 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income (Loss) | $ (781) | $ 336 |
Items Included in Other Comprehensive Income (Loss) | ||
Change in foreign currency translation adjustment | 25 | 79 |
Other | 13 | 0 |
Other Comprehensive Income (Loss) | 38 | 79 |
Total Comprehensive Income (Loss) | $ (743) | $ 415 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Feb. 29, 2020 | Nov. 30, 2019 | |
Current Assets | |||
Cash and cash equivalents | $ 1,354 | $ 518 | |
Trade and other receivables, net | 405 | 444 | |
Inventories | 440 | 427 | |
Prepaid expenses and other | 687 | 671 | |
Total current assets | 2,885 | 2,059 | |
Property and Equipment, Net | 38,023 | 38,131 | |
Operating Leases Right-of-Use Assets | [1] | 1,469 | |
Goodwill | 2,176 | 2,912 | |
Other Intangibles | 1,173 | 1,174 | |
Other Assets | 1,216 | 783 | |
Total assets | 46,943 | 45,058 | |
Current Liabilities | |||
Short-term borrowings | 1,004 | 231 | |
Current portion of long-term debt | 2,196 | 1,596 | |
Current portion of operating lease liabilities | [1] | 168 | |
Accounts payable | 904 | 756 | |
Accrued liabilities and other | 1,754 | 1,809 | |
Customer deposits | 4,690 | 4,735 | |
Total current liabilities | 10,716 | 9,127 | |
Long-Term Debt | 9,738 | 9,675 | |
Long-Term Operating Lease Liabilities | [1] | 1,312 | |
Other Long-Term Liabilities | 887 | 890 | |
Contingencies | |||
Shareholders’ Equity | |||
Additional paid-in capital | 8,829 | 8,807 | |
Retained earnings | 25,527 | 26,653 | |
Accumulated other comprehensive income (loss) (“AOCI”) | (2,028) | (2,066) | |
Treasury stock, 130 shares at 2020 and 2019 of Carnival Corporation and 60 shares at 2020 and 2019 of Carnival plc, at cost | (8,404) | (8,394) | |
Total shareholders’ equity | 24,290 | 25,365 | |
Total liabilities and shareholders' equity | 46,943 | 45,058 | |
Common Stock | |||
Shareholders’ Equity | |||
Common stock | 7 | 7 | |
Ordinary Shares | |||
Shareholders’ Equity | |||
Common stock | $ 359 | $ 358 | |
[1] | We adopted the provisions of Leases on December 1, 2019. |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Feb. 29, 2020 | Nov. 30, 2019 |
Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,960,000,000 | 1,960,000,000 |
Common stock, shares issued (in shares) | 658,000,000 | 656,000,000 |
Treasury stock, shares (in shares) | 130,000,000 | 129,000,000 |
Carnival PLC | Ordinary Shares | ||
Common stock, par value (in dollars per share) | $ 1.66 | $ 1.66 |
Common stock, shares issued (in shares) | 217,000,000 | 217,000,000 |
Treasury stock, shares (in shares) | 60,000,000 | 60,000,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
OPERATING ACTIVITIES | ||
Net income (loss) | $ (781) | $ 336 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation and amortization | 570 | 516 |
Impairments | 1,062 | 0 |
Share-based compensation | 20 | 20 |
Other, net | (73) | 12 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | 798 | 884 |
Changes in operating assets and liabilities | ||
Receivables | 21 | (50) |
Inventories | (15) | 7 |
Prepaid expenses and other | (120) | (154) |
Accounts payable | 148 | 65 |
Accrued liabilities and other | 120 | 5 |
Customer deposits | (36) | 358 |
Net cash provided by operating activities | 916 | 1,116 |
INVESTING ACTIVITIES | ||
Purchases of property and equipment | (1,326) | (2,129) |
Proceeds from sales of ships | 226 | 0 |
Payments of fuel derivative settlements | 0 | (6) |
Other, net | (61) | 76 |
Net cash provided by (used in) investing activities | (1,161) | (2,059) |
FINANCING ACTIVITIES | ||
Proceeds from (repayments of) short-term borrowings, net | 779 | (81) |
Principal repayments of long-term debt | (132) | (95) |
Proceeds from issuance of long-term debt | 823 | 1,439 |
Dividends paid | (344) | (348) |
Purchases of treasury stock | (12) | (274) |
Other, net | (24) | (29) |
Net cash provided by (used in) financing activities | 1,089 | 612 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (7) | 1 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 838 | (331) |
Cash, cash equivalents and restricted cash at beginning of period | 530 | 996 |
Cash, cash equivalents and restricted cash at end of period | $ 1,368 | $ 665 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Millions | Total | Common stock | Ordinary shares | Additional paid-in capital | Retained earnings | AOCI | Treasury stock |
Beginning Balance at Nov. 30, 2018 | $ 24,443 | $ 7 | $ 358 | $ 8,756 | $ 25,066 | $ (1,949) | $ (7,795) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | 336 | 336 | |||||
Other comprehensive income (loss) | 79 | 79 | |||||
Cash dividends declared | (345) | (345) | |||||
Purchases of treasury stock under the Repurchase Program and other | (248) | 20 | (268) | ||||
Ending Balance at Feb. 28, 2019 | 24,241 | 7 | 358 | 8,776 | 25,033 | (1,869) | (8,063) |
Beginning Balance at Nov. 30, 2019 | 25,365 | 7 | 358 | 8,807 | 26,653 | (2,066) | (8,394) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | (781) | (781) | |||||
Other comprehensive income (loss) | 38 | 38 | |||||
Cash dividends declared | (344) | (344) | |||||
Purchases of treasury stock under the Repurchase Program and other | 12 | 22 | (10) | ||||
Ending Balance at Feb. 29, 2020 | $ 24,290 | $ 7 | $ 359 | $ 8,829 | $ 25,527 | $ (2,028) | $ (8,404) |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends declared per share (in dollars per share) | $ 0.50 | $ 0.50 |
General
General | 3 Months Ended |
Feb. 29, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | General The consolidated financial statements include the accounts of Carnival Corporation and Carnival plc and their respective subsidiaries. Together with their consolidated subsidiaries, they are referred to collectively in these consolidated financial statements and elsewhere in this joint Quarterly Report on Form 10-Q as “Carnival Corporation & plc,” “our,” “us” and “we.” Liquidity and Management’s Plans Due to the spread of COVID-19 and the effects of growing port restrictions around the world, we previously announced a voluntary pause of our global fleet cruise operations. Significant events affecting travel, including COVID-19, typically have an impact on booking patterns, with the full extent of the impact generally determined by the length of time the event influences travel decisions. We believe the ongoing effects of COVID-19 on our operations and global bookings have had, and will continue to have a material negative impact on our financial results and liquidity, and such negative impact may continue well beyond the containment of such outbreak. We cannot assure you that our assumptions used to estimate our liquidity requirements will be correct because we have never previously experienced a complete cessation of our cruising operations, and as a consequence, our ability to be predictive is uncertain. In addition, the magnitude, duration and speed of the global pandemic is uncertain. As a consequence, we cannot estimate the impact on our business, financial condition or near- or longer-term financial or operational results with reasonable certainty, but we expect a net loss on both a U.S. GAAP and adjusted basis for the fiscal year ending November 30, 2020. On March 13, 2020, we fully drew down our $3.0 billion multi-currency revolving credit facility (the “Existing Multicurrency Facility”). We are taking further actions to improve our liquidity, including capital expenditure and operating expense reductions, suspending dividend payments on, and the repurchase of, the common stock of Carnival Corporation and the ordinary shares of Carnival plc and pursuing additional financing. Based on these actions and assumptions regarding the impact of COVID-19, we have concluded that we will be able to generate sufficient liquidity to satisfy our obligations and remain in compliance with our existing debt covenants for the next twelve months prior to giving effect to any additional financing that may occur. At February 29, 2020, we were in compliance with all of our debt covenants. After considering the effect of COVID-19 on our consolidated EBITDA, the actions we have taken and the other options available to us, we expect to remain in compliance with our current minimum debt service coverage ratio in certain of our debt instruments that requires a minimum of 3:1 ratio of EBITDA to Consolidated Net Interest Charges. If we expected to be out of compliance, we would seek waivers from the lenders prior to any covenant violation. Any covenant waiver may lead to increased costs, increased interest rates, additional restrictive covenants and other available lender protections that would be applicable. There can be no assurance that we would be able to obtain waivers in a timely manner, or on acceptable terms at all. If we were not able to obtain waivers or repay the debt facilities, this would lead to an event of default and potential acceleration of amounts due under all of our outstanding debt and derivative contract payables. As a result, the failure to obtain waivers would have a material adverse effect on us. On April 1, 2020, we announced the pricing of the private offerings of $4.0 billion first-priority senior secured notes due 2023 (“Secured Notes”) and $1.75 billion senior convertible notes due 2023 ($2.0125 billion if the initial purchasers exercise their option to purchase additional notes) (“Convertible Notes”), and a public offering of $500 million of common stock ($575 million if the underwriters exercise their option to purchase additional shares in full) of Carnival Corporation (“Public Equity Offering”), collectively referred to within this document as the “April 1 financing transactions”. The closings of these offerings are subject to customary conditions and are expected to occur in early April. The net proceeds from the offering of Secured Notes will be deposited in to a segregated escrow account, pending the releases in accordance with certain collateral perfection thresholds. Basis of Presentation The Consolidated Statements of Income (Loss), the Consolidated Statements of Comprehensive Income (Loss), the Consolidated Statements of Cash Flows and the Consolidated Statements of Shareholders’ Equity for the three months ended February 29/28, 2020 and 2019, and the Consolidated Balance Sheet at February 29, 2020 are unaudited and, in the opinion of our management, contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement. Our interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in the Carnival Corporation & plc 2019 joint Annual Report on Form 10-K (“Form 10-K”) filed with the U.S. Securities and Exchange Commission on January 28, 2020. Our operations are seasonal and results for interim periods are not necessarily indicative of the results for the entire year. For the three months ended February 28, 2019, we reclassified $29 million from tour and other revenues to onboard and other revenues as well as $29 million from tour and other costs and expenses to other operating cost and expenses in order to conform to the current year presentation. Accounting Pronouncements On December 1, 2019, we adopted the FASB issued guidance, Leases , using the modified retrospective approach, which allows entities to either apply the new lease standard to the beginning of the earliest period presented or only to the consolidated financial statements in the period of adoption without restating prior periods. We have elected to apply the new guidance at the date of adoption without restating prior periods. We have implemented changes to our internal controls to address the collection, recording, and accounting for leases in accordance with the new guidance. Upon adoption of the new guidance, the most significant impact was the recognition of $1.4 billion of right-of-use assets and lease liabilities relating to operating leases, reported within operating lease right-of-use assets and long-term operating lease liabilities, with the current portion of the liability reported within current portion of operating lease liabilities, in our Consolidated Balance Sheet as of December 1, 2019. There was no cumulative effect of applying the new standard and accordingly there was no adjustment to our retained earnings upon adoption. This guidance had an immaterial impact on our Consolidated Statements of Income (Loss), Consolidated Statements of Comprehensive Income (Loss), Consolidated Statements of Cash Flows and the compliance with debt-covenants under our current agreements. The FASB issued amended guidance, Intangibles - Goodwill and Other - Internal-Use Software , which requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance to determine which implementation costs to capitalize as assets or expense as incurred. The expense related to deferred implementation costs is required to be presented in the same net income (loss) line item as the related hosting fees. Additionally, the payments for deferred implementation costs are required to be presented in the same line item in the Consolidated Statements of Cash Flows as payments for the related hosting fees. This guidance is required to be adopted by us in the first quarter of 2021 and must be applied using either a prospective or a retrospective approach. Early adoption is permitted. We are currently evaluating the impact this guidance will have on our consolidated financial statements. The FASB issued amended guidance, Financial Instruments - Credit Losses |
Revenue and Expense Recognition
Revenue and Expense Recognition | 3 Months Ended |
Feb. 29, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Expense Recognition | Revenue and Expense Recognition Guest cruise deposits represent unearned revenues and are initially included in customer deposit liabilities when received. Customer deposits are subsequently recognized as cruise revenues, together with revenues from onboard and other activities, and all associated direct costs and expenses of a voyage are recognized as cruise costs and expenses, upon completion of voyages with durations of ten nights or less and on a pro rata basis for voyages in excess of ten nights. The impact of recognizing these shorter duration cruise revenues and costs and expenses on a completed voyage basis versus on a pro rata basis is not significant. Certain of our product offerings are bundled and we allocate the value of the bundled services and goods between passenger ticket revenues, onboard and other revenues and tour and other revenues based upon the estimated standalone selling prices of those goods and services. Future travel discount vouchers are included as a reduction of cruise passenger ticket revenues when such vouchers are utilized. Guest cancellation fees are recognized in cruise passenger ticket revenues at the time of cancellation. Our sale to guests of air and other transportation to and from airports near the home ports of our ships are included in passenger ticket revenues, and the related cost of purchasing these services are included in transportation costs. The proceeds that we collect from the sales of third-party shore excursions are included in onboard and other revenues and the related costs are included in onboard and other costs. The amounts collected on behalf of our onboard concessionaires, net of the amounts remitted to them, are included in onboard and other revenues as concession revenues. All of these amounts are recognized on a completed voyage or pro rata basis as discussed above. Passenger ticket revenues include fees, taxes and charges collected by us from our guests. A portion of these fees, taxes and charges vary with guest head counts and are directly imposed on a revenue-producing arrangement. This portion of the fees, taxes and charges is expensed in commissions, transportation and other costs when the corresponding revenues are recognized. For the three months ended February 29/28, fees, taxes and charges included in commissions, transportation and other costs were $174 million in 2020 and $163 million and in 2019. The remaining portion of fees, taxes and charges are expensed in other operating expenses when the corresponding revenues are recognized. Revenues and expenses from our hotel and transportation operations, which are included in our Tour and Other segment, are recognized at the time the services are performed. Revenues from the long-term leasing of ships, which are also included in our Tour and Other segment, are recognized ratably over the term of the agreement. Customer Deposits Our payment terms generally require an initial deposit to confirm a reservation, with the balance due prior to the voyage. Cash received from guests in advance of the cruise is recorded in customer deposits and in other long-term liabilities on our Consolidated Balance Sheets. These amounts include refundable deposits. We had customer deposits of $4.9 billion as of February 29, 2020 and November 30, 2019. During the three months ended February 28/29, 2020 and 2019, we recognized revenues of $3.0 billion related to our customer deposits as of November 30, 2019 and December 1, 2018. Our customer deposits balance changes due to the seasonal nature of cash collections, the recognition of revenue, refund of customer deposits and foreign currency translation. Contract Receivables Although we generally require full payment from our customers prior to or concurrently with their cruise, we grant credit terms to a relatively small portion of our revenue source. We also have receivables from credit card merchants for cruise ticket purchases and onboard revenue. These receivables are included within trade and other receivables, net. Contract Assets |
Unsecured Debt
Unsecured Debt | 3 Months Ended |
Feb. 29, 2020 | |
Debt Disclosure [Abstract] | |
Unsecured Debt | Unsecured Debt At February 29, 2020, our short-term borrowings consisted of euro-denominated commercial paper of $1.0 billion. For the three months ended February 29/28, 2020 and 2019, there were no borrowings or repayments of commercial paper with original maturities greater than three months. In December 2019, we borrowed $823 million under an export credit facility due in semi-annual installments through fiscal year 2032. In February 2020, we extended a $452 million sterling-denominated floating rate bank loan, originally maturing in 2022, to 2025 with an option to extend to 2026. Refer to Note 11 - "Subsequent Events" for a discussion of events that occurred subsequent to February 29, 2020 . |
Contingencies
Contingencies | 3 Months Ended |
Feb. 29, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Litigation On May 2, 2019, two lawsuits were filed against Carnival Corporation in the U.S. District Court for the Southern District of Florida under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act. The complaint filed by Havana Docks Corporation alleges it holds an interest in the Havana Cruise Port Terminal and the complaint filed by Javier Garcia-Bengochea alleges that he holds an interest in the Port of Santiago, Cuba, both of which were expropriated by the Cuban Government. The complaints further allege that Carnival Cruise Line “trafficked” in those properties by embarking and disembarking passengers at these facilities. The plaintiffs seek all available statutory remedies, including the value of the expropriated property, plus interest, treble damages, attorneys’ fees and costs. The court denied our motion to dismiss the complaint filed by Javier Garcia-Bengochea, on August 26, 2019. While on August 28, 2019, the court denied our motion to dismiss the complaint filed by Havana Docks Corporation, later on January 6, 2020, it dismissed virtually identical cases brought by Havana Docks Corporation against other cruise lines, on the grounds raised in our motion to dismiss. In doing so, the court explicitly reversed its position on the issue and acknowledged the conflict with our case. Therefore, on January 6, 2020, we asked the court to formally dismiss the Havana Docks Corporation complaint. We believe we have meritorious defenses to the claims and we intend to vigorously defend against them. We do not believe that it is likely that the outcome of these matters will be material, but litigation is inherently unpredictable and there can be no assurances that the final outcome of the case might not be material to our operating results or financial condition. Additionally, 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, or any settlement of claims and lawsuits, are covered by insurance and the maximum amount of our liability, net of any insurance recoverables, is typically limited to our self-insurance retention levels. We believe the ultimate outcome of these claims, lawsuits and settlements, as applicable, each and in the aggregate, will not have a material impact on our consolidated financial statements. Contingent Obligations – Indemnifications |
Fair Value Measurements, Deriva
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks | 3 Months Ended |
Feb. 29, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks | Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks Fair Value Measurements Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured using inputs in one of the following three categories: • Level 1 measurements are based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. • Level 2 measurements are based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active or market data other than quoted prices that are observable for the assets or liabilities. • Level 3 measurements are based on unobservable data that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Considerable judgment may be required in interpreting market data used to develop the estimates of fair value. Accordingly, certain estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized in a current or future market exchange. Financial Instruments that are not Measured at Fair Value on a Recurring Basis February 29, 2020 November 30, 2019 Carrying Fair Value Carrying Fair Value (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Long-term other assets (a) $ 177 $ — $ 30 $ 145 $ 181 $ — $ 31 $ 149 Total $ 177 $ — $ 30 $ 145 $ 181 $ — $ 31 $ 149 Liabilities Fixed rate debt (b) $ 7,351 $ — $ 7,548 $ — $ 7,438 $ — $ 7,782 $ — Floating rate debt (b) 5,740 — 5,656 — 4,195 — 4,248 — Total $ 13,091 $ — $ 13,204 $ — $ 11,634 $ — $ 12,030 $ — (a) Long-term other assets are comprised of notes receivables, which include loans on ship sales. The fair values of our Level 2 notes receivables were based on estimated future cash flows discounted at appropriate market interest rates. The fair values of our Level 3 notes receivable were estimated using risk-adjusted discount rates. (b) The debt amounts above do not include the impact of interest rate swaps or debt issuance costs. The fair values of our publicly-traded notes were based on their unadjusted quoted market prices in markets that are not sufficiently active to be Level 1 and, accordingly, are considered Level 2. The fair values of our other debt were estimated based on current market interest rates being applied to this debt. Financial Instruments that are Measured at Fair Value on a Recurring Basis February 29, 2020 November 30, 2019 (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Cash and cash equivalents $ 1,354 $ — $ — $ 518 $ — $ — Restricted cash 15 — — 13 — — Derivative financial instruments — 102 — — 58 — Total $ 1,368 $ 102 $ — $ 530 $ 58 $ — Liabilities Derivative financial instruments $ — $ 17 $ — $ — $ 25 $ — Total $ — $ 17 $ — $ — $ 25 $ — Nonfinancial Instruments that are Measured at Fair Value on a Nonrecurring Basis Valuation of Goodwill and Trademarks As a result of the effect of COVID-19 on our expected future operating cash flows, we performed discounted cash flow analyses and determined that the estimated fair values of a North America & Australia (“NAA”) segment reporting unit, and a Europe & Asia (“EA”) segment reporting unit, no longer exceeded their carrying values. We recognized goodwill impairment charges of $731 million for these reporting units during the first quarter of 2020. The determination of our reporting units' goodwill and trademark fair values includes numerous assumptions that are subject to various risks and uncertainties. The principal assumptions, all of which are considered Level 3 inputs, used in our cash flow analyses consisted of: • Changes in market conditions, port restrictions or strategy, including decision about the allocation of new ships amongst brands and the transfer of ships between brands • Forecasted future operating results, including net revenue yields and fuel expenses • Weighted-average cost of capital of market participants, adjusted for the risk attributable to the geographic regions in which these cruise brands operate We believe that we have made reasonable estimates and judgments. A change in the conditions, circumstances or strategy (including decisions about the allocation of new ships amongst brands and the transfer of ships between brands), which influence determinations of fair value, may result in a need to recognize an additional impairment charge. Refer to Note 11 - "Subsequent Events" for a discussion of events that occurred subsequent to February 29, 2020 . Goodwill (in millions) NAA EA Total At November 30, 2019 $ 1,898 $ 1,014 $ 2,912 Impairment charges (300) (431) (731) Foreign currency translation adjustment — (5) (5) At February 29, 2020 $ 1,598 $ 578 $ 2,176 Trademarks (in millions) NAA EA Total At November 30, 2019 $ 927 $ 240 $ 1,167 Foreign currency translation adjustment — — — At February 29, 2020 $ 927 $ 240 $ 1,167 Impairment of Ships We review our long-lived assets for impairment whenever events or circumstances indicate potential impairment. As a result of the effect of COVID-19 on our expected future operating cash flows, we determined certain impairment triggers had occurred. Accordingly, we performed undiscounted cash flow analyses on certain ships as of February 29, 2020. Based on these undiscounted cash flow analyses, we determined that certain ships had net carrying values that exceeded their estimated undiscounted future cash flows. We estimated the February 29, 2020 fair values of these ships based on their discounted cash flows. We then compared these estimated fair values to the net carrying values and, as a result, we recognized $172 million and $158 million of ship impairment charges in the NAA and EA segments, respectively, included in other operating expenses of our Consolidated Statements of Income (Loss) for the first quarter of 2020. The principal assumptions used in our analyses consisted of changes in strategy (including decisions about the sale of ships, estimated sale proceeds and timing, as well as the transfer of ships between brands), forecasted future operating results, including net revenue yields and fuel expenses. All principal assumptions are considered Level 3 inputs. Derivative Instruments and Hedging Activities (in millions) Balance Sheet Location February 29, 2020 November 30, 2019 Derivative assets Derivatives designated as hedging instruments Cross currency swaps (a) Prepaid expenses and other $ 39 $ 32 Other assets 49 25 Foreign currency forwards (b) Prepaid expenses and other 14 — Total derivative assets $ 102 $ 58 Derivative liabilities Derivatives designated as hedging instruments Cross currency swaps (a) Accrued liabilities and other $ — $ 1 Other long-term liabilities — 9 Foreign currency zero cost collars (b) Accrued liabilities and other 2 1 Interest rate swaps (c) Accrued liabilities and other 6 6 Other long-term liabilities 9 9 Total derivative liabilities $ 17 $ 25 (a) At February 29, 2020 and November 30, 2019, we had cross currency swaps totaling $1.9 billion, respectively, that are designated as hedges of our net investment in foreign operations with a euro-denominated functional currency. At February 29, 2020, these cross currency swaps settle through 2031. (b) At February 29, 2020, we had foreign currency derivatives consisting of foreign currency zero cost collars and foreign currency forwards that are designated as foreign currency cash flow hedges for a portion of our euro-denominated shipbuilding payments. See “Newbuild Currency Risks” below for additional information regarding these derivatives. (c) We have interest rate swaps designated as cash flow hedges whereby we receive floating interest rate payments in exchange for making fixed interest rate payments. These interest rate swap agreements effectively changed $288 million at February 29, 2020 and $300 million at November 30, 2019 of EURIBOR-based floating rate euro debt to fixed rate euro debt. At February 29, 2020, these interest rate swaps settle through 2025. Our derivative contracts include rights of offset with our counterparties. We have elected to net certain of our derivative assets and liabilities within counterparties. February 29, 2020 (in millions) Gross Amounts Gross Amounts Offset in the Balance Sheet Total Net Amounts Presented in the Balance Sheet Gross Amounts not Offset in the Balance Sheet Net Amounts Assets $ 102 $ — $ 102 $ (5) $ 97 Liabilities $ 18 $ — $ 17 $ (5) $ 12 November 30, 2019 (in millions) Gross Amounts Gross Amounts Offset in the Balance Sheet Total Net Amounts Presented in the Balance Sheet Gross Amounts not Offset in the Balance Sheet Net Amounts Assets $ 58 $ — $ 58 $ (4) $ 54 Liabilities $ 25 $ — $ 25 $ (4) $ 21 The effect of our derivatives qualifying and designated as hedging instruments recognized in other comprehensive income (loss) and in net income (loss) was as follows: Three Months Ended (in millions) 2020 2019 Gains (losses) recognized in AOCI: Cross currency swaps - net investment hedges - included component $ (2) $ 2 Cross currency swaps - net investment hedges - excluded component $ 42 $ (12) Foreign currency zero cost collars - cash flow hedges $ (1) $ — Foreign currency forwards - cash flow hedges $ 14 $ — Interest rate swaps - cash flow hedges $ 1 $ 1 Gains (losses) reclassified from AOCI - cash flow hedges: Interest rate swaps - Interest expense, net of capitalized interest $ (2) $ (2) Gains (losses) recognized on derivative instruments (amount excluded from effectiveness testing – net investment hedges) Cross currency swaps - Interest expense, net of capitalized interest $ 10 $ 4 The amount of estimated cash flow hedges’ unrealized gains and losses that are expected to be reclassified to earnings in the next twelve months is not significant. Refer to Note 11 - "Subsequent Events" for a discussion of derivative transactions that occurred subsequent to February 29, 2020 . Financial Risks Fuel Price Risks We manage our exposure to fuel price risk by managing our consumption of fuel. Substantially all of our exposure to market risk for changes in fuel prices relates to the consumption of fuel on our ships. We manage fuel consumption through ship maintenance practices, modifying our itineraries and implementing innovative technologies. We are also adding new, more fuel efficient ships to our fleet and are strategically disposing of smaller, less fuel efficient ships. Foreign Currency Exchange Rate Risks Overall Strategy We manage our exposure to fluctuations in foreign currency exchange rates through our normal operating and financing activities, including netting certain exposures to take advantage of any natural offsets and, when considered appropriate, through the use of derivative and non-derivative financial instruments. Our primary focus is to monitor our exposure to, and manage, the economic foreign currency exchange risks faced by our operations and realized if we exchange one currency for another. We currently only hedge certain of our ship commitments and net investments in foreign operations. The financial impacts of the hedging instruments we do employ generally offset the changes in the underlying exposures being hedged. Operational Currency Risks Our operations primarily utilize the U.S. dollar, Australian dollar, euro or sterling as their functional currencies. Our operations also have revenue and expenses denominated in non-functional currencies. Movements in foreign currency exchange rates will affect our financial statements. Investment Currency Risks We consider our investments in foreign operations to be denominated in stable currencies and are of a long-term nature. We partially mitigate the currency exposure of our investments in foreign operations by designating a portion of our foreign currency debt and derivatives as hedges of these investments. As of February 29, 2020, we have designated $852 million of our sterling-denominated debt as non-derivative hedges of our net investments in foreign operations and for the three months ended February 29, 2020, we recognized $2 million of gains on these non-derivative net investment hedges in the cumulative translation adjustment section of other comprehensive income (loss). We also have $8.2 billion of euro-denominated debt, including the effect of cross currency swaps, which provides an economic offset for our operations with euro functional currency. Newbuild Currency Risks Our shipbuilding contracts are typically denominated in euros. Our decision to hedge a non-functional currency ship commitment for our cruise brands is made on a case-by-case basis, considering the amount and duration of the exposure, market volatility, economic trends, our overall expected net cash flows by currency and other offsetting risks. We use foreign currency derivative contracts to manage foreign currency exchange rate risk for some of our ship construction payments. At February 29, 2020, for the following newbuilds, we had foreign currency contracts for a portion of our euro-denominated shipyard payments. These contracts are designated as cash flow hedges. Entered Into Matures In Weighted-Average Floor Rate Weighted- Average Ceiling Rate Weighted-Average Forward Rate Foreign currency zero cost collars Enchanted Princess 2019 June 2020 $ 1.04 $ 1.28 Mardi Gras 2019 October 2020 $ 1.05 $ 1.28 Foreign currency forwards Iona 2020 May 2020 £ 0.85 If the spot rate is between the ceiling and floor rates on the date of maturity, then we would not owe or receive any payments under the zero cost collars. At February 29, 2020, our remaining newbuild currency exchange rate risk primarily relates to euro-denominated newbuild contract payments to non-euro functional currency brands, which represent a total unhedged commitment of $6.4 billion for newbuilds scheduled to be delivered from 2020 through 2025. The cost of shipbuilding orders that we may place in the future that is denominated in a different currency than our cruise brands’ will be affected by foreign currency exchange rate fluctuations. These foreign currency exchange rate fluctuations may affect our decision to order new cruise ships. Interest Rate Risks Concentrations of Credit Risk As part of our ongoing control procedures, we monitor concentrations of credit risk associated with financial and other institutions with which we conduct significant business. We seek to minimize these credit risk exposures, including counterparty nonperformance primarily associated with our cash equivalents, investments, notes receivables, committed financing facilities, contingent obligations, derivative instruments, insurance contracts, long-term ship charters and new ship progress payment guarantees, by: • Conducting business with well-established financial institutions, insurance companies and export credit agencies • Diversifying our counterparties • Having guidelines regarding credit ratings and investment maturities that we follow to help safeguard liquidity and minimize risk • Generally requiring collateral and/or guarantees to support notes receivable on significant asset sales, long-term ship charters and new ship progress payments to shipyards At February 29, 2020, our exposures under derivative instruments were not material. We also monitor the creditworthiness of travel agencies and tour operators in Asia, Australia and Europe, which includes charter-hire agreements in Asia and credit and debit card providers to which we extend credit in the normal course of our business. Our credit exposure also includes contingent obligations related to cash payments received directly by travel agents and tour operators for cash collected by them on cruise sales in Australia and most of Europe where we are obligated to honor our guests’ cruise payments made by them to |
Leases
Leases | 3 Months Ended |
Feb. 29, 2020 | |
Leases [Abstract] | |
Leases | Leases Substantially all of our leases for which we are the lessee are operating leases of port facilities and real estate and are included within operating lease right-of-use assets, long-term operating lease liabilities and current portion of operating lease liabilities in our Consolidated Balance Sheet as of February 29, 2020. We have port facilities and real estate lease agreements with lease and non-lease components, and in such cases, we account for the components as a single lease component. We do not recognize lease assets and lease liabilities for any leases with an original term of less than one year. For some of our port facilities and real estate lease agreements, we have the option to extend our current lease term by 1 to 10 years. Generally, we do not include renewal options as a component of our present value calculation as we are not reasonably certain that we will exercise the options. As most of our leases do not have a readily determinable implicit rate, we estimate the incremental borrowing rate ("IBR") to determine the present value of lease payments. We apply judgment in estimating the IBR including considering the term of the lease, the currency in which the lease is denominated, and the impact of collateral and our credit risk on the rate. For leases that were in place upon adoption, we used the remaining lease term as of December 1, 2019 in determining the IBR. For the initial measurement of the lease liabilities for leases commencing after December 1, 2019, the IBR at the lease commencement date was applied. We amortize our lease assets on a straight-line basis over the lease term. During the quarter ended February 29, 2020, we recognized $17 million of operating lease costs, including lease amortization and imputed interest, related to all of our leases other than the port facilities, as operating lease expense. Variable and short-term lease costs related to operating leases, other than the port facilities, were not material to our consolidated financial statements. We have multi-year preferential berthing agreements which are operating leases. During the quarter ended February 29, 2020, we had $30 million of lease asset amortization expense and imputed interest expense and $31 million of variable port costs, which vary based on the number of passengers, recorded within commission, transportation and other in our Consolidated Statements of Income (Loss). We have multiple agreements, with a total undiscounted minimum commitment of approximately $454 million, that have been executed but the lease term has not commenced as of February 29, 2020. These are substantially all related to our rights to use certain port facilities. The leases are expected to commence between 2020 and 2022. During the quarter ended February 29, 2020, we obtained $107 million of right-of-use assets in exchange for new operating lease liabilities. Weighted average of the remaining lease terms and weighted average discount rates are as follows: February 29, 2020 Weighted average remaining lease term - operating leases (in years) 13 Weighted average discount rate - operating leases 3.1 % As of February 29, 2020, maturities of lease liabilities were as follows: (in millions) Year Total Operating Remainder of 2020 $ 158 2021 188 2022 156 2023 148 2024 142 Thereafter 1,039 Total lease payments 1,832 Less: Present value discount (352) Present value of lease liabilities $ 1,480 Under ASC 840, Leases , future minimum lease payments under non-cancelable operating leases of port facilities and other assets as of November 30, 2019 were as follows: (in millions) Year Total Operating 2020 $ 219 2021 196 2022 161 2023 173 2024 167 Thereafter 1,408 $ 2,324 For time charter arrangements where we are the lessor and for transactions with cruise guests related to the use of cabins, we do not separate lease and non-lease components. As the non-lease components are the predominant components in the agreements, we account for these transactions under the Revenue Recognition guidance. We have sales-type leases of ships for which we are the lessor. As of February 29, 2020, the net investment related to these leases was $127 million. |
Segment Information
Segment Information | 3 Months Ended |
Feb. 29, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Our operating segments are reported on the same basis as the internally reported information that is provided to our chief operating decision maker (“CODM”), who is the President and Chief Executive Officer of Carnival Corporation and Carnival plc. The CODM assesses performance and makes decisions to allocate resources for Carnival Corporation & plc based upon review of the results across all of our segments. Our four reportable segments are comprised of (1) NAA cruise operations, (2) EA cruise operations, (3) Cruise Support and (4) Tour and Other. The operating segments within each of our NAA and EA reportable segments have been aggregated based on the similarity of their economic and other characteristics, including geographic guest sourcing. Our Cruise Support segment includes our portfolio of leading port destinations and other services, all of which are operated for the benefit of our cruise brands. Our Tour and Other segment represents the hotel and transportation operations of Holland America Princess Alaska Tours and other operations. Three Months Ended February 29/28, (in millions) Revenues Operating costs and Selling Depreciation Operating 2020 NAA $ 3,140 $ 2,274 $ 400 $ 364 $ (197) (a) EA 1,552 1,317 207 166 (569) (b) Cruise Support 44 (87) 65 32 35 Tour and Other 52 19 7 8 18 $ 4,789 $ 3,523 $ 678 $ 570 $ (713) 2019 NAA $ 3,077 $ 2,010 $ 353 $ 328 $ 386 EA 1,526 1,075 205 152 93 Cruise Support 42 27 65 28 (78) Tour and Other 29 29 6 9 (15) $ 4,673 $ 3,142 $ 629 $ 516 $ 386 (a) Includes $300 million of goodwill impairment charges. (b) Includes $431 million of goodwill impairment charges. Revenue by geographic areas, which are based on where our guests are sourced, were as follows: Three Months Ended February 29/28 (in millions) 2020 2019 North America $ 2,647 $ 2,520 Europe 1,367 1,399 Australia and Asia 615 584 Other 161 170 $ 4,789 $ 4,673 |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Feb. 29, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Three Months Ended (in millions, except per share data) 2020 2019 Net income (loss) for basic and diluted earnings per share $ (781) $ 336 Weighted-average shares outstanding 684 693 Dilutive effect of equity plans — 2 Diluted weighted-average shares outstanding 684 695 Basic earnings per share $ (1.14) $ 0.48 Diluted earnings per share $ (1.14) $ 0.48 Antidilutive equity awards excluded from diluted earnings per share computations 1 — |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Feb. 29, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information (in millions) February 29, 2020 November 30, 2019 Cash and cash equivalents (Consolidated Balance Sheets) $ 1,354 $ 518 Restricted cash included in prepaid expenses and other and other assets 15 13 Total cash, cash equivalents and restricted cash (Consolidated Statements of Cash Flows) $ 1,368 $ 530 We did not issue notes receivable upon sale of ships during the three months ended February 29/28, 2020 and 2019. |
Other Assets
Other Assets | 3 Months Ended |
Feb. 29, 2020 | |
Other Assets [Abstract] | |
Other Assets | Other AssetsWe have a minority interest in CSSC Carnival Cruise Shipping Limited (“CSSC-Carnival”), a China-based cruise company which will operate its own fleet designed to serve the Chinese market. Our investment in CSSC-Carnival was $132 million as of February 29, 2020 and $48 million as of November 30, 2019. In December 2019, we sold to CSSC-Carnival a controlling interest in an entity with full ownership of two EA segment ships and recognized a related gain of $107 million, included in other operating expenses in our Consolidated Statements of Income (Loss). We will continue to operate both ships under bareboat charter agreements into 2021. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Feb. 29, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The spread of COVID-19 and the recent developments surrounding the global pandemic are having material negative impacts on all aspects of our business. On March 13, 2020, we announced voluntary pauses of our global fleet cruise operations across all brands. The duration of the pauses will be dependent in part on various travel restrictions and travel bans issued by countries around the world. As of April 1, 2020, substantially all our ships have disembarked their passengers. There are approximately 6,000 passengers onboard ships still at sea that are expected to disembark their passengers by the end of April. Some of our crew is unable to return home, and we will be providing them with food and housing. We have updated our cancellation policies, the terms of which vary widely by brand and sailing date, to permit cruisers to cancel certain upcoming cruises and elect to receive refunds in cash or future cruise credits. As an incentive to accept the future cruise credits, our brands have offerings which vary widely in terms but generally increase the value of the future cruise credits or onboard credits (credits that can be used as onboard spending money on a future sailing). The volume and pace of cash refunds could have a material adverse effect on our liquidity and capital resources. Significant events affecting travel, including COVID-19, typically have an impact on booking patterns, with the full extent of the impact generally determined by the length of time the event influences travel decisions. We believe the ongoing effects of COVID-19 on our operations and global bookings have had, and will continue to have, a material negative impact on our financial results and liquidity, and such negative impact may continue well beyond the containment of such outbreak. We have never previously experienced a complete cessation of our cruising operations, and as a consequence, our ability to be predictive regarding the impact of such a cessation on our brands and future prospects is uncertain. In addition, the magnitude, duration and speed of the global pandemic is uncertain. As a consequence, we cannot estimate the impact on our business, financial condition or near- or longer-term financial or operational results with certainty, but we expect a net loss on both a U.S. GAAP and adjusted basis for the fiscal year ending November 30, 2020. The effects of further decreases in estimated future operating cash flows could result in the need to recognize additional impairment charges in future periods. In March and April 2020, Moody’s and S&P Global downgraded our long-term issuer and senior unsecured debt ratings. In addition, our long-term ratings were placed on review for further downgrade by both rating agencies. Our short-term commercial paper credit ratings were downgraded and also placed on review for further downgrade. In March 2020, we fully drew down our $3.0 billion Existing Multicurrency Facility. In March 2020, we early settled all outstanding cross currency swaps designated as net investment hedges and received proceeds of $180 million, of which $167 million will remain in AOCI until either the sale or substantially complete liquidation of the related subsidiary. We also early settled our foreign currency forwards that were designated as cash flow hedges and received proceeds of $53 million which will remain in AOCI until recognized in earnings proportionately to the related depreciation expense of the underlying vessel that was hedged. On April 1, 2020, we announced the pricing terms of offerings of $4.0 billion of the Secured Notes, $1.75 billion Convertible Notes and a public offering of $500 million of common stock in the Public Equity Offering. In connection with the Convertible Notes offering, we granted the initial purchasers of the Convertible Notes an option to purchase on or before April 18, 2020, up to an additional $262.5 million aggregate principal amount of Convertible Notes. In connection with the Public Equity Offering, we granted the underwriters an option to purchase up to 9,375,000 of additional shares of common stock, which option must be exercised on or before May 1, 2020. The Secured Notes will pay interest semi-annually on April 1 and October 1 of each year, beginning on October 1, 2020, at a rate of 11.5% per year. The Secured Notes will mature on April 1, 2023. The Convertible Notes will pay interest semi-annually on April 1 and October 1 of each year, beginning on October 1, 2020, at a rate of 5.75% per year. The Convertible Notes will mature on April 1, 2023, unless earlier converted, redeemed or repurchased. The initial conversion rate per $1,000 principal amount of Convertible Notes is equivalent to 100 shares of common stock of the Corporation, which is equivalent to a conversion price of approximately $10 per share, subject to adjustment in certain circumstances. The Public Equity Offering consists of 62,500,000 shares of common stock, par value $0.01 per share, of Carnival Corporation, at a price of $8 per share. The Public Equity Offering, the Convertible Notes offering and the Secured Notes offering are expected to be completed in early April, subject to customary closing conditions. The net proceeds from the offering of Secured Notes will be deposited in to a segregated escrow account, pending the releases in accordance with certain collateral perfection thresholds. None of the closings of the Public Equity Offering and the offerings of the Secured Notes or the Convertible Notes is conditioned upon the closing of any of the other offerings or vice versa. |
General (Policies)
General (Policies) | 3 Months Ended |
Feb. 29, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of PresentationThe Consolidated Statements of Income (Loss), the Consolidated Statements of Comprehensive Income (Loss), the Consolidated Statements of Cash Flows and the Consolidated Statements of Shareholders’ Equity for the three months ended February 29/28, 2020 and 2019, and the Consolidated Balance Sheet at February 29, 2020 are unaudited and, in the opinion of our management, contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement. Our interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in the Carnival Corporation & plc 2019 joint Annual Report on Form 10-K (“Form 10-K”) filed with the U.S. Securities and Exchange Commission on January 28, 2020. Our operations are seasonal and results for interim periods are not necessarily indicative of the results for the entire year. |
Accounting Pronouncements | Accounting Pronouncements On December 1, 2019, we adopted the FASB issued guidance, Leases , using the modified retrospective approach, which allows entities to either apply the new lease standard to the beginning of the earliest period presented or only to the consolidated financial statements in the period of adoption without restating prior periods. We have elected to apply the new guidance at the date of adoption without restating prior periods. We have implemented changes to our internal controls to address the collection, recording, and accounting for leases in accordance with the new guidance. Upon adoption of the new guidance, the most significant impact was the recognition of $1.4 billion of right-of-use assets and lease liabilities relating to operating leases, reported within operating lease right-of-use assets and long-term operating lease liabilities, with the current portion of the liability reported within current portion of operating lease liabilities, in our Consolidated Balance Sheet as of December 1, 2019. There was no cumulative effect of applying the new standard and accordingly there was no adjustment to our retained earnings upon adoption. This guidance had an immaterial impact on our Consolidated Statements of Income (Loss), Consolidated Statements of Comprehensive Income (Loss), Consolidated Statements of Cash Flows and the compliance with debt-covenants under our current agreements. The FASB issued amended guidance, Intangibles - Goodwill and Other - Internal-Use Software , which requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance to determine which implementation costs to capitalize as assets or expense as incurred. The expense related to deferred implementation costs is required to be presented in the same net income (loss) line item as the related hosting fees. Additionally, the payments for deferred implementation costs are required to be presented in the same line item in the Consolidated Statements of Cash Flows as payments for the related hosting fees. This guidance is required to be adopted by us in the first quarter of 2021 and must be applied using either a prospective or a retrospective approach. Early adoption is permitted. We are currently evaluating the impact this guidance will have on our consolidated financial statements. The FASB issued amended guidance, Financial Instruments - Credit Losses |
Revenue from Contract with Customer | Guest cruise deposits represent unearned revenues and are initially included in customer deposit liabilities when received. Customer deposits are subsequently recognized as cruise revenues, together with revenues from onboard and other activities, and all associated direct costs and expenses of a voyage are recognized as cruise costs and expenses, upon completion of voyages with durations of ten nights or less and on a pro rata basis for voyages in excess of ten nights. The impact of recognizing these shorter duration cruise revenues and costs and expenses on a completed voyage basis versus on a pro rata basis is not significant. Certain of our product offerings are bundled and we allocate the value of the bundled services and goods between passenger ticket revenues, onboard and other revenues and tour and other revenues based upon the estimated standalone selling prices of those goods and services. Future travel discount vouchers are included as a reduction of cruise passenger ticket revenues when such vouchers are utilized. Guest cancellation fees are recognized in cruise passenger ticket revenues at the time of cancellation. Our sale to guests of air and other transportation to and from airports near the home ports of our ships are included in passenger ticket revenues, and the related cost of purchasing these services are included in transportation costs. The proceeds that we collect from the sales of third-party shore excursions are included in onboard and other revenues and the related costs are included in onboard and other costs. The amounts collected on behalf of our onboard concessionaires, net of the amounts remitted to them, are included in onboard and other revenues as concession revenues. All of these amounts are recognized on a completed voyage or pro rata basis as discussed above. Passenger ticket revenues include fees, taxes and charges collected by us from our guests. A portion of these fees, taxes and charges vary with guest head counts and are directly imposed on a revenue-producing arrangement. This portion of the fees, |
Fair Value Measurements, Deri_2
Fair Value Measurements, Derivative Instruments and Hedging Activities (Tables) | 3 Months Ended |
Feb. 29, 2020 | |
Fair Value Disclosures [Abstract] | |
Estimated Carrying and Fair Values of Financial Instrument Assets and Liabilities Not Measured at Fair Value on a Recurring Basis | Financial Instruments that are not Measured at Fair Value on a Recurring Basis February 29, 2020 November 30, 2019 Carrying Fair Value Carrying Fair Value (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Long-term other assets (a) $ 177 $ — $ 30 $ 145 $ 181 $ — $ 31 $ 149 Total $ 177 $ — $ 30 $ 145 $ 181 $ — $ 31 $ 149 Liabilities Fixed rate debt (b) $ 7,351 $ — $ 7,548 $ — $ 7,438 $ — $ 7,782 $ — Floating rate debt (b) 5,740 — 5,656 — 4,195 — 4,248 — Total $ 13,091 $ — $ 13,204 $ — $ 11,634 $ — $ 12,030 $ — (a) Long-term other assets are comprised of notes receivables, which include loans on ship sales. The fair values of our Level 2 notes receivables were based on estimated future cash flows discounted at appropriate market interest rates. The fair values of our Level 3 notes receivable were estimated using risk-adjusted discount rates. (b) The debt amounts above do not include the impact of interest rate swaps or debt issuance costs. The fair values of our publicly-traded notes were based on their unadjusted quoted market prices in markets that are not sufficiently active to be Level 1 and, accordingly, are considered Level 2. The fair values of our other debt were estimated based on current market interest rates being applied to this debt. |
Estimated Fair Value and Basis of Valuation of Financial Instrument Assets and Liabilities Measured at Fair Value on Recurring Basis | Financial Instruments that are Measured at Fair Value on a Recurring Basis February 29, 2020 November 30, 2019 (in millions) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Cash and cash equivalents $ 1,354 $ — $ — $ 518 $ — $ — Restricted cash 15 — — 13 — — Derivative financial instruments — 102 — — 58 — Total $ 1,368 $ 102 $ — $ 530 $ 58 $ — Liabilities Derivative financial instruments $ — $ 17 $ — $ — $ 25 $ — Total $ — $ 17 $ — $ — $ 25 $ — |
Reconciliation of Changes in Carrying Amounts of Goodwill | Goodwill (in millions) NAA EA Total At November 30, 2019 $ 1,898 $ 1,014 $ 2,912 Impairment charges (300) (431) (731) Foreign currency translation adjustment — (5) (5) At February 29, 2020 $ 1,598 $ 578 $ 2,176 |
Reconciliation of Changes in Carrying Amounts of Trademarks | Trademarks (in millions) NAA EA Total At November 30, 2019 $ 927 $ 240 $ 1,167 Foreign currency translation adjustment — — — At February 29, 2020 $ 927 $ 240 $ 1,167 |
Estimated Fair Values of Derivative Financial Instruments and Location in the Consolidated Balance Sheets | Derivative Instruments and Hedging Activities (in millions) Balance Sheet Location February 29, 2020 November 30, 2019 Derivative assets Derivatives designated as hedging instruments Cross currency swaps (a) Prepaid expenses and other $ 39 $ 32 Other assets 49 25 Foreign currency forwards (b) Prepaid expenses and other 14 — Total derivative assets $ 102 $ 58 Derivative liabilities Derivatives designated as hedging instruments Cross currency swaps (a) Accrued liabilities and other $ — $ 1 Other long-term liabilities — 9 Foreign currency zero cost collars (b) Accrued liabilities and other 2 1 Interest rate swaps (c) Accrued liabilities and other 6 6 Other long-term liabilities 9 9 Total derivative liabilities $ 17 $ 25 (a) At February 29, 2020 and November 30, 2019, we had cross currency swaps totaling $1.9 billion, respectively, that are designated as hedges of our net investment in foreign operations with a euro-denominated functional currency. At February 29, 2020, these cross currency swaps settle through 2031. (b) At February 29, 2020, we had foreign currency derivatives consisting of foreign currency zero cost collars and foreign currency forwards that are designated as foreign currency cash flow hedges for a portion of our euro-denominated shipbuilding payments. See “Newbuild Currency Risks” below for additional information regarding these derivatives. |
Offsetting Derivative Instruments | February 29, 2020 (in millions) Gross Amounts Gross Amounts Offset in the Balance Sheet Total Net Amounts Presented in the Balance Sheet Gross Amounts not Offset in the Balance Sheet Net Amounts Assets $ 102 $ — $ 102 $ (5) $ 97 Liabilities $ 18 $ — $ 17 $ (5) $ 12 November 30, 2019 (in millions) Gross Amounts Gross Amounts Offset in the Balance Sheet Total Net Amounts Presented in the Balance Sheet Gross Amounts not Offset in the Balance Sheet Net Amounts Assets $ 58 $ — $ 58 $ (4) $ 54 Liabilities $ 25 $ — $ 25 $ (4) $ 21 |
Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) | The effect of our derivatives qualifying and designated as hedging instruments recognized in other comprehensive income (loss) and in net income (loss) was as follows: Three Months Ended (in millions) 2020 2019 Gains (losses) recognized in AOCI: Cross currency swaps - net investment hedges - included component $ (2) $ 2 Cross currency swaps - net investment hedges - excluded component $ 42 $ (12) Foreign currency zero cost collars - cash flow hedges $ (1) $ — Foreign currency forwards - cash flow hedges $ 14 $ — Interest rate swaps - cash flow hedges $ 1 $ 1 Gains (losses) reclassified from AOCI - cash flow hedges: Interest rate swaps - Interest expense, net of capitalized interest $ (2) $ (2) Gains (losses) recognized on derivative instruments (amount excluded from effectiveness testing – net investment hedges) Cross currency swaps - Interest expense, net of capitalized interest $ 10 $ 4 |
Schedule of Newbuild Currency | At February 29, 2020, for the following newbuilds, we had foreign currency contracts for a portion of our euro-denominated shipyard payments. These contracts are designated as cash flow hedges. Entered Into Matures In Weighted-Average Floor Rate Weighted- Average Ceiling Rate Weighted-Average Forward Rate Foreign currency zero cost collars Enchanted Princess 2019 June 2020 $ 1.04 $ 1.28 Mardi Gras 2019 October 2020 $ 1.05 $ 1.28 Foreign currency forwards Iona 2020 May 2020 £ 0.85 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Feb. 29, 2020 | |
Leases [Abstract] | |
Schedule of Lease Terms and Discount Rates | Weighted average of the remaining lease terms and weighted average discount rates are as follows: February 29, 2020 Weighted average remaining lease term - operating leases (in years) 13 Weighted average discount rate - operating leases 3.1 % |
Schedule of Maturities of Operating Lease Liabilities | As of February 29, 2020, maturities of lease liabilities were as follows: (in millions) Year Total Operating Remainder of 2020 $ 158 2021 188 2022 156 2023 148 2024 142 Thereafter 1,039 Total lease payments 1,832 Less: Present value discount (352) Present value of lease liabilities $ 1,480 |
Schedule of Future Minimum Lease Payments | Under ASC 840, Leases , future minimum lease payments under non-cancelable operating leases of port facilities and other assets as of November 30, 2019 were as follows: (in millions) Year Total Operating 2020 $ 219 2021 196 2022 161 2023 173 2024 167 Thereafter 1,408 $ 2,324 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Feb. 29, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Three Months Ended February 29/28, (in millions) Revenues Operating costs and Selling Depreciation Operating 2020 NAA $ 3,140 $ 2,274 $ 400 $ 364 $ (197) (a) EA 1,552 1,317 207 166 (569) (b) Cruise Support 44 (87) 65 32 35 Tour and Other 52 19 7 8 18 $ 4,789 $ 3,523 $ 678 $ 570 $ (713) 2019 NAA $ 3,077 $ 2,010 $ 353 $ 328 $ 386 EA 1,526 1,075 205 152 93 Cruise Support 42 27 65 28 (78) Tour and Other 29 29 6 9 (15) $ 4,673 $ 3,142 $ 629 $ 516 $ 386 (a) Includes $300 million of goodwill impairment charges. (b) Includes $431 million of goodwill impairment charges. |
Schedule of Revenue by Geographical Area | Revenue by geographic areas, which are based on where our guests are sourced, were as follows: Three Months Ended February 29/28 (in millions) 2020 2019 North America $ 2,647 $ 2,520 Europe 1,367 1,399 Australia and Asia 615 584 Other 161 170 $ 4,789 $ 4,673 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Feb. 29, 2020 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Earnings Per Share Computation | Three Months Ended (in millions, except per share data) 2020 2019 Net income (loss) for basic and diluted earnings per share $ (781) $ 336 Weighted-average shares outstanding 684 693 Dilutive effect of equity plans — 2 Diluted weighted-average shares outstanding 684 695 Basic earnings per share $ (1.14) $ 0.48 Diluted earnings per share $ (1.14) $ 0.48 Antidilutive equity awards excluded from diluted earnings per share computations 1 — |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Feb. 29, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Supplemental Cash Flow Information | (in millions) February 29, 2020 November 30, 2019 Cash and cash equivalents (Consolidated Balance Sheets) $ 1,354 $ 518 Restricted cash included in prepaid expenses and other and other assets 15 13 Total cash, cash equivalents and restricted cash (Consolidated Statements of Cash Flows) $ 1,368 $ 530 |
General (Details)
General (Details) | 3 Months Ended | ||||||
Feb. 29, 2020USD ($) | Feb. 28, 2019USD ($) | Apr. 01, 2020USD ($) | Mar. 31, 2020USD ($) | Mar. 13, 2020USD ($) | Dec. 01, 2019USD ($) | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Revenues | $ 4,789,000,000 | $ 4,673,000,000 | |||||
Operating lease right-of-use assets | [1] | 1,469,000,000 | |||||
Operating lease liabilities | 1,480,000,000 | ||||||
ASU 2016-02 | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Operating lease right-of-use assets | $ 1,400,000,000 | ||||||
Operating lease liabilities | $ 1,400,000,000 | ||||||
Cruise onboard and other | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Revenues | 1,556,000,000 | 1,474,000,000 | |||||
Cruise onboard and other | Adjustment | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Revenues | 29,000,000 | ||||||
Cruise | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Other operating | $ 1,001,000,000 | 759,000,000 | |||||
Cruise | Adjustment | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Other operating | $ 29,000,000 | ||||||
Revolving credit facility | Subsequent Event | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 3,000,000,000 | $ 3,000,000,000 | |||||
EBITDA | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Interest coverage ratio | 3 | ||||||
Senior Secured Notes due 2023 | Secured | Subsequent Event | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Debt instrument, face amount | $ 4,000,000,000 | ||||||
Senior Secured Notes due 2023, Initial Purchasers Exercise Additional Options | Convertible | Subsequent Event | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Debt instrument, face amount | 2,012,500,000 | ||||||
Senior Convertible Notes due 2023 | Convertible | Subsequent Event | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Debt instrument, face amount | 1,750,000,000 | ||||||
Debt instrument, convertible, carrying amount | 500,000,000 | ||||||
Senior Converted Notes due 2023, Underwriters Exercise Additional Shares | Convertible | Subsequent Event | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Debt instrument, convertible, carrying amount | $ 575,000,000 | ||||||
[1] | We adopted the provisions of Leases on December 1, 2019. |
Revenue and Expense Recogniti_2
Revenue and Expense Recognition (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Feb. 29, 2020 | Feb. 28, 2019 | Dec. 01, 2019 | Nov. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Fees, taxes, and charges | $ 174 | $ 163 | ||
Contract assets | 134 | $ 154 | ||
Cruise | ||||
Disaggregation of Revenue [Line Items] | ||||
Customer deposits | 4,900 | $ 4,900 | ||
Revenues recognized related to customer deposits at beginning of period | $ 3,000 | $ 3,000 |
Unsecured Debt (Details)
Unsecured Debt (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Feb. 29, 2020 | Dec. 31, 2019 | Feb. 29, 2020 | Feb. 28, 2019 | |
Export credit facility | Export credit facility due 2032 | ||||
Debt Instrument [Line Items] | ||||
Proceeds from long-term debt | $ 823,000,000 | |||
Sterling-denominated floating rate bank loan | Sterling-denominated floating rate bank loan due 2025 | ||||
Debt Instrument [Line Items] | ||||
Proceeds from long-term debt | $ 452,000,000 | |||
Commercial paper | ||||
Debt Instrument [Line Items] | ||||
Current unsecured debt | $ 1,000,000,000 | $ 1,000,000,000 | ||
Proceeds from short term debt | $ 0 | $ 0 |
Contingencies (Details)
Contingencies (Details) | May 02, 2019lawsuit |
Commitments and Contingencies Disclosure [Abstract] | |
Number of lawsuits | 2 |
Fair Value Measurements, Deri_3
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Estimated Carrying and Fair Values of Financial Instrument Assets and Liabilities Not Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Feb. 29, 2020 | Nov. 30, 2019 |
Carrying Value | ||
Assets | ||
Long-term other assets | $ 177 | $ 181 |
Total | 177 | 181 |
Liabilities | ||
Total | 13,091 | 11,634 |
Carrying Value | Fixed rate debt | ||
Liabilities | ||
Debt | 7,351 | 7,438 |
Carrying Value | Floating rate debt | ||
Liabilities | ||
Debt | 5,740 | 4,195 |
Fair Value | Level 1 | ||
Assets | ||
Long-term other assets | 0 | 0 |
Total | 0 | 0 |
Liabilities | ||
Total | 0 | 0 |
Fair Value | Level 1 | Fixed rate debt | ||
Liabilities | ||
Debt | 0 | 0 |
Fair Value | Level 1 | Floating rate debt | ||
Liabilities | ||
Debt | 0 | 0 |
Fair Value | Level 2 | ||
Assets | ||
Long-term other assets | 30 | 31 |
Total | 30 | 31 |
Liabilities | ||
Total | 13,204 | 12,030 |
Fair Value | Level 2 | Fixed rate debt | ||
Liabilities | ||
Debt | 7,548 | 7,782 |
Fair Value | Level 2 | Floating rate debt | ||
Liabilities | ||
Debt | 5,656 | 4,248 |
Fair Value | Level 3 | ||
Assets | ||
Long-term other assets | 145 | 149 |
Total | 145 | 149 |
Liabilities | ||
Total | 0 | 0 |
Fair Value | Level 3 | Fixed rate debt | ||
Liabilities | ||
Debt | 0 | 0 |
Fair Value | Level 3 | Floating rate debt | ||
Liabilities | ||
Debt | $ 0 | $ 0 |
Fair Value Measurements, Deri_4
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Estimated Fair Value and Basis of Valuation of Financial Instrument Assets And Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Feb. 29, 2020 | Nov. 30, 2019 |
Assets | ||
Derivative financial instruments | $ 102 | $ 58 |
Liabilities | ||
Derivative financial instruments | 18 | 25 |
Financial Instruments Measured at Fair Value on a Recurring Basis | Level 1 | ||
Assets | ||
Restricted cash | 15 | 13 |
Total | 1,368 | 530 |
Financial Instruments Measured at Fair Value on a Recurring Basis | Level 1 | Money market funds | ||
Assets | ||
Cash and cash equivalents | 1,354 | 518 |
Financial Instruments Measured at Fair Value on a Recurring Basis | Level 2 | ||
Assets | ||
Total | 102 | 58 |
Liabilities | ||
Total | 17 | 25 |
Financial Instruments Measured at Fair Value on a Recurring Basis | Level 2 | Derivative financial instruments, assets | ||
Assets | ||
Derivative financial instruments | 102 | 58 |
Financial Instruments Measured at Fair Value on a Recurring Basis | Level 2 | Derivative financial instruments, liabilities | ||
Liabilities | ||
Derivative financial instruments | $ 17 | $ 25 |
Fair Value Measurements, Deri_5
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Reconciliation of Changes in Carrying Amounts of Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Goodwill [Roll Forward] | ||
At November 30, 2019 | $ 2,912 | |
Impairment charges | (731) | $ 0 |
Foreign currency translation adjustment | (5) | |
At February 29, 2020 | 2,176 | |
NAA Segment | ||
Goodwill [Roll Forward] | ||
At November 30, 2019 | 1,898 | |
Impairment charges | (300) | |
Foreign currency translation adjustment | 0 | |
At February 29, 2020 | 1,598 | |
EA Segment | ||
Goodwill [Roll Forward] | ||
At November 30, 2019 | 1,014 | |
Impairment charges | (431) | |
Foreign currency translation adjustment | (5) | |
At February 29, 2020 | $ 578 |
Fair Value Measurements, Deri_6
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Reconciliation of Changes in Carrying Amounts of Trademarks (Details) $ in Millions | 3 Months Ended |
Feb. 29, 2020USD ($) | |
Indefinite-lived Intangible Assets [Roll Forward] | |
At November 30, 2019 | $ 1,167 |
At February 29, 2020 | 1,167 |
NAA Segment | |
Indefinite-lived Intangible Assets [Roll Forward] | |
At November 30, 2019 | 927 |
Foreign currency translation adjustment | 0 |
At February 29, 2020 | 927 |
EA Segment | |
Indefinite-lived Intangible Assets [Roll Forward] | |
At November 30, 2019 | 240 |
At February 29, 2020 | $ 240 |
Fair Value Measurements, Deri_7
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Impairment of Ships (Details) $ in Millions | 3 Months Ended |
Feb. 29, 2020USD ($) | |
NAA Segment | |
Property, Plant and Equipment [Line Items] | |
Ship impairment charges | $ 172 |
EA Segment | |
Property, Plant and Equipment [Line Items] | |
Ship impairment charges | $ 158 |
Fair Value Measurements, Deri_8
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Estimated Fair Values of Derivative Financial Instruments and Location on Consolidated Balance Sheets (Details) - USD ($) $ in Millions | Feb. 29, 2020 | Nov. 30, 2019 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets | $ 102 | $ 58 |
Derivative liabilities | 17 | 25 |
Derivatives designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 102 | 58 |
Cross currency swaps | Derivatives designated as hedging instruments | Prepaid expenses and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 39 | 32 |
Cross currency swaps | Derivatives designated as hedging instruments | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 49 | 25 |
Cross currency swaps | Derivatives designated as hedging instruments | Accrued liabilities and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 0 | 1 |
Cross currency swaps | Derivatives designated as hedging instruments | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 9 | |
Foreign currency forwards | Derivatives designated as hedging instruments | Prepaid expenses and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 14 | 0 |
Foreign currency zero cost collars | Derivatives designated as hedging instruments | Accrued liabilities and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 2 | 1 |
Interest rate swaps | Derivatives designated as hedging instruments | Accrued liabilities and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 6 | 6 |
Interest rate swaps | Derivatives designated as hedging instruments | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 9 | 9 |
Interest rate swaps | Cash flow hedging | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate cash flow hedge asset at fair value | 288 | 300 |
Currency swap | Derivatives designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | $ 1,900 | $ 1,900 |
Fair Value Measurements, Deri_9
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Offsetting Derivative Instruments (Details) - USD ($) $ in Millions | Feb. 29, 2020 | Nov. 30, 2019 |
Assets | ||
Gross Amounts | $ 102 | $ 58 |
Gross Amounts Offset in the Balance Sheet | 0 | 0 |
Total Net Amounts Presented in the Balance Sheet | 102 | 58 |
Gross Amounts not Offset in the Balance Sheet | (5) | (4) |
Net Amounts | 97 | 54 |
Liabilities | ||
Gross Amounts | 18 | 25 |
Gross Amounts Offset in the Balance Sheet | 0 | 0 |
Total Net Amounts Presented in the Balance Sheet | 17 | 25 |
Gross Amounts not Offset in the Balance Sheet | (5) | (4) |
Net Amounts | $ 12 | $ 21 |
Fair Value Measurements, Der_10
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Derivatives Qualifying and Designated as Hedging Instruments Recognized in Other Comprehensive Income (Details) - Designated as hedging instruments - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Cross currency swaps, included component | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (losses) recognized in AOCI, net investment hedges | $ (2) | $ 2 |
Cross currency swaps, excluded component | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (losses) recognized in AOCI, net investment hedges | 42 | (12) |
Foreign currency zero cost collars | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (losses) recognized in AOCI, cash flow hedges | (1) | 0 |
Foreign currency forwards | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (losses) recognized in AOCI, cash flow hedges | 14 | 0 |
Interest rate swaps | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (losses) recognized in AOCI, cash flow hedges | 1 | 1 |
Gains (losses) reclassified from AOCI, cash flow hedges | (2) | (2) |
Cross currency swaps, interest expense | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gains (losses) recognized on derivative instruments (amount excluded from effectiveness testing - net investment hedges) | $ 10 | $ 4 |
Fair Value Measurements, Der_11
Fair Value Measurements, Derivative Instruments and Hedging Activities and Financial Risks - Foreign Currency Exchange Rate Risks (Details) $ in Millions | 3 Months Ended | |
Feb. 29, 2020USD ($) | Feb. 28, 2019USD ($) | |
Fair Value, Measurement Inputs, Disclosure [Line Items] | ||
Change in foreign currency translation adjustment | $ 25 | $ 79 |
Foreign currency contract commitments | $ 6,400 | |
Iona | Cash flow hedging | ||
Fair Value, Measurement Inputs, Disclosure [Line Items] | ||
Weighted-Average Forward Rate | 0.85 | |
Foreign currency zero cost collars | Enchanted Princess | Cash flow hedging | ||
Fair Value, Measurement Inputs, Disclosure [Line Items] | ||
Weighted-Average Floor Rate | 1.04 | |
Weighted- Average Ceiling Rate | 1.28 | |
Foreign currency zero cost collars | Mardi Gras | Cash flow hedging | ||
Fair Value, Measurement Inputs, Disclosure [Line Items] | ||
Weighted-Average Floor Rate | 1.05 | |
Weighted- Average Ceiling Rate | 1.28 | |
Sterling-denominated | ||
Fair Value, Measurement Inputs, Disclosure [Line Items] | ||
Debt instrument, face amount | $ 852 | |
Change in foreign currency translation adjustment | 2 | |
Euro-denominated | ||
Fair Value, Measurement Inputs, Disclosure [Line Items] | ||
Debt instrument, face amount | $ 8,200 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | 3 Months Ended |
Feb. 29, 2020USD ($) | |
Lessee, Lease, Description [Line Items] | |
Operating lease costs | $ 17 |
Operation lease amortization expense | 30 |
Operating lease interest expense | 31 |
Operating lease minimum commitment | 454 |
Right-of-use assets obtained in exchange for operating lease liabilities | 107 |
Net investment in leases | $ 127 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lease renewal term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 1 year |
Lease renewal term | 10 years |
Leases - Lease Terms and Discou
Leases - Lease Terms and Discount Rates (Details) | Feb. 29, 2020 |
Leases [Abstract] | |
Weighted average remaining lease term - operating leases (in years) | 13 years |
Weighted average discount rate - operating leases (percent) | 3.10% |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Millions | Feb. 29, 2020USD ($) |
Leases [Abstract] | |
Remainder of 2020 | $ 158 |
2021 | 188 |
2022 | 156 |
2023 | 148 |
2024 | 142 |
Thereafter | 1,039 |
Total lease payments | 1,832 |
Less: Present value discount | (352) |
Present value of lease liabilities | $ 1,480 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Millions | Nov. 30, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 219 |
2021 | 196 |
2022 | 161 |
2023 | 173 |
2024 | 167 |
Thereafter | 1,408 |
Total | $ 2,324 |
Segment Information - Segment R
Segment Information - Segment Reporting (Details) $ in Millions | 3 Months Ended | |
Feb. 29, 2020USD ($)segment | Feb. 28, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | segment | 4 | |
Revenues | $ 4,789 | $ 4,673 |
Operating costs and expenses | 3,523 | 3,142 |
Selling and administrative | 678 | 629 |
Depreciation and amortization | 570 | 516 |
Operating Income (Loss) | (713) | 386 |
Impairment charges | (731) | 0 |
NAA | ||
Segment Reporting Information [Line Items] | ||
Impairment charges | (300) | |
EA | ||
Segment Reporting Information [Line Items] | ||
Impairment charges | (431) | |
Operating Segments | NAA | ||
Segment Reporting Information [Line Items] | ||
Revenues | 3,140 | 3,077 |
Operating costs and expenses | 2,274 | 2,010 |
Selling and administrative | 400 | 353 |
Depreciation and amortization | 364 | 328 |
Operating Income (Loss) | (197) | 386 |
Impairment charges | 300 | |
Operating Segments | EA | ||
Segment Reporting Information [Line Items] | ||
Revenues | 1,552 | 1,526 |
Operating costs and expenses | 1,317 | 1,075 |
Selling and administrative | 207 | 205 |
Depreciation and amortization | 166 | 152 |
Operating Income (Loss) | (569) | 93 |
Impairment charges | 431 | |
Operating Segments | Cruise Support | ||
Segment Reporting Information [Line Items] | ||
Revenues | 44 | 42 |
Operating costs and expenses | (87) | 27 |
Selling and administrative | 65 | 65 |
Depreciation and amortization | 32 | 28 |
Operating Income (Loss) | 35 | (78) |
Operating Segments | Tour and Other | ||
Segment Reporting Information [Line Items] | ||
Revenues | 52 | 29 |
Operating costs and expenses | 19 | 29 |
Selling and administrative | 7 | 6 |
Depreciation and amortization | 8 | 9 |
Operating Income (Loss) | $ 18 | $ (15) |
Segment Information - Geographi
Segment Information - Geographic Area Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 4,789 | $ 4,673 |
North America | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 2,647 | 2,520 |
Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 1,367 | 1,399 |
Australia and Asia | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | 615 | 584 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues | $ 161 | $ 170 |
Earnings Per Share - Basic and
Earnings Per Share - Basic and Diluted Earnings Per Share Computation (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Feb. 29, 2020 | Feb. 28, 2019 | |
Earnings Per Share [Abstract] | ||
Net income (loss) for basic and diluted earnings per share | $ (781) | $ 336 |
Weighted-average shares outstanding (in shares) | 684 | 693 |
Dilutive effect of equity plans (in shares) | 0 | 2 |
Diluted weighted-average shares outstanding (in shares) | 684 | 695 |
Basic earnings per share (in dollars per share) | $ (1.14) | $ 0.48 |
Diluted earnings per share (in dollars per share) | $ (1.14) | $ 0.48 |
Antidilutive equity awards excluded from diluted earnings per share computations (in shares) | 1 | 0 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | Feb. 29, 2020 | Nov. 30, 2019 | Feb. 28, 2019 | Nov. 30, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents (Consolidated Balance Sheets) | $ 1,354 | $ 518 | ||
Restricted cash included in prepaid expenses and other and other assets | 15 | 13 | ||
Total cash, cash equivalents and restricted cash (Consolidated Statements of Cash Flows) | $ 1,368 | $ 530 | $ 665 | $ 996 |
Other Assets (Details)
Other Assets (Details) - CSSC-Carnival $ in Millions | 1 Months Ended | ||
Dec. 31, 2019USD ($)cruise_ship | Feb. 29, 2020USD ($) | Nov. 30, 2019USD ($) | |
Schedule of Equity Method Investments [Line Items] | |||
Investment, amount | $ 132 | $ 48 | |
EA Segment | |||
Schedule of Equity Method Investments [Line Items] | |||
Number of cruise ships | cruise_ship | 2 | ||
Investment amount sold, gain | $ 107 |
Subsequent Events (Details)
Subsequent Events (Details) $ / shares in Units, passenger in Thousands | Apr. 01, 2020USD ($)sharespassenger$ / shares | Mar. 31, 2020USD ($) | Feb. 29, 2020USD ($) | Feb. 28, 2019USD ($) | Mar. 13, 2020USD ($) |
Cross currency swaps | Derivatives designated as hedging instruments | |||||
Subsequent Event [Line Items] | |||||
Gains (losses) recognized in AOCI, net investment hedges | $ (2,000,000) | $ 2,000,000 | |||
Foreign currency forwards | Derivatives designated as hedging instruments | |||||
Subsequent Event [Line Items] | |||||
Gains (losses) recognized in AOCI, cash flow hedges | $ 14,000,000 | $ 0 | |||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Number of passengers onboard ships still at sea | passenger | 6 | ||||
Subsequent Event | Cross currency swaps | Derivatives designated as hedging instruments | |||||
Subsequent Event [Line Items] | |||||
Gains (losses) reclassified from AOCI, net investment hedges | $ 180,000,000 | ||||
Gains (losses) recognized in AOCI, net investment hedges | 167,000,000 | ||||
Subsequent Event | Foreign currency forwards | Derivatives designated as hedging instruments | |||||
Subsequent Event [Line Items] | |||||
Gains (losses) recognized in AOCI, cash flow hedges | 53,000,000 | ||||
Subsequent Event | Revolving credit facility | |||||
Subsequent Event [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 3,000,000,000 | $ 3,000,000,000 | |||
Subsequent Event | Secured | Senior Secured Notes due 2023 | |||||
Subsequent Event [Line Items] | |||||
Debt instrument, face amount | $ 4,000,000,000 | ||||
Debt instrument, interest rate (percent) | 11.50% | ||||
Subsequent Event | Convertible | Senior Convertible Notes due 2023 | |||||
Subsequent Event [Line Items] | |||||
Debt instrument, face amount | $ 1,750,000,000 | ||||
Debt instrument, convertible, carrying amount | 500,000,000 | ||||
Debt instrument, additional options, amount | $ 262,500,000 | ||||
Debt instrument, additional options (in shares) | shares | 9,375,000 | ||||
Debt instrument, interest rate (percent) | 5.75% | ||||
Conversion rate, amount | $ 1,000 | ||||
Debt instrument, convertible, number of shares | shares | 100 | ||||
Debt instrument, conversion price (in dollars per share) | $ / shares | $ 10 | ||||
Shares, issued (in shares) | shares | 62,500,000 | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||
Shares, issued price (in dollars per share) | $ / shares | $ 8 | ||||
Subsequent Event | Convertible | Senior Convertible Notes due 2023 | Director | |||||
Subsequent Event [Line Items] | |||||
Shares purchased by employee (in shares) | shares | 1,250,000 | ||||
Shares amount purchased by employee | $ 10,000,000 |
Uncategorized Items - ccl-20200
Label | Element | Value |
Accounting Standards Update 2014-09 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (24,000,000) |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (24,000,000) |