Orient-Express Hotels Ltd. recently announced that Paul White has resigned from his position of president and chief executive officer (CEO) on personal grounds. The company has begun the search for a successor. During the search period, chairman of the board, Bob Lovejoy, will continue as an interim chief executive officer.
Paul White spent 20 years with Orient-Express Hotels and played a key role in consolidating its base. He helped the company to survive the difficult economic period, and placed it on a strong footing for renewed growth.
However, management believes that despite the upcoming change in management, the company will continue to progress during this transitional period. Management also expects Orient-Express Hotels to beat its own earnings expectation for the forthcoming second quarter.
Orient-Express Hotels, which competes with companies like Starwood Hotels & Resorts Worldwide Inc. and Hyatt Hotels Corp. (H - Snapshot Report) ,reported its first quarter 2011 earnings in early May. Total revenue, excluding Real Estate, was up 17% at $99.6 million while revenue from owned hotels grew 13% to $88.9 million. Adjusted loss from continuing operation was 14 cents versus 21 cents recorded in the year-earlier period. The company still expects to benefit from the continued recovery of the luxury tourism industry in 2011.
We also remain confident of the ability of Bob Lovejoy who was promoted to the chairman of the board last month after serving the company since 2000 as a director. He was formerly a managing director and partner at Lazard Freres & Co. for over 15 years and served as co-head of General Banking at Lazard. Prior to the tenure at Lazard, Lovejoy was a partner at Davis Polk & Wardwell, where he practiced law for over 13 year.
Orient-Express Hotels currently retains a Zacks #4 Rank, which translates into a short-term Sell rating. We are also maintaining our long-term Neutral recommendation on the stock.