Orient-Express Hotels Ltd. Q1 2012 Update
Explanatory Statements This presentation and any related oral remarks by management contain, in addition to historical information, forward-looking statements that involve risks and uncertainties. These include statements regarding earnings outlook, investment plans, debt reduction and debt refinancings, asset sales and similar matters that are not historical facts. These statements are based on management's current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Factors that may cause a difference include, but are not limited to, those mentioned in the presentation and oral remarks, unknown effects on the travel and leisure markets of terrorist activity and any police or military response, varying customer demand and competitive considerations, failure to realize hotel bookings and reservations and planned property development sales as actual revenue, inability to sustain price increases or to reduce costs, rising fuel costs adversely impacting customer travel and the company's operating costs, fluctuations in interest rates and currency values, uncertainty of negotiating and completing proposed asset sales, debt refinancings, capital expenditures and acquisitions, inability to reduce funded debt as planned or to agree bank loan agreement waivers or amendments, adequate sources of capital and acceptability of finance terms, possible loss or amendment of planning permits and delays in construction schedules for expansion or development projects, delays in reopening properties closed for repair or refurbishment and possible cost overruns, shifting patterns of tourism and business travel and seasonality of demand, adverse local weather conditions, changing global or regional economic conditions and weakness in financial markets which may adversely affect demand, legislative, regulatory and political developments, and possible new challenges to the company's corporate governance structure. Further information regarding these and other factors is included in the filings by the company with the U.S. Securities and Exchange Commission. Management evaluates the operating performance of the company's segments on the basis of segment net earnings before interest, foreign exchange, tax (including tax on unconsolidated companies), depreciation and amortization (segment EBITDA), and believes that segment EBITDA is a useful measure of operating performance, for example to help determine the ability to incur capital expenditure or service indebtedness, because it is not affected by non-operating factors such as leverage and the historic cost of assets. EBITDA is also a financial performance measure commonly used in the hotel and leisure industry, although the company's segment EBITDA may not be comparable in all instances to that disclosed by other companies. Segment EBITDA does not represent net cash provided by operating, investing and financing activities under U.S. generally accepted accounting principles (U.S. GAAP), is not necessarily indicative of cash available to fund all cash flow needs, and should not be considered as an alternative to earnings from operations or net earnings under U.S. GAAP for purposes of evaluating operating performance. Adjusted EBITDA and adjusted net earnings / (loss) of the company are non-GAAP financial measures and do not have any standardized meanings prescribed by US GAAP. They are, therefore, unlikely to be comparable to similar measures presented by other companies, which may be calculated differently, and should not be considered as an alternative to net earnings, cash flow from operating activities or any other measure of performance prescribed by US GAAP. Management considers adjusted EBITDA and adjusted net earnings / (loss) to be meaningful indicators of operations and uses them as measures to assess operating performance because, when comparing current period performance with prior periods and with budgets, management does so after having adjusted for non-recurring items, foreign exchange (a non-cash item), dispositions of assets or investments, and certain other items (some of which may be recurring) which management does not consider indicative of ongoing operations or which could otherwise have a material effect on the comparability of the company’s operations. Adjusted EBITDA and adjusted net earnings / (loss) are also used by investors, analysts and lenders as measures of financial performance because, as adjusted in the foregoing manner, the measures provide a consistent basis on which the performance of the company can be assessed. Net debt is defined as working capital facilities, short and long-term debt (including obligations under capital leases), offset by cash and cash equivalents, including restricted cash. 2
Business Overview Copacabana Palace, Rio de Janeiro, Brazil 3
Business Overview Orient-Express Hotels Ltd. Hotels and Restaurants Trains and Cruises 32 hotels 1 ; three safari camps; one restaurant Six trains; two cruise operations Two additional hotels 2 opening in next twelve months Operations on three continents Operations on six continents Properties Include Operations Include ‘21’ Club; Charleston Place Hotel; Copacabana Palace; El Afloat in France; Eastern & Oriental Express; Road to Mandalay; The Royal Scotsman; Encanto; Grand Hotel Europe; Grand Hotel Timeo; Hotel Cipriani; Venice Simplon-Orient-Express Hotel Splendido; La Samanna; Maroma Resort and Spa 1 Hotel count excludes Bora Bora Lagoon Resort, which is currently under contract for sale. 4 2 Palacio Nazarenas and El Encanto are opening in the next twelve months.
5 Property Map
Geographic Mix 100%-Owned Hotel Keys December 31, 2011 1 Q1 2012 Guest Origin 1 2 Africa Africa / Middle Asia-Pacific East 10% 12% 4% South America Europe 9% Russia 33% France 4% 4% Asia-Pacific Sw itzerland 2% Germany 14% 5% Spain 2% Europe 36% Rest of Europe UK / Ireland 7% 11% South America North America North America 17% 42% 24% 100%-Owned Hotel Keys 1 JV Hotel Keys 3 Europe 964 167 North America 703 - South America 514 200 Asia-Pacific 411 - Africa 365 - Total 2,957 367 Total hotel keys 3,324 1 Excludes Keswick Hall, which was sold in January 2012. 6 2 Calculated using Q1 2012 room nights sold at owned and JV hotels. 3 Includes Las Casitas del Colca (20 keys), which was sold in April 2012.
Mission Statement To be recognized as the top luxury hotel company and sophisticated adventure travel operator Delivering memorable experiences that are the ultimate expression of the destination’s authentic culture Through the individual character and creativity of our team 7
Strengths • Legendary brand known for excellence, sophistication and personality • Owner and operator of iconic, irreplaceable assets • Affluent, leisure-oriented customer base; over 500,000 persons in our new customer relationship management database • Deep team of seasoned operating professionals • Substantially-improved capital structure 8
Strategy • Refine and increase quality of portfolio in order to set the stage for future growth, resulting in higher quality assets and a more profitable company • Develop and invest in the Orient-Express brand in existing and attractive new markets • Maintain owner-operator role, which is a more efficient and profitable structure for long-term, iconic assets • Achieve a leadership position and command premium rates in each of our markets 9
Strategy (continued) • Expand into key gateway cities with low capital investment by developing management contract business • Reduce debt and increase financial flexibility; progress towards a medium-term target of net debt to adjusted EBITDA of less than 3.5x 1 • Increase return on assets through disciplined investment • Sell memorable experiences; operate with the highest service standards in the industry • Create a culture of excellence through industry-leading food and beverage operations 1 Net debt includes total debt, drawn working capital facilities and obligations under capital leases, offset by cash. 10 Adjusted EBITDA excludes real estate income. See appendices A and B.
Q1 2012 Performance La Samanna, French West Indies 11
Q1 2012 Operating Results Summary • Continued RevPAR growth led by Europe and rest of world % RevPAR Change vs. Q1 2012 Same Store Room Statistics Q1 2011 Local ADR Occupancy RevPAR U.S. dollar currency Europe $423 33% $134 8% 11% North America 440 64% 280 9% 9% Rest of World 379 66% 249 11% 13% Worldwide $402 58% $233 10% 11% STR U.S. luxury segment 1 $272 71% $193 1 Source: Smith Travel Research report. 12
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