Orient-Express Hotels Announces Third Quarter and Nine Months Results

HAMILTON, Bermuda, November 2 /PRNewswire/ --

- Third Quarter Net Earnings Up 70% Over Prior Year

Orient-Express Hotels Ltd. (NYSE: OEH) (www.orient-express.com), owners of 49 deluxe hotel, restaurant, tourist train and river cruise properties in 25 countries, today announced its results for the third quarter and nine months ended September 30, 2005.

For the quarter net earnings were US$19.5 million (US$0.50 per common share) on revenue of US$132.4 million, an increase of 70% over net earnings of US$11.5 million (US$0.34 per common share) in the year earlier period. Earnings per common share were up 47% and revenue was up 29% over the third quarter of 2004.

Net earnings for the nine months were US$36.4 million (US$0.96 per common share) on revenue of US$345.2 million, an increase of 84% over net earnings of US$19.8 million (US$0.58 per common share) in the year earlier period. Earnings per common share were up 66% and revenue was up 26% over the first nine months of 2004.

Mr. James B. Sherwood, Chairman, said that hotel earnings both in Europe and North America had shown substantial improvement over the prior year's third quarter. Indeed, all other regions also reported improved hotel results, although less pronounced than for Europe and North America. Tourist trains, restaurants and management fees all registered gains as well.

"This year's hurricane season in the Gulf of Mexico has impacted our Windsor Court Hotel in New Orleans and the Maroma Resort & Spa on the Riviera Maya in Mexico. The Windsor Court has now reopened and President Bush and his entourage were among the first guests. Maroma was closed for construction works when hurricane Wilma hit so no guest nights were lost. We are fully covered by property damage and business interruption insurance for the consequences of the hurricanes, subject to a deductible of US$500,000 per event. The Windsor Court had 50 rooms (out of 330) damaged as a result of glass breakage and related water damage and Maroma had 15 of its 65 rooms damaged. We expect Maroma to reopen in January. The impact of the hurricanes on our third quarter earnings was 2 cents per common share. The fourth quarter earnings impact is estimated to be about 5 to 6 cents per share. Under U.S. GAAP some insurance receipts are only reported when payment is confirmed by the insurers. In event such confirmation is delayed (which we do not currently expect) we would have to credit the income in the quarter in which it is received."

"While these hurricanes are a challenge we feel confident that both New Orleans and the Riviera Maya will quickly recover. A major part of the room stock in New Orleans in the coming months will be occupied by business visitors engaged in the citywide recovery program," he said.

"At this time, the company's outlook for 2006 is very positive with same store bookings up 16% over the prior year," he concluded.

Mr. Simon M.C. Sherwood, President, said that the average daily room rate of owned hotels in U.S. dollars increased 3% to US$427 from US$414 in the third quarter of 2004. Same store RevPAR in U.S. dollars was up 11% to US$284 compared with the year earlier period. EBITDA margin for the quarter was up 5% to 30%.

He reviewed performance by region as follows:

Europe - EBITDA of owned hotels was US$26.9 million compared with US$19.6 million in the year earlier period. The Grand Hotel Europe in St. Petersburg acquired last February was the largest contributor, with the newly opened Hotel Caruso Belvedere in Ravello, Italy adding US$0.5 million. Only the Lapa Palace in Lisbon underperformed relative to the 2004 period.

North America - EBITDA for the quarter of owned hotels was US$3.6 million compared with US$0.4 million in the year earlier period. Keswick Hall in Charlottesville, Virginia reported the largest gain, followed by El Encanto in Santa Barbara, California and the Windsor Court in New Orleans. Only Maroma underperformed relative to the prior year as a result of it being closed for construction works.

Southern Africa - EBITDA of owned hotels was US$1.3 million compared with US$0.6 million in the prior year period. Much of the increase was due to improved results from Orient-Express Safaris in Botswana.

South America - EBITDA of owned hotels was US$1.4 million, a modest increase on US$1.3 million in the prior year period.

South Pacific - EBITDA of owned hotels was US$1.5 million compared with US$1.1 million in the prior year period. Both Lilianfels in Katoomba, Australia and the Bora Bora Lagoon Resort registered gains.

Hotel management and part-ownership - EBITDA was US$3.9 million compared with US$2.9 million in the prior year period. Charleston Place in Charleston, South Carolina and the Monasterio Hotel and Machu Picchu Sanctuary Lodge in Peru all registered significant gains.

Restaurants - EBITDA loss was US$0.2 million compared with a loss of US$0.4 million in the prior year period. The loss largely arises from the summer closing of '21' Club in New York City, a recurring seasonal event.

Tourist trains and river cruises - EBITDA for the quarter was US$6 million compared with US$4.6 million in the prior year period. Peruvian railway operations were the largest component of this improvement. Although a landslide closed the Cuzco-Machu Picchu line for a few days, it was possible to operate trains to the landslide area from both ends of the line and the passengers crossed the landslide area on foot.

Financial costs were up US$3.1 million to US$7.8 million, primarily due to the Grand Hotel Europe, St. Petersburg, El Encanto in Santa Barbara and Hotel Caruso Belvedere in Ravello acquisitions and taxes were US$1.1 million higher. Depreciation was US$1.4 million higher due to the larger asset base.

Simon Sherwood said "Our property development projects in Saint Martin continue to progress well and we recently received a casino permit on the Dutch side of our property as part of the second phase of our Cupecoy Village development. We have not yet finalized our plans for this parcel of land which is at the Dutch/French border, an attractive location because casinos are not permitted on the French side of the island."

"La Samanna in St. Martin has registered the best performance this year since we acquired the property in 1996, with EBITDA in the nine months up over 50% compared to last year. This bodes well for the success of our real estate developments on our land next to the hotel," he concluded.

Management believes that EBITDA (net earnings adjusted for interest, tax, depreciation and amortization) 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 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 U.S. generally accepted accounting principles, 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. generally accepted accounting principles for purposes of evaluating operating performance.

This news release contains, in addition to historical information, forward-looking statements that involve risks and uncertainties. These include statements regarding earnings outlook, investment plans 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, unknown effects on the travel and leisure markets of terrorist activity and any police or military response, varying customer demand and competitive considerations, realization of bookings and reservations as actual revenue, inability to sustain price increases or to reduce costs, fluctuations in interest rates and currency values, 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, uncertainty of recovering on insurance claims for property damage and lost earnings, changing global and regional economic conditions, and legislative, regulatory and political developments. Further information regarding these and other factors is included in the filings by the company and Sea Containers Ltd. with the U.S. Securities and Exchange Commission.

Orient-Express Hotels will conduct a conference call tomorrow, November 3, 2005 at 11.00 AM (EST) which is accessible at 212-231-2242. A re-play of the conference call will be available until 5.00 PM (EST) Friday, November 11, 2005 and can be accessed by calling 800-633-8284 (International dial-in #:1-402-977-9140) and entering reservation number 21265603. A re-play will also be available on the company's website: www.orient-express.com.

ORIENT-EXPRESS HOTELS LTD Three Months ended September 30, 2005 SUMMARY OF OPERATING RESULTS Three months ended September 30 $'000 - except per share amount 2005 2004 Revenue and earnings from unconsolidated companies Owned hotels - Europe 62,993 46,912 - North America 19,541 13,973 - Rest of World 21,725 18,009 Hotel management & part ownership interests 3,880 2,887 Restaurants 3,425 3,057 Trains & Cruises 20,859 18,130 Total (1) 132,423 102,968 Analysis of earnings: Owned hotels - Europe 26,878 19,644 - North America 3,627 367 - Rest of World 4,185 3,052 Hotel management & part ownership interests 3,880 2,887 Restaurants (165) (436) Trains & Cruises 5,967 4,560 Central overheads (4,856) (4,142) EBITDA 39,516 25,932 Depreciation & Amortization (8,598) (7,182) Interest (7,819) (4,751) Earnings before Tax 23,099 13,999 Tax (3,616) (2,504) Net earnings on common shares 19,483 11,495 Earnings per common share 0.50 0.34 39.34 34.25 Number of shares - millions

(1) Comprises earnings from unconsolidated companies of $4,690,000 (2004: $2,943,000) and revenue of $127,733,000 (2004: $100,025,000).

ORIENT-EXPRESS HOTELS LTD Three Months Ended September 30, 2005 SUMMARY OF OPERATING INFORMATION FOR OWNED HOTELS Three months ended September 30 2005 2004 Average Daily Rate (in U.S. dollars) Europe 625 740 North America 278 260 Rest of World 262 235 Worldwide 427 414 Rooms Sold (thousands) Europe 61 39 North America 30 31 Rest of World 47 43 Worldwide 138 113 RevPar (in U.S. dollars) Europe 417 477 North America 183 156 Rest of World 148 122 Worldwide 267 240

Change % Same Store RevPAR Dollar Local (in U.S. dollars) Currency Europe 506 477 6% 5% North America 206 178 16% 16% Rest of World 148 122 21% 22% Worldwide 284 256 11% 10%

ORIENT-EXPRESS HOTELS LTD Nine Months ended September 30, 2005 SUMMARY OF OPERATING RESULTS Nine months ended September 30 $'000 - except per share amount 2005 2004 Revenue and earnings from unconsolidated companies Owned hotels - Europe 134,468 96,046 - North America 66,473 53,434 - Rest of World 67,155 55,512 Hotel management & part ownership interests 12,494 10,571 Restaurants 14,571 13,195 Trains & Cruises 50,001 44,508 Total (1) 345,162 273,266 Analysis of earnings Owned hotels - Europe 44,836 29,452 - North America 15,121 9,382 - Rest of World 14,223 11,141 Hotel management & part ownership interests 12,494 10,571 Restaurants 2,485 1,534 Trains & Cruises 11,025 8,901 Central overheads (14,007) (11,556) EBITDA 86,177 59,425 Depreciation & Amortization (25,048) (21,151) Interest (17,549) (14,607) Earnings before Tax 43,580 23,667 Tax (7,197) (3,867) Net earnings on common shares 36,383 19,800 Earnings per common share 0.96 0.58 37.82 34.25 Number of shares - millions

(1) Comprises earnings from unconsolidated companies of $10,688,000 (2004: $8,871,000) and revenue of $334,474,000 (2004: $264,395,000).

ORIENT-EXPRESS HOTELS LTD Nine Months Ended September 30, 2005 SUMMARY OF OPERATING INFORMATION FOR OWNED HOTELS Nine months ended September 30 2005 2004 Average Daily Rate (in U.S. dollars) Europe 565 645 North America 330 321 Rest of World 270 235 Worldwide 392 373 Rooms Sold (thousands) Europe 140 88 North America 112 104 Rest of World 142 134 Worldwide 394 326 RevPar (in U.S. dollars) Europe 343 370 North America 224 210 Rest of World 155 127 Worldwide 240 217

Change % Same Store RevPAR Dollars Local (in U.S. dollars) Currency Europe 409 376 9% 6% North America 245 225 9% 9% Rest of World 155 128 21% 18% Worldwide 249 223 12% 10%

ORIENT-EXPESS HOTELS LTD

CONSOLIDATED AND CONDENSED BALANCE SHEETS (UNAUDITED)

September 30 December 31 $'000 2005 2004 Assets Cash $ 54,070 $ 85,610 Accounts receivable 48,788 34,984 Due from related parties 17,929 14,718 Prepaid expenses and other 14,760 11,914 Inventories 31,317 28,965 Total current assets 166,864 176,191 Property plant & equipment, net book value 1,022,989 916,811 Investments 126,716 123,599 Goodwill 64,136 29,529 Other assets 22,677 19,461 $ 1,403,382 $1,265,591 Liabilities and Shareholders' Equity Working capital facilities $ 38,936 $ 42,920 Accounts payable 24,724 23,839 Due to related parties 6,669 5,453 Accrued liabilities 59,205 37,288 Deferred revenue 22,078 20,493 Current portion of long-term debt and capital 57,799 46,245 leases Total current liabilities 209,411 176,238 Long-term debt and obligations under capital 495,969 537,461 leases Deferred income taxes 16,496 2,710 Minority interest 4,574 4,192 Shareholders' equity 676,932 544,990 $ 1,403,382 $1,265,591