Orient-Express Hotels Reports Fourth Quarter 2011 Results
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Orient-Express Hotels Reports Fourth Quarter 2011 Results
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Category: Worldwide - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2012-02-28
Highlights
Fourth quarter total revenue, excluding real estate, up 10% to $135.9 million
Fourth quarter revenue from owned hotels up 9% to $107.6 million
Same store revenue per available room ("RevPAR") for the quarter up 11% in US dollars, up 15% in local currency
Adjusted EBITDA before real estate for the fourth quarter up 31% to $21.2 million
Fourth quarter adjusted net loss from continuing operations $9.1 million ($0.09 per common share) compared to a loss of $15.3 million ($0.16 per common share) in the fourth quarter of 2010
Sold excess development rights in New York, recording a gain of $16.0 million, and repaid associated debt of $4.5 million
Completed the sale of Keswick Hall, Virginia, in January 2012 for $22.0 million and repaid associated debt of $10.0 million
Orient-Express Hotels Ltd. (NYSE: OEH, http://www.orient-express.com), owners or part-owners and managers of 49 luxury hotel, restaurant, tourist train and river cruise properties operating in 24 countries, today announced its results for the fourth quarter ended December 31, 2011.
"The fourth quarter provided a solid close to a year of good financial and operating progress for Orient-Express. In 2011, many of our properties achieved their all time best annual results," said Bob Lovejoy, Chairman and Interim Chief Executive Officer. "In the fourth quarter we continued to grow our top line, with total revenue before real estate increasing 10% compared to the fourth quarter of 2010. The fourth quarter also marked the eighth straight quarter of growth in revenue and adjusted EBITDA (both excluding real estate), which increased by 10% and 31%, respectively, over the same quarter of the previous year.
"During the course of 2011, we continued to strengthen our balance sheet and were pleased to achieve by the end of the year our interim goal of a net debt to adjusted EBITDA (excluding real estate) ratio of less than 5 times. Since the end of the quarter, this strengthening has continued through our program of selected disposal of non-core properties. In January 2012, we completed the sale of Keswick Hall, Virginia, for $22.0 million and we repaid $10.0 million of associated debt.
"As we look ahead to 2012, we are encouraged by our booking patterns, which indicate continued healthy demand in the luxury travel sector. Total revenue from owned hotels achieved and on the books for 2012 is currently about 8% above the comparable total at the same time last year."
Fourth Quarter 2011 Earnings Summary
Revenue, excluding real estate, was $135.9 million in the fourth quarter of 2011, up $12.2 million or 10% from the fourth quarter of 2010.
Revenue from owned hotels for the fourth quarter was $107.6 million, up $8.5 million or 9% from the fourth quarter of 2010. On a same store basis, owned hotels RevPAR was up 11% in US dollars and up 15% in local currency.
Trains & cruises revenue in the fourth quarter was $20.6 million compared to $17.7 million in the fourth quarter of 2010, an increase of 16%.
Adjusted EBITDA before real estate was $21.2 million for the fourth quarter, up 31% compared to $16.1 million in the prior year. The principal increases were at Charleston Place, South Carolina (up $1.4 million compared to the same period in the prior year), Copacabana Palace Hotel, Rio de Janeiro (up $1.2 million) and share of earnings from Peru hotels (up $1.3 million). Other notable improvements included La Residencia, Mallorca (up $0.7 million), share of earnings from PeruRail (up $0.8 million), Reid's Palace, Madeira (up $0.6 million), Hotel das Cataratas, Iguassu (up $0.6 million), and the Road to Mandalay cruise ship, Irrawaddy River, Myanmar (Burma) (up $0.6 million).
Adjusted net loss from continuing operations for the fourth quarter was $9.1 million ($0.09 per common share), compared with a loss of $15.3 million ($0.16 per common share) in the fourth quarter of 2010. Net loss attributable to Orient-Express Hotels Ltd, after tax-effected impairments of $18.6 million ($0.18 per common share), for the fourth quarter was $28.1 million ($0.27 per common share), compared with a net loss of $26.5 million ($0.27 per common share) in the fourth quarter of 2010.
Company Highlights
In December 2011, following the assignment of purchase and development agreements in April 2011 relating to the proposed New York hotel project, the Company completed the sale of excess development rights of '21' Club to the new developer, recording a gain of $16.0 million. From the gross proceeds, associated debt of the '21' Club of $4.5 million was repaid.
On January 23, 2012, the Company concluded the sale of Keswick Hall, including the adjoining golf course and development land, for gross proceeds of $22.0 million and repaid associated debt of $10.0 million. Additionally, the Company signed a definitive agreement during the fourth quarter of 2011 for the sale of Bora Bora Lagoon Resort for $3.0 million. This transaction is expected to complete during 2012.
During the quarter, the Company completed the refurbishment of 26 rooms and suites on the fifth floor of the main building of the Copacabana Palace Hotel, as well as its Cipriani restaurant. The renovated restaurant now includes a chef's table inside the kitchen, providing an intimate dining experience for six guests. Starting in June 2012, during the hotel's traditional low season, a further 121 rooms and suites in the hotel's main building will be renovated and the lobby area enlarged well in advance of the 2014 football World Cup and 2016 Olympic Games to be held in Brazil.
Also during the quarter, 46 keys at La Samanna, St. Martin, were completely refurbished and reopened in advance of the Caribbean high season. The Company plans to refurbish the main public areas of La Samanna in the third quarter of 2012. Additionally, work began in November to upgrade the historic wing of The Inn at Perry Cabin, Maryland, with 39 rooms scheduled for refurbishment by the end of the first quarter of 2012.
The Company has made two recent executive appointments: Ali Kasikci has been appointed Regional Managing Director for North America, Mexico and the Caribbean and will oversee six properties in the current portfolio and the renovation and reopening of El Encanto, Santa Barbara, California, and Richard M. Levine, Chief Legal Officer, will lead international legal and regulatory matters. Ali was previously General Manager of the Montage Beverley Hills and the Peninsula Beverley Hills. Richard joins the Company from Kerzner International Holdings Limited where he was Executive Vice President, General Counsel, working with the One&Only and Atlantis brands.
Operating Performance
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