Financial Highlights

• On a consolidated basis, net sales revenue was up 8% and stood at Rs 27.58 crore in the quarter ended June 2007 (Q1 FY 2008) over Q1 FY 2007. Operating profit margin (OPM) dropped 810 basis points (bps) to 34.0%.

• The resultant consolidated operating profit (OP) decreased 13% to Rs 9.38 crore in Q1 FY 2008 over Q1 FY 2007. The ensuing consolidated profit after tax (PAT) fell 25% to Rs 6.22 crore in Q1 FY 2008 as against Q1 FY 2007.

• The overall occupancy rate was 71% in Q1 FY 2008 compared with 78% in Q1 FY 2007.

• Room revenue was Rs 18.94 crore while the food and beverages (F&B) revenue was Rs 7.97 crore in Q1 FY 2008.

• PAT was lower in Q1 FY 2008 compared with Q1 FY 2007. The fall in PAT is due to opening up of three new hotels which were under commissioning; the Hyderabad hotel for which rental payment has started and rent had to be paid when these hotels were taken over and renovation was taking place. The Jaipur hotel is the new property that started operation in March 2007 and ran into off-season in Q1 FY 2008. In the Brindavan Garden Hotel, there was a cauvery agitation and its operations began recently.

• In terms of room availability, presently there are 195 rooms in the Royal Orchid Hotel, 130 rooms in the Royal Orchid Central , 80 rooms in Harsha, 54 rooms in resort, 55 rooms between the two properties in Mysore, 70 rooms in Jaipur, 60 rooms in Hyderabad and 70 rooms in Pune.

• In the next six months, Royal Orchid plans to add another hotel in Pune which should be ready by December 2007 and will have 115 rooms. So after adding 115 rooms it will have about 830 rooms availability.

• The average room rates (ARR’s) of Hotel Royal Orchid, Hotel Royal Orchid Central, Hotel Royal Harsha, the Birdy’s Resort, Metropole and Jaipur stood at Rs 8800, Rs 5400, Rs 2600, Rs 1800 Rs 3500 and Rs 2800, respectively, Q1 FY 2008.