9M10 Results. Highlights Rev., Ebitda and Net Profit up by +8.5%, +16.5% and +51.1% Profit & Loss Account. Operational Ratios. Interest Cover Ratios

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1 9M10 Results Profit & Loss Account (million Euros) RevPAR % EBITDAR MARGIN 28.8% 27.2% 159 bp EBITDA MARGIN 22.1% 20.6% 151 bp EBT MARGIN 8.8% 7.0% 180 bp NET PROFIT MARGIN 7.3% 5.3% 207 bp Interest Cover Ratios EBITDA / Net Interest Expense 6.7x 5.9x 12.3% EBIT / Net Interest Expense 4.4x 3.6x 24.0% Stock Performance /12/ /01/ /02/ /03/ /04/ /05/ /06/ /07/ /08/2010 SOL VOLUME SOL LAST IBEX LAST 30/09/ /10/ ,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 Average Daily Volume 2010 ( ) 2,531, Week High, Oct 28 th Week Low, Feb 9 th Market cap Nov 9 th 10 ( 6.960) 1,286.0 mn Bloomberg: SOL SM ; Reuters: SOL.MC Sep 10 Sep 09 % REVENUES % EXPENSES ( ex - Operating leases) % EBITDAR % Rental expenses % EBITDA % Depreciation and amortisation % EBIT % Total financial profit / (loss) (48.0) (39.8) 20.6% Profit/(loss) from equity investments (9.4) (8.7) -7.8% Continuing EBT % Discontinuing Operations Profit before taxes and minorities % Net Profit % Net Profit attributable % Operational Ratios 0 Highlights Rev., Ebitda and Net Profit up by +8.5%, +16.5% and +51.1% Positive evolution of the Hotel Business in Q3 in which RevPAR and Ebitda increased by +10.1% and +22.2% respectively, confirming the trend seen in the first semester of the year. In Q3, RevPAR in European Cities increased by +17.4% (vs. +9.1% in H1) due to the progress in Madrid, London, Paris and German cities. In LatAm & Caribbean RevPAR increased by +10.9% (H1: -6.3%) confirming the return to normality seen in the later months of the first semester, following the earthquakes in Q1 Haiti. Evolution of the Spanish Resorts (RevPAR: +8.3% vs. H1: +1.5%) is mainly due to the Balearic Islands. In 9M, RevPAR increased by +7.7% (ARR: +3.9%), Cost per Stay increased by +1.6% while Hotel Ebitda and its margin improved by +13.8% and 134 bps. The Company points out the healthy growth of RevPAR which is primarily explained by prices (which is behind a 72% and 51% of RevPAR growth in Q3 and 9M respectively). Prices have been increasing for the last 7 months. Outlook: positive evolution maintained, ARR gaining weight Evolution of Leisure Travel and Business Groups derived from improvement in consumption in North America advances a positive first quarter 2011 in LatAm & Caribbean. The evolution of LatAm feeder markets will be also behind this trend. In the Spanish Resorts, negotiations with major European Tour Operators indicate slight price increases for summer Volumes sold so far indicate an increase of reservations for winter According to current bookings, the positive trend in the key Spanish Cities is expected to be maintained in Q4 and 2011, particularly related to Business Groups and Weekend travel & Leisure segments in Madrid and Barcelona. A more cautious stance is maintained regarding secondary cities in Spain. Future projections for European Cities indicates that the current positive evolution will be maintained based on Business Groups, tour operation and individual business travel. Altogether, the Company expects a mid-single digit RevPAR growth for 2011, primarily explained by price increases rather than greater volume Covenants to be met by year-end. Liquidity maintained. Net Debt represents Mn Euros and the Company expects this figure to remain stable until year-end. Considering the latest real estate transactions (i.e. disposal of Sol Pelicanos Ocas & acquisition of the future ME London), current liquidity level stands at Mn Euros, which compare with Mn Euros of debt maturities until December The Company will meet its Debt Covenants - currently involving Mn Euros - for the year end and remains confident about also meeting its obligations in Further development. 27 hotels in the pipeline Currently the pipeline represents 7,455 rooms, 9.5% of current portfolio. Of this, 82% under management & franchise and 89% outside Spain. Sol Meliá will foster its presence in European gateway cities and in LatAm, where the Company's plots of land will be developed, first in Mexico and further into the future in Brazil. Increased focus in Asia (primarily China) and on key cities in the US due to its importance as a feeder market for our operations in Europe & LatAm.

2 Table of contents 1. Letter from the C.E.O. and Vice-Chairman Information on Operations Hotels Sol Meliá Vacation Club Leisure Real Estate Income Statement...9 2

3 1. Letter from the C.E.O. and Vice-Chairman Macro: Cautious stance about the future Signs of recovery in the Travel & Leisure industry Sol Meliá: Positive evolution consolidated, both in RevPAR and hotel Ebitda margins which improved by 263 bps in Q3 Dear friend, Sol Meliá is releasing its 9 month results in an environment in which the recovery seen in the first semester of 2010 has continued to strengthen in both the global macroeconomic environment & the tourism industry. According to the World Economic Outlook issued by the International Monetary Fund last October, global activity expanded in the first semester at a mid-single digit rate, outperforming the estimates made in July and leading them to revise its 2010 estimates upwards for the main advanced economies in Europe. Nevertheless, the uncertainty related to measures to cut public spending implemented in some countries i.e the UK and Germany and its impact on the economy and unemployment levels, together with limited visibility about the pace of recovery advise us to us maintain a moderately cautious stance about the future. Regarding the Travel & Leisure industry, some signs of recovery have also been seen. According to the World Tourism Organization, in the first semester of 2010 international tourist arrivals grew by 7%, and this trend is expected to continue in 2H10, achieving a year end figure that may exceed its +4% forecast. In September, Spain received more than 5 million international tourists, representing a +4.2% increase and the fifth consecutive month of growth. Additionally, Exceltur (a lobby group of 25 of Spain's main travel groups) has recently revised its forecasts of tourism GDP for 2010 upwards, based on a better performance of the industry in the summer due to the recovery of foreign demand. As far as Sol Meliá is concerned, the positive underlying evolution seen throughout the first half of the year at the Hotel level has been consolidated during the third quarter, maintaining the RevPAR growth trend on a quarterly basis. In this sense, RevPAR in Q3 has increased by +10.1% (vs. Q1:-0.7%, Q2: +11.9%), enabling to report an increase in the Ebitda in the Hotel division of 22.2% (vs. Q1: -1.5%, Q2: +15.5%). This 10.1% RevPAR increase in Q3 (72% due to price) has been fuelled by the performance of the Upscale & Premium hotels (RevPAR: +15.3%) versus the Midscale brands (+5.7%), showing that the work already done related to the Brand Equity strategy - one of the key strategic areas for the Company - in terms of service and attributes standards implementation at the Meliá and Premium brands is payingoff. It is worth noting that the Company will focus its expansion plans in the future on the Upscale & Premium segments. With regard to margins, as the gradual recovery in prices has become more relevant, hotel Ebitda margins have significantly improved, increasing by 263 basis points in the third quarter compared with +5 bps in Q1 and +80 bps in Q2. Looking ahead, for 2011, the Company expects this trend to continue, leading to a mid-single digit RevPAR increase, with the recovery in prices becoming increasingly more relevant. Gradual recovery protected by low supply growth Liquidity guarantees short and mid term maturities This gradual recovery is expected to be protected by low supply growth in the main markets where the Company operates. In this regard, according to STR Global in its report of September 2010, new supply is expected to grow annually by 0.6% and +1.0% in Dominican Republic and Mexico respectively. In regard to Europe and Spain, new supply is also expected not to be an issue in the near future. According to the same source, in these areas supply is estimated to grow annually in terms of rooms by +0.8% and +0.3% per year respectively. Financially speaking, considering the recent sale of the Sol Pelicanos Ocas hotel and the acquisition of the ME London hotel, liquidity level stands at million Euros, guaranteeing short and medium-term debt repayments that represent million Euros between last quarter 2010 and December In terms of liquidity, the Company has renewed 100% of the amount of credit facilities that expired in the first 9 months. Moreover in the last months Sol Meliá has signed 4 bank loans / mortgages for 74 million Euros in order to maintain its high liquidity level into the future. As occurred last year, exploiting the current market situation in which interest rates are particularly low, Sol Meliá works to maintain the weight of the fixed rate debt in approximately 60%. In relation to Development Capex, the strategy based on growth through low capital intensive formulas in those countries where the Company currently boasts experience and know-how is maintained: European Cities, Mediterranean rim and LatAm. 3

4 Brand Equity Strategy underpins the Expansion, supported by a flagship acquisition, the ME London Development in Asia Last September 29, taking advantage of market opportunities with regard to distressed assets, Sol Meliá acquired a free-hold strategic asset, the ME London, located in a key destination / feeder market and also reinforcing and positioning the ME by Meliá brand. Regardless of the profitability expected in the medium term, this flagship hotel (expected to open early 2012) will help the ME by Meliá brand to grow globally through management, franchise and joint venture agreements. Among the expansion plans of Sol Meliá, in the medium term the Company will maintain a focus on Asia, where 25 years ago established its first international hotel in Bali and where recently opened a flagship hotel, the Gran Meliá Shanghai in China. These expansion plans will materialize mainly through local partners in order to develop further hotels & resorts with special emphasis on China Additionally, following the recently opened Meliá Atlanta hotel the Company will increase its focus on the United States, where we understand that there is a significant volume of potential demand for our hotels and resorts in Europe and LatAm. In order to increase its brand awareness and customer base, in the medium term the Company will gradually increase its presence in key cities where it would make sense for us (i.e. New York, Miami, Orlando and Washington). To end this letter, we would like to emphasize the moderately optimistic stance that Sol Meliá maintains in relation with the evolution of the business in 2011, taking into consideration that the recovery process in the sector is beginning to consolidate. In this environment, the efforts made from a Brand Equity standpoint reinforcing our brands globally, the expansion plan based on low capital intensive formulas focusing in the Upscale & Premium segments along with the financial strength and liquidity levels provides Sol Meliá enough level of comfort allowing us to focus the efforts on the operational management of the Company within a framework of cautious optimism. Gabriel Escarrer CEO & Vice Chairman 4

5 2. Information on Operations 2.1. Hotels RevPAR for owned and leased hotels has increased by +7.7% during the first 9 months of the year, due to increases in Occupancy and ARR by +3.6% and +3.9% respectively. In 3Q10, RevPAR increased by +10.1% with increases in Occupancy and ARR of +2.6% and +7.2% respectively. In this period, increases in ARR have been seen in 105 out of 158 hotels (66.5%). Food & Beverage revenues have increased by 1.9%, below the +9.0% of Room revenues. This is explained by a) the level of resistance to consumption by hotel customers and transients and b) the offers made by Sol Meliá in F&B (such as breakfast promotions) in order to maximize total revenues. The combined effect represents a slight decrease in the F&B department margins (30.8% vs. 32.1%), offset by the increase in the Room department margins (69.0% vs. 67.7%). The overall effect is widely positive in light of the Ebitda margin evolution during the year and the quarter (i.e.+134 bps and +263 bps respectively). RevPAR for Sol brand (100% resort, 100% Spain) increased by +1.9% during the first 9 months of the year, mainly due to an increase in ARR by +4.3%. The performance of the Balearic Islands, where RevPAR increased by +7.1% and, to a lesser extent, the Canary Islands explains these figures. Recovery in the Balearic Islands During the Third Quarter, RevPAR increased by +4.9%, due to changes in Occupancy and ARR by -1.6% and +6.7% respectively. Increases in ARR have been seen in 28 out of 41 hotels. The performance of the resorts in the Balearic Islands (RevPAR: +9.7%) and, to a lesser extent, resorts in Costa del Sol (RevPAR: +2.0%) offset the evolution in some destinations in mainland Spain i.e. Alicante. The -1.6% decrease in Occupancy in Q1 is mainly explained by the decrease in roomnights from the UK and, to a lesser extent, Spanish feeder markets, which was partially compensated by the increase in roomnights from Portugal, Italy, Central Europe and Eastern Countries. Operational Expenses (excluding rental expenses) have increased during the first 9 months by +0.1%, while total costs per stay increased by +3.3%. The reason is related to the volume of fixed costs of the brand, since total number of stays decreased by -2.6% within the period. In terms of Available Rooms, the decrease is related to the late opening of 2 seasonal hotels: Sol Antillas Barbados and Sol Magalluf Park, both located in the Balearic Islands. RevPAR for the Tryp by Wyndham brand (100% city; 78% Spain) has increased by +6.0% during the first 9 months, as a result of increases in Occupancy by +4.4% and, to a lesser extent, in ARR by +1.6%. Positive RevPAR evolution maintained in Q3 During the Third Quarter, RevPAR increased by +7.0%, confirming the positive trend seen during the first half of the year on a quarterly basis (Q1: -1.7%, Q2: +10.8%). Increases in ARR have been seen in 30 out of 56 hotels. The positive performance of hotels in Germany and France witnessed during the first months of 2010 has been maintained in Q3, where RevPAR increased by +26.7% and +4.8% respectively. Hotels in Spain have seen RevPAR increase by +3.5%, on the back of the performance of hotels in Madrid. In Spain, room revenues from both the Individual Leisure and Business Groups segments - close to 33% and 11% of the brand s room revenues - increased by +11% and +14% respectively in Q3, maintaining the positive evolution seen in the first half of the year. Operational Expenses (excluding rental expenses) have increased during the first 9 months by +4.6%, while total cost per stay decreased by -1.6% on the back of decreases in the Food & Beverage and 5 ME Madrid

6 Personnel cost per stay of -2.0% and -2.7% respectively, continuing the trend witnessed during the first semester as a result of the adjustments of staff to the volume of business. The decrease in the Available Rooms item is explained by the termination of 2 hotel lease contracts for the Tryp by Wyndham Rex and the Tryp by Wyndham Burlada, both located in Spain. In 9M, RevPAR for the Meliá brand (48% Spain, 20% LatAm, 32% EMEA) increased by +13.5%, due to both increases in Occupancy and ARR by +5.4% and +7.7% respectively. The performance of European City hotels (+8.6%) and Meliá resorts (+19.7%) explain these figures. The positive evolution seen in the first semester has been maintained in Q3, where RevPAR increased by +17.2%, maintaining double digit increases in each month. In Q3, Increases in ARR have been seen in 38 out of 48 hotels. LatAm resorts: Recovery in prices on track Double-digit RevPAR increase in European Cities Regarding the Meliá resorts, in the Third Quarter RevPAR increased by +24.8% mainly due to the performance of the Spanish resorts, specially those located in the Balearic and the Canary Islands, where RevPAR increased by +33.6% and +29.2% respectively. Mention must also be made of the evolution of resorts in America, especially those located in Mexico (+10.3%) and the Dominican Republic (+17.2%) fuelled by recovery in prices, with increases in ARR by +21.9% and 14.0% respectively. Positive performance in City hotels in Q3 due to the performance of hotels in UK (+23.1%), France (+20.2%), Germany (+19.1%) and to a lesser extent Spain (+7.4%). In Spain, the positive trend witnessed in the first semester of the Individual Leisure and Business Groups segments - close to 28% and 23% of the brand s room revenues respectively - has been consolidated, with an increase in Q3 by +25.6% and +30.7% respectively. This has been also the case for the Individual Business, where room revenues increased by +15.0% in the quarter. During the first 9 months of the year, Operational Expenses (excluding rental expenses) have increased by +13.0% while total cost per stay has increased by +5.6%. Excluding changes in the perimeter, total cost per stay has increased by +0.5%. In terms of Available Rooms, the increase is explained by 1) the incorporation of the Meliá Luxembourg (May 09), Innside Düsseldorf Derendorf, Meliá Valencia (both in October 09), Meliá Bilbao (September 09) and the Innside Dresden (January 10), partially offset by 2) the disaffiliation of the Meliá Palm Azur (November 09). Premium brands (77% of the portfolio in the Americas) have seen RevPAR increase by +2.2% in the first 9 months of 2010, due to increases in Occupancy by +10.8%. The evolution of the European City hotels and Resorts, where RevPAR increased by +17.8% and +18.0% respectively, explain these figures. Worth mentioning the evolution in Q3, where RevPAR increased by +10.4%. Recovery in prices in the Americas During the Third Quarter, Resorts have seen its RevPAR increase by +26.6%, explained by the evolution of the hotels in Mexico, based on a better comparables due to the Influenza A. In this area, RevPAR increased by +50.7% helped by a recovery in Occupancy by +49.5% and to a lesser extent the ARR (+0.8%), which has improved compared to the first semester (ARR: -11.1%). Increases in ARR have been seen in 9 out of 13 hotels. Operational Expenses (excluding rental expenses) have decreased during the first 9 months of 2010 by -3.8%, while total cost per stay has gone down by -11.1%, on the back of reductions in Food & Beverage and Personnel cost per stay by -10.7% and -11.4% respectively. 6

7 Table 1: Hotel statistics Owned and Leased hotels 10 / 09 (RevPAR & A.R.R. in Euros) % Occupancy RevPAR A.R.R. Available rooms ( 000 units) SOL 2, % ,559.4 % o/ % 1.9% 4.3% -0.2% 2, % ,565.5 TRYP BY WYNDHAM 2, % ,141.7 % o/ % 6.0% 1.6% -1.7% 2, % ,179.0 MELIÁ 2, % ,963.3 % o/ % 13.5% 7.7% 5.2% 2, % ,816.7 PREMIUM 2, % ,272.5 % o/ % 2.2% -7.8% 0.3% 2, % ,268.8 TOTAL 2, % ,936.9 % o/ % 7.7% 3.9% 1.2% 2, % ,830.0 Table 2: Hotel revenues split 10 / 09 for owned/leased hotels Room Revenues F&B and Other Total Revenues SOL 2, % o/ % -5.7% -1.2% 2, TRYP BY WYNDHAM 2, % o/ % 7.9% 5.2% 2, MELIÁ 2, % o/ % 6.7% 14.1% 2, PREMIUM 2, % o/ % 0.4% 1.3% 2, TOTAL 2, % o/ % 2.5% 6.3% 2,

8 2.2 Sol Meliá Vacation Club During the first 9 months of 2010, the total number of weeks sold directly by the Club, represented 2,070 units, a -10.0% decrease versus the same period last year, while in Euros the average price has increased by +10.6%, leading to a total Net Club sales to decrease by -0.5%. The overall performace during the first 9 months of 2010 is mainly explained by the decrease in the occupancy levels that affected our resorts in the Dominican Republic in Q1, as well as the significant change in some hotels in the client mix, impacting the number of suitably qualified prospects. In order to maintain the flow of customers, alternative prospecting measures have been implemented such as the launch of in-house marketing programmes to increase the rate of closing efficiency. 2.3 Leisure Real Estate 61.3 million Euros of Ebitda is mainly due to capital gains generated in 9M2010 from the sale of two hotels, the Tryp by Wyndham Los Gallos (Cordoba - Spain) and the Sol Pelicanos - Ocas (Alicante - Spain) generating 59.7 million Euros of capital gains within the Company s asset rotation activity. Regarding the other real estate businesses, by country: In the Dominican Republic, total revenues represent 5.7 million Euros, a -19.2% decrease derived from: 1) Decrease in revenues from managing the golf courses and the administration of residences located in the Desarrollos Sol complex of -11.6% (-0.4 million Euros). 2) The management of the Sierra Parima shopping centre, where revenues increased by 13.7% (0.4 million Euros) partially compensated the decrease in revenues from the sale of plots of land. In Venezuela, rentals of shopping premises in the basement of the hotel Gran Meliá Caracas decreased by 24.3% (-0.5 million Euros), affected by the devaluation of the Venezuelan currency. 11 8

9 3. Income Statement Revenues Total Operating Revenues have increased by +8.5% to million Euros. The evolution of the hotels, Sol Meliá Vacation Club and the Leisure Real Estate Division is explained in greater detail in the Information from Operations section. Other revenues include third party management fees of 35.1 Mn which represents a 4.8% increase. Operating Expenses Total Operating Expenses have increased by +6.2% (40.3 million Euros). Raw Material Expenses have increased by +9.4% (9.8 million Euros) due to increases in this item in Sol Meliá Vacation Club. At the hotel division, Raw Material Expenses have increased by +4.4%, in line with the +3.6% increase in Occupancy. Excluding changes in the perimeter Raw Material Expenses have increased by +3.4% at the hotel division. Personnel Expenses have increased by +1.2% (3.5 million Euros). At the Hotel Level, personnel expenses increased by +1.1% (+2.6 million Euros). Excluding changes in the perimeter and exchange rate differences - basically the devaluation of the Venezuelan currency - overall Personnel Expenses increased at the Hotel level by +1.4%. Other operating expenses have increased by +10.7% (27.0 million Euros). When excluding perimeter, forex and extraordinary items, other operating expenses would have increased by +6.0% overall and 5.1% at the hotel level. Rental Expenses have increased by 10.0% (5.9 million Euros). This figure is affected by some changes in the perimeter, 1) the incorporation of 4 hotels under the Meliá brand (Madrid Princesa, Luxembourg, Valencia and Bilbao), and 3 hotels under the Tryp by Wyndham brand (Condal Mar, Gallos and Alondras) and 2) the disaffiliation of two rental contracts in Tunisia. Excluding changes in the perimeter, rental expenses have decreased by -1.1% (-0.6 million Euros) thanks to negotiations carried out with hotel owners that have more than compensated the updates to annual rents - all rentals are updated in line with the Consumer Price Index - and the better hotel performance, since some of the lease contracts have a variable part linked to hotel results. Rentals from the lease of the Sol Pelicanos Ocas hotel will be accounted as operational leases according to IAS 17. Ordinary Profit / Net Profit Net Interest Expense has increased by -3.7% (1.2 million Euros) due to 2 opposite effects. On the positive side, 1) the financial capital gains (14.2 million Euros) from the sale of two minority stakes in two hotels and, on the negative side, 1) the consideration of Venezuela as a hyperinflationary economy according to IFRS standards and its corresponding impact on its monetary assets (-5.5 million Euros), and 2) accounting of the 200 million Euros convertible bond (-3.0 million Euros), and 3) increase of regular interest expenses derived from a) increment of spreads and b) the interest rate swaps signed last year in order to increase the weighting of fixed debt. The evolution of Associates is related with the sale of the stake in the Paradisus Riviera Cancun which does not contribute any longer to this item. Tax rate has decreased from 17.0% to 15.7%. In any case, as mentioned on the First Semester 2010 results, the Company maintains a conservative policy regarding the capitalization of tax losses generated in the holding company, and will continue doing so. 9 ME Viena

10 Table 3: Sol Meliá Consolidated Income Statement Million Euros Sep 10 Sep 09 % Hotels Leisure Real Estate Vacation Club Other Revenues Total revenues % Raw Materials (114.3) (104.5) Personnel expenses (301.4) (298.0) Other operating expenses (279.9) (252.8) Total operating expenses (695.6) (655.3) 6.2% EBITDAR % Rental expenses (65.0) (59.2) EBITDA % Depreciation and amortisation (72.3) (73.6) EBIT % Net Interest Expense (32.5) (31.3) Exchange Rate Differences (6.6) 0.4 Other Interest Expense (8.9) (8.9) Total financial profit/(loss) (48.0) (39.8) 20.6% Profit/(loss) from equity investments (9.4) (8.7) Continuing Earnings Before Taxes % Discontinuing Operations Profit before taxes and minorities % Taxes (13.6) (10.8) Group net profit/(loss) % Minorities (P)/L (1.1) (5.2) Profit/(loss) of the parent company % 10 Meliá Istrian - Croatia