Carnival Corporation | ![]() | Carnival plc |
(Exact name of registrant as specified in its charter) | (Exact name of registrant as specified in its charter) | |
Republic of Panama | England and Wales | |
(State or other jurisdiction of incorporation) | (State or other jurisdiction of incorporation) | |
001-9610 | 001-15136 | |
(Commission File Number) | (Commission File Number) | |
59-1562976 | 98-0357772 | |
(IRS Employer Identification No.) | (IRS Employer Identification No.) | |
3655 N.W. 87th Avenue Miami, Florida 33178-2428 | Carnival House, 100 Harbour Parade, Southampton SO15 1ST, United Kingdom | |
(Address of principal executive offices) (Zip Code) | (Address of principal executive offices) (Zip Code) | |
(305) 599-2600 | 011 44 23 8065 5000 | |
(Registrant’s telephone number, including area code) | (Registrant’s telephone number, including area code) | |
None | None | |
(Former name or former address, if changed since last report.) | (Former name, former address, if changed since last report.) |
CARNIVAL CORPORATION | CARNIVAL PLC | |||
By: | /s/ David Bernstein | By: | /s/ David Bernstein | |
Name: | David Bernstein | Name: | David Bernstein | |
Title: | Chief Financial Officer and Chief Accounting Officer | Title: | Chief Financial Officer and Chief Accounting Officer | |
Date: | September 27, 2018 | Date: | September 27, 2018 |
Exhibit No. | Description |
99.1 | Press release, dated September 27, 2018 (furnished pursuant to Item 2.02) |
• | Gross revenue yields (revenue per available lower berth day or “ALBD”) increased 4.0 percent. In constant currency, net revenue yields increased 2.9 percent, better than June guidance of up 1.5 to 2.5 percent. |
• | Gross cruise costs including fuel per ALBD decreased 2.6 percent. In constant currency, net cruise costs excluding fuel per ALBD increased 2.7 percent, better than June guidance of up 3.0 to 4.0 percent, principally due to the timing of expenses between quarters. |
• | Changes in fuel prices (including realized fuel derivatives) and currency exchange rates decreased earnings by $0.08 per share. |
Full Year 2018 | Fourth Quarter 2018 | |||||||
Year over year change: | Current Dollars | Constant Currency | Current Dollars | Constant Currency | ||||
Net revenue yields | Approx 5.0% | Approx 3.5% | 1.0 to 2.0% | 1.5 to 2.5% | ||||
Net cruise costs excl. fuel / ALBD | Approx 3.0% | Approx 1.5% | (1.5) to (2.5)% | (1.0) to (2.0)% |
Full Year 2018 | Fourth Quarter 2018 | ||
Fuel cost per metric ton consumed | $488 | $529 | |
Fuel consumption (metric tons in thousands) | 3,305 | 845 | |
Currencies (USD to 1) | |||
AUD | $0.75 | $0.73 | |
CAD | $0.78 | $0.77 | |
EUR | $1.19 | $1.18 | |
GBP | $1.34 | $1.31 | |
RMB | $0.15 | $0.15 |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income (in millions) | $ | 1,707 | $ | 1,329 | $ | 2,659 | $ | 2,060 | |||||||
Adjusted net income (in millions) (a) | $ | 1,673 | $ | 1,659 | $ | 2,537 | $ | 2,318 | |||||||
Earnings per share-diluted | $ | 2.41 | $ | 1.83 | $ | 3.72 | $ | 2.84 | |||||||
Adjusted earnings per share-diluted (a) | $ | 2.36 | $ | 2.29 | $ | 3.55 | $ | 3.19 |
MEDIA CONTACT | INVESTOR RELATIONS CONTACT | |
Roger Frizzell | Beth Roberts | |
+1 (305) 406 7862 | +1 (305) 406 4832 |
• Net revenue yields | • Net cruise costs, excluding fuel per available lower berth day |
• Booking levels | • Estimates of ship depreciable lives and residual values |
• Pricing and occupancy | • Goodwill, ship and trademark fair values |
• Interest, tax and fuel expenses | • Liquidity |
• Currency exchange rates | • Adjusted earnings per share |
• | The demand for cruises may decline due to adverse world events impacting the ability or desire of people to travel, including conditions affecting the safety and security of travel, government regulations and requirements, and decline in consumer confidence |
• | Incidents, such as ship incidents, security incidents, the spread of contagious diseases and threats thereof, adverse weather conditions or other natural disasters and the related adverse publicity affecting our reputation and the health, safety, security and satisfaction of guests and crew |
• | Changes in and compliance with laws and regulations relating to environment, health, safety, security, data privacy and protection, tax and anti-corruption under which we operate may lead to litigations, enforcement actions, fines, or penalties |
• | Disruptions and other damages to our information technology and other networks and operations, breaches in data security, lapses in data privacy, and failure to keep pace with developments in technology |
• | Ability to recruit, develop and retain qualified shipboard personnel who live on ships away from home for extended periods of time |
• | Increases in fuel prices and availability of fuel supply |
• | Fluctuations in foreign currency exchange rates |
• | Overcapacity and competition in the cruise ship and land-based vacation industry |
• | Continuing financial viability of our travel agent distribution system, air service providers and other key vendors in our supply chain, as well as reductions in the availability of, and increases in the prices for, the services and products provided by these vendors |
• | Inability to implement our shipbuilding programs and ship repairs, maintenance and refurbishments on terms that are favorable or consistent with our expectations, as well as increases to our repairs and maintenance expenses and refurbishment costs as our fleet ages |
• | Geographic regions in which we try to expand our business may be slow to develop and ultimately not develop how we expect |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Revenues | |||||||||||||||
Cruise | |||||||||||||||
Passenger ticket | $ | 4,353 | $ | 4,138 | $ | 10,694 | $ | 9,814 | |||||||
Onboard and other | 1,316 | 1,223 | 3,509 | 3,237 | |||||||||||
Tour and other | 167 | 154 | 222 | 200 | |||||||||||
5,836 | 5,515 | 14,425 | 13,251 | ||||||||||||
Operating Costs and Expenses | |||||||||||||||
Cruise | |||||||||||||||
Commissions, transportation and other | 760 | 699 | 2,000 | 1,781 | |||||||||||
Onboard and other | 207 | 184 | 485 | 438 | |||||||||||
Payroll and related | 537 | 520 | 1,638 | 1,552 | |||||||||||
Fuel | 434 | 307 | 1,166 | 914 | |||||||||||
Food | 275 | 270 | 804 | 774 | |||||||||||
Other ship operating (a) | 655 | 947 | 2,115 | 2,293 | |||||||||||
Tour and other | 90 | 86 | 140 | 132 | |||||||||||
2,958 | 3,013 | 8,348 | 7,884 | ||||||||||||
Selling and administrative | 573 | 547 | 1,794 | 1,649 | |||||||||||
Depreciation and amortization | 511 | 473 | 1,510 | 1,368 | |||||||||||
Goodwill and trademark impairment | — | 89 | — | 89 | |||||||||||
4,042 | 4,122 | 11,653 | 10,990 | ||||||||||||
Operating Income | 1,794 | 1,393 | 2,772 | 2,261 | |||||||||||
Nonoperating Income (Expense) | |||||||||||||||
Interest income | 5 | 3 | 10 | 7 | |||||||||||
Interest expense, net of capitalized interest | (49 | ) | (49 | ) | (147 | ) | (150 | ) | |||||||
Gains (losses) on fuel derivatives, net (b) | 4 | 7 | 61 | (19 | ) | ||||||||||
Other (expense) income, net | (9 | ) | 14 | 2 | 7 | ||||||||||
(50 | ) | (25 | ) | (74 | ) | (155 | ) | ||||||||
Income Before Income Taxes | 1,744 | 1,368 | 2,699 | 2,106 | |||||||||||
Income Tax Expense, Net | (37 | ) | (39 | ) | (40 | ) | (46 | ) | |||||||
Net Income | $ | 1,707 | $ | 1,329 | $ | 2,659 | $ | 2,060 | |||||||
Earnings Per Share | |||||||||||||||
Basic | $ | 2.42 | $ | 1.84 | $ | 3.73 | $ | 2.85 | |||||||
Diluted | $ | 2.41 | $ | 1.83 | $ | 3.72 | $ | 2.84 | |||||||
Dividends Declared Per Share | $ | 0.50 | $ | 0.40 | $ | 1.45 | $ | 1.15 | |||||||
Weighted-Average Shares Outstanding - Basic | 706 | 723 | 712 | 724 | |||||||||||
Weighted-Average Shares Outstanding - Diluted | 707 | 726 | 714 | 727 |
(a) | Includes $304 million of ship impairment charges in the three and nine months ended August 31, 2017. |
(b) | During the three months ended August 31, 2018 and 2017, our gains (losses) on fuel derivatives, net include net unrealized gains of $8 million and $65 million and realized (losses) of $(4) million and $(57) million, respectively. During the nine months ended August 31, 2018 and 2017, our gains (losses) on fuel derivatives, net include net unrealized gains of $90 million and $134 million and realized (losses) of $(29) million and $(153) million, respectively. |
August 31, 2018 | November 30, 2017 | ||||||
ASSETS | |||||||
Current Assets | |||||||
Cash and cash equivalents | $ | 526 | $ | 395 | |||
Trade and other receivables, net | 366 | 312 | |||||
Inventories | 405 | 387 | |||||
Prepaid expenses and other | 458 | 502 | |||||
Total current assets | 1,755 | 1,596 | |||||
Property and Equipment, Net | 35,178 | 34,430 | |||||
Goodwill | 2,949 | 2,967 | |||||
Other Intangibles | 1,182 | 1,200 | |||||
Other Assets | 689 | 585 | |||||
$ | 41,753 | $ | 40,778 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
Current Liabilities | |||||||
Short-term borrowings | $ | 632 | $ | 485 | |||
Current portion of long-term debt | 688 | 1,717 | |||||
Accounts payable | 666 | 762 | |||||
Accrued liabilities and other | 1,616 | 1,877 | |||||
Customer deposits | 4,418 | 3,958 | |||||
Total current liabilities | 8,020 | 8,800 | |||||
Long-Term Debt | 8,297 | 6,993 | |||||
Other Long-Term Liabilities | 783 | 769 | |||||
Shareholders’ Equity | |||||||
Common stock of Carnival Corporation, $0.01 par value; 1,960 shares authorized; 656 shares at 2018 and 655 shares at 2017 issued | 7 | 7 | |||||
Ordinary shares of Carnival plc, $1.66 par value; 217 shares at 2018 and 2017 issued | 358 | 358 | |||||
Additional paid-in capital | 8,741 | 8,690 | |||||
Retained earnings | 24,921 | 23,292 | |||||
Accumulated other comprehensive loss | (1,840 | ) | (1,782 | ) | |||
Treasury stock, 129 shares at 2018 and 122 shares at 2017 of Carnival Corporation and 44 shares at 2018 and 32 shares at 2017 of Carnival plc, at cost | (7,533 | ) | (6,349 | ) | |||
Total shareholders’ equity | 24,654 | 24,216 | |||||
$ | 41,753 | $ | 40,778 |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
STATISTICAL INFORMATION | |||||||||||||||
ALBDs (in thousands) (a) (b) | 21,475 | 21,120 | 62,626 | 61,541 | |||||||||||
Occupancy percentage (c) | 112.6 | % | 111.3 | % | 107.8 | % | 106.7 | % | |||||||
Passengers carried (in thousands) | 3,562 | 3,441 | 9,393 | 9,116 | |||||||||||
Fuel consumption in metric tons (in thousands) | 818 | 814 | 2,458 | 2,463 | |||||||||||
Fuel consumption in metric tons per thousand ALBDs | 38.1 | 38.5 | 39.3 | 40.0 | |||||||||||
Fuel cost per metric ton consumed | $ | 531 | $ | 378 | $ | 474 | $ | 371 | |||||||
Currencies (USD to 1) | |||||||||||||||
AUD | $ | 0.74 | $ | 0.78 | $ | 0.76 | $ | 0.76 | |||||||
CAD | $ | 0.76 | $ | 0.78 | $ | 0.78 | $ | 0.76 | |||||||
EUR | $ | 1.16 | $ | 1.15 | $ | 1.20 | $ | 1.11 | |||||||
GBP | $ | 1.31 | $ | 1.29 | $ | 1.36 | $ | 1.27 | |||||||
RMB | $ | 0.15 | $ | 0.15 | $ | 0.15 | $ | 0.15 | |||||||
CASH FLOW INFORMATION (in millions) | |||||||||||||||
Cash from operations | $ | 1,349 | $ | 1,449 | $ | 4,436 | $ | 4,298 | |||||||
Capital expenditures | $ | 583 | $ | 437 | $ | 2,784 | $ | 2,296 | |||||||
Dividends paid | $ | 356 | $ | 290 | $ | 1,003 | $ | 797 |
(a) | ALBD is a standard measure of passenger capacity for the period that we use to approximate rate and capacity variances, based on consistently applied formulas that we use to perform analyses to determine the main non-capacity driven factors that cause our cruise revenues and expenses to vary. ALBDs assume that each cabin we offer for sale accommodates two passengers and is computed by multiplying passenger capacity by revenue-producing ship operating days in the period. |
(b) | For the three months ended August 31, 2018 compared to the three months ended August 31, 2017, we had a 1.7% capacity increase in ALBDs comprised of a 3.1% capacity increase in our North America and Australia segment (“NAA”) and a 0.8% capacity decrease in our Europe and Asia segment (“EA”). |
• | Full quarter impact from one Carnival Cruise Line 3,970-passenger capacity ship that entered into service in April 2018 |
• | Full quarter impact from one Seabourn 600-passenger capacity ship that entered into service in May 2018 |
• | Full quarter impact from one P&O Cruises (UK) 700-passenger capacity ship removed from service in March 2018 |
• | Full quarter impact from one Costa Cruises 1,300-passenger capacity ship removed from service in April 2018 |
• | Partial period impact from one Princess Cruises 3,560-passenger capacity ship that entered into service in April 2017 |
• | Partial period impact from one Carnival Cruise Line 3,970-passenger capacity ship that entered into service in April 2018 |
• | Partial period impact from one Seabourn 600-passenger capacity ship that entered into service in May 2018 |
• | Partial period impact from one AIDA Cruises 3,290-passenger capacity ship that entered into service in June 2017 |
• | Partial period impact from one P&O Cruises (UK) 700-passenger capacity ship removed from service in March 2018 |
• | Partial period impact from one Costa Cruises 1,300-passenger capacity ship removed from service in April 2018 |
(c) | In accordance with cruise industry practice, occupancy is calculated using a denominator of ALBDs, which assumes two passengers per cabin even though some cabins can accommodate three or more passengers. Percentages in excess of 100% indicate that on average more than two passengers occupied some cabins. |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||||||||||
(dollars in millions, except yields) | 2018 | 2018 Constant Dollar | 2017 | 2018 | 2018 Constant Dollar | 2017 | |||||||||||||||||
Passenger ticket revenues | $ | 4,353 | $ | 4,342 | $ | 4,138 | $ | 10,694 | $ | 10,413 | $ | 9,814 | |||||||||||
Onboard and other revenues | 1,316 | 1,315 | 1,223 | 3,509 | 3,447 | 3,237 | |||||||||||||||||
Gross cruise revenues | 5,669 | 5,657 | 5,361 | 14,203 | 13,860 | 13,051 | |||||||||||||||||
Less cruise costs | |||||||||||||||||||||||
Commissions, transportation and other | (760 | ) | (758 | ) | (699 | ) | (2,000 | ) | (1,930 | ) | (1,781 | ) | |||||||||||
Onboard and other | (207 | ) | (207 | ) | (184 | ) | (485 | ) | (476 | ) | (438 | ) | |||||||||||
(967 | ) | (965 | ) | (883 | ) | (2,485 | ) | (2,406 | ) | (2,219 | ) | ||||||||||||
Net passenger ticket revenues | 3,593 | 3,584 | 3,439 | 8,694 | 8,483 | 8,033 | |||||||||||||||||
Net onboard and other revenues | 1,109 | 1,108 | 1,039 | 3,024 | 2,971 | 2,799 | |||||||||||||||||
Net cruise revenues | $ | 4,702 | $ | 4,692 | $ | 4,478 | $ | 11,718 | $ | 11,454 | $ | 10,832 | |||||||||||
ALBDs | 21,475,014 | 21,475,014 | 21,120,155 | 62,626,499 | 62,626,499 | 61,540,974 | |||||||||||||||||
Gross revenue yields | $ | 263.98 | $ | 263.40 | $ | 253.82 | $ | 226.78 | $ | 221.31 | $ | 212.07 | |||||||||||
% increase | 4.0 | % | 3.8 | % | 6.9 | % | 4.4 | % | |||||||||||||||
Net revenue yields | $ | 218.96 | $ | 218.48 | $ | 211.99 | $ | 187.10 | $ | 182.90 | $ | 176.01 | |||||||||||
% increase | 3.3 | % | 3.1 | % | 6.3 | % | 3.9 | % | |||||||||||||||
Net passenger ticket revenue yields | $ | 167.31 | $ | 166.89 | $ | 162.82 | $ | 138.82 | $ | 135.45 | $ | 130.52 | |||||||||||
% increase | 2.8 | % | 2.5 | % | 6.4 | % | 3.8 | % | |||||||||||||||
Net onboard and other revenue yields | $ | 51.65 | $ | 51.60 | $ | 49.17 | $ | 48.28 | $ | 47.45 | $ | 45.49 | |||||||||||
% increase | 5.0 | % | 4.9 | % | 6.1 | % | 4.3 | % |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||||||||||
(dollars in millions, except yields) | 2018 | 2018 Constant Currency | 2017 | 2018 | 2018 Constant Currency | 2017 | |||||||||||||||||
Net passenger ticket revenues | $ | 3,593 | $ | 3,573 | $ | 3,439 | $ | 8,694 | $ | 8,455 | $ | 8,033 | |||||||||||
Net onboard and other revenues | 1,109 | 1,110 | 1,039 | 3,024 | 2,980 | 2,799 | |||||||||||||||||
Net cruise revenues | $ | 4,702 | $ | 4,683 | $ | 4,478 | $ | 11,718 | $ | 11,436 | $ | 10,832 | |||||||||||
ALBDs | 21,475,014 | 21,475,014 | 21,120,155 | 62,626,499 | 62,626,499 | 61,540,974 | |||||||||||||||||
Net revenue yields | $ | 218.96 | $ | 218.06 | $ | 211.99 | $ | 187.10 | $ | 182.60 | $ | 176.01 | |||||||||||
% increase | 3.3 | % | 2.9 | % | 6.3 | % | 3.7 | % | |||||||||||||||
Net passenger ticket revenue yields | $ | 167.31 | $ | 166.38 | $ | 162.82 | $ | 138.82 | $ | 135.01 | $ | 130.52 | |||||||||||
% increase | 2.8 | % | 2.2 | % | 6.4 | % | 3.4 | % | |||||||||||||||
Net onboard and other revenue yields | $ | 51.65 | $ | 51.68 | $ | 49.17 | $ | 48.28 | $ | 47.59 | $ | 45.49 | |||||||||||
% increase | 5.0 | % | 5.1 | % | 6.1 | % | 4.6 | % |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||||||||||
(dollars in millions, except costs per ALBD) | 2018 | 2018 Constant Dollar | 2017 | 2018 | 2018 Constant Dollar | 2017 | |||||||||||||||||
Cruise operating expenses | $ | 2,867 | $ | 2,864 | $ | 2,927 | $ | 8,208 | $ | 8,014 | $ | 7,752 | |||||||||||
Cruise selling and administrative expenses | 569 | 567 | 543 | 1,772 | 1,728 | 1,637 | |||||||||||||||||
Gross cruise costs | 3,436 | 3,431 | 3,470 | 9,980 | 9,743 | 9,389 | |||||||||||||||||
Less cruise costs included above | |||||||||||||||||||||||
Commissions, transportation and other | (760 | ) | (758 | ) | (699 | ) | (2,000 | ) | (1,930 | ) | (1,781 | ) | |||||||||||
Onboard and other | (207 | ) | (207 | ) | (184 | ) | (485 | ) | (476 | ) | (438 | ) | |||||||||||
Gains (losses) on ship sales and impairments | 27 | 26 | (304 | ) | 39 | 35 | (300 | ) | |||||||||||||||
Restructuring expenses | — | — | (3 | ) | — | — | (3 | ) | |||||||||||||||
Other | — | — | — | (1 | ) | (1 | ) | — | |||||||||||||||
Net cruise costs | 2,496 | 2,492 | 2,280 | 7,532 | 7,370 | 6,867 | |||||||||||||||||
Less fuel | (434 | ) | (434 | ) | (307 | ) | (1,166 | ) | (1,166 | ) | (914 | ) | |||||||||||
Net cruise costs excluding fuel | $ | 2,062 | $ | 2,058 | $ | 1,973 | $ | 6,367 | $ | 6,204 | $ | 5,953 | |||||||||||
ALBDs | 21,475,014 | 21,475,014 | 21,120,155 | 62,626,499 | 62,626,499 | 61,540,974 | |||||||||||||||||
Gross cruise costs per ALBD | $ | 160.02 | $ | 159.76 | $ | 164.32 | $ | 159.36 | $ | 155.57 | $ | 152.56 | |||||||||||
% (decrease) increase | (2.6 | )% | (2.8 | )% | 4.5 | % | 2.0 | % | |||||||||||||||
Net cruise costs excluding fuel per ALBD | $ | 96.03 | $ | 95.85 | $ | 93.39 | $ | 101.66 | $ | 99.07 | $ | 96.72 | |||||||||||
% increase | 2.8 | % | 2.6 | % | 5.1 | % | 2.4 | % |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||||||||||
(dollars in millions, except costs per ALBD) | 2018 | 2018 Constant Currency | 2017 | 2018 | 2018 Constant Currency | 2017 | |||||||||||||||||
Net cruise costs excluding fuel | $ | 2,062 | $ | 2,060 | $ | 1,973 | $ | 6,367 | $ | 6,205 | $ | 5,953 | |||||||||||
ALBDs | 21,475,014 | 21,475,014 | 21,120,155 | 62,626,499 | 62,626,499 | 61,540,974 | |||||||||||||||||
Net cruise costs excluding fuel per ALBD | $ | 96.03 | $ | 95.92 | $ | 93.39 | $ | 101.66 | $ | 99.07 | $ | 96.72 | |||||||||||
% increase | 2.8 | % | 2.7 | % | 5.1 | % | 2.4 | % |
Three Months Ended August 31, | Nine Months Ended August 31, | ||||||||||||||
(in millions, except per share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Net income | |||||||||||||||
U.S. GAAP net income | $ | 1,707 | $ | 1,329 | $ | 2,659 | $ | 2,060 | |||||||
Unrealized (gains) losses on fuel derivatives, net | (8 | ) | (65 | ) | (90 | ) | (134 | ) | |||||||
(Gains) losses on ship sales and impairments | (27 | ) | 392 | (39 | ) | 389 | |||||||||
Restructuring expenses | — | 3 | — | 3 | |||||||||||
Other | — | — | 7 | — | |||||||||||
Adjusted net income | $ | 1,673 | $ | 1,659 | $ | 2,537 | $ | 2,318 | |||||||
Weighted-average shares outstanding | 707 | 726 | 714 | 727 | |||||||||||
Earnings per share | |||||||||||||||
U.S. GAAP earnings per share | $ | 2.41 | $ | 1.83 | $ | 3.72 | $ | 2.84 | |||||||
Unrealized (gains) losses on fuel derivatives, net | (0.01 | ) | (0.09 | ) | (0.13 | ) | (0.18 | ) | |||||||
(Gains) losses on ship sales and impairments | (0.04 | ) | 0.55 | (0.05 | ) | 0.53 | |||||||||
Restructuring expenses | — | — | — | — | |||||||||||
Other | — | — | 0.01 | — | |||||||||||
Adjusted earnings per share | $ | 2.36 | $ | 2.29 | $ | 3.55 | $ | 3.19 | |||||||
• | The translation of our operations with functional currencies other than U.S. dollar to our U.S. dollar reporting currency results in decreases in reported U.S. dollar revenues and expenses if the U.S. dollar strengthens against these foreign currencies and increases in reported U.S. dollar revenues and expenses if the U.S. dollar weakens against these foreign currencies. |
• | Our operations have revenue and expense transactions in currencies other than their functional currency. If their functional currency strengthens against these other currencies, it reduces the functional currency revenues and expenses. If the functional currency weakens against these other currencies, it increases the functional currency revenues and expenses. |
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