Name: Royal Caribbean Cruises Ltd. (NYSE:RCL) | Liabilities and Stockholders’ Equity
Creator: Stock Analysis on Net

Balance Sheet: Liabilities and Stockholders’ Equity

The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.

Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.

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Royal Caribbean Cruises Ltd., consolidated balance sheet: liabilities and stockholders’ equity

US$ in thousands

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Current portion of long-term debt	2,243,131)	961,768)	1,186,586)	1,646,841)	1,188,514)
Commercial paper	—)	409,319)	1,434,180)	775,488)	—)
Current portion of operating lease liabilities	68,922)	102,677)	96,976)	—)	—)
Accounts payable	545,978)	353,422)	563,706)	488,212)	360,113)
Accrued interest	251,974)	252,668)	70,090)	74,550)	47,469)
Accrued expenses and other liabilities	887,575)	615,750)	1,078,345)	899,761)	903,022)
Derivative financial instruments	127,236)	56,685)	94,875)	78,476)	47,464)
Customer deposits	3,160,867)	1,784,832)	3,428,138)	3,148,837)	2,243,682)
Current liabilities	7,285,683)	4,537,121)	7,952,896)	7,112,165)	4,790,264)
Long-term debt, excluding current portion	18,847,209)	17,957,956)	8,414,110)	8,355,370)	6,350,937)
Long-term operating lease liabilities	534,726)	563,876)	601,641)	—)	—)
Other long-term liabilities	505,181)	645,565)	617,810)	583,254)	452,813)
Long-term liabilities	19,887,116)	19,167,397)	9,633,561)	8,938,624)	6,803,750)
Total liabilities	27,172,799)	23,704,518)	17,586,457)	16,050,789)	11,594,014)
Redeemable noncontrolling interest	—)	—)	569,981)	542,020)	—)
Preferred stock, $0.01 par value; none outstanding	—)	—)	—)	—)	—)
Common stock, $0.01 par value	2,827)	2,652)	2,365)	2,358)	2,352)
Paid-in capital	7,557,297)	5,998,574)	3,493,959)	3,420,900)	3,390,117)
Retained earnings	302,276)	5,562,775)	11,523,326)	10,263,282)	9,022,405)
Accumulated other comprehensive loss	(710,885)	(739,341)	(797,713)	(627,734)	(334,265)
Treasury stock, common shares at cost	(2,065,959)	(2,063,991)	(2,058,091)	(1,953,345)	(1,378,306)
Shareholders’ equity	5,085,556)	8,760,669)	12,163,846)	11,105,461)	10,702,303)
Total liabilities and shareholders’ equity	32,258,355)	32,465,187)	30,320,284)	27,698,270)	22,296,317)

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).

The balance sheet demonstrates a significant shift in capital structure between 2017 and 2021, characterized by a substantial increase in total liabilities and a simultaneous erosion of shareholders' equity. Total liabilities rose from $11.59 billion in 2017 to $27.17 billion in 2021, representing a growth of approximately 134%. This expansion is primarily driven by a surge in long-term debt, which more than doubled between 2019 and 2020.

Long-Term Debt and Leverage: A dramatic escalation in long-term debt, excluding the current portion, is observed starting in 2020. The balance increased from $8.41 billion in 2019 to $17.96 billion in 2020, reaching $18.85 billion by 2021. This suggests a heavy reliance on external borrowing to sustain operations during a period of financial stress.
Current Liability Volatility: Current liabilities showed significant fluctuations, peaking at $7.95 billion in 2019 before dropping to $4.54 billion in 2020 and rebounding to $7.29 billion in 2021. A key driver of this volatility is customer deposits, which fell from $3.43 billion in 2019 to $1.78 billion in 2020, before recovering to $3.16 billion in 2021, indicating a return of advance bookings.
Equity Erosion and Capital Infusions: Shareholders' equity experienced a steady decline from a peak of $12.16 billion in 2019 to $5.09 billion in 2021. This contraction is most evident in retained earnings, which plummeted from $11.52 billion in 2019 to just $302 million in 2021, signaling substantial accumulated losses. To mitigate this decline, paid-in capital was increased from $3.49 billion in 2019 to $7.56 billion in 2021, suggesting that equity issuances were utilized to bolster the capital base.
Liquidity and Short-Term Obligations: The current portion of long-term debt saw a sharp increase in 2021 to $2.24 billion, up from $961 million in 2020. Additionally, accrued interest rose from $70 million in 2019 to over $250 million in 2020 and 2021, reflecting the higher cost of servicing the expanded debt load.

Overall, the financial trajectory indicates a transition from a balanced equity-to-debt ratio toward a highly leveraged position. The depletion of retained earnings and the massive increase in long-term liabilities underscore a period of severe financial pressure, partially offset by strategic increases in paid-in capital.

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