| HAMILTON, Bermuda, Aug. 8, 2002 - Orient-Express
Hotels Ltd., luxury hotel, restaurant, tourist train and river cruise ship
operator (NYSE: OEH) today announced its results for the second quarter
and six months ended June 30, 2002. Net earnings were ($0.47
per common share) in the second quarter of 2001. Revenue was up 3%
to $79.1 million compared with $76.7 million in the year earlier period.
For the six months ended June 30, 2002 net income was $12.0 million
($0.39 per common share) on revenue of $132.8 million, compared with net
income of $19.3 million ($0.62 per common share) on revenue of $134.6 million
in the year earlier period.
Mr. James B. Sherwood, Chairman, said that the second quarter had performed
to expectation. Lower earnings year on year were due to the lingering
effects of September 11th and the conscious decision of the company to
close the Inn at Perry Cabin for construction which is doubling the number
of keys, and delayed openings at the Villa San Michele for major rooms
addition and at the Hotel Cipriani, also because of major works at the
property.
He indicated that same store RevPAR in the second quarter was down 8%
from the year earlier period, indicating continuing recovery from September
11th. Same store RevPAR was down 17% in the fourth quarter of 2001
and 12% in the first quarter of 2002. He said that second quarter
earnings were in line with "street consensus".
Mr. Sherwood indicated that travel patterns had remained unchanged from
previous observations, meaning that Americans and Japanese seem to be less
on the move to overseas destinations, with arrivals of Americans in Europe
down about 20% from the same period of 2001. Travel by Europeans
within Europe is strong, as is travel by Americans within the U.S.
Business travel in the U.S. also seems weaker as many of the IT and
telecoms companies reduce spending. Orient-Express Hotels differs
from many of its competitors in that 65% of its guests are leisure as distinct
from business travellers.
Mr. Sherwood said that negotiations were progressing satisfactorily
with respect to acquisition of additional properties in the U.S., Europe
and Asia but it is unlikely that any will be concluded until later in the
year so there would be no earnings implications for 2002.
Mr. Sherwood advised that effective July 22, 2002 a subsidiary of Orient-Express
Hotels had acquired 18,044,478 Class B shares in Orient-Express Hotels
from Sea Containers Ltd. under an agreement that had been put in place
before the initial public offering of Orient-Express Hotels in August 2000.
These shares may be voted by the subsidiary but are not counted for purposes
of earnings per share calculations in accordance with U.S. generally accepted
accounting practices, while the subsidiary owns them.
The significance of this transaction is twofold. First, voting
control of Orient-Express Hotels is no longer in the hands of Sea Containers
Ltd., and second, in a takeover situation, the board of Orient-Express
Hotels' subsidiary holding the Class B shares would be able to assure the
highest price was achieved for all shareholders.
Mr. Simon M.C. Sherwood, President, summarized the second quarter results
as follows:
Owned European hotels. EBITDA was $11.4 million compared
with $11.8 million in the second quarter of 2001. Weakness in Italian
hotels caused by closures and less arrivals from the U.S. was offset by
earnings from Le Manoir and La Residencia, both acquired early in 2002.
Owned North American hotels. EBITDA was $3.6 million compared
with $4.8 million in the prior year period. La Samanna was particularly
hard hit by September 11th and closure of the Inn at Perry Cabin was also
a factor.
Owned Southern Africa hotels. EBITDA was $0.2 million,
up from a loss of $0.1 million in the prior year period. Southern
Africa is showing strong growth and the South African Rand has strengthened
although it is still lower in value than in 2001.
Owned South American hotels. EBITDA was $1.2 million, down
from $1.6 million in the prior year period due to continued weakness in
the Brazilian Real and less business travel to South America, reflecting
economic concerns in the region.
Owned South Pacific hotels. EBITDA was $0.4 million compared
with $0.8 million. These long haul destinations have been badly hit
by September 11th.
Management and part ownership interests. EBITDA was $3.6
million compared with $3.3 million in the year earlier period, reflecting
solid performance from Charleston Place and improved results at Peruvian
hotels.
Restaurants. EBITDA was $1.4 million, unchanged from the
year earlier period.
Tourist trains and river cruise ship. EBITDA was $3.7 million
compared with $3.5 million in the year earlier period. European tourist
trains were ahead of the year earlier period.
Simon Sherwood indicated that same store RevPAR in the second quarter
was $169 compared with $184 in the second quarter of 2001. Rooms
sold were 117,000, the same as in the year earlier period and ADR was $291
compared with $300.
He indicated that work is proceeding on both the La Cabana restaurant
in Buenos Aires and the Hotel Caruso in Ravello, Italy with a view to opening
both properties in 2003. Tourism to Argentina is rising rapidly in
the wake of the devalued peso. The Amalfi coast is still experiencing
a shortage of five star hotel accommodation.
He said that booking patterns remain unpredictable due to stock market
and recession jitters, with last minute bookings becoming the norm rather
than the exception. Nonetheless, the company's properties seem to
fill. He said that the company had just acquired six beautiful "Shasta"
cars for a new day trip tourist train operation in the U.S. The train
will be based in New York City and will be operated in much the same way
as the British Pullman train is operated out of London.
He stressed that the company has a very well balanced portfolio of 41
properties in 16 countries and is not over-dependent on any one market.
He said that the company's strategy of investing in hotels capable of expansion
is paying dividends and that much of the company's future investment would
be directed to this.
He concluded by repeating management's earlier forecast that same store
RevPAR is expected to be higher in the third and fourth quarters compared
with 2001 and net earnings for the year are expected to exceed those of
2001 when the company had net income of $30 million ($0.97 per common share).
ORIENT-EXPRESS HOTELS LTD
Six Months ended June 30, 2002
SUMMARY OF OPERATING RESULTS
Six months ended
June 30
$'000
2002 2001
Revenue
Owned hotels
- Europe
41,403 36,788
- North America
30,766 35,649
- Rest of World
26,400 27,257
Hotel management & part ownership
interests 6,044
5,842
Restaurants
9,549 9,749
Trains & Cruises
18,602 19,323
Total revenue
132,764 134,608
Operating Profits
Owned hotels
- Europe
10,875 11,638
- North America
9,056 12,061
- Rest of World
6,377 8,437
Hotel management & part ownership
interests 6,044
5,842
Restaurants
2,316 2,399
Trains & Cruises
2,956 3,631
Central overheads
(5,138) (4,554)
EBITDA
32,486 39,454
Depreciation & Amortization
(9,250) (8,024)
Interest
(9,367) (9,745)
Earnings before Tax
13,869 21,685
Tax
(1,865) (2,378)
Net earnings on common shares
12,004 19,307
Earnings per common share
0.39 0.62
Number of shares - millions
30.80 30.90
ORIENT-EXPRESS HOTELS LTD
Six Months Ended June 30, 2002
SUMMARY OF OPERATING INFORMATION FOR OWNED HOTELS
Six months ended
June 30
2002 2001 Average Daily Rate (in dollars)
Europe
323 318
North
America 338 346
Rest
of World 178 199
Worldwide
270 282
Rooms Sold (thousands)
Europe
75 74
North
America 60
67
Rest
of World 88
83
Worldwide
223 224
RevPar (in dollars)
Europe
211 227
North
America 235 259
Rest
of World 93 112
Worldwide
163 185
Same Store RevPAR
Change %
(in dollars)
Dollars Local
Currency
Europe
201 219 -8%
-8%
North
America 238 264
-10% -10%
Rest
of World 89 103
-13% -6%
Worldwide
161 179 -10%
-8%
ORIENT-EXPRESS HOTELS LTD
Three Months ended June 30, 2002
SUMMARY OF OPERATING RESULTS
Three months ended
June 30
$'000
2002 2001
Revenue
Owned hotels
- Europe
31,122 27,691
- North America
14,209 16,281
- Rest of World
11,856 11,731
Hotel management & part ownership
interests 3,595
3,330
Restaurants
4,963 4,993
Trains & Cruises
13,349 12,671
Total revenue
79,094 76,697
Operating Profits
Owned hotels
- Europe
11,368 11,785
- North America
3,578 4,754
- Rest of World
1,772 2,328
Hotel management & part ownership
interests 3,595
3,330
Restaurants
1,365 1,419
Trains & Cruises
3,687 3,485
Central overheads
(2,559) (2,253)
EBITDA
22,806 24,848
Depreciation & Amortization
(4,905) (4,095)
Interest
(4,544) (4,634)
Earnings before Tax
13,357 16,119
Tax
(1,793) (1,704)
Net earnings on common shares
11,564 14,415
Earnings per common share
0.38 0.47
Number of shares - millions
30.80 30.90
ORIENT-EXPRESS HOTELS LTD
Three Months Ended June 30, 2002
SUMMARY OF OPERATING INFORMATION FOR OWNED HOTELS
Three months ended
June 30
2002 2001 Average Daily Rate (in dollars)
Europe
380 380
North
America 295 314
Rest
of World 174 184
Worldwide
291 300
Rooms Sold (thousands)
Europe
49 48
North
America 30
32
Rest
of World 38
37
Worldwide
117 117
RevPar (in dollars)
Europe
268 294
North
America 195 223
Rest
of World 80
93
Worldwide
172 195
Same Store RevPAR
Change %
(in dollars)
Dollar Local
Currency
Europe
266 286 -7%
-8%
North
America 198 221
-10% -10%
Rest
of World 69
74 -7% -4%
Worldwide
169 184 -8%
-8%
ORIENT-EXPESS HOTELS LTD
CONSOLIDATED AND CONDENSED BALANCE SHEETS
$'000
June 30 December 31
2002 2001
Assets
Cash
43,941 57,863
Accounts receivable
58,685 45,420
Inventories
19,961 17,463
Total current assets
122,587 120,746
Real estate and other fixed assets,
net book value
704,658 602,763
Investments
77,748 79,430
Intangible assets
29,529 29,529
Other assets
2,991 3,783
937,513 836,251
Liabilities and Shareholders' Equity
Working capital facilities
21,818 7,038
Accounts payable
17,678 19,526
Accrued liabilities
39,127 38,594
Deferred revenue
16,156 10,513
Current portion of long-term debt
and capital leases
56,328 55,695
Total current liabilities
151,107 131,366
Long-term debt and obligations
under capital leases
368,599 307,176
Deferred income taxes
5,301 3,875
Minority interest
3,753 1,247
Shareholders' equity
408,753 392,587
937,513 836,251
|
This news release contains, in addition to historical information, forward-looking
statements that involve risks and uncertainties. These include statements
regarding earnings growth, investment plans and similar matters that are
not historical facts. |
