SOL MELIA ANNUAL REPORT 00 COMP

2 Business Trends
In view of the agreements reached as a result of the acquisition of Tryp S.A., the Balance Sheet, Profit and Loss Account
and Notes thereto for the year 2000 include the consolidated figures of the Tryp Group for the last six months of the year.
2.1 Property business
Tryp figures for the second half year, which are included in the consolidated profit and loss account, have also been included in
statistics.
RevPar in the Property Business – including owned and leased hotels – has increased by 18.6%, driven by the positive performance
of the three Divisions in which Sol Meliá operates owned and leased hotels.
With an accumulated RevPar increase of 11.2% -10.4% without Tryp-, the European Resort Division has evolved very satisfactorily
thanks in great part to an outstanding summer season. The almost 16% increase in ADR was possible thanks to the
refurbishment program and the positive trend of the resort business in Spain. The Company believes that the favourable trend
of the resort business will go on in 2001, taking into account the evolution of sales to date. In the future, the renovations carried
out in our resort properties will promote the Congress and Conventions market segments.
The 13.3% -14.9%, without Tryp, RevPar increase in the European City Division confirms the positive trend of the city business
in Europe, specially in Spain. 10% is due to the evolution of the Spanish city hotels and to the incorporation of the Paris
hotels and the Meliá White House in London, with significantly higher ADR’s, 42% and 50%, respectively.
We expect to achieve important increases in ADR’s in the forthcoming years as a consequence of the existing gap between
Spanish city hotels and other European properties in terms of prices. The Company believes that the Euro currency will help
to clarify rate differences between European Regions, with a positive impact on results.
The Company would also like to emphasise the recovery in the America Division during 2000, with a RevPar increase of 29.5%.
This increase has been further boosted by the conversion of Dollars – the currency used in our hotels in Latin America – to
Pesetas. Excluding the conversion factor, the increase in RevPar would have reached 12.3%. Furthermore, without taking into
account the latest hotel incorporations, most of which have still not yet reached maturity in 2000, the RevPar increase would
have been 28.5%, mainly due to the good performance of our resorts in Mexico and the Dominican Republic.
The Company has positive expectations for the America Division in the light of the recovery in the Latin American economy,
the maturity of some units acquired in the last 18 months and the positive trend of hotel performance in the region so far.
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