Half Year 2026 Melia Hotels International SA Earnings Call Transcript
Key Points
- Consolidated revenue excluding capital gains increased by 7.1% in H1 2026, with Q2 growth particularly strong at 8.5%.
- Underlying revPAR growth was robust, with owned and leased revPAR up 5.1% in H1 on a constant currency and comparable portfolio basis.
- The company reaffirmed its full-year 2026 guidance, including high-single-digit revPAR growth, 200 basis points like-for-like margin improvement, and at least EUR565 million of EBITDA.
- On-the-books reservations are up double-digits year-over-year, providing strong visibility for the summer season and the remainder of the year.
- The company is actively expanding its portfolio, having signed 17 new hotels (over 3,800 rooms) and opened 14 hotels (about 2,000 rooms) in H1 2026, including a strategic entry into Tunisia.
- Management is targeting asset disposals of over EUR100 million from non-core assets, which is expected to have no material impact on recurring earnings.
- The exit from Cuba is complete, with the EUR79 million impairment being a one-off, non-cash charge that removes a source of future volatility.
- Recent acquisitions and investments are expected to deliver double-digit cash-on-cash returns, enhancing the quality and earnings potential of the portfolio.
- Strong performance in key markets like Spain, Italy, the UK, and the Dominican Republic, with the latter achieving double-digit revPAR growth.
- The company maintains a disciplined financial profile with a clear objective of keeping net debt to EBITDA below 2.5 times.
- Group net profit was significantly impacted by a EUR79 million non-recurring impairment related to the exit from Cuba, dragging reported net profit down to just EUR4.1 million.
- EBITDA margins remained under pressure in H1 2026, partly due to the temporary closure of two key owned hotels (Paradisus Cancun and Gran Melia Don Pepe), which had a combined impact of over EUR20 million on EBITDA.
- Performance in Mexico was temporarily affected by specific local security-related events, impacting booking patterns and overall results in the region.
- The company faces ongoing headwinds from foreign exchange movements, which negatively affected both revenue and cost base during the period.
- Net unit growth will be naturally impacted by the exit from Cuba, which could mask the underlying strength of the development pipeline.
- The operating environment remains volatile due to geopolitical tensions, particularly in the Middle East, which continues to pose risks to the tourism sector.
- France experienced temporary pressure from disruptions linked to the Middle East conflict and air connectivity issues.
- Germany faced a more demanding comparison due to the absence of major events that benefited the prior year.
- The company's net debt excluding leases increased by EUR65.1 million in H1, reflecting significant investments made during the period.
- China's recovery remains gradual, with pricing conditions in the market remaining competitive.
Good afternoon and welcome to Melia Hotels International first half 2026 webcast. I'm Stephane Baos, Head of Investor Relations. Before we begin. We would like to remind you that our presentation will include forward-looking statements. Actual results could differ from those indicated in our forward-looking statements.
And forward-looking statements met today speak only to our expectations as of today. Unless otherwise state or revPAR, occupancy, average daily rates and P&L comments. Refer to year-over-year changes for the comparable period.
For the purposes of this presentation, our President and Chief Executive Officer, Gabriel Escarrer, together with our Chief Operating Officer, Andre Gerondeau, will walk you through the key highlights and main topics. You can find our earnings release. On our investor relation website at meliahotelsinternational.com. We will now see a short reel with the main KPIs followed by the presentation.
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