Choppy waters

New York, Feb. 26 (PTI): Orient-Express, the NYSE-listed operator of luxury hotels that rejected an alliance offer from the Tata group, today said it was looking at potential acquisitions for future growth, even as it reported a net loss in the fourth quarter of 2007.

The Bermuda-based firm posted a net loss of $4.9 million for the quarter ended December 2007 against a net profit of $6.7 million in the year-ago period. The company’s fourth-quarter revenue, however, rose to $151.2 million in the latest quarter from $135.2 million in the fourth quarter of 2006, a statement said.

“We believe that there will continue to be numerous opportunities for growth through acquisitions of properties, as well as through strategic organic expansion into key geographic markets,” Orient-Express president and CEO Paul White said.

For the year ended December 31, 2007, the company's net earnings dropped to $33.6 million from $39.8 million in 2006. Revenue increased 21 per cent to $599.6 million in 2007 from $497.1 million in 2006.

Orient-Express said its adjusted net earnings from continuing operations, which exclude items such as an impairment charge related to a strategic review of Bora Bora Lagoon resort, were $10.4 million for the quarter, compared with adjusted net earnings from continuing operations of $9.2 million the previous year.

Orient-Express has seen a flurry of share purchases by hedge funds over the past few weeks, presumably on expectations of a possible takeover bid by the Tata group’ s Indian Hotels, which had last year made an unsuccessful business alliance proposal. In reply to Indian Hotels’ offer, White had said he did not want Orient-Express to be associated with a predominantly domestic Indian brand.

This led to the Tata group seeking a “public apology” for using libellous remarks while rejecting its offer.

While Orient-Express is yet to react to the Tatas' apology demand, at least three major hedge funds have recently raised their holdings in the company to over five per cent, while one of them has said additional purchase of shares could be linked to a possible change in the company’s ownership.