Good morning, and welcome to the Norwegian Cruise Line Holdings’ First Quarter 2015 Earnings Conference Call. My name is Bridget and I will be your conference operator. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions for the session will follow at that time. [Operator Instructions] As a reminder to all participants, this conference call is being recorded. I would now like to turn the conference over to your host Ms. Wendy Beck, Executive Vice President and Chief Financial Officer. Ms. Beck, please proceed.

Thank you, Bridget. Good morning, everyone, and thank you, for joining us on our first quarter earnings call. I am joined today by Frank Del Rio, President and Chief Executive Officer of Norwegian Cruise Line Holdings. Frank will begin the call with opening commentary, after which I will follow with commentary on the results for the quarter, as well as provide updated guidance for 2015, before turning the call back to Frank for closing words. We will then open the call for your questions. As a reminder, this conference call is being simultaneously webcast on the company’s Investor Relations website at www.nclhltdinvestor.com, and will be available for replay for 30 days following today’s call. Before we discuss our results, I would like to cover a few items. Our press release with first quarter 2015 results was issued this morning and is available on our Investor Relations website. I would also like to review information about forward-looking statements and the use of non-GAAP information as a part of this call. The company’s comments today may include statements about expectations for the future. Those expectations are subject to known and unknown risks, uncertainties and other factors that may cause the company’s actual results and performance in future periods to be materially different from any future results or performance suggested by these expectations. The company cannot guarantee the accuracy of any forecasts or estimates, and we undertake no obligation to update any forward-looking statements. If you would like more information on the risks involved in forward-looking statements, please see the company’s SEC filings. In addition, some of our comments may reference non-GAAP financial measures. A reconciliation of the most directly comparable GAAP financial measure and other associated disclosures are contained in the company’s earnings release. Now with that, I’d like to turn the call over to Frank Del Rio. Frank?

Thank you, Wendy and good morning everyone. You recall it was not too long ago that we were announcing Norwegian’s 2014 full year results and meeting many of you face-to-face at our investor conference in New York City. It was truly an exciting time as we had much to share with you. First, the deal to acquire Prestige had closed a few months prior and the two previously separate Norwegian and Prestige organizations were starting to come together. At the same time, we implemented a corporate-wide organizational structure that balance brand champions and department heads tasked with maximizing revenue with leaders focused on keeping a keen eye on controlling costs. We created integration teams focused on quickly identifying and harvesting synergies across the organization. But most importantly, we began to lay out the strategies that would form the foundation for how my leadership team and I would leverage the size, brand positioning and expertise of our larger and more diversified company to ensure outsized future profitability growth. An excellent foundation for growth had already been established at each of the previously separate organization. The Norwegian brand had completed a turnaround that was nothing short of remarkable and embarked on a disciplined newbuild program with six new innovative ships scheduled for delivery through 2019. All this, while reporting 26 consecutive quarters of earnings growth and continuing on its announced path of doubling return on invested capital since the time of its IPO. Prestige, meanwhile, continued to dominate the upscale cruise space generating the highest per diems and the highest EBITDA per berth in the industry, while at the same time planning for expansion of its market share in the luxury segment with the building of the Regent Seven Seas brand Explorer, the most luxurious cruise ship ever to be built and…

Thanks, Frank. I would like to begin by noting that unless otherwise stated the following commentary compares first quarter 2015 and 2014 on an as reported basis. You may recall that in our last earnings release, we provided guidance for changes in net yield and net cruise costs on an as reported basis as we customarily do. This as reported basis compares current year’s reported results with those reported for Norwegian Cruise Line Holdings in the first quarter of 2014 results which occurred prior to the acquisition of Prestige Cruise Holdings. In order to provide a better comparison of the combined company’s true performance, we also provided guidance for net yield and net cruise costs which compares first quarter 2015 results for NCLH against the first quarter of 2014 which includes the results of Prestige. We refer to this guidance as combined company which we have provided on both an as reported and constant currency basis. For first quarter 2015, the company generated adjusted earnings per share of $0.27 compared to $0.23 in the prior year and guidance of $0.20 to $0.24. Contributing to the earnings’ beat were an outperformance in net yield and lower interest expense as a result of lower-than-expected interest rates and better grid pricing on certain credit facilities. Adjusted net yield performance was better than anticipated, increasing 18.9% on an as reported basis as a result of a full quarter of consolidation of the upper premium and luxury Prestige brands. On a combined company basis, adjusted net yield decreased a slight 0.7% compared to guidance of down 1% to 2% and was essentially flat on a constant currency basis. These results are even more impressive as they come against the strong first quarter of 2014 where net yield increased 3.8% for the Norwegian brands and included…

Thank you, Wendy. As I mentioned earlier, the excitement of Norwegian's prospects and those of our three brands is resonating with our travel agent partners, our valued past guests and throughout the organization as we continue to work for a great 2015 and ready ourselves for another year of outsized profit growth in 2016. Both Oceania and Regent will welcome fleet additions in 2016 that will further solidify the places -- their places in the upscale cruise space. And not to be outdone, the Norwegian brand will continue its history of innovation with a full year of sailings of its large ship Norwegian Escape, the introduction of a semi-all-inclusive experience on its three and four night Bahamas product onboard Norwegian Sky and will begin the planning for the arrival in 2017 of the Norwegian Bliss. On the synergy front, we expect that on our next earnings call we will communicate the final tally from our formal synergy identification and implementation efforts that will transition to a new phase of our combined operations where we turn from identifying savings solely as a result of the combination but instead focus on broader opportunities that arise from day-to-day operations. We are working hard on all aspects of the business to bring our shareholders superior profit growth and investment returns. We continue to lead the industry in net yield, EBITDA margin and return on invested capital, and if the year continues as planned, we will have double our adjusted earnings per share in just two years. It’s a great start to our first full quarter of combined results and we look forward to speaking to you again next quarter. Thank you all for your continued support. We’d like to go ahead and open up the lines for questions. Operator?

[Operator Instructions] And our first question is from Steve Wieczynski with Stifel.

Hey thanks guys. This is actually Brad in for Steve. First off, on the $30 million in identified revenue synergies, and perhaps what comes beyond, can you kind of give some color around how you see that shaking out between ticket and onboard?

So first off, I don't want to give too much color but I would say the majority of it goes to onboard and net shore ex. And the smaller portion goes to be ticket side but that’s the opportunity and so that’s really – that’s the FDR deal that’s not baked into our guidance, it’s not baked into our long-term target for ‘17 that we put out there and I think, Frank, do you want to speak a little more to that?

Yes, as you recall at the investor conference, one of the drivers of the so-called FDR deal is how do you increase demand which in turn increases per diems which leads to higher yield. And that’s a longer -- longer evolving initiative, it’s already taken hold. I gave you a couple of tidbits of information of how well we are booked into the rest of ‘15 and into ’16. And when you are booked that well, when your load factor is double what it was the same time last year for 2016, unless you're totally asleep at the wheel, which we are not, prices per diem will go up. And so we see various initiatives that will increase our ability to increase yields at a higher clip, at a faster clip than historical averages. We’re not ready to obviously give you a whole lot of color and specifics around what we expect yields to be in 2016. We reiterated yield guidance for the rest of ‘15 but if the booking load factors are as good as we were saying they are, you know what’s going to come next. And that is better price.

And then on the second topic, since you last talked to us, a number of your competitors have announced kind of expanded plans and aspirations for the Chinese market. Just wanted to see if we could get an update on your thinking long-range around the China opportunity.

Well, what appears to be every ship in the world is going to China, maybe the rest of the world is a bigger opportunity now in China. I say that only tongue-in-cheek but it is incredible to see our competitors devoting their newest largest, probably their best performing ships to the Chinese market. We have launched the study group that we said we were going to launch back in the investor day conference, we have hired a very seasoned executive who has gone through the process of opening up China for one of our competitors. And so we believe that having him on board with his expertise will quickly increase our overall knowledge of that market. Harry Sommer who now has been our chief integration officer, as soon as the integration efforts are complete by the end of Q2 will transition and lead that effort. And so we've got quite a bit of talent dedicated to that study group. I, of course, will oversee it and we’re still very bullish on China as the rest of the industry seems to be as well. So no real specifics at this time, as I mentioned at the investor conference, we expect to complete our work by year-end and be able to share it with you shortly thereafter.

Thank you. And our next question is from Harry Curtis with Nomura.

I've got a couple of questions. Turning to your incremental reinvestments, can you give us a sense of what you are investing in and why? What is the strategy behind what you're trying to do with the incremental money that you are setting aside? And then have you assumed any impact on yield as a result of that investment?

The main driver is to increase demand. All of our three brands are taking on additional tonnage over the next few years as I mentioned in my opening comments. And so the most important initiative that any company can undertake is to make sure that you build that capacity coming online. And so a lot of the work that we’re doing is to do everything we can to generate more demand, and part of that is through sales and marketing efforts. You recall that very early in my tenure in Q1 we announced that we were going to increase the sales force to penetrate the under-performing Canadian and California markets for the Norwegian brand and we were going to do more work on the international arena that the Oceania and Regent brands had penetrated the international marketplace a little bit more effectively than Norwegian had up to now. And quite a bit of that money being spent is to do just that, a more pronounced presence in important markets and with the marketing spend that goes with entering those markets. The second part of the reimbursement is to make the onboard product better, to increase guest satisfaction. If you have happy customers, they are more likely to come back more frequently than if you have unhappy customers. So the Norwegian product is already very good but we want to make it the best it can possibly be and the industry-leading in our space. And so all the monies being spent on the product side are being spent on the Norwegian brand specifically. We’re very happy with the product – onboard product of the Oceania and Regent brands but we do think that the Norwegian brand could improve from where it is today.

Then that leads to my second question is it's been three months since –

By the way, Harry, I didn't answer your second part of your question is that there is absolutely no benefit baked into many of the numbers that we disclosed today, whether it is for ‘15 or ’16. And so we hope that these $20 million initiatives in ’15 and $40 million in ‘16 will lead to a greater demand which will in turn lead to higher per diems and higher yields but we’re assuming for the moment that we’re going to incur the cost and not reap any of the benefits. So we’re being very conservative with this reinvestment program.

Very good. And that leads to the next question, which is longer-term. You have made comments about the earnings power of Norwegian perhaps doubling by the end of 2017. It's been three months since you publicly commented on that. Has anything changed in the last three months to make your ability to achieve that goal more or less likely?

I just want to correct, I think that the comments we made was that by 2017 earnings-per-share would hit $5. And you recall that was against the context at the time of basically the plan that had been in place prior to my arrival, which had included $50 million of synergies. So what we know today – two or three months later, the synergies now are greater than $50 million. Everything that I see at Norwegian from a structural perspective, from a brand perspective, I believe there is improvements that we can achieve whether you want to categorize them as synergies or categorize them as just good old business opportunities that had been neglected, or not been fully exploited, I believe that’s the case. So I believe that $5 is -- I feel stronger today than I did three months ago that the $5 if not more is achievable. A bit too early to quantify how much more. So I don’t want to get into what we’re going to be doing in ’17 because we haven’t gone through ‘16 yet. But there is no reason to believe that those numbers are somewhat conservative at this point.

And I would just add that we had baked $50 million into the ‘16 synergy number to get to the $5 and so with the net 75 that we put out in our earnings release, that’s an additional 25 million upside to the $5.

Thank you and our next quarter is from Robin Farley with UBS.

A couple of questions. Frank, in your opening remarks, and you talked about a 39% increase in revenue on the books for ‘16 versus the same time last year, is that a pro forma number? I just want to think about the scale of that number. Is that pro forma, or is that -- because Prestige would not have been on the books at this time last year? –

No, it is apples to apples. We took what Prestige had in the books at this time last year for ‘15 and added the two numbers together. So it is a good number.

And then can you give us a little color -- maybe this is a question for Wendy -- on the pro forma increase in ticket yields versus the percent increase in onboard yields in kind of a constant-currency basis? Just because there's not enough information released to see what that would look like pro forma constant currency.

Robin, we don't actually break out the ticket versus onboard in our guidance. I mean that’s a combined number. But what I can tell you is based on the synergies that we saw roughly two-thirds is going towards onboard and one towards ticket. And the upside or the opportunity for us is to continue to push on the ticket side.

But I was – it sounds just like the actual, Q1 actual?

On Q1, yes, 75% I would say is ticket and the way that – that actually skews more towards Norwegian and then the onboard upside really skews more towards Oceania and Regent.

But with the flat pro forma net yield for Q1, does that -- if you said most of that was ticket, does that mean that ticket was up slightly, and maybe onboard was down slightly?

Yes, so if you go back – when we put out our Q3 earnings call we actually said at that time that we had hoped that Q1 would be up -- either flat to up 1% and then we guided down but as we went into the quarter we were up high on our per diems but we were actually down on our load. And that was one of the first changes that was made here with the new management team, was let’s get loaded and then once we get it loaded, we will start increasing the revenue and we changed the marketing initiative, that we talked about this at investor day, we changed the deal, we had an enticing ad but we changed to even more call to action less branding and so that resulted in upside in the ticket for Norwegian.

Yes and that’s why we are excited, yes, for the second half of ‘15 and really into ‘16 because the necessary condition in my view of being able to raise prices and per diems and therefore yields is load factor. And when your book is well booked into the future as we are at this point, that bodes very well for constant increases in prices.

And then just my last question is just can you clarify what's the deferred revenue that -- it's in your -- you have a line item, adjusted yield, and it looks like it adds about 400 basis points to yield on a reported basis. So I'm just wondering, first of all, can you clarify what that is that you are adjusting? And then, also, how much did it add to your pro forma net yield? In other words, pro forma net yield was basically flat in the quarter. Would it also have been down 4% -- just to understand what that adjustment is?

So this is related to the acquisition of Prestige and it’s under the business combination accounting rules. So obviously we booked revenue when the ship sails but advance ticket sales, it was about $48 million in total, that is deemed that the sailing process had primarily occurred at the time of the acquisition. And so therefore you have to actually haircut that number and so we actually are adjusting out to 21 million because we are putting it back in, just say, this is real revenue that you need to look at for that selling. But because of the accounting rules they make you haircut it. And that was already baked into our guidance. We were discussing that at the last call.

That $21 million, under the accounting rules, it will show up in later quarters? Or in other words, are they sailings that --

That’s correct.

So those were sailings that hadn't been taken yet or something?

So we are going to see it for the rest of the year and it will go consistently down over the next three quarters.

Thank you. And our next question is from Steven Kent with Goldman Sachs.

Just to finish up on that question that Robin just asked, because we had the same one -- did that $20 million of deferred revenues or so, does it go $20 million to $10 million to $5 million to $5 million? Because it does influence the cadence of the net yield, which obviously we all focus in on. That's one question. Then the second question is just on -- same thing, on cadence of your fuel costs. Fuel price per metric ton probably goes up from first quarter to the second quarter, but fuel price per metric ton seems to be lower in your guidance. So I'm trying to understand that. Is that related to the fuel hedges?

Okay good question. So on the deferred revenue, there is about $18 million to $19 million remaining for the last three quarters. And then that will go away. And then regarding the fuel prices, yes, so our fuel prices do actually spike up in Q2 and Q3 as we are moving into the more premium itineraries or burning more NGLs and then it’s going to go back down into the fourth quarter. You will see that lower back down to get us back to our full year guidance.

Thank you and our next question is from Felicia Hendrix with Barclays.

Frank and Wendy, really appreciate all the detail you provided in the prepared remarks, and so far in the Q&A. I'm just wondering, can you update us more specifically about what you're seeing in your various markets in 2015, Caribbean, Europe, Alaska, perhaps some details on pricing on bookings, and if you have seen any changes since your first-quarter guidance in those markets?

From that perspective, it’s been pretty steady. There isn’t any markets that are – that distinguish themselves either on the high end or the low end. If there is a market that shows a little weakness and I think it’s some leftover fears of the Ebola virus and some of the more exotic itineraries on the Oceania and Regent fleet that touch the African continents and go out to Asia. There is a little weakness there. The good news is that’s a very, very small part of our overall deployment but you issue itineraries a year and half, three years ahead of the actual sailing. So if I had to do all over again I may not have as many sailings in and out of Cape Town, Africa. But they are coming back a bit, I think, as the headline and all the negative news stories about Ebola start to fade in and the world is not coming to an end because of Ebola. But if there was one that I would tell you had a little bit of weakness, it would be that but overall Europe is strong, Alaska is strong, the Caribbean is very good. I mentioned to you how well Escape is going and Escape is a Caribbean ship out of Miami. So when you are booked as well as we are booked into the future given the diversification of itineraries by definition, the areas are all doing pretty well.

And then also, Frank, thank you. I know you are very focused on customer satisfaction. I think that goes without saying. You've talked earlier about raising your beverage pricing and your room service fees. I'm just wondering if those efforts have affected consumer satisfaction at all and what kind of feedback has Norwegian gotten from that, if any?

On the beverage, we’ve seen nothing at all. We have not seen a decrease in consumption. It’s pretty much what we thought, if you are thirsty around the pool, and you want a Pepsi in the middle of the ocean, you’re going to buy that Pepsi whether it’s $2.10 which was the old price, or $2.25 which is a new price, so nothing at all. On the more recent introduction of a fleet-wide $7.95 service charge on room service, if you read some of the online blogs, there has been some comments, there always is, no one likes to pay more. But we tested it on two ships in two different price points and we didn’t hear complaints. We improved the menus, so there was a give and take. So yes, you have to pay a delivery charge so that we can deliver faster, because that eliminates some of the folks who order a piece of toast on a cup of coffee in the morning and – but no, overall, all these initiatives that we have put in place that recognize the power of the captive audience that you have without going too far, they’ve all panned out as we expected.

And then just quick housekeeping. Wendy, can you just update us, if there is an update from your investor day on the FX sensitivities to yield and/or EPS?

Sure. It’s the same sensitivities actually that we had. So let’s see – it’s three-tenths of a penny, count to two-tenths Canadian, three-tenths and then Australian two-tenths that’s gaining.

Thank you. And our next question is from Jamie Katz with Morningstar.

The $5 that you guys are looking at in 2017 not only implies that you can capture some pricing growth, but also that net cruise costs, capacity-adjusted, are extremely well contained. And I think this quarter, like-for-like they were up about 5.6%, it indicated in the press release. So can you just sort of speak to your confidence level on the ability to maintain those costs and really where you see the best opportunity is to keep those costs under control?

First off, Jamie, we don’t have in $5. Any upside of FDR new deal into the revenue side of the business. I just want to say if you look back at what I just talked about with the long term outlook, that’s pretty much a 3% to 4% net yield growth baked into that year. So to the extent that these things start to take place and take a foot hold, that’s upside to the $5. And regarding the net cruise costs, I can just say in my role here, we are just as focused on net cruise costs as we always have been. This is an anomaly year, primarily an organic year, we don’t get the benefit of a new ship until the back end of the year and we already are putting a number of investments into marketing to really bolster the marketing where we believe remains to be and that’s both pre-Frank coming on-board and then post-Frank coming on board, saying, okay, I need to tweak it even more. I will turn it to you, Frank.

Yes, but as a general comment, I will tell you that I truly believe that whether you want to consider them formal synergies as I said we need to transition away from just looking at the combination as an opportunity for cost savings and transition to running a business period. We are not done at all on the synergy cost capture. Again we have been here four months now and have found – what we have found nearly $200 million in total but we are not done. Not going to tell you how much more we think we can get but it’s not de minimis. So we are going to continue to focus on costs. There’s lots of more opportunities. We hinted at our investor conference what we thought we could achieve on the back office, on payroll if you will and we hit the top end. Baked into the synergy number for 2016, for example, is a $27 million of headcount reduction and was roughly 10% of our payroll. And we think we are pretty much done there but there are many pockets – in a company that generates $4.5 billion worth of revenue and makes $500 million of the profit, it’s $4 billion of expenses and there is just more to get. So none of that – none of those costs above the $50 million in net synergies that are baked into the $5 in 2017 or the $3.71 I believe in 2016, zero upside to pricing to yields is baked in, whether you want to call it the FDR deal or just the fact that we are still well booked into the future and what’s going to happen next is you are going to see pricing steadily increasing as a result of that strong load factor. None of those factors, both which are positive, are embedded in the $5 in 2017 EPS estimate. And so again I don’t want to start adding A plus B equals C but at this point the $5 is a very well in our focus and it should exceed – the actual results should exceed that $5 target.

Thank you. And our next question is from Greg Badishkanian with Citigroup.

So I mean really good to hear that you are so well booked. And the 39% year-over-year increase in revenues for 2016 on the books, and then you compare that with the load factor at double, the primary difference there? And then, also, typically at this point in the year, if you don't want to give the specific number right now, but typically, how much of the forward year do you have on the books, just to see the magnitude of how important those numbers are?

Still low, I won’t give you a number. But any time you are that far ahead is good.

And the 39% versus the 2 times load factor -- the difference there, what the big difference is there?

Difference is that the 39% encompasses all three brands and the double in load factor in Norwegian only.

And then finally, just on -- Royal, obviously, as you listen to your competitor earnings calls -- talked about the policy of stopping last-minute discounting. Has that had any impact on you? And have you noticed any change in behavior of some of the -- I guess it would just be Carnival, since there is not a lot of other big players out there. But have you noticed any differences in the competitive landscape responding to that?

I don’t know what Carnival is doing. I heard what Royal was going and I applaud them. No one likes to see discounts. We think that our go-to-market strategy while eliminating discounts, it certainly minimizes the need for discount because if you are again booked this far in advance like we are, the pricing dynamic is want to increase pricing and not to decrease pricing. So if we are successful at rolling out what we say we are going to do and by definition, the need for massive last minute discounting goes away.

Thank you and our next question is from Tim Conder with Wells Fargo Securities.

Just a few more here. Wendy, could you maybe give us a little more color on the impact of the unplanned resumed drydock here due to the warranty issue on yield and cost? And then is there any possible recovery for business interruption insurance, either yours or be borne by the yard?

That’s a great question and obviously once we look into – so the good news is that the drydock cost is minimal. Our cost is less than $1 million on that because it’s being covered under warranty. The bigger item is the lost revenue and that’s in the mid single digit million that we’ve actually lost on that 15-day Panama Canal sailing.

And then you would have some cost avoidance, also. You are not burning fuel, or -- but I guess you are still obviously paying the crew --

There is, Tim but on the same token, when we cancelled that sailing, we hauled tail if you will, to the Bahamas from the West Coast to get there to minimize any disruption before we did the Transatlantic. So it’s an offset.

And then Frank, again, early days, but you and the rejuvenated team here -- great, great performance. Given the discussion that's happened here so far with the incremental net cost savings after reinvestments, and then how that's been some additional opportunities that you had but have not yet quantified, and the impact going forward here, could you or Wendy just maybe update us on your thoughts on the debt prepay? I think you’d talked about pre-paying a certain amount of debt beginning in ‘16 and how that was a little bit factored into your guidance. But then maybe balancing that versus share repo, is that still looking at 2016?

Great question. And we are very focused on that and including our board as to what’s the best use of our free cash flow. And what I said at investor day is that probably or there is likelihood that in the fourth quarter of ’15 we could start to either pay down some debt or go back and start – embark again on our share repurchase program. And I would say that we are still very focused on that. So it’s either late ’15 or into ’16, I think that’s what we are focused on. What I also stated was that there is more of an appetite with our weighted average cost of debt being just over 3.7%, we are inclined that share repurchases is more likely the better use of funds. And we are excited about that. So that’s highly likely, obviously it has not been approved by our board at this time but we are focused on that.

And lastly, Frank, I know this is a board decision, but you’d also talked about maybe initiating a dividend. And would that be reasonable to assume that you would maybe want to do that earlier than later, just to broaden out the investor base here?

Let me jump in and take that, Tim. I think it was the one that addressed that at the investor day. And it’s not that necessarily – I think what we said all along is that it’s a matter of time before a dividend is implemented. And we know that we want to broaden that investor base. But it hasn’t been the primary focus. We are probably more keen on repurchasing shares first but again that’s a good discussion at our board level and I do think it is a matter of time.

Thank you and our last question is from Stuart Gordon with Berenberg.

A couple of questions. Just the first one on the yield, just looking at what you delivered in the first quarter, above the top end of what you'd expected in the quarter. And then your commentary on the outlook seems extremely bullish. I was just curious as to why yield guidance wouldn't have been lifted on the back of this? Is it just Star going in for the drydock, or what's your thoughts there? And the second thing is -- is there anything you can say about Cuba, given obviously we have seen the ferry service getting introduced; JetBlue. Where is the cruise industry in discussions on opening up Cuba?

Well Cuba is of a special interest to me, not only because I run a cruise line but because I was born in Havana and haven’t been back in 54 years. So it’d be nice to go back. Look, I have said publicly Cuba was tailor-made for the cruise industry given where it is, given the pent-up demand that there has to be for Cuba after being closed to Americans and for most of the world for all these years. I will tell you that I welcome the initiatives that both governments have undertaken to resume discussions and resume a normal relations between the two countries, literally a week doesn’t go by some news comes out about making progress towards that goal. I think you saw this week where the administration approved four ferry companies to start ferry service to Cuba. I think that’s all positive steps. Obviously we need to go further. I don’t think that both countries want to stop where we are and so we are hopeful that progress continues and that some day not in the distant future, cruising to Cuba will be allowed. It will be a great boon to the industry and coupled with what we are seeing in China this can be the start of another golden boom in the cruise industry, where you’ve got new destinations to go to that are very sought after in Cuba and a whole new market, a large new market in China that wants to cruise. It could be heck of a 1Q punch to really increase overall demand for cruising. In terms of yields, could you repeat the question, please?

Yes, it just seems to be -- I think you were above the top end of the first-quarter guidance with yields. And clearly, the commentary and the reinvestment that you're making is all -- sounds extremely positive. But I was curious why I think you've left the full-year guidance where it was. Is it really simply down to the enforced drydock of the Star or are you just being extremely conservative despite the good start to the year?

Great question. So yes, we did have a beat in revenue on Q1 but it’s a combination not only of the Star drydock that I just spoke about but then also the additional FX hit that we’re going through that at this time we anticipate will hit us for the year. That’s why we have left the yields where they are but we have said that the upside from the FDR new deal plan is baked into those numbers and it takes time to roll out those initiatives. So we feel very confident that they will be fully in place for ’16 but we think that there could be potential upside in ’15 too and we will just have to continue to message that to you. End of Q&A

Thanks everyone for your time and support today. As always, we’ll be available later this afternoon to answer any questions you may have. Operator, thank you for your good work. Good by everyone.