SEC XBRL Viewer

Document and Entity Information Document	6 Months Ended
Document and Entity Information Document	Jun. 30, 2012
Entity Information [Line Items]
Entity Registrant Name	Seven Seas Cruises S. DE R.L.
Entity Central Index Key	0001534814
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding	0

Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2011	Dec. 31, 2010
Current assets
Cash and cash equivalents	$ 106,689	$ 68,620	$ 97,253	$ 37,258
Restricted cash	234	743
Trade and other receivables, net	9,975	8,319
Related party receivables	0	748
Inventories	6,013	5,132
Prepaid expenses	20,396	19,149
Other current assets	3,322	4,165
Total current assets	146,629	106,876
Property and equipment, net	653,259	655,360
Goodwill	404,858	404,858
Intangible assets, net	84,838	86,120
Other long-term assets	29,999	30,576
Total assets	1,319,583	1,283,790
Current liabilities
Trade and other payables	1,821	5,752
Related party payables	1,474	0
Accrued expenses	47,074	41,782
Passenger deposits	196,817	159,312
Derivative liabilities	2,405	112
Current portion of long-term debt	12,500	0
Total current liabilities	262,091	206,958
Long-term debt	506,000	518,500
Other long-term liabilities	9,823	13,694
Total liabilities	777,914	739,152
Commitments and contingencies
Members' equity
Contributed capital	563,863	563,365
Accumulated deficit	(22,194)	(18,727)
Total members' equity	541,669	544,638
Total liabilities and members' equity	$ 1,319,583	$ 1,283,790

Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) (USD $) In Thousands, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2012	Mar. 31, 2012	Jun. 30, 2011	Mar. 31, 2011	Jun. 30, 2012	Jun. 30, 2011
Revenue
Passenger ticket	$ 119,548		$ 110,185		$ 228,120	$ 203,453
Onboard and other	11,932		12,664		23,220	23,167
Total revenue	131,480		122,849		251,340	226,620
Cruise operating expense
Commissions, transportation and other	46,468		38,718		85,734	67,224
Onboard and other	3,153		3,608		5,409	5,252
Payroll, related and food	19,245		17,699		38,021	35,186
Fuel	10,435		10,263		22,547	20,612
Other ship operating	11,040		9,820		20,371	18,947
Other	5,844		5,283		7,124	6,323
Total cruise operating expense	96,185		85,391		179,206	153,544
Other operating expense
Selling and administrative	16,854		16,974		38,001	38,172
Depreciation and amortization	9,868		9,224		19,543	18,037
Total operating expense	122,907		111,589		236,750	209,753
Operating income	8,573		11,260		14,590	16,867
Non-operating income (expense)
Interest income	122		50		225	64
Interest expense	(7,982)		(7,394)		(16,066)	(15,412)
Other income (expense)	(4,527)		(7,026)		(2,015)	(3,098)
Total non-operating expense	(12,387)		(14,370)		(17,856)	(18,446)
Loss before income taxes	(3,814)		(3,110)		(3,266)	(1,579)
Income tax benefit (expense)	(11)		108		(201)	50
Net loss	(3,825)		(3,002)		(3,467)	(1,529)
Other comprehensive income, net of tax:
Loss on change in derivative fair value	0		0	2,814	0	(2,814)
Total comprehensive loss	$ (3,825)		$ (3,002)		$ (3,467)	$ (4,343)

Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Cash flows from operating activities
Net loss	$ (3,467)	$ (1,529)
Adjustments:
Depreciation and amortization	19,543	18,037
Amortization of deferred financing costs	1,577	1,916
Accretion of debt discount	218	168
Stock-based compensation	499	428
Unrealized loss (gain) on derivative contracts	2,710	(1,316)
Loss on early extinguishment of debt	0	7,502
Other, net	275	7
Changes in operating assets and liabilities:
Trade and other accounts receivable	(909)	5,253
Prepaid expenses and other current assets	(1,240)	(7,591)
Inventories	(881)	(1,904)
Accounts payable and accrued expenses	52	505
Passenger deposits	35,689	38,284
Net cash provided by operating activities	54,066	59,760
Cash flows from investing activities
Purchases of property and equipment	(14,135)	(11,840)
Changes in restricted cash	509	(20,167)
Acquisition of intangible assets	0	(4,445)
Net cash used in investing activities	(13,626)	(36,452)
Cash flows from financing activities
Repayment of debt	0	(180,786)
Proceeds from the issuance of senior secured notes	0	225,000
Debt issuance costs	(374)	(6,562)
Deferred intangible asset payment	(2,000)	0
Costs associated with the early extinguishment of debt	0	(1,393)
Net cash (used in) provide by financing activities	(2,374)	36,259
Effect of exchange rate changes on cash and cash equivalents	3	428
Net increase in cash and cash equivalents	38,069	59,995
Cash and cash equivalents
Beginning of period	68,620	37,258
End of period	$ 106,689	$ 97,253

Basis of Presentation	6 Months Ended
Basis of Presentation	Jun. 30, 2012
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation Seven Seas Cruises S. DE R.L. (“SSC”, “Company”, “we” or “our”) is a Panamanian sociedad de responsibilidad limitada organized on November 7, 2007, and is owned by Classic Cruises, LLC (“CCL I”) and Classic Cruises II, LLC (“CCL II”). CCL I and CCL II are Delaware companies and each company owns 50% of SSC. Prestige Cruise Holdings, Inc. (“PCH”) owns both CCL I and CCL II. PCH is a wholly-owned subsidiary of our ultimate parent company, Prestige Cruises International, Inc. (“PCI”). PCI is controlled by funds affiliated with Apollo Global Management, LLC. The accompanying interim consolidated financial statements include the accounts of SSC and its wholly-owned subsidiaries and have been prepared in accordance with generally accepted accounting principles in the United States. The financial information presented as of any date other than December 31 has been prepared from the books and records of the Company without audit. Financial information as of December 31 has been derived from SSC’s audited financial statements, but does not include all disclosures required by generally accepted accounting principles. The accompanying Consolidated Balance Sheet at June 30, 2012 and the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the three and six months ended June 30, 2012 and 2011 and Consolidated Statements of Cash Flows for the six months ended June 30, 2012 and 2011 are unaudited, and, in the opinion of management, contain all adjustments, consisting of only normal recurring adjustments, necessary for fair presentation. Our interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2011 and notes thereto included in the fifth amendment to our registration statement on Form S-4 (333-178244) filed with the Securities and Exchange Commission on May 7, 2012. Our operations are seasonal, and results from our interim periods are not necessarily indicative of the results to be expected for the entire year. New Accounting Pronouncements - As of January 1, 2012, we adopted Financial Accounting Standards Board ASU 2011-08, Intangibles - Goodwill and Other (Topic 350). This updated standard allows a company to perform a quantitative analysis prior to its two step impairment test. If this analysis does not result in a more likely than not conclusion that impairment exists, then performing the two step impairment test is no longer required. This change did not have any impact on our consolidated financial condition, results of comprehensive income (loss) or cash flows. As of January 1, 2012, we adopted Financial Accounting Standards Board ASU 2011-05, Presentation of Comprehensive Income (Topic 220). This updated standard has changed the presentation of our financial statements as it required presentation of comprehensive income (loss) in either a single continuous statement of comprehensive income (loss) or in two separate, but consecutive statements. We have elected to present this information on a single continuous statement. This change did not have any impact on our consolidated financial condition, results of comprehensive income (loss) or cash flows. As of January 1, 2012 we adopted Financial Accounting Standards Board ASU 2011-04, Fair Value Measurement (Topic 820). This standard increased the disclosure requirements for each class of assets and liabilities that is not measured at fair value in the balance sheet, but for which fair value is disclosed within the notes to the financial statements. This change did not have any impact on our consolidated financial condition, results of comprehensive income (loss) or cash flows. As of January 1, 2012 we adopted Financial Accounting Standards Board ASU 2011-12, Deferral of the Effective Date for Amendments to the Presentation of Reclassification of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05. This standard delays the presentation requirements for reclassifying items out of accumulated other comprehensive income (loss) as noted in Financial Accounting Standards Board ASU 2011-12. This change did not have any impact on our consolidated financial condition, results of comprehensive income (loss) or cash flows. In June 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-06, Comprehensive Income (Topic 820). This accounting standard update eliminates the option to present components of other comprehensive income (loss) as part of the statement of equity and requires the total of comprehensive income (loss), the components of net income (loss), and the components of other comprehensive income (loss) be presented either in a single continuous statement of comprehensive income (loss) or in two separate but consecutive statements. It also requires presentation on the face of the financial statements of reclassification adjustments for items that are reclassified from other comprehensive income (loss) to net income (loss) in the statement(s) where the components of net income (loss) and the components of other comprehensive income (loss) are presented. This accounting standard update became effective on January 1, 2012. In December 2011, the FASB issued ASU No. 2011-12 which indefinitely defers the guidance related to the presentation of reclassification adjustments only. The adoption of this accounting standard update resulted in financial statement presentation changes only.

Property and Equipment, net	6 Months Ended
Property and Equipment, net	Jun. 30, 2012
Property, Plant and Equipment [Abstract]
Property and Equipment, net	Property and Equipment, net During the six months ended June 30, 2012, property and equipment, net decreased $2.1 million. Capital expenditures totaled $9.2 million and $7.8 million for the three months ended June 30, 2012 and 2011, respectively, and $14.1 million and $11.8 million for the six months ended June 30, 2012 and 2011, respectively. Depreciation expense on assets in service was $9.1 million and $8.6 million for the three months ended June 30, 2012 and 2011, respectively, and $18.1 million and $16.7 million for the six months ended June 30, 2012 and 2011, respectively.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

+ References+ Details

Debt

6 Months Ended

Jun. 30, 2012

Debt Disclosure [Abstract]

Debt



	June 30,		December 31,
(in thousands)	2012		2011

$425 million term loan, currently LIBOR plus 1.75%, due through 2014	$	293,500	$	293,500
$225 million senior secured notes, 9.125%, due 2019	225,000		225,000
	518,500		518,500
Less: Current portion of long-term debt	12,500		—
Long-term portion	$	506,000	$	518,500

Interest expense on third-party debt, including interest rate swaps in 2011, was $6.9 million and $6.0 million for the three months ended June 30, 2012 and 2011, respectively, and $13.8 million and $12.8 million for the six months ended June 30, 2012 and 2011, respectively.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References+ Details

Derivative Instruments, Hedging Activities and Fair Value Measurements

6 Months Ended

Jun. 30, 2012

Derivative Instruments, Hedging Activities and Fair Value Measurements [Abstract]

Derivative Instruments, Hedging Activities and Fair Value Measurements

We are exposed to market risks attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We manage these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments pursuant to our hedging practices and policies as described below. The financial impacts of these hedging instruments are primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the amount, term and conditions of the derivative instrument with the underlying risk being hedged. We do not hold or issue derivative financial instruments for trading or other speculative purposes. We monitor our derivative positions using techniques including market valuations and sensitivity analyses.

Interest Rate Risk

Our exposure to market risk for changes in interest rates relates to our long-term debt obligations including future interest payments. We use interest rate swap agreements to modify our exposure to interest rate fluctuations and to manage our interest expense. During 2008, we entered into an interest rate swap agreement with a notional amount of $400.0 million to limit the interest rate exposure related to our long-term debt. This interest rate swap, which matured on February 14, 2011, was designated as a cash flow hedge and the change in fair value of the effective portion of the interest rate swap was recorded as a component of accumulated other comprehensive loss in the accompanying consolidated balance sheet. There were no interest rate swaps outstanding as of June 30, 2012 and December 31, 2011.

Foreign Currency Exchange Risk

Our exposure to foreign currency exchange rate risk relates to our euro denominated vessel dry-dock and other operational expenses. We enter into foreign currency swaps to limit the exposure to movements in the foreign currency exchange rates. The foreign currency swaps do not qualify for hedge accounting; therefore, the changes in fair value of these foreign currency derivatives are recorded in other income (expense) in the accompanying consolidated statements of income (loss) and comprehensive income (loss). The total aggregate notional amount of outstanding foreign currency swap agreements as of June 30, 2012 and December 31, 2011 was €2.0 million ($2.7 million) and €3.9 million ($5.2 million), respectively.

Fuel Price Risk

Our exposure to market risk for changes in fuel prices relates primarily to the consumption of fuel on our vessels. We use fuel derivative swap agreements to mitigate the financial impact of fluctuations in fuel prices. The fuel swaps do not qualify for hedge accounting; therefore, the changes in fair value of these fuel derivatives are recorded in other income (expense) in the accompanying consolidated statements of income (loss) and comprehensive income (loss). As of June 30, 2012, we have hedged the variability in future cash flows for forecasted fuel consumption occurring through 2014. As of June 30, 2012 and December 31, 2011, we have entered into the following fuel swap agreements:



	Fuel Swap Agreements
	As of June 30, 2012		As of December 31, 2011
	(in barrels)
2012	157,500		156,300
2013	203,025		—
2014	108,750		—


	Fuel Swap Agreements
	As of June 30, 2012		As of December 31, 2011
	(% hedged)
2012	80	%	39	%
2013	52	%	—	%
2014	28	%	—	%

Our fuel derivative contracts are subject to certain margin requirements. On any business day, we may be required to post collateral if the mark-to-market exposure assessed at our parent company level exceeds $3.0 million. The amount of collateral required to be posted is an amount equal to the difference between the exposure (cost of liquidating and terminating the derivative position) and $3.0 million at our parent company level. As of June 30, 2012 and December 31, 2011, we were not required to post any collateral for our fuel derivative instruments as the exposure at our parent company level did not exceed $3.0 million.

At June 30, 2012 and December 31, 2011, the fair values and line item captions of derivative instruments recorded were as follows:



Derivatives not designated as hedging instruments under FASB ASC 815-20

		Fair Value as of		Fair Value as of
(in thousands)	Balance Sheet Location	June 30, 2012		December 31, 2011

Foreign currency swap	Other current assets	$	77	$	—
Fuel hedges	Other current assets	—		489
Fuel hedges	Other long-term assets	129		—
	Total Derivatives Assets	$	206	$	489

Foreign currency swap	Current liabilities - Derivative liabilities	$	119	$	112
Fuel hedges	Current liabilities - Derivative liabilities	2,286		—
Fuel hedges	Other long-term liabilities	134		—
	Total Derivatives Liabilities	$	2,539	$	112

We had no derivative instruments qualifying and designated as hedging instruments on the consolidated financial statements as of June 30, 2012.

The effect of derivative instruments qualifying and designated as hedging instruments on the consolidated financial statements for the three and six months ended June 30, 2011 was as follows:



(in thousands)	Amount of Gain/(Loss) Recognized in OCI on Derivative (Effective Portion)			Location of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion)	Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion)			Location of Gain/(Loss) Recognized in Income on Derivative (Ineffective Portion excluded from Effectiveness Testing)	Amount of Gain/(Loss) Recognized in Income on Derivative (Ineffective Portion excluded from Effectiveness Testing)

Interest rate swap	$	(2,814	)	Interest expense	$	(2,814	)	N/A	$	—
Total	$	(2,814	)		$	(2,814	)		$	—

The effect of derivative instruments not designated as hedging instruments on the consolidated financial statements for the three and six months ended June 30, 2012 and 2011 was as follows:



	Location of Gain/(Loss) Recognized in Income on Derivative
		Amount of Gain / (Loss) Recognized in Income on Derivative
		For the Three Months Ended June 30,
(in thousands)		2012			2011

Foreign currency swap	Other income (expense)	$	(216	)	$	—
Fuel hedges	Other income (expense)	(3,687		)	394
Total		$	(3,903	)	$	394


	Location of Gain/(Loss) Recognized in Income on Derivative	Amount of Gain / (Loss) Recognized in Income on Derivative
		For the Six Months Ended June 30,
(in thousands)		2012			2011

Foreign currency swap	Other income (expense)	$	(7	)	$	—
Fuel hedges	Other income (expense)	(1,402		)	4,097
Total		$	(1,409	)	$	4,097

Fair Value Measurements

U.S. GAAP establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. Unobservable inputs are inputs that reflect our assumptions which market participants would use in pricing the asset or liability based on the best available information under the circumstances. The hierarchy is broken down into three levels based on the reliability of the inputs as follows:


•	Level 1 Inputs – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.


•	Level 2 Inputs – Inputs other than quoted prices included within Level 1 that are observable for the asset and liability, either directly or indirectly.


•	Level 3 Inputs – Inputs that are unobservable for the asset or liability.

Fair Value of Financial Instruments

We use quoted prices in active markets when available to determine the fair value of our financial instruments. The fair value of our financial instruments that are not measured at fair value on a recurring basis are as follows:



	Carrying Value as of				Fair Value as of
(in thousands)	June 30, 2012		December 31, 2011		June 30, 2012		December 31, 2011
Long-term bank debt	$	293,500	$	293,500	$	284,853	$	275,338
Senior secured notes	225,000		225,000		232,313		226,133
Total	$	518,500	$	518,500	$	517,166	$	501,471

Long-term bank debt: level 2 inputs were used to calculate the fair value of our long-term debt which was estimated using the present value of expected future cash flows which incorporates our risk profile. The valuation also takes into account debt maturity and interest rate based on the contract terms.

Senior secured notes: level 1 inputs were used to calculate the fair value of our Notes which was estimated using quoted market prices.

Other financial instruments: due to their short-term maturities and no interest rate, currency or price risk, the carrying amounts of cash and cash equivalents, passenger deposits, accounts receivable, accounts payable, accrued interest, and accrued expenses approximate their fair values as of June 30, 2012 and December 31, 2011.

We consider these inputs to be level 1 as all are observable and require no judgment for valuation.

The following table presents information about our financial instrument assets and liabilities that are measured at fair value on a recurring basis:




(in thousands)		As of June 30, 2012								As of December 31, 2011
Description		Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Assets
Derivative financial instruments	(a)	$	206	$	—	$	206	$	—	$	489	$	—	$	489	$	—
Total Assets		$	206	$	—	$	206	$	—	$	489	$	—	$	489	$	—
Liabilities
Derivative financial instruments	(b)	$	2,539	$	—	$	2,539	$	—	$	112	$	—	$	112	$	—
Total liabilities		$	2,539	$	—	$	2,539	$	—	$	112	$	—	$	112	$	—

(a) As of June 30, 2012, derivative financial instruments assets of $0.1 million and $0.1 million are classified as other current assets and other long-term assets, respectively, in the consolidated balance sheets. As of December 31, 2011, $0.5 million was classified as other current assets.

(b) As of June 30, 2012, derivative financial instruments liabilities of $2.4 million and $0.1 million are classified as current liabilities-derivative liabilities and other long-term liabilities, respectively, in the consolidated balance sheets. As of December 31, 2011, $0.1 million was classified as current liabilities-derivative liabilities.

Our derivative financial instruments consist of an interest rate swap, foreign currency exchange contracts and fuel hedge swaps. Fair value is derived using the valuation models that utilize the income value approach. These valuation models take into account the contract terms, such as maturity, and inputs, such as forward interest rates, forward fuel prices, discount rates, creditworthiness of the counterparty and us, as well as other data points. The data sources utilized in these valuation models that are significant to the fair value measurement are classified as Level 2 sources in the fair value input level hierarchy.

Non-recurring Measurements of Non-financial Assets

Goodwill and indefinite-lived intangible assets not subject to amortization are reviewed for impairment on an annual basis or earlier if there is an event or change in circumstances that would indicate that the carrying value of these assets could not be fully recovered. If the carrying amount exceeds the estimated discounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value.

Other long-lived assets, such as our vessels, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. If the carrying amount of the asset exceeds the estimated expected undiscounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value. The estimation of fair value measured by undiscounted or discounted expected future cash flows would be considered Level 3 inputs. During the second quarter of 2012, the Seven Seas Navigator underwent a dry-dock, in which significant improvements were made. Due to the significant costs added to its carrying value, we performed an impairment review utilizing an undiscounted cash flow analysis. The principle assumptions used in the undiscounted cash model were projected operating results, including net per diems, net cruise costs, projected occupancy, available passenger days, and projected growth. Upon performing the impairment review, we determined that the revised carrying amount of the vessel is recoverable and therefore not impaired as of June 30, 2012. Our annual impairment tests are performed as of September 30^th.

Commitments and Contingencies	6 Months Ended
Commitments and Contingencies	Jun. 30, 2012
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Contingencies – Litigation On an ongoing basis, we assess the potential liabilities related to any lawsuits or claims brought against us. While it is typically very difficult to determine the timing and ultimate outcome of such actions, we use our judgment to determine if it is probable that we will incur an expense related to the settlement or final adjudication of such matters and whether a reasonable estimation of such probable loss can be made. In assessing probable losses, we take into consideration estimates of the amount of insurance recoveries, if any. We accrue a liability when we believe a loss is probable and the amount of loss can be reasonably estimated. The majority of claims are covered by insurance and we believe the outcome of such claims, net of estimated insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows. Other During February 2012, we made a $2.0 million payment for previously acquired intangible assets related to Regent licensing rights acquired in 2011. As of June 30, 2012, we have a remaining liability of $2.0 million due in February 2013. During March 2012, management signed a 5-year maintenance agreement with a vendor. The cost of future maintenance contract obligations as of June 30, 2012 is approximately $14.4 million. The contract consists of multiple cost components. Monthly variable maintenance fees are based on engine usage over the contract term. Monthly fixed fees are based on a per vessel basis. We are also required to purchase a certain amount of capital equipment and spare parts. Equipment will be recorded as property and equipment upon receipt and maintenance fees are recorded as repair and maintenance expenses. As of June 30, 2012 we pre-paid $1.0 million for capital equipment, which is recorded in Prepaid expenses in the accompanying consolidated balance sheet. During April 2012, our Chief Operating Officer was granted 600,000 options to purchase PCI shares according to his employment contract. These options are time based and vest over 3 years on his employment anniversary date. The contractual term of these options are 8 years and forfeiture percentage is estimated as 0%. Total compensation expense for these options was calculated at our parent company level. The fair value was estimated on the date of grant using the Black-Scholes model which includes the fair value of PCI common stock determined at the approximate grant date. The estimated fair value of these stock options, less estimated forfeitures, totaled $1.4 million and is amortized over the vesting period using the graded-vesting method. As our Chief Operating Officer provides services to both us and Oceania Cruises, Inc., our sister company, the related compensation costs are allocated on an agreed percentage. The allocated compensation expense was approximately $0.2 million for the three and six months ended June 30, 2012.

- Definition

The entire disclosure for commitments and contingencies.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 460

-SubTopic 10

-Section 50

-Paragraph 8

-URI http://asc.fasb.org/extlink&oid=6398077&loc=d3e12565-110249

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 450

-SubTopic 20

-Section 50

-Paragraph 4

-URI http://asc.fasb.org/extlink&oid=6952336&loc=d3e14435-108349

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name FASB Interpretation (FIN)

-Number 14

-Paragraph 3

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 440

-SubTopic 10

-Section 50

-Paragraph 2

-URI http://asc.fasb.org/extlink&oid=6394976&loc=d3e25287-109308

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 210

-SubTopic 10

-Section S99

-Paragraph 1

-Subparagraph (SX 210.5-02.25)

-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 20

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6449706&loc=d3e16207-108621

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 5

-Paragraph 9, 10, 11, 12

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Accumulated Other Comprehensive Loss

6 Months Ended

Jun. 30, 2012

Equity [Abstract]

Accumulated Other Comprehensive Loss

The following table summarizes activity within accumulated other comprehensive loss:




(in thousands)	2012		2011
Accumulated other comprehensive loss - January 1	$	—	$	(2,814	)
Quarterly change in derivative fair value			2,814
Accumulated other comprehensive loss - March 31	$	—	$	—
Quarterly change in derivative fair value	—		—
Accumulated other comprehensive loss - June 30	$	—	$	—

- Definition

The entire disclosure for comprehensive income, which includes, but is not limited to, 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 12

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e640-108580

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 11

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e637-108580

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 130

-Paragraph 14-26

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 505

-SubTopic 10

-Section S99

-Paragraph 1

-Subparagraph (SX 210.3-04)

-URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187085-122770

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Glossary Reclassification Adjustments

-URI http://asc.fasb.org/extlink&oid=6522872

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 14

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e681-108580

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 16

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e709-108580

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 1A

-URI http://asc.fasb.org/extlink&oid=20435746&loc=SL7669619-108580

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 15

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e689-108580

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 17

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e716-108580

+ Details

Subsequent Events	6 Months Ended
Subsequent Events	Jun. 30, 2012
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events On August 1, 2012, we held a meeting with potential investors to discuss the refinance of our existing credit facility with a new $340 million senior secured credit facility. The meeting was preliminary in nature, and at this time we have not committed to complete a refinancing, nor can we state the terms on which any such refinancing would be achieved.

Consolidating Financial Information

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidating Financial Information

Our Notes are collateralized by our vessels and guaranteed fully and unconditionally, jointly and severally by all our subsidiaries ( the "Guarantors," and each a "Guarantor"). These Guarantors are 100% owned subsidiaries of the Company.

The following condensed consolidating financial statements for Seven Seas Cruises S. DE R.L. and the Guarantors present condensed consolidating statements of income (loss) and comprehensive income (loss) for three and six months ended June 30, 2012 and 2011, condensed consolidating balance sheets as of June 30, 2012 and December 31, 2011 and condensed consolidating statements of cash flows for the six months ended June 30, 2012 and 2011, using the equity method of accounting, as well as elimination entries necessary to consolidate the parent company and all of its subsidiaries.

Seven Seas Cruises S. DE R.L. has charter hire agreements in place with certain subsidiaries, which own the vessels. These agreements require Seven Seas Cruises S. DE R.L. to pay a daily hire fee to the subsidiary to administratively manage the vessel. The costs incurred by the vessel owning subsidiaries include deck and engine crew payroll and expenses, vessel insurance, depreciation and interest related to the terms loans. In addition to the vessel owning subsidiaries, we have a sales and marketing office that is also a Guarantor.

Our vessel owning subsidiaries are parties to our first lien term loan as both borrowers and guarantors. The applicable outstanding debt related to the first lien term loan is included in the Guarantor accounts as well as the related interest expense and deferred financing costs. In 2011, Seven Seas Cruises S. DE R.L repaid the second lien term loan. As the loan was repaid by the parent company, each subsidiary remains responsible for its portion of the related debt to Seven Seas Cruises S. DE R.L. and such obligation was recorded as an intercompany payable at the subsidiary level and eliminated within the 2011 condensed consolidated balance sheet.

Each subsidiary guarantee will be automatically released upon any one or more of the following circumstances: the subsidiary is sold or sells all of its assets; the subsidiary is declared “unrestricted” for covenant purposes; the subsidiary’s guarantee of other indebtedness is terminated or released; the requirements for legal defeasance or covenant defeasance or to discharge the indenture have been satisfied; or the subsidiary transfers ownership of a mortgaged vessel in connection with a permitted reflagging transaction.



Condensed Consolidating Balance Sheets
	As of June 30, 2012
(in thousands)	Parent 'Issuer'			Subsidiaries Guarantors		Eliminations			Consolidated
Assets
Current assets
Cash and cash equivalents	$	104,586		$	2,103	$	—		$	106,689
Restricted cash	234			—		—			234
Trade and other receivable, net	9,843			132		—			9,975
Related party receivables	—			—		—			—
Inventories	4,082			1,931		—			6,013
Prepaid expenses	19,763			633		—			20,396
Intercompany receivable	155,211			35,706		(190,917		)	—
Other current assets	1,328			1,994		—			3,322
Total current assets	295,047			42,499		(190,917		)	146,629
Property and equipment, net	73,292			579,967		—			653,259
Goodwill	404,858			—		—			404,858
Intangible assets, net	84,838			—		—			84,838
Other long-term assets	27,817			2,182		—			29,999
Investment in subsidiaries	222,393			—		(222,393		)	—
Total assets	$	1,108,245		$	624,648	$	(413,310	)	$	1,319,583

Liabilities and Members' Equity
Current liabilities
Trade and other payables	$	1,155		$	666	$	—		$	1,821
Related party payables	1,474			—		—			1,474
Intercompany payables	35,706			155,211		(190,917		)	—
Accrued expenses	44,952			2,122		—			47,074
Passenger deposits	196,817			—		—			196,817
Derivative liabilities	2,405			—		—			2,405
Current portion of long-term debt	2,097			10,403		—			12,500
Total current liabilities	284,606			168,402		(190,917		)	262,091
Long-term debt	272,147			233,853		—			506,000
Other long-term liabilities	9,823			—		—			9,823
Total liabilities	566,576			402,255		(190,917		)	777,914
Commitments and Contingencies
Members' equity
Contributed capital	563,863			134,036		(134,036		)	563,863
Accumulated deficit	(22,194		)	88,357		(88,357		)	(22,194		)
Total members' equity	541,669			222,393		(222,393		)	541,669
Total liabilities and members' equity	$	1,108,245		$	624,648	$	(413,310	)	$	1,319,583



Condensed Consolidating Balance Sheets
	As of December 31, 2011
(in thousands)	Parent 'Issuer'			Subsidiaries Guarantors		Eliminations			Consolidated
Assets
Current assets
Cash and cash equivalents	$	67,771		$	849	$	—		$	68,620
Restricted cash	743			—		—			743
Trade and other receivable, net	8,242			77		—			8,319
Related party receivables	748			—		—			748
Inventories	3,284			1,848		—			5,132
Prepaid expenses	17,637			1,512		—			19,149
Intercompany receivable	176,672			30,849		(207,521		)	—
Other current assets	2,171			1,994		—			4,165
Total current assets	277,268			37,129		(207,521		)	106,876
Property and equipment, net	66,446			588,914		—			655,360
Goodwill	404,858			—		—			404,858
Intangible assets, net	86,120			—		—			86,120
Other long-term assets	27,416			3,160		—			30,576
Investment in subsidiaries	205,634			—		(205,634		)	—
Total assets	$	1,067,742		$	629,203	$	(413,155	)	$	1,283,790

Liabilities and Members' Equity
Current liabilities
Trade and other payables	$	5,250		$	502	$	—		$	5,752
Intercompany payables	30,849			176,672		(207,521		)	—
Accrued expenses	39,642			2,140		—			41,782
Passenger deposits	159,312			—		—			159,312
Derivative liabilities	112			—		—			112
Total current liabilities	235,165			179,314		(207,521		)	206,958
Long-term debt	274,245			244,255		—			518,500
Other long-term liabilities	13,694			—		—			13,694
Total liabilities	523,104			423,569		(207,521		)	739,152
Commitments and Contingencies
Members' equity
Contributed capital	563,365			129,702		(129,702		)	563,365
Accumulated deficit	(18,727		)	75,932		(75,932		)	(18,727		)
Total members' equity	544,638			205,634		(205,634		)	544,638
Total liabilities and members' equity	$	1,067,742		$	629,203	$	(413,155	)	$	1,283,790



Condensed Consolidating Statements of Income (Loss) and Comprehensive Income (Loss)
	Three Months Ended June 30, 2012
(in thousands)	Parent 'Issuer'			Subsidiaries Guarantors			Eliminations			Consolidated
Revenue
Passenger ticket	$	119,548		$	—		$	—		$	119,548
Onboard and other	11,926			6			—			11,932
Related Party Revenue	—			26,302			(26,302		)	—
Total revenue	131,474			26,308			(26,302		)	131,480
Cruise operating expense
Commissions, transportation and other	46,492			1,407			(1,431		)	46,468
Onboard and other	3,153			—			—			3,153
Payroll, related and food	16,171			3,074			—			19,245
Fuel	10,435			—			—			10,435
Other ship operating	7,505			3,535			—			11,040
Other	27,989			1,106			(23,251		)	5,844
Total cruise operating expense	111,745			9,122			(24,682		)	96,185
Selling and administrative	16,562			1,912			(1,620		)	16,854
Depreciation and amortization	3,576			6,292			—			9,868
Total operating expense	131,883			17,326			(26,302		)	122,907
Operating income (loss)	(409		)	8,982			—			8,573
Non-operating income (expense)
Interest expense	(6,113		)	(1,869		)	—			(7,982		)
Interest income	121			1			—			122
Other income (expense)	(4,474		)	(53		)	—			(4,527		)
Equity in earnings of subsidiaries	7,046			—			(7,046		)	—
Total non-operating income (expense)	(3,420		)	(1,921		)	(7,046		)	(12,387		)
Income (expense) before income taxes	(3,829		)	7,061			(7,046		)	(3,814		)
Income tax benefit (expense), net	4			(15		)	—			(11		)
Net income (loss)	(3,825		)	7,046			(7,046		)	(3,825		)
Comprehensive income (loss)	$	(3,825	)	$	7,046		$	(7,046	)	$	(3,825	)



Condensed Consolidating Statements of Income (Loss) and Comprehensive Income (Loss)
	Three Months Ended June 30, 2011
(in thousands)	Parent 'Issuer'			Subsidiaries Guarantors			Eliminations			Consolidated
Revenue
Passenger ticket	$	110,185		$	—		$	—		$	110,185
Onboard and other	12,661			3			—			12,664
Related Party Revenue	—			24,888			(24,888		)	—
Total revenue	122,846			24,891			(24,888		)	122,849
Cruise operating expense
Commissions, transportation and other	38,720			1,178			(1,180		)	38,718
Onboard and other	3,608			—			—			3,608
Payroll, related and food	14,789			2,910			—			17,699
Fuel	10,263			—			—			10,263
Other ship operating	7,433			2,387			—			9,820
Other	26,495			1,146			(22,358		)	5,283
Total cruise operating expense	101,308			7,621			(23,538		)	85,391
Selling and administrative	16,493			1,831			(1,350		)	16,974
Depreciation and amortization	5,551			3,673			—			9,224
Total operating expense	123,352			13,125			(24,888		)	111,589
Operating income (loss)	(506		)	11,766			—			11,260
Non-operating income (expense)
Interest expense	(3,777		)	(3,617		)	—			(7,394		)
Interest income	49			1			—			50
Other income (expense)	(7,026		)	—			—			(7,026		)
Equity in earnings of subsidiaries	8,254			—			(8,254		)	—
Total non-operating income (expense)	(2,500		)	(3,616		)	(8,254		)	(14,370		)
Income (loss) before income taxes	(3,006		)	8,150			(8,254		)	(3,110		)
Income tax benefit (expense), net	4			104			—			108
Net income (loss)	(3,002		)	8,254			(8,254		)	(3,002		)
Comprehensive income (loss)	$	(3,002	)	$	8,254		$	(8,254	)	$	(3,002	)



Condensed Consolidating Statements of Income (Loss) and Comprehensive Income (Loss)
	Six Months Ended June 30, 2012
(in thousands)	Parent 'Issuer'		Subsidiaries Guarantors		Eliminations		Consolidated
Revenue
Passenger ticket	$	228,120	$	—	$	—	$	228,120
Onboard and other	23,214		6		—		23,220
Related Party Revenue	—		53,103		(53,103

Regent Seven Seas Cruises - XBRL