Carnival Cruises 2013 Annual Report Download - page 86

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Table of Contents
At November 30, 2013, our outstanding fuel derivatives consisted of zero cost collars on Brent to cover a portion of our estimated fuel consumption as follows:
Maturities (a)
Transaction
Dates
Barrels
(in thousands)
Weighted-Average
Floor Prices
Weighted-Average
Ceiling Prices
Percent of Estimated
Fuel Consumption
Covered
Fiscal 2014
November 2011 2,112 $85 $114
February 2012 2,112 $ 88 $125
June 2012 2,376 $ 71 $116
May 2013 1,728 $85 $108
8,328 43%
Fiscal 2015
November 2011 2,160 $80 $114
February 2012 2,160 $80 $125
June 2012 1,236 $74 $110
April 2013 1,044 $80 $111
May 2013 1,884 $80 $110
8,484 43%
Fiscal 2016
June 2012 3,564 $75 $108
February 2013 2,160 $80 $120
April 2013 3,000 $75 $115
8,724 44%
Fiscal 2017
February 2013 3,276 $80 $115
April 2013 2,028 $75 $110
5,304 27%
(a) Fuel derivatives mature evenly over each month within the above fiscal periods.
Concentrations of Credit Risk
As part of our ongoing control procedures, we monitor concentrations of credit risk associated with financial and other institutions with which we conduct
significant business. Our maximum exposure under foreign currency and fuel derivative contracts and interest rate swap agreements that are in-the-money,
which were not material at November 30, 2013, is the replacement cost, net of any collateral received, in the event of nonperformance by the counterparties to
the contracts, all of which are currently our lending banks. We seek to minimize credit risk exposure, including counterparty nonperformance primarily
associated with our cash equivalents, investments, committed financing facilities, contingent obligations, derivative instruments, insurance contracts and new
ship progress payment guarantees, by normally conducting business with large, well-established financial institutions, insurance companies and export credit
agencies, and by diversifying our counterparties. In addition, we have guidelines regarding credit ratings and investment maturities that we follow to help
safeguard liquidity and minimize risk. We normally do require collateral and/or guarantees to support notes receivable on significant asset sales, long-term
ship charters and new ship progress payments to shipyards. We currently believe the risk of nonperformance by any of our significant counterparties is
remote.
We also monitor the creditworthiness of travel agencies and tour operators in Europe and credit card providers to which we extend credit in the normal course
of our business. Our credit exposure includes contingent obligations related to cash payments received directly by travel agents and tour operators for cash
collected by them on cruise sales in most of Europe where we are obligated to extend credit in a like amount to these guests even if we do not receive payment
from the travel agents and tour operators. Concentrations of credit risk associated with these receivables and contingent obligations are not considered to be
material, primarily due to the large number of unrelated accounts within our customer base, the amount of these contingent obligations and their short
maturities. We have experienced only minimal credit losses on our trade receivables and related contingent obligations. We do not normally require collateral or
other security to support normal credit sales.
F-27