Sol Meliá“S Operational Profits Will Increase By 28%

Sol Meliá`s operational profits, before interest, repayments and taxes, (EBITDA) have increased by 28% at the close of the third quarter, totalling 26.738 million pesetas - 160,7 million Euros -. At the same time, the Company`s total consolidated production has risen to 84.194 million pesetas - 506,02 million Euros -, which represents an increase of 19% compared with the third quarter of 1998.


With regard to the net consolidated profits obtained by Sol Meliá for the first nine months of the year, the total achieved is 12.700 million pesetas - 76,3 million Euros - 17% more than for the same period last year.


The positive results obtained by the Spanish tourism sector in the first eight months of 1999, during which a total of 35,8 million people were accommodated in Spanish hotels - 9% more than during the same period last year - represents a marked increase in the occupancies and income from the European city and resort hotels, especially in Spain, where the majority of Sol Meliá `s hotels are located.


15 NEW HOTELS INCORPORATED SO FAR THIS YEAR:
From the beginning of this year until now, Sol Meliá has incorporated 15 new establishments into its ranks, 3 of which are owned by the Company. Following the acquisition of the Meliá White House in London and the Meliá México Reforma in Mexico D.F., together with over 100 apartments in the Gran Meliá Caracas, all during the first half of 1999, the Spanish company has now signed an agreement with the Aurelia Centro company, for the management with a future pre-emption right, of Sol Meliá`s fist hotel in the Italian capital city: the Meliá Roma Aurelia


The incorporation of the Meliá Roma Aurelia is the result of the development strategy which Sol Meliá is carrying out in the major European capitals and cities and which aims to establish the company in the main countries of Europe, by the acquisition of one or several hotels - in Italy the first hotel was the Meliá Milán - followed by the signature of management contracts, as in the case of the Meliá Roma Aurelia.

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Following the inauguration in July 2000 of the aforementioned hotel in Rome, Sol Meliá will increase its world-wide presence to include 28 countries, 10 of which are in Europe: Germany, Belgium, Croatia, Spain, France, Greece, Italy, Portugal, Great Britain and Turkey.


Apart from this, Sol Meliá has recently signed an agreement with the Local Government of Extremadura, to carry out together various luxury projects in the provinces of Cáceres and Badajoz, the first of which is the Meliá Trujillo, which is due to open at the end of the year 2000.


With this hotel, the Spanish company intends to initiate a new range of products, characterised by their situation in small, special and/or historical buildings, located in the main European cities.


THE COMPANY`S GROWTH STRATEGY:


At the moment, Sol Meliá has signed agreements for 36 establishments in Germany, Brazil, Cuba, Egypt, Spain, Italy, Panama, Peru, Portugal, the Dominican Republic and Tunisia, which will be incorporated over a period of time until the year 2001 and which will enable the Company to offer an extra 10.422.


With regard to the Company`s short-term development objectives, these are based on increasing the number of hotel management and rental agreements, as well as continuing the actions initiated following the creation of the new company, which will consist of the acquisition of the majority of the capital, up to 100%, in individual establishments and small and medium-sized hotel chains, mainly in Europe and Latin-America.


SECOND LARGEST HOTEL COMPANY IN EUROPE:


According to the world-wide ranking of hotel companies, published in the July edition of the prestigious American magazine, “Hotels”, Sol Meliá now occupies thirteenth position in the world, second in Europe and first in Spain. The same publication has just awarded Sol Meliá`s Chairman, Gabriel Escarrer Juliá, this year`s title of “Corporate Hotelier of the World”.

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