06 June 2018


Gabriel Escarrer Jaume at Shareholders' Meeting: "Meliá has increased earnings per share by 240% over the last four years".

Escarrer described the Group's 2020 vision and achievements in building a "stronger, more solvent and more just" company

The Executive Vice President and CEO of Meliá announced the elimination of single-use plastics before the end of 2018

Meliá Hotels International held its General Shareholders' Meeting today, chaired by Gabriel Escarrer Juliá. Both the Non-Executive Chairman and the Executive Vice President and CEO, Gabriel Escarrer Jaume, presented positive Company results for 2017, milestones in the Group's Strategic Plan which ends in 2018 and news on progress in the cultural transformation that they have been leading.

Both leaders also referred to the process of generational change, a subject they believe to be of the utmost importance for company governance and investor confidence, which Meliá has managed efficiently and which has been well received by markets.

The current Non-Executive President, Gabriel Escarrer Juliá, explained how Meliá has undergone profound changes throughout its history, noting that it is also successfully managing the disruption caused by digital transformation which experts have compared to periods such as the Renaissance or industrial revolution .

Escarrer Juliá focused his speech on three things he defined as "key levers" for the future of the Company: firstly, strengthening corporate governance (which he defined as fundamental for a sustainable business), secondly, continuing with international growth (the company added 30 new hotels in 2017), and thirdly, the management of people and corporate talent. The founder of Meliá highlighted the intense transformation that digitalisation has brought to global talent management in a company that is already present in more than 40 countries and has been named the travel company in which most Spaniards would like to work and the company employees are "happiest to work for" in Spain.

The Executive Vice President and CEO then explained the positive results for the Group in 2017 from several different perspectives (social cash-flow, financial results, customer satisfaction, and market response). According to Escarrer, the positive financial results and prudent debt management are helping build a more profitable and solvent company (an objective in the Strategic Plan), and also a "more just" company, which in 2017 distributed almost 3,000 million euros among all of its stakeholders, demonstrating its capacity to generate value for society as a whole.

Escarrer Jaume highlighted the high degree of achievement of the objectives defined in the current Strategic Plan (2016-2018) as well as the main advances in cultural transformation, a process that started a few years ago and which has allowed the Company to make progress in creating a revenue and profitability culture, in brand value and positioning, and, very importantly, in the digital transformation of its sales.

Escarrer strongly emphasised evolution from a business model based on ownership towards a management-based model. He reminded the audience that 31% of Group EBITDA comes from managed hotels, generating greater profitability with minimal capital investment and thus allowing Meliá to become more solvent and more resilient to real estate cycles while also favouring more agile and strategic international growth. Gabriel Escarrer explained that these advances have made it easier for Meliá to plan 50 new hotel openings over the next two years, an average of almost one new hotel every two weeks.

For the CEO, it is very important that successful companies work together with society to create shared value, and cited several examples of the transformation of destinations that Meliá has promoted over recent years, such as the Calviá Beach project for the sustainable transformation of Magaluf or the Palma Convention Centre project by which the Group aims to create a driver behind the transformation of tourism and development in Palma de Mallorca.

Escarrer devoted the final part of his speech to summarising the satisfactory stock market performance in 2017, a year in which the share price rose by 3.8% compared to an average fall of 0.4% in the Ibex 35. He stressed that so far in 2018, the share price has increased by 4,35%. The Vice President and CEO expressed special pride in generating value for shareholders and earning their confidence, saying "in four years Meliá has increased earnings per share by 240%”. 96% of analysts that cover Meliá shares have published “buy” or “hold” recommendations, making the company "the Ibex company with the best market consensus".

Escarrer was very concerned about the global challenge caused by climate change and its effects on tourism. In his words, "four of the five risks that will have the greatest impact on tourism are related to climate change". After reminding the audience that Meliá is one of the companies leading the fight against climate change as indicated in the prestigious Carbon Disclosure Project index, as well as a signatory to the commitments made at the Paris Climate Summit 2015, he announced that Meliá has decided to completely eliminate single-use plastics from its value chain in hotels and corporate offices by the end of 2018.

Regarding the outlook for 2018, Gabriel Escarrer Jaume mentioned the favourable prospects for the global travel industry and his certainty that the Group will meet the objectives defined in its Strategic Plan, due to end at the beginning of 2019 The CEO of Meliá also mentioned some of the risk factors for the industry, such as the collaborative economy, processes such as Brexit in the United Kingdom, and the political situation in countries such as Italy and Spain, among others.

Both men thanked shareholders for their support and trust, and reiterated their commitment to shareholders and all other stakeholders and their willingness to continue building a responsible, profitable and sustainable hotel Company both for present and future generations.

As expected, the General Shareholders' Meeting was held with the required quorum and approved all of the items on the meeting agenda.

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