Hamilton/Bermuda. Hotel earnings both in Europe and North America showed substantial improvement over the prior year`s third quarter. Orient-Express Hotels Ltd., owners of 49 deluxe hotel, restaurant, tourist train and river cruise properties in 25 countries, published its results for the third quarter and nine months ended September 30, 2005.
For the quarter net earnings were USD 19.5 million on revenue of USD132.4 million, an increase of 70% over net earnings of USD 11.5 million in the year earlier period. Earnings per common share were up 47% and revenue was up 29% over the third quarter of 2004.
Net earnings for the nine months were USD 36.4 million on revenue of USD 345.2 million, an increase of 84% over net earnings of USD 19.8 million in the year earlier period. Earnings per common share were up 66% and revenue was up 26% over the first nine months of 2004.
James B. Sherwood, Chairman, said that hotel earnings both in Europe and North America had shown substantial improvement over the prior year`s third quarter. Indeed, all other regions also reported improved hotel results, although less pronounced than for Europe and North America. Tourist trains, restaurants and management fees all registered gains as well.
Last year`s hurricane season in the Gulf of Mexico had impacted Windsor Court Hotel in New Orleans and the Maroma Resort & Spa on the Riviera Maya in Mexico. The Windsor Court has now reopened, Maroma was closed for construction works when hurricane Wilma hit so no guest nights were lost. Orient-Express was fully covered by property damage and business interruption insurance for the consequences of the hurricanes, subject to a deductible of USD 500,000 per event. The Windsor Court had 50 rooms damaged as a result of glass breakage and related water damage and Maroma had 15 of its 65 rooms damaged. Maroma is expected to reopen in January 2006.
The impact of the hurricanes on the third quarter earnings was 2 cents per common share. The fourth quarter earnings impact is estimated to be about 5 to 6 cents per share. By November 2005, the company`s outlook for 2006 was very positive with same store bookings up 16% over the prior year," Sherwood said.
The President also said that the average daily room rate of owned hotels in U.S. dollars increased 3% to USD 427 from USD 414 in the third quarter of 2004. Same store RevPAR in U.S. dollars was up 11% to USD 284 compared with the year earlier period. EBITDA margin for the quarter was up 5% to 30%.
He reviewed performance by region as follows:
Europe . EBITDA of owned hotels was USD 26.9 million compared with USD 19.6 million in the year earlier period. The Grand Hotel Europe in St. Petersburg acquired last February was the largest contributor, with the newly opened Hotel Caruso Belvedere in Ravello, Italy adding USD 0.5 million. Only the Lapa Palace in Lisbon underperformed relative to the 2004 period.
North America . EBITDA for the quarter of owned hotels was USD 3.6 million compared with USD 0.4 million in the year earlier period. Keswick Hall in Charlottesville, Virginia reported the largest gain, followed by El Encanto in Santa Barbara, California and the Windsor Court in New Orleans. Only Maroma underperformed relative to the prior year as a result of it being closed for construction works.
Southern Africa . EBITDA of owned hotels was USD 1.3 million compared with USD 0.6 million in the prior year period. Much of the increase was due to improved results from Orient-Express Safaris in Botswana.
South America . EBITDA of owned hotels was USD 1.4 million, a modest increase on USD 1.3 million in the prior year period.
South Pacific . EBITDA of owned hotels was USD 1.5 million compared with USD 1.1 million in the prior year period. Both Lilianfels in Katoomba, Australia and the Bora Bora Lagoon Resort registered gains.
Hotel management and part-ownership . EBITDA was USD 3.9 million compared with USD 2.9 million in the prior year period. Charleston Place in Charleston, South Carolina and the Monasterio Hotel and Machu Picchu Sanctuary Lodge in Peru all registered significant gains.
Restaurants . EBITDA loss was USD 0.2 million compared with a loss of USD 0.4 million in the prior year period. The loss largely arises from the summer closing of `21` Club in New York City, a recurring seasonal event.
Tourist trains and river cruises . EBITDA for the quarter was USD 6 million compared with USD 4.6 million in the prior year period. Peruvian railway operations were the largest component of this improvement. Although a landslide closed the Cuzco-Machu Picchu line for a few days, it was possible to operate trains to the landslide area from both ends of the line and the passengers crossed the landslide area on foot.
Financial costs were up USD 3.1 million to USD 7.8 million, primarily due to the Grand Hotel Europe, St. Petersburg, El Encanto in Santa Barbara and Hotel Caruso Belvedere in Ravello acquisitions and taxes were USD 1.1 million higher. Depreciation was USD 1.4 million higher due to the larger asset base.
Simon Sherwood said "Our property development projects in Saint Martin continue to progress well and we recently received a casino permit on the Dutch side of our property as part of the second phase of our Cupecoy Village development. We have not yet finalized our plans for this parcel of land which is at the Dutch/French border, an attractive location because casinos are not permitted on the French side of the island."./ red