Carnival Cruises 2007 Annual Report Download - page 30

CARNIVAL CORPORATION & PLC | 27
No. 158 required us upon adoption to recognize the funded
status of our defined benefit single employer pension plans.
Accordingly, as of November 30, 2007, we recorded an
increase in our pension plan assets and liabilities of $17 million
and $24 million, respectively, and a reduction to AOCI of $7
million. The adoption of SFAS No. 158 had no effect on our
Consolidated Statement of Operations for fiscal 2007, or for
any prior period presented, and it will not effect our results
of operations in future periods.
Defined Contribution Plans
We have several defined contribution plans available to
most of our employees. We contribute to these plans based
on employee contributions, salary levels and length of service.
Total expense relating to these plans was $18 million,
$17 million and $14 million in fiscal 2007, 2006 and 2005,
respectively.
NOTE 13—EARNINGS PER SHARE
Our basic and diluted earnings per share were computed
as follows (in millions, except per share data):
Years Ended November 30,
2007 2006 2005
Net income ....................... $ 2,408 $ 2,279 $ 2,253
Interest on dilutive convertible notes . . . 34 36 47
Net income for diluted earnings
per share ....................... $ 2,442 $ 2,315 $ 2,300
Weighted-average common and
ordinary shares outstanding . . . . . . . . 793 801 806
Dilutive effect of convertible notes . . . . 33 33 42
Dilutive effect of stock plans . . . . . . . . . 22 5
Diluted weighted-average
shares outstanding . . . . . . . . . . . . . . . 828 836 853
Basic earnings per share. . . . . . . . . . . . . $ 3.04 $ 2.85 $ 2.80
Diluted earnings per share . . . . . . . . . . . $ 2.95 $ 2.77 $ 2.70
Options to purchase 8.3 million, 8.5 million and 2.1 million
shares for fiscal 2007, 2006 and 2005, respectively, were
excluded from our diluted earnings per share computation
since the effect of including them was anti-dilutive.
NOTE 14— SUPPLEMENTAL CASH FLOW
INFORMATION
Total cash paid for interest was $414 million, $363 million
and $314 million in fiscal 2007, 2006 and 2005, respectively.
In addition, cash paid for income taxes was $14 million, $47
million and $15 million in fiscal 2007, 2006 and 2005, respec-
tively. Finally, in 2007, 2006 and 2005, $8 million, $69 million
and $297 million of our convertible notes were converted
through a combination of the issuance of Carnival Corporation
treasury stock and newly issued Carnival Corporation com-
mon stock, which represented a noncash financing activity.
NOTE 15—ACQUISITION
In September 2007, we entered into an agreement with
Orizonia Corporation, Spain’s largest travel company to oper-
ate Ibero Cruises, a Spanish cruise line, for an investment of
€290 million, which we funded with €105 million of cash and
€185 million in proceeds that Ibero Cruises borrowed under
a portion of our Facility. Orizonia contributed €35 million of
assets, principally trademarks and goodwill, for their 25%
interest in the venture. Ibero Cruises operates two contempo-
rary Spanish cruise ships, the 834-passenger capacity Grand
Voyager, and the 1,244-passenger capacity Grand Mistral,
which were built in 2000 and 1999, respectively. For reporting
purposes, we have included Ibero Cruises’ results of opera-
tions within our consolidated financial results since September
1, 2007. The pro forma impact of including Ibero Cruises in our
results as if the acquisition took place on December 1, 2005
and December 1, 2006 has not been presented due to its
immaterial effect.
The acquisition was accounted for as a business purchase
combination using the purchase method of accounting under
the provisions of SFAS No. 141, “Business Combinations.”
The purchase price was allocated to tangible and identifiable
intangible assets acquired based on their estimated fair values
at the acquisition date, with the excess allocated to goodwill.
The $451 million purchase price was allocated as follows:
$254 million to ships, $161 million to goodwill, $35 million
to trademarks and $1 million to other.