Carnival Cruises 2010 Annual Report Download - page 51

Sources and Uses of Cash
Our business provided $3.8 billion of net cash from operations during fiscal 2010, an increase of $476 million, or
14.2%, compared to $3.3 billion in fiscal 2009. This increase was caused by an increase in customer deposits and
more cash provided by our results of operations.
At November 30, 2010 and 2009, we had working capital deficits of $4.5 billion and $3.4 billion,
respectively. Our November 30, 2010 deficit included $2.8 billion of customer deposits, which represent the
passenger revenues we collect in advance of sailing dates and, accordingly, are substantially more like deferred
revenue transactions rather than actual current cash liabilities. We use our long-term ship assets to realize a
portion of this deferred revenue in addition to consuming current assets. In addition, our November 30, 2010
working capital deficit included $1.4 billion of current debt obligations, which included $696 million outstanding
under our commercial paper programs and $657 million outstanding under our export credit facilities, bank loans
and other debt. We continue to generate substantial cash from operations and have a strong balance sheet. This
strong balance sheet provides us with financial flexibility to meet our current debt obligations as they become
due in most financial credit market environments. We also have our principal revolver available to provide long-
term rollover financing should the need arise, or we choose to do so. After excluding customer deposits and
current debt obligations from our November 30, 2010 working capital deficit balance, our non-GAAP adjusted
working capital deficit is only $353 million. As explained above, our business model allows us to operate with a
significant working capital deficit and, accordingly, we believe we will continue to have a working capital deficit
for the foreseeable future.
During fiscal 2010, our expenditures for capital projects were $3.6 billion, of which $2.9 billion was spent on our
ongoing new shipbuilding program, including $2.5 billion for the final delivery payments for AIDAblu, Azura,
Costa Deliziosa, Nieuw Amsterdam, Queen Elizabeth and Seabourn Sojourn. In addition to our new shipbuilding
program, we had capital expenditures of $544 million for ship improvements and replacements and $115 million
for cruise port facilities, information technology and other assets.
During 2010, we borrowed a net $626 million of short-term borrowings in connection with our needs for, and
availability of, cash at various times throughout the year. In addition, during fiscal 2010, we repaid $350 million
and borrowed $94 million under our revolving credit facilities, which was also in connection with our needs for,
and availability of, cash at various times throughout the year. We also borrowed $1.3 billion of new other long-
term debt during fiscal 2010, under three export credit financing facilities and two bank loans. In addition, we
also repaid $1.8 billion of other long-term debt in fiscal 2010 for scheduled payments on export credit facilities
and a bank loan, redemption of our 2% Notes and early repayment of two export credit facilities and a bank loan.
Finally, we paid cash dividends of $237 million in fiscal 2010.
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