Other balance sheet items (Tables)

9 Months Ended

Sep. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Trade and Other Receivables, Net

The following summarizes the balances of trade and other receivables, net as of September 30, 2020 and December 31, 2019 ($ in thousands):

	As of September 30,		As of December 31,
	2020		2019
Gross trade and other receivables	$	22,973	$	73,015
Allowance for doubtful accounts (1)	(2,102)		(1,765)
Total trade and other receivables, net (2)	$	20,871	$	71,250

________

(1) We recognized an additional $0.8 million in bad debt expense during the year ended December 31, 2019 as a result of the bankruptcy of Thomas Cook, one of our travel partners. We also recognized $2.1 million in bad debt expense during the nine months ended September 30, 2020 primarily as result of the negative effects of COVID-19.

(2) The opening balance as of January 1, 2019 was $64.8 million.

Schedule of Prepayments and Other Assets

The following summarizes the balances of prepayments and other assets as of September 30, 2020 and December 31, 2019 ($ in thousands):

	As of September 30,		As of December 31,
	2020		2019
Advances to suppliers	$	9,753	$	7,865
Prepaid income taxes	11,376		12,412
Prepaid other taxes (1)	11,268		11,156
Operating lease right-of-use assets	4,448		5,673
Contract deposit (2)	2,700		2,700
Other assets	4,941		4,885
Total prepayments and other assets	$	44,486	$	44,691

________

(1) Includes recoverable value-added tax, general consumption tax and other sales tax accumulated by our Mexico, Jamaica, Netherlands and Dominican Republic entities.

(2) Represents a cash deposit related to the Sanctuary Cap Cana management contract. The deposit will be used towards a purchase of a partial interest in Sanctuary Cap Cana if we are able to agree on terms.

Schedule of Goodwill

The gross carrying values and accumulated impairment losses of goodwill by reportable segment (refer to discussion of our reportable segments in Note 15) as of September 30, 2020 and December 31, 2019 are as follows ($ in thousands):

	Yucatán Peninsula		Pacific Coast		Dominican Republic		Jamaica		Total
Balance at December 31, 2019
Gross carrying value	$	51,731	$	—	$	—	$	32,776	$	84,507
Accumulated impairment losses	(6,168)		—		—		—		(6,168)
Net carrying value	45,563		—		—		32,776		78,339
Activity during the year
Adjustments (1)	—		—		—		1,756		1,756
Impairment losses (2)	—		—		—		(17,039)		(17,039)
Balance at September 30, 2020
Gross carrying value	51,731		—		—		34,532		86,263
Accumulated impairment losses	(6,168)		—		—		(17,039)		(23,207)
Net carrying value	$	45,563	$	—	$	—	$	17,493	$	63,056

________

(1) During the third quarter of 2020, we recognized adjustments to deferred income taxes and goodwill representing a correction of an immaterial error for acquired property and equipment from the business combination with Sagicor in 2018. These adjustments were not significant to our previously reported Condensed Consolidated Financial Statements.

(2) As a result of the immaterial correction noted above, we recognized an additional $0.9 million in impairment losses during the third quarter of 2020.

We performed an interim quantitative impairment analysis as of March 31, 2020 and recognized $17.0 million of goodwill impairment losses at the following reporting units within impairment loss in the Condensed Consolidated Statements of Operations for the three months ended March 31, 2020 as we determined that their carrying values exceeded their fair value ($ in thousands):

Reporting Unit	Reportable Segment	Impairment Loss(1)
Jewel Runaway Bay Beach Resort & Waterpark	Jamaica	$	7,318
Jewel Dunn’s River Beach Resort & Spa	Jamaica	$	5,400
Jewel Paradise Cove Beach Resort & Spa	Jamaica	$	4,321

________

(1) As a result of the immaterial correction to goodwill noted above, we recognized an additional $0.9 million in impairment losses on these three reporting units during the third quarter of 2020.

Schedule of Other Intangible Assets, Indefinite-Lived

Other intangible assets as of September 30, 2020 and December 31, 2019 consisted of the following ($ in thousands):

	As of September 30,		As of December 31,
	2020		2019
Gross carrying value
Casino and other licenses (1)	$	875	$	875
Management contract	1,900		1,900
Enterprise resource planning system (2)	5,633		5,187
Other	4,274		3,346
Total gross carrying value	12,682		11,308
Accumulated amortization
Management contract	(214)		(143)
Enterprise resource planning system (2)	(941)		(437)
Other	(2,999)		(2,320)
Total accumulated amortization	(4,154)		(2,900)
Net carrying value
Casino and other licenses (1)	875		875
Management contract	1,686		1,757
Enterprise resource planning system (2)	4,692		4,750
Other	1,275		1,026
Total net carrying value	$	8,528	$	8,408

________

(1) Our casino licenses have indefinite lives. Accordingly, there is no associated amortization expense or accumulated amortization.

(2) Represents software development costs incurred to develop and implement SAP as our integrated enterprise resource planning (“ERP”) system, of which $1.4 million and $2.6 million was placed into service in 2020 and 2019, respectively and are being amortized over a weighted-average amortization period of 7 years.

Schedule of Other Intangible Assets, Finite-Lived

Other intangible assets as of September 30, 2020 and December 31, 2019 consisted of the following ($ in thousands):

	As of September 30,		As of December 31,
	2020		2019
Gross carrying value
Casino and other licenses (1)	$	875	$	875
Management contract	1,900		1,900
Enterprise resource planning system (2)	5,633		5,187
Other	4,274		3,346
Total gross carrying value	12,682		11,308
Accumulated amortization
Management contract	(214)		(143)
Enterprise resource planning system (2)	(941)		(437)
Other	(2,999)		(2,320)
Total accumulated amortization	(4,154)		(2,900)
Net carrying value
Casino and other licenses (1)	875		875
Management contract	1,686		1,757
Enterprise resource planning system (2)	4,692		4,750
Other	1,275		1,026
Total net carrying value	$	8,528	$	8,408

________

(1) Our casino licenses have indefinite lives. Accordingly, there is no associated amortization expense or accumulated amortization.

(2) Represents software development costs incurred to develop and implement SAP as our integrated enterprise resource planning (“ERP”) system, of which $1.4 million and $2.6 million was placed into service in 2020 and 2019, respectively and are being amortized over a weighted-average amortization period of 7 years.

Schedule of Trade and Other Payables

The following summarizes the balances of trade and other payables as of September 30, 2020 and December 31, 2019 ($ in thousands):

	As of September 30,		As of December 31,
	2020		2019
Trade payables	$	17,308	$	45,299
Advance deposits (1)	25,086		53,769
Withholding and other taxes payable	37,261		46,983
Interest payable	1,455		125
Payroll and related accruals	14,090		14,547
Accrued expenses and other payables	18,937		20,880
Total trade and other payables	$	114,137	$	181,603

________

(1) The opening balance as of January 1, 2019 was $57.3 million.

Schedule of Other Liabilities

The following summarizes the balances of other liabilities as of September 30, 2020 and December 31, 2019 ($ in thousands):

	As of September 30,		As of December 31,
	2020		2019
Pension obligation (1)(2)	$	5,563	$	6,764
Lease liabilities	4,937		6,208
Unfavorable ground lease liability	2,114		2,187
Key money (3)	16,024		8,225
Other	883		923
Total other liabilities	$	29,521	$	24,307

________

(1) For the nine months ended September 30, 2020 and 2019, the service cost component of net periodic pension cost was $0.6 million and $0.6 million, respectively. For the three months ended September 30, 2020 and 2019, the service cost component of net periodic pension cost was $0.2 million and $0.2 million, respectively. These costs are recorded within direct expense in the Condensed Consolidated Statements of Operations.

(2) For the nine months ended September 30, 2020 and 2019, the non-service cost components of net periodic pension benefit or cost were $1.6 million and $0.4 million, respectively. For the three months ended September 30, 2020 and 2019, the non-service cost components of net periodic pension benefit or cost were $0.3 million and $0.2 million, respectively. These costs are recorded within other income (expense) in the Condensed Consolidated Statements of Operations.

(3) Represents the unamortized balance of key money received, which is amortized as a reduction to franchise fees within direct expenses in the Condensed Consolidated Statements of Operations. We received $8.5 million and $6.5 million in 2020 and 2019, respectively.