14th August 2008, Kolkata, India: Addressing the Fifty-eighth Annual General Meeting of EIH Limited (the flagship company of The Oberoi Group) held in Kolkata today, Mr. P.R.S. Oberoi, Chairman said, “The Oberoi Group has constantly raised the bar as far as service and luxury standards are concerned. The many awards and accolades we have received from reputable sources bear testimony to this. In the 2008 Travel + Leisure Readers’ Poll three of our hotels have been rated as number 2, 4 and 6 best in the world and 1st, 2nd and 3rd best in Asia.
The company’s performance during the Financial Year 2007-2008 has been more than satisfactory.
The Total Revenue was Rs. 1151.12 crores as compared to Rs. 995.20 crores in the previous year, which is an increase of 16%.
The Earnings before Interest, Depreciation, Tax and other Amortisations (“EBIDTA”) increased from Rs. 396.30 crores to Rs. 480.36 crores, which is an increase of over 21%. The Profit after Tax increased from Rs. 157.55 crores (without considering Extraordinary Income of Rs. 42.81 crores) to Rs. 217.23 crores, which is an increase of 38%. The Company has declared a Dividend of Rs. 1.80 (90%) per Share as against Rs. 1.40 (70%) per Share during the previous year.
The Company’s performance during the first three months of the current Financial Year has been better than the year before. The Total Income increased from Rs. 233.59 crores to Rs. 255.78 crores, which is an increase of over 10%. The Earnings before Interest Depreciation, Tax and Exceptional Items (“EBIDTA”) increased from Rs. 81.73 crores to Rs. 90.45 crores, which is an increase of 11%.
Mr. Oberoi stated that world economic growth was expected to slow during the current year. Despite this, emerging economies like India and China are expected to show growth. Rising food prices and the unprecedented increases in the price of crude oil are major concerns. The increase in the price of crude oil was likely to impact travel. High aviation fuel prices were having an adverse effect on airlines around the world. Several domestic and international airlines had reduced the number of flights and had also raised air fares. As of now, the full impact on the business of the Company had not been felt. The company, nonetheless, recognises these challenges and has initiated steps to reduce waste, increase productivity and create a sustainable marketing strategy.
Mr. Oberoi further stated that the strategic alliance with Hilton International for marketing and co-branding of Trident hotels in India ceased from close of business on 31 March 2008. Thereafter, all Trident Hilton hotels had been re-branded “Trident” hotels.
With regard to the company’s expansion plans, Mr. Oberoi pointed out that:
The construction of Trident, Bandra Kurla, Mumbai is underway. The hotel is scheduled to open in 2009.
In the next three and a half years, Mr. Oberoi said we shall see the opening of ten hotels. We shall add 2300 rooms in India and abroad. We shall also add new Oberoi Flight Kitchens in Mauritius, Kolkata, Cochin and Calicut. These Oberoi Flight Kitchens will open at the end of 2009 or in early 2010.
Mr. Oberoi further stated, “The biggest challenge for us will be human resources. It is my belief that a company is only as good as its people. We must continue to carefully select, train and motivate our people. We have done this in the past and we must continue to do this in the future. This core competence has been our greatest strength. Well trained and motivated personnel will differentiate us from our competitors.”