Royal Caribbean Cruise Lines 2011 Annual Report Download - page 25

PART I
ROYAL CARIBBEAN CRUISES LTD. 21
around the world and prices vary by gateway and
destination. Generally, air tickets are sold to guests
at prices close to cost. Passenger ticket revenues
accounted for 73.3%, 72.7% and 71.4% of total revenues
in 2011, 2010 and 2009, 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 for 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,
boxing rings, gaming facilities, lounges, bars, a wide
variety of dining options and venues, Las Vegas-style
entertainment, hot glass shows, retail shopping, librar-
ies, dedicated recreational areas for youth of all ages,
cinemas, conference centers, 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, photog-
raphy, 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, respec-
tively, 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 din-
ing 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 bever-
age packages for Royal Caribbean International and
Celebrity Cruises prior to embarkation. Royal Caribbean
International and Celebrity Cruises also offer a cata-
logue 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 offers land-based
travel packages to Spanish and European vacation
travelers including hotels and flights to Caribbean
resorts and sells land-based tour packages to Europe
aimed at Latin American guests. Pullmantur also owns
a 49% interest in an air business that operates four
Boeing 747 aircrafts in support of its cruise and tour
operations. In addition, we sell cruise vacation protec-
tion coverage, which provides guests with coverage
for trip cancellation, medical protection and baggage
protection. Onboard and other revenues accounted
for 26.7%, 27.3% and 28.6% of total revenues in 2011,
2010 and 2009, respectively.
SEGMENT REPORTING
We operate five wholly-owned cruise brands, Royal
Caribbean International, Celebrity Cruises, Azamara
Club Cruises, Pullmantur and CDF Croisières de France.
In addition, we have a 50% investment in a joint
venture which operates the brand TUI Cruises with
TUI AG. We believe our global brands possess the
versatility to enter multiple cruise market segments
within the cruise vacation industry. Although each
of our brands has its own marketing style as well as
ships and crews of various sizes, the nature of the
products sold and services delivered by our brands
share a common base (i.e., the sale and provision of
cruise vacations). Our brands also have similar itiner-
aries as well as similar cost and revenue components.
In addition, our brands source passengers from similar
markets around the world and operate in similar
economic environments with a significant degree of
commercial overlap. As a result, our brands (including
TUI Cruises) have been aggregated as a single report-
able segment based on the similarity of their economic
characteristics, types of consumers, regulatory envi-
ronment, maintenance requirements, supporting
systems and processes as well as products and services
provided. Our Chairman and Chief Executive Officer
has been identified as the chief operating decision-
maker and all significant operating decisions including
the allocation of resources are based upon the analyses
of the Company as one segment. (For financial
information see Item 8. Financial Statements and
Supplementary Data.)
EMPLOYEES
As of December 31, 2011, we employed approximately
6,300 full-time and 740 part-time employees world-
wide in our shoreside operations. We also employed
approximately 54,000 shipboard employees. As of
December 31, 2011, approximately 80% of our ship-
board employees were covered by collective bargain-
ing agreements. Based on employee survey results,
we believe our employees’ satisfaction level with our
organization is strong.