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URL:  http://boards.fool.com/ccl-financial-statement-20060802.aspx

Subject:  CCL-Financial Statement Date:  12/27/2003  11:47 PM
Author:  kitkatklub Number:  26877 of 46904

Income Statement
          
Years Ended November 30,
2002 2001 2000


Revenues $4,368,269 $4,535,751 $3,778,542

Costs and Expenses
Operating 2,311,919 2,468,730 2,058,342
Selling and administrative 611,948 618,664 487,403
Depreciation and amortization 382,343 372,224 287,667
Impairment charge 20,000 140,378
Loss (income) from affiliated
operations, net 44,024 (37,828)
3,326,210 3,644,020 2,795,584

Operating Income 1,042,059 891,731 982,958

Nonoperating (Expense) Income
Interest income 32,140 34,255 16,506
Interest expense, net of
capitalized interest (110,740) (120,692) (41,372)
Other (expense) income, net (4,080) 108,649 8,460
(82,680) 22,212 (16,406)

Income Before Income Taxes 959,379 913,943 966,552

Income Tax Benefit (Expense), Net 56,562 12,257 (1,094)

Net Income $1,015,941 $ 926,200 $ 965,458

Earnings Per Share
Basic $1.73 $1.58 $1.61
Diluted $1.73 $1.58 $1.60


2002 2001 2000 1999 1998

Gross Profit 47% 46% 46% 47% 46%
Operating Margin 33% 32% 33% 34% 34%
Net Margin 23% 20% 26% 29% 28%
Growth in Revenue -4% 20% 8% 16%
Growth in Net Income 10% -4% -6% 23%
Growth in COGS -6% 20% 11% 15%
Change in Marketing Costs -0.01 0.27 0.09 0.21

**CCL has very good margins. The net margin only decreases to 22% if the $56M tax benefit is eliminated. Still very impressive margins.
**Growth in revenue is a disappointment for 2002.
**Costs appear to stay in line.
**Perhaps they should be spending more on marketing to improve occupancy?

**Impairment Charge
This is from the 10K. It was undertaken due to a review of assets required by GAAP and it decreases revenue in 2002 and 2001. If you were looking at CCLs sustainable earnings base, you would add these charges back as one time events and not count them as a failing of the business.

In fiscal 2002 we reduced the carrying value of one of our ships by recording an impairment charge of $20 million. In fiscal 2001, we recorded an
impairment charge of $140 million, which consisted principally of a $71 million reduction in the carrying value of ships, a $36 million write-off of Seabourn
goodwill, a $15 million write-down of a Holland America note receivable and a $11 million loss on the sale of the Seabourn Goddess I and II.


**Income Taxes
You should notice the in 2002 and 2001, they have large tax credits that contributed to net income. This should be deducted if examining the true earnings of the company that should exclude one time events either positive or negative. If $56.6M is subtracted from the 2002 income, CCl had a net income of $959.4M.
An income tax benefit of $12 million was recognized in 2001 compared to
a $1 million expense in 2000. Approximately $9 million of the net increase in the income tax benefit was from Costa, primarily due to changes in Italian tax laws.


In fiscal 2002, we recognized a net $57 million income tax benefit primarily due to a new Italian investment incentive law, which allowed Costa to receive a $51 million income tax benefit based on contractual expenditures during 2002 on the construction of new ships. At November 30, 2002, Costa had a
remaining net deferred tax asset of approximately $45 million relating to the tax benefit of the net operating loss carryforwards arising from this incentive law, which expire in 2007. We do not expect to incur income taxes on future distributions of undistributed earnings of foreign subsidiaries.


These benefits of tax law cannot be counted on to boost income in future years. In fact, CCL has no provision for deferred taxes in the 10K.

**Revenues decreased $167 million(not counting the income tax benefit), or
3.7%, in 2002 compared to 2001.

**Cruise revenues decreased $129 million, or 3.0%, to $4.23 billion in 2002
from $4.36 billion in 2001.Cruise revenue change resulted from a 7.0%
decrease in gross revenue per passenger cruise day, partially offset by a 3.6% increase in passenger capacity and a 0.5% increase in occupancy rate. This decrease in gross revenue per passenger cruise day was primarily caused by a significant decline in the number of guests purchasing air transportation from CCL in 2002 compared to 2001. Also adding to the reduction in gross revenue per passenger cruise day was the adverse impact of the September 11, 2001 events, which resulted in lower cruise ticket prices.

**Tour revenues decreased $54 million, or 23.4%, to $176 million in 2002
from $229 million in 2001 principally due to a lower number of Alaska and
Canadian Yukon cruise/tours sold. This revenue decrease was primarily as a
result of one less ship offering land tours.In addition, three isolated cancellations of Holland America Alaska cruises occurred in 2002 resulting primarily from mechanical malfunctions also contributed to this decrease in revenues.

**The tour segment's operating income decreased from $10 million in 1999
to an operating loss of $13 million in 2002. This decrease was primarily the result of increased competition. Although our tour segment is not material to our consolidated results,

**Operating expenses decreased $157 million, or 6.4%, in 2002 compared to
2001. Cruise operating costs decreased by $130 million, or 5.6%, to $2.20
billion in 2002 from $2.33 billion in 2001. Approximately $116 million of this decrease was due to reduced air travel and related costs primarily due to fewer guests purchasing air transportation.This is to be expected since revenue from loss of air transport was also down. You would have to be worried if costs
increased on decreased revenues.

**Tour operating expenses decreased $42 million, or 22.3%, to $145 million in 2002 from $187 million in 2001 principally due to the reduction in the number of cruise/tours sold.

**Selling and administrative expenses decreased $7 million, or 1.1%, to
$612 million in 2002 from $619 million in 2001. Selling and administrative
expenses decreased in 2002 primarily because of our 3.9% decrease in selling
and administrative costs per available berth day.


Balance Sheet
 
November 30,
ASSETS 2002 2001

Current Assets
Cash and cash equivalents $ 666,700 $ 1,421,300
Short-term investments 39,005 36,784
Accounts receivable, net 108,327 90,763
Inventories 91,310 91,996

Property and Equipment, Net 10,115,404 8,390,230

Goodwill 681,056 651,814

$12,334,848 $11,563,552

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt $ 148,642 $ 21,764
Accounts payable 268,687 269,467

Dividends payable 61,612 61,548

Total current liabilities 1,619,806 1,480,240

Long-Term Debt 3,011,969 2,954,854

Additional paid-in capital 1,089,125 1,805,248
Retained earnings 6,325,850 5,556,296

Treasury stock; 33,848 shares at cost (727,637)
Total shareholders' equity 7,417,903 6,590,777
$12,334,848 $11,563,552


2002 2001 2000 1999 1998

Current ratio 0.70 1.32 0.32 0.56 0.33
Quick Ratio 0.41 0.96 0.11 0.37 0.12

Accounts receivable growth 19.27% -4.82% 51.67% 3.45%
DSO 9.05 80.65 138.01 336.02 36.74
Days Inventory on hand 14.41 13.60 17.82 16.46 16.99
Day Payable Outstanding 42.42 39.85 59.00 38.39 37.98
ROA 8.24% 8.01% 9.82% 12.40%
ROE 13.70% 14.05% 16.45% 17.32% 19.51%
ROIC 6.53% 7.31% 7.48% 8.76% 5.50%
Fixed asset turnover 0.43 0.54 0.47 0.55
Debt to equity 42.61% 45.16% 39.98% 18.10% 38.05%
Debt to capitalization 29.88% 31.11% 28.56% 15.33% 27.56%
Book value 12.64 11.24 10.04 9.61 7.20
Cash per share 1.14 2.42 0.32 0.85 0.23
Working capital -487.6 478.8 -1165.8 -613.4 -764.8
Non Cash Working Capital -1005.7 -920.7 -1106.9 -928.9 -834.5
Cash Conversion Cycle -18.96 54.40 96.84 314.09 15.75

**Assets to liabilities are on the low side. This is also reflected in the working capital figures. This is good use of assets, but the ROA is still slightly low. The bad news is that working capital is decreasing and that is not sustainable in a DCF model. Continually decreasing levels of working capital increase free cash flow, but it is not something that can be done in perpetuity. They also would be considered illiquid by those who put faith in the quick ratio and current ratio.The bulk of their assets(long-term) are in the very expensive ships.

**They do a masterful job managing money outflow and inflow. DSO is very low and inventory is turned rapidly(parts?)Payables are out longer than receivables and the cash conversion cycle is an amazing -18.

**They have high but not crushing levels of debt
**They have increasing cash per share
**Returns on assets equity and capital are on the low side. They decreased in 2002 due to decreasing revenues.

**During fiscal 2002,CCL borrowed $232 million, which included $150 million under Costa's euro denominated revolving credit facility and $50 million under the US revolving credit facility. In addition, in fiscal 2002, CCL made $190 million of principal repayments, primarily on Costa's revolving credit facility and Costa's collateralized debt.
**CCL paid cash dividends of $246 million in fiscal 2002.

**They are not a party to any off-balance sheet arrangements, including guarantee contracts, retained or contingent interests, certain derivative
instruments and variable interest entities, that either have, or are reasonably likely to have, a current or future material effect on the financial statements.



Cash Flow Statement(abbreviated)

Years Ended November 30,
2002 2001 2000

OPERATING ACTIVITIES
Net income 1,015,941 926,200 965,458
Depreciation and amortization 382,343 372,224 287,667

Net cash operating activities 1,469,032 1,2