Capital gains deficit affects Spanish hotel group results

Spanish international hotel group Sol Meliá has reported net profits of £31.5m for the first half of the year. This was 11% lower than the figure recorded for the same period last year.

The company said the fall was caused by a lack of extraordinary capital gains, which it achieved a year ago from the sale of hotels in the Canary Islands and the Dominican Republic.

In the six months to 30 June, its revenue climbed to £296m, an increase of 29% over the same period last year. This, it said, reflected its successful amalgamation of Tryp Hotels, which it bought in August 2000. It paid £219m for the rival 60-strong chain, based in Madrid.

Business at Sol Meliá's European city hotels was good during the half-year, particularly in Spain. This resulted in an overall increase in revenue per available room (revpar) at its European city hotels of 8.6%. In its European resort hotels, revpar was reported to have increased by 6.6% and by 13.5% in its hotels in the Americas.

In the first six months of the year, the company increased its number of hotels by 16. It now has 347 hotels with 83,805 bedrooms in 30 countries.

On 30 June, Sol Meliá signed agreements for a further 74 hotels. These are scheduled to open over the next two years.

by Louise Bozec