Orient Express posts Q3 profit; to reply to Tatas in due course
New York: Swinging back into profit for the third-quarter with net earnings of about USD 18 million, luxury hotel chain operator Orient Express on Friday said it is consulting financial and legal advisors on the Tata group's takeover bid and will reply to the offer in due course of time.
Bermuda-based Orient Express Hotels, which is listed in the US and operates luxury hotels and trains across the world, had suffered a net loss of about USD 50 million in the third quarter last year, but swung back into profit in the quarter ended September 30, 2012.
The company, which is facing a USD 1.86 billion takeover bid from Indian business conglomerate Tata group's Indian Hotels, said it witnessed strong growth in North America and Asia-Pacific regions, while Europe also recorded a resilient performance despite poor macro-economic conditions.
However, the company's total revenue fell by about nine percent to USD 162.5 million in the last quarter.
Commenting on Tata group's offer, the company said: "The Board of Directors of Orient-Express Hotels Ltd is evaluating the proposal in consultation with its financial and legal advisors and will respond in due course in accordance with the best interests of the Company and its shareholders".
The company said it received a letter on October 18 from Indian Hotels and certain other members of the Tata group of companies, in which those parties and a fund controlled by Montezemolo & Partners made an unsolicited proposal to acquire all outstanding shares of Orient-Express Hotels Ltd.
"We continue to make good progress on our programme of reinvestment in core properties with important investments underway or completed..." Orient Express Director and Interim CEO Philip Mengel said in a statement, announcing the results.
"We are seeing the benefits of our investments in the financial performance of many properties... Looking forward, we expect to realise the benefits of this year's renovation projects starting in the current quarter.
"Early indications for 2013 bookings across the collection are positive, with bookings for total owned hotels 11 percent ahead of where they were at the same time last year," he said.
The company said it is pursuing plans to maximise opportunities from emerging markets and has retained the services of two leading sales representation companies for promoting its services in the Chinese market.
These firms will represent Orient-Express from offices in Singapore, Hong Kong, Taipei, Beijing, Shanghai and Guangzhou.
Besides, Orient Express also plans to launch a new river cruise in Myanmar in July 2013, wherein its ship will operate between Yangon and Bhamo, while passing through mountain ranges towards western Myanmar as far north as Homalin, 30 miles from the Indian border.
Orient Express is present in most of the countries across the world, barring India.