The hotel chain Meliá Hotels International, which was founded in Majorca in 1956, earned €20.4 million in the first quarter of 2017, 8% less than in the same period of 2016. Revenues (€420.3 M) increased by 5% and EBITDA improved by 3%. The most positive figure was again generated by the hotel business, whose key performance indicator, Revenue Per Available Room (RevPAR) increased by a healthy 8.3%, while that of Spain – considering both resorts and city hotels – improved by an excellent 12.5%.
The results for the first quarter are influenced by the “Easter effect”, which, as Easter falls in April this year, will have a positive impact in the second quarter. In spite of this, the revenues of owned and leased hotels plus the fees paid by managed hotels increased by €28.5 million compared to the same period in 2016.
The company continues to achieve strong results from its digitalization strategy, where its most important direct sales channel, melia.com, increased sales in the quarter by 8.1%. Including April, the sales increase rises to 20% due the “Easter effect”.
Financial results saw a slight increase in debt, as usual in the first quarter, which remains at a comfortable ratio of 2 to 2.5X EBITDA. This was due in large part to the investment in the master plan being implemented in the Dominican Republic, and the purchase of the Paradisus Los Cabos hotel. Financial management achieved a further reduction in financial costs, with an average interest rate of 3.4%, and was negatively affected by exchange rate differences.
Gabriel Escarrer Jaume, Vice President and Chief Executive Officer of Meliá Hotels International: “Meliá recorded a notable increase in its main performance indicator, RevPAR, which improved by 8.3% in the quarter, the 27th consecutive quarter of growth. The performance in Spain (+12.5%) in the weakest quarter of the year points towards a positive high season, which Meliá will continue to use to strengthen its products through extensive investments in the renovation and repositioning of hotels. The company also continues to move forward with expansion, adding 15 new hotels in the year to date, with a special focus on Cuba where we have just signed 8 new hotels, and Asia, where we have opened two new hotels this year in China (Shanghai and Zhengzhou) and we will open three more in Indonesia.”
Results by region: Mediterranean
Business performance: Excellent performance in the Canary Islands, in spite of the “Easter effect”, due to high demand from the British, Scandinavian and German markets, and despite the reforms in the Meliá Gorriones and Meliá Salinas. Strong performance (+13.5% RevPAR) in Cape Verde hotels (currently with more than 2,000 rooms). Melia.com increased sales in the first quarter by 36%.
Expansion: In the first quarter, one new hotel was signed in Estepona (Malaga).
Outlook: Excellent prospects in the Spanish peninsula and Balearic Islands thanks to a positive Easter season, and a strong increase (double digit) of bookings for the summer in all areas (Balearic Islands, Canary Islands, and Spanish coast). Sales through melia.com for the summer have increased by a remarkable 42%.
Titelfoto: Hotel GRAN MELIÁ DE MAR, Meliá Hotels International