8-K

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) August 5, 2004

SEA CONTAINERS LTD.
(Exact name of registrant as specified in its charter)

Bermuda
(State or other jurisdiction of incorporation)

001-07560
(Commission File Number) 98-0038412
(I.R.S. Employer Identification No.)

22 VICTORIA STREET
P.O. BOX HM 1179
HAMILTON HMEX, BERMUDA
(Address of principal executive offices) Zip Code

441-295-2244
(Registrant's telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

ITEM 7.    Financial Statements, Pro Forma Financial Information and Exhibits

(c)

Exhibits

99

News release dated August 5, 2004 regarding second quarter 2004 consolidated earnings

ITEM 12.    Results of Operations and Financial Condition

        On August 5, 2004, the registrant announced its consolidated earnings for the three months ended June 30, 2004. The news release is attached as an Exhibit to this Current Report and incorporated herein by reference. The information in this Current Report is being furnished to the Commission.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SEA CONTAINERS LTD.
By:	/s/  EDWIN S. HETHERINGTON
	Edwin S. Hetherington
	Vice President, General Counsel and Secretary

Date: August 5, 2004

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EXHIBIT INDEX

Exhibit Number	Description
99	News release dated August 5, 2004

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SIGNATURES
EXHIBIT INDEX

EX-99

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EXHIBIT 99

SEA CONTAINERS ANNOUNCES RESULTS FOR QUARTER AND SIX MONTHS ENDED JUNE 30, 2004.

        Hamilton, Bermuda, August 5, 2004.    Sea Containers Ltd. (NYSE: SCRA and SCRB, www.seacontainers.com) marine container lessor, passenger and freight transport operator, and leisure industry investor, today announced its results for the second quarter and six months ended June 30, 2004. Net earnings for the quarter were $6.8 million ($0.29 per common share diluted) on revenue of $432.4 million, compared with net earnings of $9.3 million ($0.44 per common share diluted) on revenue of $410.3 million in the year earlier period. For the six months net earnings were a loss of $10.1 million ($0.44 per common share) on revenue of $805.7 million, compared with a net loss of $1.0 million ($0.05 per common share) on revenue of $758.5 million in the first half of 2003.

        Mr. James B. Sherwood, President, said that the significant differences in the second quarter of 2004 compared with the same period of 2003 were first, the lack of earnings from the Isle of Man Steam Packet Company which was sold in the third quarter of 2003. In 2003 this unit had net earnings of $3.5 million in the second quarter. Second, the second quarter of 2003 recorded a $5.3 million foreign exchange gain which was not repeated in the second quarter of 2004.

        Mr. Sherwood reviewed results by activity as follows (amounts in tables are in thousands of dollars):

1.

Silja, the Baltic ferry operator.

	Three months ended June 30				Six months ended June 30
	2004		2003		2004		2003
Silja operations:
Revenue	$	161,179	$	154,603	$	299,070	$	269,269
Operating and SG&A expenses		140,651		135,149		274,544		247,927
EBITDA		20,528		19,454		24,526		21,342
Depreciation		9,555		9,258		19,051		17,961
Earnings before net finance costs	$	10,973	$	10,196	$	5,475	$	3,381

        Silja's operating profit increased 7.6% in the quarter to $11 million and 62% in the six months to $5.5 million despite higher than budgeted fuel costs and start-up costs of introduction of the m.v. Finnjet into a new service between Germany, Estonia and Russia in June. Estonia's entry into the European Union on May 1, 2004 has not caused any significant change in travel patterns on Silja's routes.

1

2.

GNER, the intercity high speed rail service connecting London with Leeds, Newcastle and Scotland.

	Three months ended June 30				Six months ended June 30
	2004		2003		2004		2003
Rail operations:
Revenue	$	208,261	$	156,933	$	408,466	$	329,583
Operating and SG&A expenses		192,234		140,716		377,041		289,950
EBITDA		16,027		16,217		31,425		39,633
Depreciation		3,577		2,458		7,992		5,171
Earnings before net finance costs	$	12,450	$	13,759	$	23,433	$	34,462

        GNER's operating profit of $12.5 million in the quarter was down 10% from the year earlier period, due to a reduction in compensation payments for delays from Network Rail which were not fully offset by increased revenue.

        For the first six months the operating profits were lower at $23.4 million compared with $34.5 million in 2003 due to a non-recurring gain of $11.5 million reported in the first quarter of 2003 in connection with settlement of damages by Network Rail arising from the Hatfield rail accident in 2000.

        As previously announced, on July 1, 2004 GNER settled a claim by the U.K. Strategic Rail Authority for its participation in the Network Rail settlement arising out of Hatfield.

        The U.K. government announced in July, 2004 the results of its Rail Review. It has been decided to abolish the Strategic Rail Authority and transfer its powers to the Department for Transport. The Department will henceforth determine service patterns. If the cost exceeds the Department's budget the service patterns will be reduced. These changes are not expected to affect GNER's service patterns. The Department for Transport has not yet published the specification against which GNER is to bid for a new franchise but has indicated it will be made available in September and GNER's bid will be required in November. The Rail Review emphasized that past performance will be an important factor in the decision to award a new franchise and GNER believes this policy will be to its benefit. A consortium of Virgin Rail, Stagecoach and the German Railways which qualified as a bidder for GNER's franchise, announced recently that it was dropping out of the contest.

        3.    Other ferry operations, consisting of Hoverspeed's 5 ships operating in U.K. waters, SNAV-Hoverspeed's two ships operating in the Adriatic, two high speed ferries chartered out to other operators and SeaStreak's 7 passenger-only fast ferries operating commuter services between Manhattan and New Jersey.

	Three months ended June 30						Six months ended June 30
	2004			2003			2004			2003
Other ferry operations:
Revenue	$	30,444		$	61,404		$	34,519		$	88,542
Operating and SG&A expenses		34,109			59,559			43,859			88,033
EBITDA		(3,665	)		1,845			(9,340	)		509
Depreciation		3,649			4,139			6,644			8,622
Earnings before net finance costs	$	(7,314	)	$	(2,294	)	$	(15,984	)	$	(8,113	)

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        Losses were $5 million worse for the quarter and $7.9 million worse for the six months due to absence of earnings from the Isle of Man Steam Packet Company which was sold in the third quarter of 2003. The Steam Packet's earnings before net finance costs in the second quarter of 2003 were $5.7 million and $8.4 for the six months.

        Higher fuel costs than budgeted and SeaStreak's reduced services in February due to ice conditions in New York Harbor contributed to the lower results, masking improvements as a result of Hoverspeed moving to seasonal operations. The third quarter is in the main earnings period for Hoverspeed, however, higher than budgeted fuel costs will adversely impact results.

        4.    GE SeaCo, the 50% owned joint venture with GE Capital, engaged in the ownership and leasing out of marine cargo containers.

	Three months ended June 30				Six months ended June 30
	2004		2003		2004		2003
Container operations: GE SeaCo Owned Fleet (100%)
Revenue	$	34,060	$	23,100	$	64,201	$	44,351
Operating and SG&A expenses		3,912		2,790		7,645		5,957
EBITDA		30,148		20,310		56,556		38,394
Depreciation		10,038		7,055		19,329		13,754
Earnings before net finance costs		20,110		13,255		37,227		24,640
Finance costs		3,547		2,783		6,981		5,433
Earnings before tax	$	16,563	$	10,472	$	30,246	$	19,207
SCL's 50% share	$	8,282	$	5,236	$	15,123	$	9,603

        Profits powered ahead in the wake of the strongest market seen for the past decade. The company's share of GE SeaCo's net earnings increased 58% to $8.3 million from $5.2 million in the prior year period. For the six months net earnings were also up 58% to $15.1 million compared to $9.6 million in the same period of 2003.

        GE SeaCo took delivery of $147 million of new containers in the six months ended June 30, 2004 and now expects to invest more than $200 million for the full year 2004. The "pool fleet" consisting of containers owned by Sea Containers and GE Capital and managed by GE SeaCo, was 92% utilized for dry cargo types at June 30, 2004. Refrigerated containers in the pool fleet were 76% utilized at June 30, 2004 (June is the low season for refrigerated container demand when the northern hemisphere is harvesting its own perishable foods, not having to import them from the southern hemisphere). Utilization of other specialized types at June 30, 2004 was 84%.

        New container purchase prices are beginning to ease from second quarter peaks, in step with lower steel prices, however, demand remains high for both new and older units. Repair costs have risen as more expensive-to-repair containers are repaired and brought into service but storage costs are significantly down as less units linger in depot. Lease rates for older units are rising as short term contracts are renewed. The outlook for the year is excellent.

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5.

Other container operations, including factories, depots, and service facilities.

	Three months ended June 30				Six months ended June 30
	2004		2003		2004		2003
Other container operations:
Revenue	$	26,580	$	30,601	$	52,546	$	59,102
Operating and SG&A expenses		12,682		14,484		24,805		26,363
EBITDA		13,898		16,117		27,741		32,739
Depreciation		11,155		11,957		22,346		24,380
Earnings before net finance costs	$	2,743	$	4,160	$	5,395	$	8,359

        The reduced operating profits of $2.7 million in the quarter compared with $4.2 million in the prior year period, as well as the $5.4 million in the six months compared with $8.4 million in 2003 were due primarily to termination of finance lease contracts in 2003 and consequent absence of profits from such contracts in 2004.

        The company acquired a number of container depot, service and logistics operations based in Australia and New Zealand from the Owens Group effective July 19, 2004. The purchase price net of proceeds on the sale of the company's 26% interest in the Westfield container depot in Auckland, N.Z, was $6.7 million, approximately 3 times EBITDA.

        6.    Property, Plantations and Publishing. This unit includes the company's port interests (primarily the Corinth Canal in Greece and Newhaven, England), plantations in the Ivory Coast and Brazil and publishing services for the company, Orient-Express Hotels and others.

	Three months ended June 30				Six months ended June 30
	2004		2003		2004			2003
Other operations:
Revenue	$	5,925	$	6,718	$	11,066		$	11,992
Operating and SG&A expenses		5,556		5,641		11,423			10,431
EBITDA		369		1,077		(357	)		1,561
Depreciation		328		242		620			553
Earnings before net finance costs	$	41	$	835	$	(977	)	$	1,008

        Results for the quarter and six months were down from the prior year periods due to failure of the early table grape crop in Brazil due to heavy rain, combined with less than optimum banana production in the Ivory Coast.

        Contracts were signed for the sale of Folkestone Port on July 2, 2004 and completion should occur within the third quarter. The gain will be recorded in the third quarter.

        7.    Leisure investment. Orient-Express Hotels Ltd. in which the company has a 42% shareholding, increased its net income in the second quarter by 37% to $12.9 million from $9.4 million in the year earlier period. For the six months net income was up 22% to $8.3 million from $6.8 million.

        Sea Containers' share of these earnings in the second quarter was $5.4 million compared with $4.4 million in the prior year period. For the six months its share was $3.5 million compared with $3.2 million in the year earlier period.

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        Orient-Express Hotels is recovering from the effects of the Iraq War, SARS and weak corporate demand in 2003 and its management predicts that 2004 will be more profitable than 2003. Mr. Sherwood indicated that Sea Containers has no current intention to sell any of its shareholding in Orient-Express Hotels.

        He concluded by reminding investors that the third quarter is the main earnings period for the seasonal ferry businesses. He said that the company's priorities are improvement of results of U.K. fast ferry operations, renewal or extension of the GNER franchise in 2005 and obtaining the new Integrated Kent franchise, and expansion of ferry operations in the Baltic and Mediterranean.

*    *    *    *    *

Management believes that EBITDA (net earnings adjusted for interest, tax, depreciation and amortization) is a useful measure of operating performance, to help determine the ability to incur capital expenditure or service indebtedness, because it is not affected by non-operating factors such as leverage and the historic cost of assets. However, EBITDA does not represent cash flow from operations as defined by U.S. generally accepted accounting principles, is not necessarily indicative of cash available to fund all cash flow needs and should not be considered as an alternative to earnings from operations under U.S. generally accepted accounting principles for purposes of evaluating results of operations.

This news release contains, in addition to historical information, forward-looking statements that involve risks and uncertainties. These include statements regarding earnings growth, investment plans and similar matters that are not historical facts. These statements are based on management's current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Factors that may cause a difference include, but are not limited to, those mentioned in the news release, unknown effects on the transport, leasing and leisure markets in which the company operates of terrorist activity and any police or military response, varying customer demand and competitive considerations, inability to sustain price increases or to reduce costs, fluctuations in interest rates, currency values and public securities prices, variable fuel prices, variable container prices and container lease and utilization rates, uncertainty of negotiating, financing and completing proposed acquisition, disposal or capital expenditure transactions, inadequate sources of capital and unacceptability of finance terms and inability to reduce debt, global, regional and industry economic conditions, shifting patterns and levels of world trade and regional passenger travel, seasonality and adverse weather conditions, changes in ferry service and ship deployment plans, inability of Network Rail to maintain properly the U.K. rail infrastructure, and legislative, regulatory and political developments including the uncertainty of renewing the GNER rail franchise beyond April 2005 or obtaining other U.K. rail franchises. Further information regarding these and other factors is included in the filings by the company and Orient-Express Hotels Ltd. with the U.S. Securities and Exchange Commission.

*    *    *    *    *

        Sea Containers Ltd. will conduct a conference call on Friday, August 6, 2004 at 10.00 AM (EDT) which is accessible at 212-676-5388. A re-play of the conference call will be available until 5.00 PM (EDT) Monday, August 16, 2004 and can be accessed by calling 800-633-8284 (International dial-in #: 402-977-9140) and entering reservation number 21204083. A re-play will also be available on the company's website: www.seacontainers.com

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SEA CONTAINERS LTD. AND SUBSIDIARIES (SCL)
SUMMARY OF OPERATING RESULTS (UNAUDITED)

			Three months ended June 30,
			2004			2003
Revenue:
	Ferry operations
		—Silja	$	161,179,000		$	154,603,000
		—Other		30,444,000			61,404,000
	Rail operations			208,261,000			156,933,000
	Container operations			26,580,000			30,601,000
	Other			5,925,000			6,718,000
Total revenue			$	432,389,000		$	410,259,000
Earnings/(losses) before net finance costs:
	Ferry operations:
		Silja	$	10,973,000		$	10,196,000
		Other		(7,314,000	)		(2,294,000	)
				3,659,000			7,902,000
	Rail operations			12,450,000			13,759,000
	Container operations:
		GE SeaCo		8,282,000			5,236,000
		Other		2,743,000			4,160,000
				11,025,000			9,396,000
	Other, including property, publishing and plantations			41,000			835,000
Corporate costs				(4,668,000	)		(3,604,000	)
Total earnings before net finance costs*				22,507,000			28,288,000
Net finance costs				(19,873,000	)		(21,339,000	)
Earnings before income taxes				2,634,000			6,949,000
Provision for income taxes				1,000,000			1,767,000
Earnings before earnings from investment in Orient-Express Hotels Ltd.				1,634,000			5,182,000
Investment in Orient-Express Hotels Ltd.				5,429,000			4,412,000
Net earnings				7,063,000			9,594,000
Preferred share dividends				272,000			272,000
Net earnings on class A and class B common shares			$	6,791,000		$	9,322,000
Net earnings per class A and class B common share:
	Basic		$	0.30		$	0.44
	Diluted		$	0.29		$	0.44
Weighted average number of class A and class B common shares:
	Basic			22,939,523			21,020,360
	Diluted			23,068,246			21,095,055

*

Includes depreciation and amortization of $28,264,000 (2003—$28,054,000) so that earnings before interest, tax, depreciation and amortization (EBITDA) was $50,771,000 (2003—$56,342,000).

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SEA CONTAINERS LTD. AND SUBSIDIARIES (SCL)
SUMMARY OF OPERATING RESULTS (UNAUDITED)

			Six months ended June 30,
			2004			2003
Revenue:
	Ferry operations
		—Silja	$	299,070,000		$	269,269,000
		—Other		34,519,000			88,542,000
	Rail operations			408,466,000			329,583,000
	Container operations			52,546,000			59,102,000
	Other			11,066,000			11,992,000
Total revenue			$	805,667,000		$	758,488,000
Earnings/(losses) before net finance costs:
	Ferry operations:
		Silja	$	5,475,000		$	3,381,000
		Other		(15,984,000	)		(8,113,000	)
				(10,509,000	)		(4,732,000	)
	Rail operations			23,433,000			34,462,000
	Container operations:
		GE SeaCo		15,123,000			9,603,000
		Other		5,395,000			8,359,000
				20,518,000			17,962,000
	Other, including property, publishing and plantations			(977,000	)		1,008,000
Corporate costs				(8,369,000	)		(7,692,000	)
Total earnings before net finance costs*				24,096,000			41,008,000
Net finance costs				(40,603,000	)		(47,924,000	)
Losses before income taxes				(16,507,000	)		(6,916,000	)
Benefit from income taxes				(3,500,000	)		(3,268,000	)
Losses before earnings from investment in Orient-Express Hotels Ltd.				(13,007,000	)		(3,648,000	)
Investment in Orient-Express Hotels Ltd.				3,492,000			3,186,000
Net losses				(9,515,000	)		(462,000	)
Preferred share dividends				544,000			544,000
Net losses on class A and class B common shares			$	(10,059,000	)	$	(1,006,000	)
Net losses per class A and class B common share:
	Basic and diluted		$	(0.44	)	$	(0.05	)
Weighted average number of class A and class B common shares:
	Basic and diluted			22,947,131			21,020,108

*

Includes depreciation and amortization of $56,653,000 (2003—$56,687,000) so that earnings before interest, tax, depreciation and amortization (EBITDA) was $80,749,000 (2003—$97,695,000).

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SEA CONTAINERS LTD. AND SUBSIDIARIES (SCL)
CONSOLIDATED AND CONDENSED BALANCE SHEETS (UNAUDITED)

	June 30, 2004			December 31, 2003
Cash	$	214,863,000		$	213,313,000
Receivables		251,836,000			247,303,000
Containers and ships, net book value		1,589,510,000			1,637,666,000
Real estate and other fixed assets, net book value		141,881,000			145,294,000
Assets under capital leases, net book value		10,951,000			12,494,000
Inventories		44,364,000			45,991,000
Investments		373,109,000			356,024,000
Other assets		114,515,000			103,832,000
	$	2,741,029,000		$	2,761,917,000
Accounts payable	$	416,459,000		$	427,896,000
Liabilities with respect to containers and ships		1,075,518,000			1,052,233,000
Bank loans with respect to real estate and other fixed assets		82,928,000			143,756,000
Obligations under capital leases		5,999,000			8,260,000
Senior notes		406,248,000			305,806,000
Senior subordinated debentures		—			79,571,000
Minority interests and deferred revenue		23,349,000			12,582,000
Shareholders' equity		1,121,789,000			1,123,074,000
Class B common shares with voting rights owned by a subsidiary		(391,261,000	)		(391,261,000	)
	$	2,741,029,000		$	2,761,917,000

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SEA CONTAINERS LTD. AND SUBSIDIARIES (SCL) SUMMARY OF OPERATING RESULTS (UNAUDITED)
SEA CONTAINERS LTD. AND SUBSIDIARIES (SCL) SUMMARY OF OPERATING RESULTS (UNAUDITED)
SEA CONTAINERS LTD. AND SUBSIDIARIES (SCL) CONSOLIDATED AND CONDENSED BALANCE SHEETS (UNAUDITED)