Royal Caribbean Cruise Lines 2010 Annual Report Download - page 23

2010 ANNUAL REPORT 20
PART I
Passengers and Capacity
Selected statistical information is shown in the following table (see Description of Certain Line Items and Selected
Operational and Financial Metrics under Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations, for definitions). (Amounts include Pullmantur effective January 1, 2007):
Year Ended December 31,     
Passengers Carried     
Passenger Cruise Days     
Available Passenger Cruise Days (APCD)     
Occupancy     
Cruise Pricing
Our cruise ticket prices include accommodations and
a wide variety of activities and amenities, including
meals and entertainment. Prices vary depending on
the destination, cruise length, stateroom category
selected and the time of year the cruise takes place.
Although we grant credit terms to certain travel agen-
cies and tour operators outside of the United States,
our payment terms generally require an upfront deposit
to confirm a reservation with the balance due prior to
the sailing. During the selling period of a cruise, we
continually monitor and adjust our cruise ticket prices
for available guest staterooms based on demand, with
the objective of maximizing net yields. Historically,
we have opened cruises for sale at least one year in
advance and often as much as two years in advance.
Additionally, we offer air transportation as a service
for guests that elect to utilize our transportation pro-
gram. Our air transportation program is available in
major cities around the world and prices vary by gate-
way and destination. Generally, air tickets are sold to
guests at prices close to cost. Passenger ticket reve-
nues accounted for 72.7%, 71.4% and 72.4% of total
revenues in 2010, 2009 and 2008, respectively.
From time to time, we have introduced temporary fuel
supplements to partially offset a portion of fuel costs,
which result in an additional fee being charged to the
guests. While none of our brands are currently charg-
ing fuel supplements, we reserve the right to reinstate
our fuel supplements in one or more of our brands
and will continue to monitor our markets and review
our position based upon the appropriate facts and
circumstances.
Onboard Activities and Other Revenues
Our cruise brands offer modern fleets with a wide
array of onboard services, amenities and activities
which vary by brand and ship including swimming
pools, sun decks, lawn decks, spa facilities (which
include massage and exercise facilities), beauty salons,
bungee jumping trampolines, boxing rings, gaming
facilities, lounges, bars, a wide variety of dining options
and venues, Las Vegas-style entertainment, hot glass
shows, retail shopping, libraries, dedicated recreational
areas for youth of all ages, cinemas, conference cen-
ters, internet services & cafes and shore excursions
at each port of call. While many onboard activities
are included in the base price of a cruise, we realize
additional revenues from, among other things, gaming,
the sale of alcoholic and other beverages, gift shop
items, shore excursions, photography, spa/salon and
fitness services, art auctions and a wide variety of
specialty restaurants and dining options. A flexible
dining option, “My Time Dining” and “Celebrity Select
Dining,” allows guests for Royal Caribbean International
and Celebrity Cruises, respectively, to choose when
they dine in the main dining room onboard, on a day-
by-day basis, which includes the industry’s first pre-
cruise day-by-day flexible dining reservation system.
Royal Caribbean International, Celebrity Cruises and
Azamara Club Cruises offer enhanced functionality
on their respective internet sites for selecting shore
excursions, specialty dining and amenities, including
spa appointments and beverage packages for Royal
Caribbean International and Celebrity Cruises prior
to embarkation. Royal Caribbean International and
Celebrity Cruises also offer a catalogue gift service,
which is now offered via the internet to provide travel
agents and others the opportunity to purchase gifts
for guests.
In conjunction with our cruise vacations, we offer pre-
and post-cruise hotel packages to our Royal Caribbean
International, Celebrity Cruises and Azamara Club
Cruises guests. We also offer these guests escorted,
premium land-tour vacation packages in Alaska, Asia,
Australia, the Canadian Rockies, Europe, New Zealand
and Latin America through our cruise-tour operations,
Royal Celebrity Tours. Pullmantur also offers land-
based travel packages to Spanish and European vaca-
tion travelers including hotels and flights to Caribbean
resorts and sells land based tour packages to Europe
aimed at Latin American guests. In addition, we sell
cruise vacation protection coverage, which provides
guests with coverage for trip cancellation, medical
protection and baggage protection. Onboard and other
revenues accounted for 27.3%, 28.6% and 27.6% of
total revenues in 2010, 2009 and 2008, respectively.
SEGMENT REPORTING
We operate five wholly-owned cruise brands, Royal
Caribbean International, Celebrity Cruises, Pullmantur,
Azamara Club Cruises and CDF Croisières de France.
The brands have been aggregated as a single report-
able segment based on the similarity of their economic