FORM 8-K
CURRENT REPORT
Pursuant To Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of report (Date of earliest event reported): October 27, 2011
ROYAL CARIBBEAN CRUISES LTD.
|
|
(Exact Name of Registrant as Specified in Charter)
|
|
Republic of Liberia
|
|
(State or Other Jurisdiction of Incorporation)
|
|
1-11884
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98-0081645
|
(Commission File Number)
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(IRS Employer Identification No.)
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1050 Caribbean Way, Miami, Florida
|
33132
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(Address of Principal Executive Offices)
|
(Zip Code)
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Registrant’s telephone number, including area code: 305-539-6000
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|
Not Applicable
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|
(Former Name or Former Address, if Changed Since Last Report)
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|
|
o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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|
o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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|
o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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|
o
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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(d) | Exhibits |
Exhibit 99.1 - Press release dated October 27, 2011. |
ROYAL CARIBBEAN CRUISES LTD.
|
||||
Date:
|
October 27, 2011
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By:
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/s/ Brian J. Rice
|
|
Name:
|
Brian J. Rice
|
|||
Title:
|
Executive Vice President and
Chief Financial Officer
|
o
|
Net income was $399.0 million, or $1.82 per share, versus $350.2 million, or $1.61 per share, in 2010;
|
o
|
Net Yields increased 5.3% (2.6% on a Constant-Currency basis.) Net Cruise Costs per APCD (“NCC”) excluding fuel increased 2.5% (0.7% on a Constant-Currency basis.)
|
o
|
For the full year 2011, the company’s Constant-Currency Net Yield improvement expectations are essentially unchanged at 2% to 3%. Including currency movements, full year Net Yields are expected to increase approximately 4%;
|
o
|
Full year 2011 EPS is expected to be within a range of $2.70 to $2.80, a $0.15 reduction from prior guidance primarily due to the strengthening of the U.S. Dollar and the fuel option revaluation loss.
|
●
|
2012 Outlook: Though economic uncertainty is elevated and it is still early in the booking cycle, 2012 demand thus far has been solid. Booked load factors and pricing are both running ahead of this time last year, which supports the company’s expectation of continued yield accretion during 2012.
|
FUEL STATISTICS
|
Fourth Quarter 2011
|
Full Year 2011
|
Fuel Consumption (metric tons)
|
344,000
|
1,317,000
|
Fuel Expenses
|
$204 Million
|
$761 Million
|
Percent Hedged (fwd consumption)
|
57%
|
57%
|
Impact of 10% change in fuel prices *
|
$9 million
|
$9 million
|
GUIDANCE
|
As-Reported
|
Constant-Currency
|
Fourth Quarter 2011
|
||
Net Yields
|
3% to 4%
|
3% to 4%
|
Net Cruise Costs per APCD
|
Approx. 6%
|
Approx. 6%
|
Net Cruise Costs per APCD,
excluding Fuel
|
Approx. 4%
|
3% to 4%
|
Full Year 2011
|
||
Net Yields
|
Approx. 4%
|
2% to 3%
|
Net Cruise Costs per APCD
|
3% to 4%
|
2% to 3%
|
Net Cruise Costs per APCD,
excluding Fuel
|
2% to 3%
|
1% to 2%
|
Fourth Quarter 2011
|
Full Year 2011
|
|
EPS
|
$0.09 to $0.19
|
$2.70 to $2.80
|
Capacity Increase
|
7.3%
|
7.5%
|
Depreciation and Amortization
|
$180 to $185 million
|
$702 to $707 million
|
Interest Expense, net
|
$82 to $87 million
|
$357 to $362 million
|
Exchange rates used in guidance calculations
|
||
EUR
|
$1.39
|
|
GBP
CAD
|
$1.60
$1.00
|
Quarter Ended
|
Nine Months Ended
|
||||||||||||||||
September 30,
|
September 30,
|
||||||||||||||||
2011
|
2010
|
2011
|
2010
|
||||||||||||||
Passenger ticket revenues
|
$
|
1,734,328
|
$
|
1,520,562
|
$
|
4,257,634
|
$
|
3,762,536
|
|||||||||
Onboard and other revenues
|
587,666
|
540,097
|
1,504,228
|
1,385,470
|
|||||||||||||
Total revenues
|
2,321,994
|
2,060,659
|
5,761,862
|
5,148,006
|
|||||||||||||
Cruise operating expenses:
|
|||||||||||||||||
Commissions, transportation and other
|
405,674
|
350,166
|
984,397
|
889,956
|
|||||||||||||
Onboard and other
|
181,604
|
159,824
|
419,032
|
374,949
|
|||||||||||||
Payroll and related
|
210,535
|
197,070
|
613,816
|
565,112
|
|||||||||||||
Food
|
113,319
|
99,969
|
312,550
|
286,466
|
|||||||||||||
Fuel
|
202,478
|
164,786
|
556,667
|
483,843
|
|||||||||||||
Other operating
|
291,690
|
267,810
|
805,284
|
750,761
|
|||||||||||||
Total cruise operating expenses
|
1,405,300
|
1,239,625
|
3,691,746
|
3,351,087
|
|||||||||||||
Marketing, selling and administrative expenses
|
231,761
|
213,300
|
722,157
|
636,143
|
|||||||||||||
Depreciation and amortization expenses
|
177,191
|
162,232
|
522,493
|
479,838
|
|||||||||||||
Operating Income
|
507,742
|
445,502
|
825,466
|
680,938
|
|||||||||||||
Other income (expense):
|
|||||||||||||||||
Interest income
|
7,070
|
1,815
|
17,329
|
4,547
|
|||||||||||||
Interest expense, net of interest capitalized
|
(98,198)
|
(89,082)
|
(291,791)
|
(271,271)
|
|||||||||||||
Other (expense) income
|
(17,656)
|
(8,056)
|
19,855
|
69,539
|
|||||||||||||
(108,784)
|
(95,323)
|
(254,607)
|
(197,185)
|
||||||||||||||
Net Income
|
$
|
398,958
|
$
|
350,179
|
$
|
570,859
|
$
|
483,753
|
|||||||||
Earnings Per Share:
|
|||||||||||||||||
Basic
|
$
|
1.84
|
$
|
1.63
|
$
|
2.63
|
$
|
2.25
|
|||||||||
Diluted
|
$
|
1.82
|
$
|
1.61
|
$
|
2.60
|
$
|
2.23
|
|||||||||
Weighted-Average Shares Outstanding:
|
|||||||||||||||||
Basic
|
217,105
|
215,150
|
216,883
|
214,839
|
|||||||||||||
Diluted
|
218,934
|
217,512
|
219,315
|
217,388
|
STATISTICS
|
||||||||||||||||||
Quarter Ended
|
Nine Months Ended
|
|||||||||||||||||
September 30,
|
September 30, | |||||||||||||||||
2011 | 2010 |
2011
|
2010 | |||||||||||||||
Passengers Carried
|
1,247,574
|
1,199,759
|
3,648,063
|
3,430,273
|
||||||||||||||
Passenger Cruise Days
|
9,255,801
|
8,656,023
|
26,039,146
|
24,058,087
|
||||||||||||||
APCD
|
8,575,926
|
8,069,663
|
24,714,236
|
22,967,291
|
||||||||||||||
Occupancy
|
107.9%
|
107.3%
|
105.4%
|
104.7%
|
As of | |||||||||
September 30, | December 31, | ||||||||
2011 | 2010 | ||||||||
(unaudited) | |||||||||
Assets
|
|||||||||
Current assets
|
|||||||||
Cash and cash equivalents
|
$
|
451,460
|
$
|
419,929
|
|||||
Trade and other receivables, net
|
303,919
|
266,710
|
|||||||
Inventories
|
152,273
|
126,797
|
|||||||
Prepaid expenses and other assets
|
241,392
|
145,144
|
|||||||
Derivative financial instruments
|
74,074
|
56,491
|
|||||||
Total current assets
|
1,223,118
|
1,015,071
|
|||||||
Property and equipment, net
|
16,988,832
|
16,771,677
|
|||||||
Goodwill
|
760,769
|
759,328
|
|||||||
Other assets
|
1,197,307
|
1,107,753
|
|||||||
$
|
20,170,026
|
$
|
19,653,829
|
||||||
Liabilities and Shareholders' Equity
|
|||||||||
Current liabilities
|
|||||||||
Current portion of long-term debt
|
$
|
639,497
|
$
|
1,198,929
|
|||||
Accounts payable
|
323,082
|
249,047
|
|||||||
Accrued interest
|
146,536
|
160,906
|
|||||||
Accrued expenses and other liabilities
|
526,158
|
553,218
|
|||||||
Customer deposits
|
1,479,968
|
1,283,073
|
|||||||
Total current liabilities
|
3,115,241
|
3,445,173
|
|||||||
Long-term debt
|
8,136,206
|
7,951,187
|
|||||||
Other long-term liabilities
|
480,483
|
356,717
|
|||||||
Commitments and contingencies
|
|||||||||
Shareholders' equity
|
|||||||||
Preferred stock ($0.01 par value; 20,000,000 shares authorized;
|
|||||||||
none outstanding)
|
-
|
-
|
|||||||
Common stock ($0.01 par value; 500,000,000 shares authorized;
|
|||||||||
227,530,560 and 226,211,731 shares issued, September 30, 2011
|
2,275
|
2,262
|
|||||||
and December 31, 2010, respectively)
|
|||||||||
Paid-in capital
|
3,066,162
|
3,027,130
|
|||||||
Retained earnings
|
5,809,150
|
5,259,998
|
|||||||
Accumulated other comprehensive (loss) income
|
(25,787)
|
25,066
|
|||||||
Treasury stock (10,308,683 common shares at
cost, September 30, 2011 and December 31, 2010)
|
(413,704)
|
(413,704)
|
|||||||
Total shareholders' equity
|
8,438,096
|
7,900,752
|
|||||||
$
|
20,170,026
|
$
|
19,653,829
|
Nine Months Ended
|
||||||
September 30,
|
||||||
2011 | 2010 | |||||
Operating Activities
|
||||||
Net income
|
$
|
570,859
|
$
|
483,753
|
||
Adjustments:
|
||||||
Depreciation and amortization
|
522,493
|
479,838
|
||||
(Gain) loss on fuel call options
|
(11,701)
|
4,167
|
||||
Changes in operating assets and liabilities:
|
||||||
Decrease in trade and other receivables, net
|
55,062
|
91,196
|
||||
Increase in inventories
|
(25,490)
|
(6,255)
|
||||
Increase in prepaid expenses and other assets
|
(72,538)
|
(33,456)
|
||||
Increase in accounts payable
|
74,498
|
16,894
|
||||
(Decrease) increase in accrued interest
|
(14,370)
|
7,159
|
||||
Increase in accrued expenses and other liabilities
|
34,380
|
59,855
|
||||
Increase in customer deposits
|
97,089
|
157,952
|
||||
Cash received on settlement of derivative financial instruments
|
-
|
172,993
|
||||
Dividends received from unconsolidated affiliates
|
21,147
|
-
|
||||
Other, net
|
21,289
|
1,811
|
||||
Net cash provided by operating activities
|
1,272,718
|
1,435,907
|
||||
Investing Activities
|
||||||
Purchases of property and equipment
|
(1,030,102)
|
(925,826)
|
||||
Cash received (paid) on settlement of derivative financial instruments
|
20,172
|
(1,521)
|
||||
Loans to unconsolidated affiliates
|
(110,660)
|
-
|
||||
Proceeds from the sale of ships
|
345,000
|
-
|
||||
Other, net
|
352
|
(12,057)
|
||||
Net cash used in investing activities
|
(775,238)
|
(939,404)
|
||||
Financing Activities
|
||||||
Debt proceeds
|
1,408,368
|
1,081,069
|
||||
Debt issuance costs
|
(80,619)
|
(57,238)
|
||||
Repayments of debt
|
(1,786,414)
|
(1,378,099)
|
||||
Dividends paid
|
(21,707)
|
-
|
||||
Proceeds from exercise of common stock options
|
18,947
|
11,802
|
||||
Other, net
|
10,413
|
1,148
|
||||
Net cash used in financing activities
|
(451,012)
|
(341,318)
|
||||
Effect of exchange rate changes on cash
|
(14,937)
|
2,126
|
||||
Net increase in cash and cash equivalents
|
31,531
|
157,311
|
||||
Cash and cash equivalents at beginning of period
|
419,929
|
284,619
|
||||
Cash and cash equivalents at end of period
|
$
|
451,460
|
$
|
441,930
|
||
Supplemental Disclosure
|
||||||
Cash paid during the period for:
|
||||||
Interest, net of amount capitalized
|
$
|
269,625
|
$
|
210,684
|
Gross Yields and Net Yields were calculated as follows (in thousands, except APCD and Yields):
|
||||||||||||||||||||||||
Quarter Ended
|
Nine Months Ended
|
|||||||||||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||||||||||
2011 |
2011
On a
Constant
Currency basis
|
2010 | 2011 |
2011
On a
Constant
Currency basis
|
2010 | |||||||||||||||||||
Passenger ticket revenues
|
$
|
1,734,328
|
$
|
1,680,010
|
$
|
1,520,562
|
$
|
4,257,634
|
$
|
4,141,218
|
$
|
3,762,536
|
||||||||||||
Onboard and other revenues
|
587,666
|
579,196
|
540,097
|
1,504,228
|
1,486,269
|
1,385,470
|
||||||||||||||||||
Total revenues
|
2,321,994
|
2,259,206
|
2,060,659
|
5,761,862
|
5,627,487
|
5,148,006
|
||||||||||||||||||
Less:
|
||||||||||||||||||||||||
Commissions, transportation and other
|
405,674
|
392,424
|
350,166
|
984,397
|
956,606
|
889,956
|
||||||||||||||||||
Onboard and other
|
181,604
|
176,292
|
159,824
|
419,032
|
408,703
|
374,949
|
||||||||||||||||||
Net revenues
|
$
|
1,734,716
|
$
|
1,690,490
|
$
|
1,550,669
|
$
|
4,358,433
|
$
|
4,262,178
|
$
|
3,883,101
|
||||||||||||
APCD
|
8,575,926
|
8,575,926
|
8,069,663
|
24,714,236
|
24,714,236
|
22,967,291
|
||||||||||||||||||
Gross Yields
|
$
|
270.76
|
$
|
263.44
|
$
|
255.36
|
$
|
233.14
|
$
|
227.70
|
$
|
224.15
|
||||||||||||
Net Yields
|
$
|
202.28
|
$
|
197.12
|
$
|
192.16
|
$
|
176.35
|
$
|
172.46
|
$
|
169.07
|
Gross Cruise Costs and Net Cruise Costs were calculated as follows (in thousands, except APCD and costs per APCD):
|
||||||||||||||||||||||||
Quarter Ended
|
Nine Months Ended
|
|||||||||||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||||||||||
2011 |
2011
On a
Constant
Currency basis
|
2010 | 2011 |
2011
On a
Constant
Currency basis
|
2010 | |||||||||||||||||||
Total cruise operating expenses
|
$
|
1,405,300
|
$
|
1,377,294
|
$
|
1,239,625
|
$
|
3,691,746
|
$
|
3,633,042
|
$
|
3,351,087
|
||||||||||||
Marketing, selling and administrative expenses
|
231,761
|
225,996
|
213,300
|
722,157
|
705,640
|
636,143
|
||||||||||||||||||
Gross Cruise Costs
|
1,637,061
|
1,603,290
|
1,452,925
|
4,413,903
|
4,338,682
|
3,987,230
|
||||||||||||||||||
Less:
|
||||||||||||||||||||||||
Commissions, transportation and other
|
405,674
|
392,424
|
350,166
|
984,397
|
956,606
|
889,956
|
||||||||||||||||||
Onboard and other
|
181,604
|
176,292
|
159,824
|
419,032
|
408,703
|
374,949
|
||||||||||||||||||
Net Cruise Costs
|
$
|
1,049,783
|
$
|
1,034,574
|
$
|
942,935
|
$
|
3,010,474
|
$
|
2,973,373
|
$
|
2,722,325
|
||||||||||||
Less:
|
||||||||||||||||||||||||
Fuel
|
202,478
|
201,415
|
164,786
|
556,667
|
553,794
|
483,843
|
||||||||||||||||||
Net Cruise Costs Excluding Fuel
|
$
|
847,305
|
$
|
833,159
|
$
|
778,149
|
$
|
2,453,807
|
$
|
2,419,579
|
$
|
2,238,482
|
||||||||||||
APCD
|
8,575,926
|
8,575,926
|
8,069,663
|
24,714,236
|
24,714,236
|
22,967,291
|
||||||||||||||||||
Gross Cruise Costs per APCD
|
$
|
190.89
|
$
|
186.95
|
$
|
180.05
|
$
|
178.60
|
$
|
175.55
|
$
|
173.60
|
||||||||||||
Net Cruise Costs per APCD
|
$
|
122.41
|
$
|
120.64
|
$
|
116.85
|
$
|
121.81
|
$
|
120.31
|
$
|
118.53
|
||||||||||||
Net Cruise Costs Excluding Fuel per APCD
|
$
|
98.80
|
$
|
97.15
|
$
|
96.43
|
$
|
99.29
|
$
|
97.90
|
$
|
97.46
|
Net Debt-to-Capital was calculated as follows (in thousands):
|
|||||
As of
|
|||||
September 30, | December 31, | ||||
2011 | 2010 | ||||
Long-term debt, net of current portion
|
$
|
8,136,206
|
$
|
7,951,187
|
|
Current portion of long-term debt
|
639,497
|
1,198,929
|
|||
Total debt
|
8,775,703
|
9,150,116
|
|||
Less: Cash and cash equivalents
|
451,460
|
419,929
|
|||
Net Debt
|
$
|
8,324,243
|
$
|
8,730,187
|
|
Total shareholders' equity
|
$
|
8,438,096
|
$
|
7,900,752
|
|
Total debt
|
8,775,703
|
9,150,116
|
|||
Total debt and shareholders' equity
|
17,213,799
|
17,050,868
|
|||
Debt-to-Capital
|
51.0%
|
53.7%
|
|||
Net Debt |
8,324,243
|
8,730,187
|
|||
Net Debt and shareholders' equity |
$
|
16,762,339
|
$
|
16,630,939
|
|
Net Debt-to-Capital
|
49.7%
|
52.5%
|
Quarter Ended
|
Quarter Ended
|
||||||||||||||||||||||
September 30, 2010
|
September 30, 2009
|
||||||||||||||||||||||
As Previously Reported | Adjustment | As Revised | As Previously Reported | Adjustment | As Revised | ||||||||||||||||||
Interest expense, net of interest capitalized
|
$
|
(82,494)
|
$
|
(6,588)
|
$
|
(89,082)
|
$
|
(73,912)
|
$
|
(684)
|
$
|
(74,596)
|
|||||||||||
Total other expense
|
(88,735)
|
(6,588)
|
(95,323)
|
(76,449)
|
(684)
|
(77,133)
|
|||||||||||||||||
Net Income
|
356,767
|
(6,588)
|
350,179
|
230,392
|
(684)
|
229,708
|
|||||||||||||||||
Earnings per Share:
|
|||||||||||||||||||||||
Basic
|
$
|
1.66
|
$
|
(0.03)
|
$
|
1.63
|
$
|
1.08
|
$
|
0.00
|
$
|
1.07
|
|||||||||||
Diluted
|
$
|
1.64
|
$
|
(0.03)
|
$
|
1.61
|
$
|
1.07
|
$
|
0.00
|
$
|
1.07
|
|||||||||||
Nine Months Ended
|
Nine Months Ended
|
||||||||||||||||||||||
September 30, 2010
|
September 30, 2009
|
||||||||||||||||||||||
As Previously Reported
|
Adjustment
|
As Revised
|
As Previously Reported
|
Adjustment
|
As Revised
|
||||||||||||||||||
Interest expense, net of interest capitalized
|
$
|
(250,264)
|
$
|
(21,007)
|
$
|
(271,271)
|
$
|
(221,701)
|
$
|
(1,873)
|
$
|
(223,574)
|
|||||||||||
Total other expense
|
(176,178)
|
(21,007)
|
(197,185)
|
(247,088)
|
(1,873)
|
(248,961)
|
|||||||||||||||||
Net Income
|
504,760
|
(21,007)
|
483,753
|
159,068
|
(1,873)
|
157,195
|
|||||||||||||||||
Earnings per Share:
|
|||||||||||||||||||||||
Basic
|
$
|
2.35
|
$
|
(0.10)
|
$
|
2.25
|
$
|
0.74
|
$
|
(0.01)
|
$
|
0.74
|
|||||||||||
Diluted
|
$
|
2.32
|
$
|
(0.10)
|
$
|
2.23
|
$
|
0.74
|
$
|
(0.01)
|
$
|
0.73
|
As of
|
As of
|
||||||||||||||||||||||
December 31, 2010
|
December 31, 2009
|
||||||||||||||||||||||
As Previously
Reported
|
Adjustment | As Revised |
As Previously
Reported
|
Adjustment | As Revised | ||||||||||||||||||
Property and equipment, net
|
$
|
16,769,181
|
$
|
2,496
|
$
|
16,771,677
|
$
|
15,268,053
|
$
|
384
|
$
|
15,268,437
|
|||||||||||
Other assets
|
1,151,324
|
(43,571)
|
1,107,753
|
1,146,677
|
(9,453)
|
1,137,224
|
|||||||||||||||||
Total assets
|
19,694,904
|
(41,075)
|
19,653,829
|
18,233,494
|
(9,069)
|
18,224,425
|
|||||||||||||||||
Accrued expenses and other liabilities
|
552,543
|
675
|
553,218
|
521,190
|
867
|
522,057
|
|||||||||||||||||
Total current liabilities
|
3,444,498
|
675
|
3,445,173
|
2,749,030
|
867
|
2,749,897
|
|||||||||||||||||
Retained earnings
|
5,301,748
|
(41,750)
|
5,259,998
|
4,754,950
|
(9,936)
|
4,745,014
|
|||||||||||||||||
Total shareholders' equity
|
7,942,502
|
(41,750)
|
7,900,752
|
7,499,717
|
(9,936)
|
7,489,781
|
|||||||||||||||||
Total liabilities and shareholders' equity
|
19,694,904
|
(41,075)
|
19,653,829
|
18,233,494
|
(9,069)
|
18,224,425
|
|||||||||||||||||
The correction did not have an effect on the Company's operating cash flows. The following table presents the effect on the individual line items within operating cash flows on the Company's Consolidated Statement of Cash Flows for September 30, 2010.
|
|||||||||||||||||||
Nine Months Ended September 30, 2010
|
|||||||||||||||||||
As Previously
Reported
|
Adjustment | Reclassification1 | As Revised | ||||||||||||||||
Net Income
|
$
|
504,760
|
$
|
(21,007)
|
$
|
-
|
$
|
483,753
|
|||||||||||
Increase in accrued expenses and other liabilities
|
58,700
|
1,155
|
-
|
59,855
|
|||||||||||||||
Other, net
|
(13,874)
|
19,852
|
(4,167)
|
1,811
|
|||||||||||||||
1 For the nine months ended September 30, 2010, $4.2 million has been reclassified in the consolidated statement of cash flows from other, net to (gain) loss on fuel call options within net cash flows provided by operating activities in order to conform to the current year presentation.
|