Royal Caribbean Cruise Lines 2014 Annual Report Download - page 30

Royal Caribbean Cruises Ltd. 29
PART I
and Strategic Planning. Before joining Royal Caribbean,
Mr. Liberty was a Senior Manager at the international
public accounting firm of KPMG LLP.
Harri U. Kulovaara has served as Executive Vice Presi-
dent, Maritime since January 2005. Mr. Kulovaara is
responsible for fleet design and newbuild operations.
Mr. Kulovaara also chairs our Maritime Safety Advisory
Board. Mr. Kulovaara has been employed with Royal
Caribbean since 1995 in a variety of positions, including
Senior Vice President, Marine Operations, and Senior
Vice President, Quality Assurance. Mr. Kulovaara is a
naval architect and engineer.
Bradley H. Stein has served as General Counsel of the
Company since 2006. He has also served as Senior
Vice President and Chief Compliance Officer of the
Company since February 2009 and February 2011,
respectively. Mr. Stein has been with Royal Caribbean
since 1992. Before joining Royal Caribbean, Mr. Stein
worked in private practice in New York and Miami.
Henry L. Pujol has served as Senior Vice President,
Chief Accounting Officer of the Company since May
2013. Mr. Pujol originally joined Royal Caribbean in
2004 as Assistant Controller and was promoted to
Corporate Controller in May 2007. Before joining
Royal Caribbean, Mr. Pujol was a Senior Manager at
the international public accounting firm of KPMG LLP.
ITEM 1A. RISK FACTORS
The risk factors set forth below and elsewhere in this
Annual Report on Form 10-K are important factors
that could cause actual results to differ from expected
or historical results. It is not possible to predict or
identify all such risks. The risks described below are
only those known risks relating to our operations and
financial condition that we consider material. There
may be additional risks that we consider not to be
material, or which are not known, and any of these
risks could have the effects set forth below. See Item
7. Management’s Discussion and Analysis of Financial
Condition and Results of Operations for a cautionary
note regarding forward-looking statements.
Adverse worldwide economic, geopolitical or other
conditions could reduce the demand for cruises and
adversely impact our operating results, cash flows and
financial condition including potentially impairing the
value of our ships, goodwill and other assets.
The demand for cruises is affected by international,
national and local economic and geopolitical condi-
tions. In recent years, we have been faced with very
challenging global economic conditions, which have
adversely affected vacationers’ discretionary income
and consumer confidence. This, in turn, resulted in
cruise booking slowdowns, decreased cruise prices
and lower onboard revenues for us and for others
in the cruise industry as compared to more robust
economic times. Although the cruise industry contin-
ued to recover in 2014, ongoing economic challenges
continue in certain key markets, including Europe.
In addition, we cannot predict with any certainty
whether demand for cruises will continue to improve
in countries that have experienced improved economic
conditions or the strength of such improvement. Any
significant deterioration of global, national or local
economic conditions could result in a prolonged period
of booking slowdowns, depressed cruise prices and
reduced onboard revenues. Demand for our cruises is
also influenced by geopolitical events. Unfavorable
conditions, such as cross-border conflicts, civil unrest
and governmental changes, especially in regions with
popular ports of call, can undermine consumer demand
and/or pricing for itineraries featuring these ports.
Continued unrest and economic instability could mate-
rially adversely impact our operating results, cash flows
and financial condition including potentially impairing
the value of our ships, goodwill and other assets. See
Critical Accounting Policies for more information.
We may not be able to obtain sufficient financing
or capital for our needs or may not be able to do so
on terms that are acceptable or consistent with our
expectations.
To fund our capital expenditures and scheduled debt
payments, we have historically relied on a combina-
tion of cash flows provided by operations, drawdowns
under available credit facilities, the incurrence of addi-
tional indebtedness and the sale of equity or debt
securities in private or public securities markets. We
also condition the effectiveness of our ship orders on
obtaining committed financing arrangements. Any
circumstance or event which leads to a decrease in
consumer cruise spending, such as worsening global
economic conditions or significant incidents impacting
the cruise industry, could negatively affect our oper-
ating cash flows. See “—Adverse worldwide economic,
geopolitical or other conditions…” and “—Incidents
or adverse publicity concerning the cruise vacation
industry…” for more information.
Although we believe we can access sufficient liquidity
to fund our operations and obligations as expected,
there can be no assurances to that effect. Our ability
to access additional funding as and when needed, our
ability to timely refinance and/or replace our outstand-
ing debt securities and credit facilities on acceptable
terms and our cost of funding will depend upon numer-
ous factors including but not limited to the vibrancy
of the financial markets, our financial performance
and the performance of our industry in general.