This summary is based on the fourth quarter fiscal 2007 earnings call conducted by Orient-Express Hotels Ltd. (OEH) on February 26, 2008.
Management:
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President and Chief Executive Officer: Paul White
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Vice President Corporate Communications: Pippa Isbell
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Vice President, General Counsel and Secretary: Edwin S. Hetherington
Key Investor Issues:
- Revenues were $151.2 million, up 12% from a year ago.
- The firm recorded a loss of $4.9 million or 12 cents a share, from a profit of $6.7 million or 16 cents a year ago.
- Orient Express completed the acquisition of land to develop a new ''21'' hotel in New York and completed the takeover of Hotel das Cataratas, Iguacu Falls, Brazil.
Full Year Highlights:
- Net earnings were $33.6 million or 79 cents per share, down 15.6% from $39.8 million or 98 cents per share in 2006.
- Revenue increased 21% from $497.1 million in 2006 to $599.6 million in 2007.
- The firm accelerated acquisitions of The Royal Scotsman and Afloat in France businesses in Europe and acquired land to build a hotel in Buzios, Brazil.
Fourth Quarter Highlights:
Total revenues were $151.2 million up 12% over prior year due to growth in worldwide store revenues.
- The firm had a loss of $4.9 million or 12 cents per share down from positive net earnings of $6.7 million or 16 cents per share as the bottom line was negatively impacted by the unforeseen conflict in Burma resulting in EBITDA $1.9 million lower.
- Worldwide same-store RevPAR rose 10% in local currency, 14% in US dollars.
- Adjusted net earnings from continuing operations which exclude certain items, including an impairment charge related to a strategic review of Bora Bora Lagoon Resort, were $10.4 million or 25 cents per common share.
The firm completed the acquisition of land to develop the new 21 Hotel in New York and completed the takeover of Hotel das Cataratas at Iguacu Falls in Brazil.
- This decision is supported by the results of the quarter with total hotels'' revenue up 19%, 9 percentage points above same store RevPAR, which was up 10%.
- The St. Petersburg, Russia investment has yielded in excess of $20 million of EBITDA this year, and more than doubled Russian visitors.
- The firm had cash of $94.4 million which compares with $79.3 million at the same time in 2006.
- In addition, the firm had cash availability of $72.4 million comprising undrawn revolving credit facilities in Europe, US, and UK.
- The firm also has undrawn construction finance of $60 million in relation to Cupecoy bringing total cash availability to $226.8 million.
Long-term debt was $669 million or net of cash $636 million, resulting in a debt to EBITDA ratio of 4.5, down from 4.8 from 2006.
- Cash from operations was $50.2 million, $13.6 million ahead of the same period in 2006, primarily performance-linked.
- Capital expenditure for the year inclusive of maintenance capital expenditure was $103.9 million and this included $12 million for the refurbishment of the Grand Hotel Europe, $11.9 million for works on the Italian properties and $10 million relating to works on Allen Campton.
- The firm repaid $147 million worth of term debt and drew a $177 million of new term debt.
- Dividends of $4 million were paid resulting in net cash flow of $15.4 million.
Business Highlights:
- The firm continues to show strong progress in its existing pipeline of new properties, including those in Santa Barbara, California; New York; Brazil; Bali; and Peru, with properties progressing well within their schedules.
- The most imminent opening is of Las Casitas del Colca, the luxury 20-room lodge in Peru''s Colca Canyon, which is scheduled to open on time in April 2008.
- In Brazil, the company is reviewing some exciting contemporary designs for its planned boutique hotel and villa development in Buzios.
- Work is scheduled to begin shortly on the renovation of the first 100 rooms at Hotel das Cataratas at Iguacu Falls, of which the company took over management in October 2007.
The company opened the purpose built spas at The Inn at Perry Cabin in St Michaels, Maryland and at the Copacabana Palace in Rio de Janeiro, Brazil.
- It also made significant investments in existing room stock and property enhancement last year and this will continue into the first quarter of 2008.
- These investments include the opening of eight new suites at La Residencia, Majorca; the establishment of the Windsor Court Club Floors comprising 59 rooms and suites over four floors at the hotel in New Orleans.
- Real Estate developments in St. Martin continue to move ahead on plan, with one of the seven villas being built at La Samanna scheduled to be ready for occupation in the third quarter.
