EIH Limited Annual General Meeting, August 2010

Oberoi Hotels ranked amongst the best in Asia and in the world.

Steady growth. 10 new projects under planning and development.

Profitability in 1st Quarter better than in the previous Quarter.

24th August 2010, Kolkata, India:  Addressing the Sixtieth Annual General Meeting of EIH Limited (the flagship Company of The Oberoi Group) held in Kolkata today, Mr. P.R.S. Oberoi, Chairman stated, "The Oberoi, Mumbai which was destroyed by the terrorists in November, 2008 re-opened on 24th April, 2010.  The Oberoi, Mumbai has been well received by guests".  Mr. Oberoi also said, "The Oberoi, Mumbai is now amongst the best in the region". 

Mr. Oberoi added, "Travel + Leisure, a leading  international travel magazine, has, in a readers’ poll, ranked one of the Company’s hotels as the Best Hotel in the World; four Oberoi Hotels have been ranked as number 1, 2, 3 and 4 Best in Asia and four Oberoi Hotels have been ranked in the first 15 in the world.  No hotel company has received such distinction in the past. The above honours bear testimony to the levels of excellence and service standards that the Company has strived to maintain". 

Mr. Oberoi also said, "The demand for hotel rooms in India should grow in this Financial Year. Whilst room rates should begin to improve, margins are likely to be under strain due to high inflation. Appropriate measures have been taken to contain costs, wherever possible, while ensuring service excellence".

The difficult financial landscape of 2009-2010 impacted the Company’s performance during that Financial Year.  As a result:

• Total Revenue for the year ended 31st March, 2010 was Rs. 907.27 crores  as compared to Rs. 1078.47 crores in the previous year; 
• The Profit before Tax was Rs. 88.99 crores as compared to Rs. 273.26 crores  in the previous year;
• The Profit after Tax was Rs. 57.23 crores as compared to Rs. 170.44 crores in the previous year.

Nonetheless, the previous year’s Dividend of Rs. 1.20 per share had been maintained.

The operating results of the first quarter in this Financial Year are better than that of the first quarter in the previous Financial Year, without considering the estimated income from insurance claims accounted for in the previous Financial Year. 

Thus:

• Total Income for the first quarter increased from Rs.166.39 crores to Rs.205.16 crores. This represents an increase of 23.3%.
• The Earnings before Interest, Depreciation, Taxation and Amortisation ("EBITDA") increased from   Rs. 15.78 crores to Rs. 25.95 crores. This represents an increase of nearly 65%.

Mr. Oberoi further added, "On 12th July, 2010, we opened our first overseas Flight Kitchen venture at Mauritius. The Kitchen is owned through a wholly owned subsidiary. The 10,000 meals per day capacity Kitchen has cost us approximately US $ 24 million".

Mr. Oberoi pointed out that the Company had completed the following projects/acquisitions:

• On 30th June, 2010 EIH International Limited, a wholly owned subsidiary of  EIH Limited completed the acquisition of the 45.85% equity interest of Amex Investment Limited in its international hotels Joint Venture Company EIH Holdings Limited for US $ 45 million. With this acquisition, EIH Holdings Limited was now a wholly owned subsidiary of EIH International Limited.
• The 440 key Trident at Bandra Kurla, Mumbai opened on 1st December, 2009. The hotel had been well received and occupancies were stabilising.

The opening of Trident, Bandra Kurla, Mumbai and the much anticipated successful re-opening of The Oberoi, Mumbai will ensure that the Company had the requisite inventory of rooms to cater to future demand.

The status of other projects on hand is as follows:

• The Oberoi, Gurgaon consisting of 202 keys was expected to open during the fourth quarter of the current Financial Year.
• Construction of the 103 key Trident hotel at Dehradun was on schedule. The hotel was expected to open in the spring of 2012.
• Construction of the 229 key Oberoi hotel at Cyber City, Hyderabad was under way. This was in addition to a 323 key Trident hotel also under construction at the adjacent site. Both hotels were expected to open in phases beginning in the summer of 2012.
• Construction of the 252 key Oberoi hotel in Dubai located at Business Bay was progressing. The hotel is expected to commence operations in the last quarter of 2011 or in the first quarter of 2012.
• Planning had commenced on Oberoi hotels in Abu Dhabi and in Oman.
• Planning for The Oberoi, Marrakech, Morocco is under way.
• Management Contracts for a hotel at Scorpio Bay, Greece and a second Oberoi hotel in Mauritius have been signed.
• The new Flight Kitchen in Delhi was expected to be operational in March 2011.
• The Flight Kitchen at Cochin was expected to be commissioned shortly; while the Calicut Flight Kitchen was expected to commence operations in early 2011.

In conclusion Mr. Oberoi further stated, "The last two and half years have been challenging due to the global financial crisis and the terrorist attack on Mumbai in November 2008. I am confident that we have the trained work force and the commitment to meet the challenges of the future and emerge stronger and more profitable".