Stock Analysis on Net

Royal Caribbean Cruises Ltd. (NYSE:RCL)

$22.49

This company has been moved to the archive! The financial data has not been updated since July 29, 2022.

Analysis of Bad Debts

Microsoft Excel

Allowance for doubtful accounts receivable (bad debts) is a contra account which reduce the balance of the company gross accounts receivable. The relationship between the allowance and the balance in receivables should be relatively constant unless there is a change in the economy overall or a change in customer base.

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Allowance for Doubtful Accounts Receivable

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in thousands)
Credit loss allowance
Receivables, gross
Financial Ratio
Allowance as a percentage of receivables, gross1

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 2021 Calculation
Allowance as a percentage of receivables, gross = 100 × Credit loss allowance ÷ Receivables, gross
= 100 × ÷ =


Receivables, gross
The gross receivables exhibit a generally stable trend from 2017 to 2020, fluctuating slightly between approximately 288 million and 325 million. However, there is a notable increase in 2021, where gross receivables rise significantly to around 421 million, indicating a substantial growth in amounts owed to the company in that year.
Credit loss allowance
Data for credit loss allowance is available only for 2020 and 2021. It reveals a sizable increase from approximately 3.9 million in 2020 to 13.4 million in 2021. This indicates the company has increased its provision for potential credit losses substantially within that one-year period.
Allowance as a percentage of receivables, gross
The allowance percentage is recorded only for 2020 and 2021 and shows an upward trend from 1.34% to 3.18%. This indicates that, relative to the total gross receivables, the company has reserved a larger proportion for potential losses in 2021 compared to 2020. This trend suggests a more cautious approach to credit risk management amid increasing receivables.