Spain’s Melia Hotels returns to profit in 2022, expects further travel rebound

Adds 2022 results details, 2023 outlook

MADRID, Feb 27 (Reuters) – Spanish chain Melia Hotels International MEL.MCreturned to profit in 2022 after two years of losses, it said on Monday, as tourism rebounded at the end of COVID-19 restrictions and it hiked room prices.

The Mallorca-based group reported a net profit of 120.1 million euros ($127.40 million) compared to a net loss of 192.9 million euros one year ago. That was still 1.3% below 2019 pre-pandemic levels, but well ahead of analysts’ estimates for a 58 million euro net profit, according to Refinitiv.

Melia booked 1.6 billion euros in revenue last year, in line with analysts’ expectations of 1.63 billion and only 6% behind its pre-pandemic levels, as international tourism took off strongly in the second half of 2022, leaving the latest restrictions due the Omicron variant of the coronavirus behind.

The company anticipated inflation pressures by increasing room rates early last year, as it took advantage of high pent-up travel demand after two years of lockdowns and was also boosted by the return of in-person business meetings and events.

The hotel group said it increased rates by an average of 26% in 2022 compared to the year before.

Chief Executive Officer Gabriel Escarrer said Melia was “optimistic” for 2023.

The company expects global bookings to surpass pre-pandemic 2019 levels by double digits in the first quarter, Easter and summer season this year, Escarrer said in a statement.

While international travellers from the United States, Canada and Central and Northern Europe have returned to its hotels in Mexico, the Caribbean and the Canary Islands during the first quarter of 2023, Melia expects a strong rebound of tourism from countries such as South Korea, Japan, Australia and China by the second half of the year.

The company said it plans to open at least 30 new hotels this year and values its own and joint ventures assets at 4.6 billion euros ($4.88 billion).

($1 = 0.9435 euros)

(Reporting by Matteo Allievi and Corina Pons, editing by Inti Landauro, Jane Merriman and Bill Berkrot)

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