Orient-Express Hotels Ltd. Reports First Quarter 2013 Results

  Orient-Express Hotels Ltd. Reports First Quarter 2013 Results

  *First quarter same store revenue per available room (“RevPAR”) up 6%
    compared to prior-year quarter in US dollars; up 7% in local currency
  *First quarter total revenue up 3% to $103.2 million from $100.5 million in
    prior-year quarter
  *First quarter adjusted EBITDA up 41% to $4.5 million from $3.2 million in
    prior-year quarter
  *Continued progress on portfolio optimization and capital redeployment
    strategy, including expansion of North American footprint with successful
    opening of 92-key El Encanto, Santa Barbara, California
  *Positive indications for 2013; bookings for total owned hotels up 8% from
    the same time last year

Business Wire

HAMILTON, Bermuda -- May 1, 2013

Orient-Express Hotels Ltd. (NYSE: OEH, www.orient-express.com) (the
“Company”), owners, part-owners or managers of 46 luxury hotel, restaurant,
tourist train and river cruise properties operating in 22 countries, today
announced its results for the first quarter ended March 31, 2013.

Total revenue was $103.2 million in the first quarter of 2013, up $2.7 million
or 3% from $100.5 million in the first quarter of 2012. Revenue from owned
hotels for the first quarter was $89.2 million, up $1.7 million or 2% from
$87.5 million in the first quarter of 2012. On a same store basis, owned
hotels RevPAR was up 6% in US dollars and up 7% in local currency. Trains &
cruises revenue in the first quarter was $11.2 million, up 18% compared to
$9.5 million in the first quarter of 2012.

Adjusted EBITDA was $4.5 million for the first quarter, up $1.3 million or 41%
from $3.2 million in the prior-year period. The principal increases were at
Road To Mandalay and The Governor’s Residence, both in Myanmar, where
aggregate EBITDA increased by $2.6 million. EBITDA also increased at Maroma
Resort and Spa, Riviera Maya, Mexico (up $0.4 million) and Charleston Place,
South Carolina (up $0.4 million), offset by a decrease at Copacabana Palace,
Rio de Janeiro (down $1.1 million).

Adjusted net loss from continuing operations for the first quarter was $8.3
million ($0.08 per common share) compared with a loss of $14.4 million ($0.14
per common share) in the first quarter of 2012.

“2013 has started on a positive note,” said John Scott, President and Chief
Executive Officer. “Same store RevPAR across our portfolio was up 6% in US
dollar terms and up 7% in local currency. Adjusted EBITDA for the Company’s
traditionally low first quarter was $4.5 million, up 41% from $3.2 million
last year.

“The highlight of the first quarter was the March opening of the El Encanto
hotel in Santa Barbara, California that has firmly established our brand
presence in the important US West Coast travel market. This wonderfully
restored hotel will significantly enhance the revenue-generating power of our
portfolio and will fully contribute to earnings in future periods.

“Our new leadership team remains sharply focused on our strategy to increase
the earnings power of our properties and optimize our unique portfolio of
luxury travel assets. During the quarter, we completed the sale of Porto
Cupecoy, Sint Maarten, generating cash proceeds of $19.0 million and removing
a loss-making asset from our portfolio. We are also embarking on significant
renovation plans at Charleston Place and Grand Hotel Europe, St. Petersburg,
two of our key cash-generating properties.

“Current early indicators for 2013 are positive, with bookings pace for owned
hotels up 8% compared to last year. Booked revenue for the Italian properties
is 15% ahead of where it was at the same time last year and Asia is 18% ahead,
reflecting the continued strength of Asia and providing momentum as we enter
our second and third quarters.”

Company highlights

The Company opened the completely renovated 92-key El Encanto hotel on March
18, 2013. The property has been very well received by clients, the travel
trade and international media and bookings are growing for the peak summer
season.

The Company made continued progress on its plans for a three-year
refurbishment at Grand Hotel Europe that will include the conversion of 19
rooms into six ultra-luxury suites, including a two-bedroom presidential
suite; a new food and beverage concept from a world-class restaurant designer;
an expanded spa; and fully renovated meeting room space. In April, the Company
made a first draw-down of $4.0 million under its new $50.0 million loan
facility, of which $26.0 million will fund the refurbishment, which is
scheduled to commence in the second quarter.

Also in the second quarter, the Company will commence the first phase of a
three-year rooms refurbishment at Charleston Place. The first phase of the
project entails the renovation of 145 rooms and is partially financed by $9.2
million of additional funds borrowed in December 2012 pursuant to an increase
in principal of the hotel’s existing loan facility.

The Grand Hotel Europe and Charleston Place renovations have been phased so
that they will have minimal disruption on hotel operations.

The Company took positive steps to strengthen its core leadership with the
appointment of three vice presidents, bringing new talent to the management
team. Amrita Bhalla will join the Company as Vice President, Global Human
Resources, and Katherine Blaisdell will join the Company as Vice President,
Technical Services, following the planned retirement of Roger Collins after 22
years of dedicated service.Amrita Bhalla joins the Company from a leading
Asian hospitality group, where she was Chief People Officer and Executive Vice
President, Human Resources. Prior to this, she served as Executive Vice
President of Human Resources for The Oberoi Group and before that as Director,
Recruitment & Development for Four Seasons Hotels & Resorts.Katherine
Blaisdell joins the Company from Rosewood Hotels & Resorts, where she was Vice
President, Architecture & Design, responsible for managing global hotel
construction and renovation projects.During her years in the industry, she
has also served as Director of Project Management & Construction for St. Regis
Hotels & Resorts and as Vice President of Design & Construction for Viceroy
Hotels.

These appointments follow the internal promotion of Neil Gribben to Vice
President, Accounting and Control in March 2013.In his new role, Neil will
continue to oversee the Company’sregional financial controllers and the
financial performance of its business units, and in addition, is now
responsible for the financial reporting function in central finance.

Operating Performance

Europe:

In the Company’s seasonally low first quarter, revenue from owned hotels was
$16.0 million, up $0.2 million or 1% from $15.8 million in the first quarter
of 2012, despite some continued weakness in certain European markets.

Same store RevPAR in Europe was up 8% compared to the prior-year quarter in US
dollars (up 9% in local currency) due to a two point increase in occupancy.

EBITDA for the quarter was a loss of $8.0 million compared to a loss of $7.6
million in the first quarter of 2012.

North America:

Revenue from owned hotels for the quarter was $30.7 million, up $1.6 million
or 5% from $29.1 million in the first quarter of 2012. Revenue in the first
quarter grew at every property in the region compared to the same quarter last
year, led by Maroma Resort and Spa, where revenue was up $0.6 million or 15%
compared to the first quarter of 2012 due to strong package business and
double-digit rate growth.

Same store RevPAR in the region increased by 9% in US dollars, largely due to
a 7% increase in average daily rate (“ADR”).

EBITDA in North America was $6.1 million before impairment charges, down $1.1
million from $7.2 million in the first quarter of 2012. Lower EBITDA in the
first quarter of 2013 was impacted by $2.0 million of charges for planned
pre-opening expenses at El Encanto, offset by increases of $0.4 million at
each of Charleston Place and Maroma Resort and Spa, with good conversion on
mostly rate-driven revenue growth.

Rest of World:

Asia-Pacific:

Revenue for the first quarter of 2013 was $10.3 million, an increase of $1.8
million or 21% compared to $8.5 million in the first quarter of 2012. Revenue
growth in the region continued to be led by The Governor’s Residence, Yangon
(up $0.7 million), as Myanmar’s popularity as a tourist destination continues
to grow. Same store RevPAR for the region increased by 23% in both US dollars
and local currency due to a 16% increase in ADR and a four-point increase in
occupancy.

EBITDA grew by 31% to $3.8 million compared to $2.9 million in the first
quarter of 2012, which included a $0.5 million increase at The Governor’s
Residence and a $0.3 million increase at La Residence d’Angkor, Siem Reap,
Cambodia, reflecting strong demand throughout the region.

Southern Africa:

First quarter revenue from owned hotels was $6.4 million, down $0.2 million or
3% from $6.6 million in the first quarter of 2012. This is largely due to the
year-over-year weakening of the South African rand versus the US dollar.
Excluding the effect of currency movements, revenue was $0.6 million ahead of
last year.

Due to an eight-point improvement in occupancy, same store RevPAR in the
region was up 14% in local currency terms but, due to a weaker South African
rand, was down 1% in US dollars.

EBITDA was $1.3 million versus $1.8 million in the first quarter of 2012 due
to a management restructuring charge of $0.3 million in the first quarter of
2013 and a negative currency impact of $0.2 million.

South America:

First quarter revenue from owned hotels was $25.8 million, down $1.6 million
or 6% from $27.4 million in the first quarter of 2012. This decrease is
primarily the result of difficult year-over-year comparisons at Copacabana
Palace, as a number of large events in Rio de Janeiro in the first quarter of
2012 did not recur; however, the benefit of the renovated product is expected
to be felt over the remainder of the year, with full year revenue currently
forecasted to exceed prior-year levels. Same store RevPAR in the region for
the first quarter decreased by 3% in both US dollars and local currency.

EBITDA for the quarter was $8.0 million, a decrease of $1.0 million compared
to $9.0 million in the first quarter of last year. In addition to the revenue
shortfall at Copacabana Palace, $0.4 million of this decrease was due to costs
incurred to resolve a tax case in Brazil.

Hotel management & part-ownership interests:

EBITDA for the first quarter of 2013 was a loss of $2.0 million compared to a
loss of $0.7 million in the first quarter of 2012. This loss was attributable
to $0.7 million of management restructuring charges related to the closure of
the Singapore development office, which will result in cost savings in future
periods, and a decline of $0.7 million at Hotel Ritz, Madrid due to a
write-off of fixed assets.

Restaurants:

Revenue from ‘21’ Club in the first quarter of 2013 was unchanged from the
same quarter of 2012 at $3.8 million. EBITDA was $0.2 million compared to $0.3
million in the first quarter of 2012.

Trains & cruises:

Revenue for the first quarter of 2013 was $11.2 million, up $1.7 million or
18% from $9.5 million in the first quarter of 2012. This growth is due to an
increase of $2.7 million from Road To Mandalay, which performed extremely well
due to the continued popularity of Myanmar as a tourist destination, offset by
decreases from the UK day-trains, as the sluggish UK economy and poor weather
impacted demand and a reduced number of trips was operated in the first
quarter with a heavier loading into the busier summer months.

EBITDA was $1.1 million compared to a loss of $0.3 million in the first
quarter of 2012. This growth was also attributable to Road To Mandalay, where
first quarter EBITDA was $2.5 million compared to $0.4 million in the prior
year, offset by some declines from the UK day-trains.

Central costs:

In the first quarter of 2013, central overheads were $9.0 million compared
with $7.8 million in the prior-year period. This increase was largely due to
management restructuring charges of $1.0 million incurred during the quarter.
Together with the restructuring costs within Southern Africa and the hotel
management business, these costs will result in meaningful cost savings in
future periods.

In addition, the Company incurred $1.5 million of non-cash share-based
compensation expense compared to $2.0 million in the first quarter of 2012.

Impairment:

Following a strategic review of its assets, the Company recorded a total
non-cash impairment charge for the quarter of $35.7 million related to La
Samanna, St Martin.

Depreciation and amortization:

The depreciation and amortization charge for the first quarter of 2013 was
$11.5 million, up from $10.5 million in the first quarter of 2012 as a result
of the completion of several recent capital projects and the opening of El
Encanto.

Interest:

The interest charge for the first quarter of 2013 was $7.0 million, down $0.2
million from $7.2 million in the prior year quarter. The amount of capitalized
interest related to El Encanto was $1.1 million in the first quarter of 2013
compared to $0.9 million in the prior-year quarter.

Tax:

The tax benefit for the first quarter of 2013 was $6.1 million compared to a
charge of $0.2 million in the same quarter in the prior year.The tax benefit
in the first quarter of 2013 included a release of tax provisions in Brazil of
$3.9 million following the conclusion of inquiries by the tax authorities.

Investment:

The Company invested a total of $20.7 million in its portfolio during the
first quarter of 2013, including $10.8 million for the renovation of El
Encanto, $1.9 million primarily for the completion of the refurbishment at
Copacabana Palace, $1.4 million at Charleston Place, including the
refurbishment of the Palmetto Café, $1.3 million primarily for façade works at
Grand Hotel Europe, and the balance for routine capital expenditures.

Balance Sheet

At March 31, 2013, the Company had long-term debt (including the current
portion and debt of consolidated variable interest entities) of $606.0
million, working capital loans of $0.4 million and cash balances of $101.0
million (including $21.7 million of total restricted cash of which $13.4
million is in other assets), resulting in total net debt of $505.4 million
compared to total net debt at the end of 2012 of $505.0 million. At March 31,
2013, the ratio of net debt to trailing 12-month adjusted EBITDA was 4.8
times.

Undrawn amounts available to the Company at March 31, 2013 under short-term
lines of credit were $3.9 million, bringing total cash availability (excluding
restricted cash) at March 31, 2013 to $83.2 million.

At March 31, 2013, approximately 48% of the Company’s debt was at fixed
interest rates and 52% was at floating interest rates. The weighted average
maturity of the debt was approximately 2.3 years and the weighted average
interest rate was 4.0%. The Company had $85.9 million of debt repayments due
within 12 months. These obligations are expected to be met through a
combination of operating cash flow, proceeds from recent divestment of
non-core assets, refinancing of the facilities, and utilization of available
cash.

                               * * * * * * * *

ORIENT-EXPRESS HOTELS LTD.
SUMMARY OF OPERATING RESULTS
(Unaudited)
                                                          
$millions – except per share amounts                       Three months ended
                                                            March 31,
                                                           2013      2012
                                                                    
Revenue and earnings from unconsolidated companies
Owned hotels
- Europe                                                    16.0       15.8
- North America                                             30.7       29.1
- Rest of world                                             42.5      42.6
Total owned hotels                                          89.2       87.5
Hotel management & part-ownership interests                 (1.0)      (0.3)
Restaurants                                                 3.8        3.8
Trains & cruises                                            11.2      9.5
Total (1)                                                   103.2     100.5
                                                                       
Analysis of earnings
Owned hotels
- Europe                                                    (8.0)      (7.6)
- North America                                             6.1        7.2
- Rest of world                                             13.0       13.7
Hotel management & part-ownership interests                 (2.0)      (0.7)
Restaurants                                                 0.2        0.3
Trains & cruises                                            1.1        (0.3)
Central overheads                                           (9.0)      (7.8)
Share-based compensation                                    (1.5)     (2.0)
EBITDA before impairment                                    (0.1)      2.8
Impairment                                                  (35.7)    -
EBITDA                                                      (35.8)     2.8
Depreciation & amortization                                 (11.5)     (10.5)
Interest                                                    (7.0)      (7.2)
Foreign exchange gain                                       2.1       0.9
Loss before tax                                             (52.2)     (14.0)
Tax                                                         6.1       (0.2)
Net loss from continuing operations                         (46.1)     (14.2)
Discontinued operations                                     (0.9)     0.4
Net loss                                                    (47.0)    (13.8)
Net earnings attributable to non-controlling interests      (0.2)      (0.3)
Net loss attributable to Orient-Express Hotels Ltd.         (47.2)    (14.1)
                                                                       
Net loss per common share attributable to Orient-Express    (0.46)     (0.14)
Hotels Ltd.
Number of shares – millions                                103.01    102.72


(1) Comprises losses from unconsolidated companies of $0.9 million (2012 -
$46,000) and revenue of $104.1 million (2012 - $100.5 million).

ORIENT-EXPRESS HOTELS LTD.
SUMMARY OF OPERATING INFORMATION FOR OWNED HOTELS
                                   
                                    Three months ended
                                     March 31,
                                   2013       2012
Average Daily Rate (in US dollars)             
Europe                               424         423
North America                        472         440
Rest of world                        406         402
Worldwide                            430         418
                                                 
Room Nights Available
Europe                               48,039      49,379
North America                        63,650      63,791
Rest of world                        94,742      96,694
Worldwide                            206,431     209,864
                                                 
Rooms Nights Sold
Europe                               16,446      15,654
North America                        40,961      40,633
Rest of world                        65,186      65,348
Worldwide                            122,593     121,635
                                                 
Occupancy
Europe                               34%         32%
North America                        64%         64%
Rest of world                        69%         68%
Worldwide                            59%         58%
                                                 
RevPAR (in US dollars)
Europe                               145         134
North America                        303         280
Rest of world                        279         272
Worldwide                            256         242
                                                 
Same Store RevPAR (in US dollars)
Europe                               145         134
North America                        305         280
Rest of world                        279         272
Worldwide                            256         242
                                                 
Same Store RevPAR (% change)         US dollar   Local currency
Europe                               8%          9%
North America                        9%          9%
Rest of world                        3%          5%
Worldwide                           6%         7%
                                                 

ORIENT-EXPRESS HOTELS LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
                                                              
                                                     March 31,  December 31,
$millions                                            2013       2012

Assets
Cash                                                  79.3        93.4
Restricted cash                                       8.3         21.1
Accounts receivable                                   40.2        36.5
Due from unconsolidated companies                     15.4        15.2
Prepaid expenses and other                            35.1        21.2
Inventories                                           43.5        44.6
Other assets held for sale                            2.9         22.1
Real estate assets                                    2.0        1.9
Total current assets                                  226.7       256.0
                                                                  
Property, plant & equipment, net of accumulated       1,126.5     1,171.6
depreciation
Property, plant & equipment, net of accumulated
depreciation of consolidated variable interest        184.1       183.8
entities
Investments in unconsolidated companies               55.7        58.9
Goodwill                                              159.1       161.3
Other intangible assets                               18.4        18.6
Other assets                                          53.8       41.8
                                                                  
Total assets                                          1,824.3    1,892.0
                                                                  
Liabilities and Equity
                                                                  
Working capital loans                                 0.4         -
Accounts payable                                      22.6        25.2
Accrued liabilities                                   80.0        77.5
Deferred revenue                                      44.5        30.5
Other liabilities held for sale                       1.4         2.2
Current portion of long-term debt and capital         84.1        90.1
leases
Current portion of long-term debt of consolidated     1.8        1.8
variable interest entities
                                                                  
Total current liabilities                             234.8       227.3
                                                                  
Long-term debt and obligations under capital leases   424.4       431.4
Long-term debt of consolidated variable interest      95.7        96.2
entities
Deferred income taxes                                 103.1       104.1
Deferred income taxes of consolidated variable        60.1        60.3
interest entities
Other liabilities                                     28.7       34.4
                                                                  
Total liabilities                                     946.8       953.7
                                                                  
Shareholders’ equity                                  874.9       936.0
Non-controlling interests                             2.6        2.3
Total equity                                          877.5       938.3
                                                                
Total liabilities and equity                         1,824.3    1,892.0
                                                                  

ORIENT-EXPRESS HOTELS LTD.
RECONCILIATIONS AND ADJUSTMENTS
(Unaudited)
                                                          
                                                           Three months ended
$millions – except per share amounts                       March 31,
                                                            2013      2012
                                                                    
EBITDA                                                      (35.8)     2.8
                                                                       
Adjusted items:
Pre-opening expenses (1)                                    2.1        -
Management restructuring (2)                                1.6        -
Write-off of fixed assets (3)                               0.7        0.4
Acquisition proposal costs (4)                              0.2        -
Impairment (5)                                              35.7      -
                                                                       
Adjusted EBITDA                                            4.5       3.2
                                                                       
Reported net loss attributable to Orient-Express Hotels     (47.2)     (14.1)
Ltd.
Net earnings attributable to non-controlling interests      (0.2)     (0.3)
Reported net loss                                           (47.0)     (13.8)
Discontinued operations net of tax                          0.9       (0.4)
Net loss from continuing operations                         (46.1)     (14.2)
                                                                       
Adjusted items net of tax:
Pre-opening expenses (1)                                    1.4        -
Management restructuring (2)                                1.1        -
Write-off of fixed assets (3)                               0.5        0.3
Acquisition proposal costs (4)                              0.2        -
Impairment (5)                                              35.7       -
Deferred financing costs (6)                                0.4        -
Interest rate swaps (7)                                     -          0.4
Foreign exchange (8)                                        (1.5)     (0.9)
                                                                       
Adjusted net loss from continuing operations               (8.3)     (14.4)
                                                                       
Reported EPS                                                (0.46)     (0.14)
Reported EPS from continuing operations                     (0.45)     (0.14)
Adjusted EPS from continuing operations                     (0.08)     (0.14)
Number of shares (millions)                                103.01    102.72
                                                                       

(1) Pre-opening expenses at El Encanto and the Orcaella river-cruise ship that
will commence operations in Myanmar in the third quarter
(2) Restructuring and redundancy costs
(3) Non-cash write-off of fixed asset balances
(4) Costs associated with unsolicited proposal by The Indian Hotels Company
Limited to acquire the Company
(5) Non-cash impairment at one owned property
(6) Non-cash write-off of deferred financing costs
(7) Change in fair value of derivatives that are not designated in hedging
relationships and the ineffective portion of derivatives that are designated
in hedging relationships
(8) Foreign exchange is a non-cash item arising on the translation of certain
assets and liabilities denominated in currencies other than the functional
currency


ORIENT-EXPRESS HOTELS LTD.
RECONCILIATIONS AND ADJUSTMENTS (CONTINUED)
(Unaudited)
                                                            
                                Twelve        Three months     Year
                                 months ended   ended             ended
$millions – except per share    March 31,     March 31,        December 31,
amounts
                                 2013          2013    2012    2012
                                                       
EBITDA                           55.1           (35.8)   2.8      93.7
                                                                  
Adjusted items:
Pre-opening expenses (1)         3.9            2.1      -        1.8
Management restructuring (2)     2.1            1.6      -        0.5
Write-off of fixed assets (3)    1.9            0.7      0.4      1.6
Acquisition proposal costs (4)   1.4            0.2      -        1.2
Write-down of receivable (5)     0.5            -        -        0.5
Loss on sale of real estate      0.6            -        -        0.6
units (6)
Impairment (7)                   41.6           35.7     -        5.9
Gain on disposal (8)             (1.5)         -       -       (1.5)
                                                                  
Adjusted EBITDA                 105.6         4.5     3.2     104.3
                                                                  
EBITDA                           55.1           (35.8)   2.8      93.7
                                                                  
Depreciation and amortisation    (44.9)         (11.5)   (10.5)   (43.9)
Interest                         (29.6)         (7.0)    (7.2)    (29.8)
Foreign exchange                 (1.6)         2.1     0.9     (2.8)
(Loss) / earnings before tax     (21.0)         (52.2)   (14.0)   17.2
Tax                              (21.5)        6.1     (0.2)   (27.8)
Net loss from continuing         (42.5)         (46.1)   (14.2)   (10.6)
operations
Discontinued operations          2.4           (0.9)   0.4     3.7
Net loss                        (40.1)        (47.0)  (13.8)  (6.9)


(1) Pre-opening expenses at El Encanto and the Orcaella river-cruise ship that
will commence operations in Myanmar in the third quarter
(2) Restructuring and redundancy costs
(3) Non-cash write-off of fixed asset balances
(4) Costs associated with unsolicited proposal by The Indian Hotels Company
Limited to acquire the Company
(5) Write down of receivable balance within central costs
(6) Loss on sale of final two units at Keswick Estate
(7) Non-cash impairment charges related to goodwill and long-lived assets
(8) Gain on disposal of capital lease and New York hotel project


ORIENT-EXPRESS HOTELS LTD.
NET DEBT TO ADJUSTED EBITDA CALCULATION
(Unaudited)
                                               
                                                Twelve months ended and as at
                                                March 31,      December 31,
$millions – except ratios                        2013            2012
                                                             
Cash
Cash and cash equivalents                        79.3            93.4
Restricted cash (including $13.4 million /       21.7           21.1
$nil million classified within other assets)
                                                                 
Total cash                                       101.0          114.5
                                                                 
Total debt
Working capital facilities                       0.4             -
Current portion of long-term debt and capital    84.1            90.1
leases
Current portion of long-term debt of             1.8             1.8
consolidated variable interest entities
Long-term debt and obligations under capital     424.4           431.4
leases
Long-term debt held by consolidated variable     95.7           96.2
interest entities
                                                                 
Total debt                                       606.4          619.5
                                                                 
Net debt                                         505.4          505.0
                                                                 
Adjusted EBITDA                                  105.6           104.3
                                                                 
Net debt / adjusted EBITDA                      4.8            4.8
                                                                 

Management analyzes the operating performance of the Company on the basis of
earnings before interest, foreign exchange, tax (including tax on
unconsolidated companies), depreciation and amortization (EBITDA), and
believes that 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 historical cost of assets. EBITDA is also a financial
performance measure commonly used in the hotel and leisure industry, although
the Company’s EBITDA may not be comparable in all instances to that disclosed
by other companies. EBITDA does not represent net cash provided by operating,
investing and financing activities under US generally accepted accounting
principles (US 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 US 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), disposals of assets
or investments, and certain other items (some of which may be recurring) that
management does not consider indicative of ongoing operations or that 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.

This news release and related oral presentations 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 news
release and oral presentations, 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 real estate 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 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
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.

                                 * * * * * *

Orient-Express Hotels Ltd. will conduct a conference call on Thursday, May 2,
2013 at 9:00 am EDT (2:00 pm BST), which is accessible at +1 855 287 9927 (US
toll free) or +44 (0)20 3059 8125 (Standard International) or 0800 368 0649
(UK Freephone). The participant password is Orient-Express. A re-play of the
conference call will be available until 7:00 pm (EDT) Thursday, May 9, 2013
and can be accessed by calling +1 866 268 1947 (US toll free) or +44 (0)121
260 4861 (Standard International).The access code is 1163392#. A re-play will
also be available on the Company’s website: www.orient-expresshotelsltd.com.

Orient-Express Hotels Ltd. will host an investor and analyst meeting via
webcast on Friday, May 3, 2013 at 11:00 am EDT (4:00 pm BST), which is
accessible through the Company’s website at www.orient-expresshotelsltd.com
under the webcasts / presentations section or via the following link:
http://www.media-server.com/m/p/9xgvb7hr.

Financial media requiring further information should contact Vicky Legg,
Director of Corporate Communications, on +44 (0)20 3117 1380 or
vicky.legg@orient-express.com.

Contact:

Orient-Express Hotels Ltd.
Martin O’Grady, +44 20 3117 1333
Vice President, Chief Financial Officer
martin.ogrady@orient-express.com
Amy Brandt, +44 20 3117 1323
Director of Investor Relations
amy.brandt@orient-express.com