Royal Caribbean Cruise Lines 2006 Annual Report Download - page 36

Our debt agreements contain covenants that require us, among
other things, to maintain minimum net worth and fixed charge cov-
erage ratio and limit our net debt-to-capital ratio. We are in compli-
ance with all covenants as of December 31, 2006. Following is a
schedule of annual maturities on long-term debt as of December 31,
2006 for each of the next five years (in thousands):
Year
2007 $ 373,422
2008 283,371
2009 265,113
2010 1,058,493
2011 619,735
NOTE 7. SHAREHOLDERS’ EQUITY
In September 2005, we announced that we and an investment bank
had finalized a forward sale agreement relating to an Accelerated
Share Repurchase (“ASR”) transaction. The forward sale agreement
matured in February 2006. As part of the ASR transaction, we pur-
chased 5.7 million shares of our common stock from the investment
bank at a price of $43.67 per share. Total consideration paid to
repurchase such shares, including commissions and other fees, was
approximately $249.1 million and was recorded in shareholders'
equity as a component of treasury stock.
On June 2, 2006, we announced that we and an investment bank
had finalized a forward sale agreement relating to an Accelerated
Share Repurchase (“ASR”) transaction. The forward sale agree-
ment matured in August 2006. As part of the ASR transaction, we
purchased 4.6 million shares of our common from the investment
bank at a price of $35.99 per share. Total consideration paid to
repurchase such shares, including commissions and other fees,
was approximately $164.6 million and was recorded in sharehold-
ers' equity as a component of treasury stock.
We declared cash dividends on our common stock of $0.15 per
share in each of the quarters of 2006. Cash dividends of $0.13 per
share were declared in each of the first and second quarters of 2005
and $0.15 per share in each of the third and fourth quarters of 2005.
NOTE 8. EARNINGS PER SHARE
A reconciliation between basic and diluted earnings per share is as
follows (in thousands, except per share data):
Year Ended December 31,
2006 2005 2004
Income before cumulative
effect of a change in
accounting principle $633,922 $663,465 $474,691
Cumulative effect of a
change in accounting
principle (Note 2) – 52,491 –
Net income 633,922 715,956 474,691
Interest on dilutive
convertible notes 17,237 48,128 54,530
Net income for diluted
earnings per share $651,159 $764,084 $529,221
Weighted-average common
shares outstanding 210,703 206,217 198,946
Dilutive effect of stock
options and restricted
stock awards 1,725 2,725 4,161
Dilutive effect of
convertible notes 9,057 25,772 31,473
Diluted weighted-average
shares outstanding 221,485 234,714 234,580
Basic earnings per share:
Income before cumulative
effect of a change in
accounting principle $ 3.01 $ 3.22 $ 2.39
Cumulative effect of a
change in accounting
principle $–$ 0.25 $ –
Net income $ 3.01 $ 3.47 $ 2.39
Diluted earnings per share:
Income before cumulative
effect of a change in
accounting principle $ 2.94 $ 3.03 $ 2.26
Cumulative effect of a
change in accounting
principle $–$ 0.22 $ –
Net income $ 2.94 $ 3.26 $ 2.26
Diluted earnings per share did not include options to purchase 3.2 mil-
lion shares for the year ending December 31, 2006 and 1.3 million
shares for each of the years ended December 31, 2005 and 2004
because the effect of including them would have been antidilutive.
34 ROYAL CARIBBEAN CRUISES LTD.
Notes to the Consolidated Financial Statements (Continued)