Melia Posts Great First-Half Outcomes in 2015

Meliá Hotels International has announced excellent results for the first half of 2015. In particular, the company highlights positive growth in the main European and American markets and verifies the recovery of the Spanish market.

Along with this encouraging situation and the favorable effect of the appreciation of the dollar and the pound sterling, Meliá attributes the positive developments to the company’s strategic focus on revenue, direct sales and customer loyalty (Meliá Rewards program) together with hotel renovations and rebranding.

The company earned €20,3 million in the first half of the year, a 224 percent increase compared to the same period in 2014, with a growth of 19 percent in total revenue and 22,1 percent in underlying EBITDA, which increased by 43 percent if the greater capital gains from asset sales during the period are included.

The growth in sales on melia.com (+27 percent to date), powered by the increasing digitalization of the business through the “MeliáDigital” project, has made it the company’s most important sales channels. It also complements the business generated through close cooperation with the most important travel agencies and tour operators.

Gabriel Escarrer, Vice Chairman and CEO at Meliá Hotels International said: “The results from January to June confirm the positive business performance of Meliá Hotels International. Together with our strength in the Caribbean the results reflect the fruits of economic recovery and our successful sales strategy in major European cities, especially in Spain. Looking ahead, Meliá is working towards a new Strategic Plan for 2016-2018, which will allow us to continue to lead in a constantly changing industry, both in the resort and new “urban resort” areas, and to continue to make progress in the company’s digitalization.”

This quarter has welcomed a strong recovery in profit margins, with overall growth of 323 basic points, improved in all business areas, as well as the reduction of net debt, allowing the company to meet its financial deleverage objective and continue to alleviate financial costs. Financial results improved by 45 percent and free cash flow grew by €30 million compared to the first half of 2014.

Reinforcing the company’s strong international growth, Meliá highlighted the important rate of new hotel openings (nine openings so far in 2015 and 14 new hotels signed for future openings).

The company’s portfolio currently totals 377 hotels (with nearly 98,000 rooms), of which 316 are currently operating and 61 are signed and in the process of opening. The company is continuing to grow in Cuba, where it expects to have 15,000 rooms in operation by 2018.

The Americas saw excellent RevPAR growth of 30 percent excluding the impact of the change to SIMADI exchange rate of the Venezuelan Bolivar. This was due to the positive performance of the business and the appreciation of the Dollar against the Euro. Also of note was the growth of sales through melia.com which under the company’s “MeliáDigital” project increased by 36 percent compared to 2014.

By country, Mexico continues to do well with RevPAR growth of 34.6 percent thanks to the persistent growth of Paradisus Playa del Carmen, Paradisus La Perla and Paradisus La Esmeralda and the renovations at Paradisus Cancun.

The resorts in the Dominican Republic also saw a significant improvement (+28.2 percent) in RevPAR, 95 percent due to price increases. Also of note is the successful management of direct sales and US online travel agency sales to offset the collapse of the outbound Russian market.

Finally, developments at the Meliá Nassau in the Bahamas have doubled its results compared to last year after a major renovation and conversion to an all-inclusive resort.