FIRST HALF RESULTS 2015

FIRST HALF RESULTS 2015

Meliá Paris La Défense meliahotelsinternational.com

FIRST HALF RESULTS 2015 Meliá tripled its Net Profit over the previous year thanks to the significant progress in revenues, EBITDA and RevPAR, and consolidates the recovery trend in margins Business Performance Net result reaches 20.3 million euros, +224% compared with the same period last year, despite the impairment of 28.7 millon euros in the asset in Puerto Rico in Discontinuing Operations. The Company has recently updated the asset appraisal with JLLS (june 2015) highlighting the value improvement of the Gran Melia Palacio de Isora, Paradisus Playa del Carmen and Meliá Milano between others. Total Revenues improved by 19.2% due to the excellent performance of the hotel business, which saw a RevPAR increase of 11.5% (9.4% ARR, 2% Occ) in spite of the impact of the Venezuelan bolivar. Recovery in EBITDA ex capital gains margins* (+200bp) thanks to a healthy RevPAR growth. Melia.com continues with its consistently positive performance, with YTD growth of 27.2% compared with same period last year. Debt Management EBITDA ex-capital gains increase (+22.1%) and significant improvement in financial results (+45%) allow an important improvement in free cash flow generation (+30 million euros). Net debt decreased by 118 million compared to December 2014 reaching 869 million, thanks to the better performance of the Cash Flow from Operating Activities and the asset rotation activities, partially offset the purchase of the 58.5% remaining of the Meliá Milano. The Company maintains its commitment for 2015 to deleverage the balance sheet, with a target for the year end of: net debt / Ebitda ex-capital gains below 3.5 times. Development strategy In the first semester the Company has signed 14 additional hotels focussing on emerging markets and resorts, to reach a total pipeline of 61 hotels (14,190 rooms), 82% under management and 18% under lease agreements. YTD the Company has opened 9 new hotels with 1,679 rooms, all of them under low capital intensive formulas, outstanding the opening of Meliá Doha, ME Milano - Il Duca and the Meliá Paris - La Défense. The Company expects to achieve the goal of 25 news contracts in 2015 Outlook 2015 Thanks to the Company focus on Revenue Culture implemented through a yield management strategy and a healthy distribution strategy with special emphasis on the development of direct sales channels, the consolidation of the relaunch of the Sol Hotels & Resorts brand and the favourable sales situation to date, everything points towards a excellent summer season (3Q). The Company maintains its guidance of healthy high single-digit growth in RevPAR for the full year 2015, with more than 2/3 explained by price increase. 3

Gabriel Escarrer, Vice-Chairman & CEO of Meliá Hotels International, Dear friend, The Company is releasing the First Semester 2015 set of results confirming the positive underlying performance of our hotels & resorts worldwide. In addition to our strength of our leading Latin America and the Caribbean position, we are happy to see the recovery of European main cities. Special mention deserves the evolution of the main and secondary Spanish urban destinations which reflects the recovery of the domestic economy along with Company s commercial capability. The latter, has enabled us to improve our Ebitda and consolidated margins by 43% and 323basic points respectively leading Melia Hotels International to a 224% Net Profit increase. We are also confident on this third quarter which main indicators, advance a record year as far as the summer season is concerned. Therefore, the projected evolution of the business, together with the proceeds obtained due to the recent strategic move with Starwood Capital will enable the Company to meet its financial goals for 2015. We are also satisfied with the outcome of the asset valuation made by JLL announced today representing a global amount 3.555 million Euros. The quality of our assets, resulting of years of cleaning our portfolio, through focused on location, physical condition and branding, should enable us to leverage our network through management contracts in Company s core markets. From a strategic standpoint, the Company looks into the future well aware of how our societies and our industry have changed in the last few years. On the business side, Melia Hotels International will focus on maintaining its leader position as a resort player reinforcing its presence on the urban leisure segment. Intangible assets will be key in the years to come. We want to leverage on our differential intangible assets: brands, data, Customer Relation Management while implementing an overall business intelligence & analytics approach. These capabilities as well as Company s right choice of real estate assets (our brand standard flagships) in key areas will permit us to expand Company s network via low capital intensive formulas and strategic partners. With regard to corporate reputation, Meliá Hotels International retained its position as the travel company with the best corporate reputation according to the Corporate Reputation Business Monitor (Merco), also climbing 13 places to 18th position in the global ranking of the 100 best companies in Spain. This historic ascent is the highest recognition of the excellence of the Company business model and corporate responsibility. To finalize this letter we would like to point out that all above mentioned must be put in a framework of corporate financial and value creation for the Company s stakeholders. 4

1. REPORT ON HOTEL OPERATIONS: EVOLUTION PER AREA Positive performance in all areas of hotels business. RevPAR for owned and leased hotels increased by a healthy 11.5% due to a 9.4% increase in Average Room Rate (ARR) and a 2% increase in occupancy rates. Highlight the improvement in Ebitda margins compared with the same period last year. AMERICA RevPAR for owned and leased hotels in the Americas grew by 8.5%, with ARR increasing by 6.4% and occupancy by 2% As mentioned in the release for the first quarter, RevPAR was negatively influenced by the change to SIMADI exchange rate of the Venezuelan Bolivar. Ignoring this negative impact, RevPAR would have increased by +30% (+24.6% ARR and +4.3% occupancy). If we also ignore the positive impact of the appreciation of the USD against the EUR, the USD RevPAR increased by 5.2%, generating an improvement in EBITDA of 16.2% in USD (excluding Venezuela), +43.6% in EUR. Sales through direct channels (melia.com) improved by 36% over the previous year, in line with the expectations of the company Meliá Digital project. By area: The best performance this semester was seen in Mexico, where RevPAR increased by +34.6% (+8.9% in USD), highlighting the performance of the Paradisus Playa del Carmen, with significant growth potential as it is still in a ramp up stage in operations. Also remarkable is the performance of the Paradisus Cancún which has been able to improve RevPAR by +37.78% thanks to increase group business. RevPAR in Dominican Republic improved by +28.20% (+3.78% in USD), 95% of which is explained by ARR growth. The destination has been affected by the collapse of the Russian market (virtually nonexistent in the first half with a drop of 80% versus the previous year) and decreased group business. This was offset by tour operator guests, direct sales and OTAs. Particularly in the US market. In managed hotels there was a positive performance at the Meliá Nassau, which is doubling its GOP after renovation in the previous year and a change to an all inclusive formula. Room numbers have increased by 5.1% mainly thanks to an increase in rooms at the Paradisus Palma Real. EMEA (+PREMIUM) RevPAR for owned and leased hotels grew by +7.8%, all explained by improved ARR. From this year, EMEA also includes ME EUROPE. The most important achievements in this area are: GERMANY Despite being a year in which there are not many trade fairs, the region has managed to increase revenues by 7.1% driven by an increase in room revenues of 10.3%. These results are due to the good performance of Innside Wolfsburg, which in the second quarter continued to exceed the expectations. During the second quarter the strong performance of Berlin should also be taken into consideration, especially assisted by the Champions League s final. Hotels have achieved RevPAR figures well above their competitive sets and generating double-digit growth in RevPAR. Moreover renovated hotels such as the Tryp Munich have also seen double-digit growth, validating the strategy of improving product quality in the region. Finally, outbound sales from Germany to other company hotels are growing at almost 100%, especially in groups and conventions. PARIS Strong performance of the new Meliá Paris La Defense with very positive results in terms of revenue, exceeding the targets defined in the business plan and generating a strong position in all segments, especially among online customers. The other Paris hotels also continue to show a good performance, especially regarding the price of the Melia Vendome and Melia Royal Alma, although suffering a slight contraction in demand which is expected to recover over the coming months. 5

ITALY The evolution of our hotels in Italy has been very positive in the first half of the year with growth up to 20% in room revenues, especially due to the excellent performance of the Gran Meliá Rome which has seen double-digit growth in RevPAR and achieved record ARR figures. Also of note is the strong performance of the Meliá Milano, helped by the hosting of the Expo in the city, which has seen RevPAR growth of over 15% mainly due to price increases. In the 2nd quarter the company opened the ME Milano Il Duca Hotel which has been very well received in the market and has beaten revenue expectations in its first two months of operation. UK The Euro-Pound exchange rate helped to generate a very positive performance in the UK in terms of RevPAR for the first half of the year, with growth exceeding 15% at the ME London and over 5% at the Meliá White House. Especially the positive evolution of ME London, maintaining a firm commitment to price increases and showing growth of more than 40 Euros in price compared to the previous year. In local currency the results show a less positive change, especially at the Melia White House, affected by reduced demand from the European market, yet with a performance that is stronger than the competitive set according to the STR reports. In the second quarter the company opened its first Innside hotel in the UK in the city of Manchester wich is registering numbers above the feasibility plan. PREMIUM SPAIN Company strategy in the luxury market continues to generate a strong performance, with RevPAR growth of over 10% during the first half of the year, 50% of which is due to price increases. The company s main hotels in this segment continue to show a strong performance, with the Gran Meliá Palacio de Isora, for example, maintaining double-digit growth in RevPAR. Our hotels in Seville (Gran Meliá Colón) and Marbella (Gran Meliá Don Pepe) also performed very well, with RevPAR growth of over 30%. Madrid and Barcelona remain on an upward trend, with double-digit growth in RevPAR, especially in Madrid. Finally note should be made of the successful opening of the Premium hotels in the Balearic Islands (ME Mallorca, ME Ibiza and Meliá de Mar), all well above the previous year in terms of RevPAR which is a good sign for the third quarter in the resort business. Most of the Premium hotel growth comes from improved direct sales through our own channels, that grow at a rate above 25%, together with increased penetration on the large luxury market networks. In EMEA available rooms increased by 10.4% due to the incorporation of the Innside Wolfsburg, Meliá La Defense, Melia Barcelona Sky, ME Milan il Duca, offset by the transfer of the Meliá Madrid Princesa to the same region. MEDITERRANEAN RevPAR in the Mediterranean region during the first half of 2015 grew by 7.8%, more than 95% was generated by improvements in average rates. This healthy RevPAR growth is mainly explained by the success of the implementation of revenue management strategy, enabling significant improvements in average rates. The evolution of the performance in the second quarter was similar to what happened in the first quarter. There was a positive trend in the Canary Islands with a RevPAR increase of +8%, after an ARR increase of 8.8%, mainly due to the incorporation of the Melia Jardines del Teide. Excluding this hotels, RevPAR would have improved by +3.8% and ARR by +6.5%. Of note is the collapse of the Russian market which was compensated mainly by a recovery in the Spanish market. On the Spanish mainland coast RevPAR increased by +12.8%, highlighting the Melia Atlántico Isla Canela which improved by +19.9% thanks to melia.com (+30%). Of note is the recovery of the Spanish market (+10%) and the UK, especially for Benidorm. The Balearic Islands have seen negative RevPAR evolution of -1.9% (ARR +5.6% and -7.1% in occupancy), in May due to works 6

Sol Beach House Ibiza carried out in the hotels for their rebranding (Beach House Ibiza, Gavilanes,Trinidad). Mention must also be made of the negative impact in some areas in Mallorca, with the collapse of the Russian market, a market which used to pay the highest rates. Worth mention the positive evolution of sales through direct channels which increased by +26% over the previous year. Rooms available in the Mediterranean area decreased by -7.5% due to the sale of 6 resort hotels to the joint venture with Starwood Capital, partially offset by the addition of the Melia Jardines del Teide. SPAIN The positive trend in city hotels in Spain continues, with an improvement in RevPAR for the first half of 2015 of +12%, generated by growth in both ARR +7.1% and occupancy +4.5%. Excluding the effect of the addition and loss of hotels, RevPAR for the region would have increased by 9.4%, explained almost equally between average rates and occupancy. The positive results are due to a homogeneous recovery in all segments, helped by 50% growth of the group market originated in EMEA and the leisure strategy of the Company in the city hotels. Sales through direct channels (melia.com) have improved over the previous year by 14% during the first half of 2015. Of note is the performance in Madrid (RevPAR +10.2%) and Seville (RevPAR +20.2%). Valencia (RevPAR +2.37%), on the other hand, shows slower growth because conferences held last year will not be repeated this year. Madrid airport hotels are beginning to show improvements due to increased airport business in recent months. In Madrid, after the refurbishment works last year at the Melia Galgos saw a RevPAR increase of +26.9% this semester (11.3% via ARR and 14% via occupancy) In the second quarter Barcelona has recovered a positive trend, presenting accumulated RevPAR growth for the semester of +3.12%, after a -1.42% decrease in the first quarter. The Company points out the evolution of the flow through (translation of the revenues into Gross Operating Profit) of the Spain division which represents 74% for the semester. The number of rooms has increased by 1.24% due to the incorporation of the Meliá Madrid Princesa from the EMEA division and the Tryp Estepona Valle Romano, all offset by the disaffiliation of the Tryp Arenal and Tryp Oviedo hotels, both included in the debug process of the underperforming hotels. 7

HOTEL STATISTICS OWNED & LEASED 15 / 14 (in Euros) HOTEL REVENUES SPLIT OWNED & LEASED 15 / 14 (Million Euros)* * These figures do not include the Gran Meliá Puerto Rico INNSIDE Manchester 8

MANAGEMENT MODEL AT MELIÁ HOTELS INTERNATIONAL Given the focus of the company on an asset-light model and the growing importance of management agreements, at the close of 2013 the company changed its reporting method to include more detail on the profitability of the overall management model. The table below reflects the income generated by Meliá as a hotel manager, including: The management fees from third parties but also from Meliá s owned and leased hotels. Other revenues, mainly commissions and other services. Total Fees Revenues, including both owned and leased and third party hotels, increased by almost 6.4 million euros compared to H1 2014. Management fees from third parties totalled 24.5 million euros, 1.4 million euros higher than in 2014. The difference is mainly due to the positive evolution of last years openings, mainly the Meliá Nassau Beach, Meliá Jardines del Rey and Meliá Dunas, as well as the increase in fees from Cuba, helped by the effect of changes in the dollar exchange rate. This positive trend has been partially off-set by the fees of the hotels in Brazil and Asia, this last one affected by the devaluation of the Indonesian Rupiah. OTHER HOTEL BUSINESS The Other Hotel Business item basically includes the contribution of casinos, golf facilities and Sol Caribe Tours, a tour operator based in Latin America. Compared with first semester 2014, the better performance is mainly due to the higher contribution from Sol Caribe Tours thanks to the appreciation of the USD and the Casino Tamarindos business performance. HOTEL BUSINESS OUTLOOK The third quarter is the offseason in the Americas. To improve occupancy in the quarter the company is pursuing several business strategies, which is increasing occupancy and improving up-selling in hotels, among other benefits. Current forecasts indicate an improvement over last year s figures. Prospects remain good, especially in resorts, where sales already on the books show strong growth over the previous year, especially in the Canary Islands, Costa del Sol and Mallorca. Major European countries are also expected to maintain good growth figures, especially in Italy and Germany, accompanied by a recovery in the Paris and London markets. Finally, a more complex third quarter is expected in Madrid and Barcelona, especially in September due to the comparison with a previous year which saw many events (ESMO, Cardiology Congress, World Basketball Championships, etc..) In the short term the most relevant issue for the Company is the expected evolution of the summer season, particularly in the Mediterranean. Based on the sales situation to date, everything points towards a excellent summer season. Although some specific areas of Mallorca have started the season a little sluggishly, from mid-july onwards growth will be boosted by last minute bookings, as well as the effect of the attacks in Tunisia and the political situation in Greece, especially for the UK and Germany. 9

Note that summer 2015 will be influenced by the following: Company focus on a Revenue Culture implemented through a yield management strategy and a healthy distribution strategy with special emphasis on the development of direct sales channels. The Meliá strategy to attract less price-sensitive markets The success of the Meliá Rewards loyalty programme (+4 million members) Appreciation of the pound sterling and US dollar against the Euro Recovery of the Spanish market (+ 10%) Consolidation of products such as the Sol Beach House Rebranding of some resort hotels. Instability in North Africa Sales currently on the books for the Canary Islands, Spain s mainland coast and Balearic Islands show double-digit growth compared to the same period in the previous year. In Spain, very positive results are expected in Q3. Sales already on the books show important growth over the previous year ( +3.6 million), although September will not be as good as 2014 due to the strong demand generated by events held last year (Madrid - ESMO Congress and World Basketball Championships - and Barcelona Cardiology Congress). DEVELOPMENT Additions ( 9 hotels / 1,679 rooms) During the first half of 2015 the Company added 9 hotels with 1,679 rooms to its portfolio, 58% under management and 42% under lease agreement. Out of these 9 hotels, 6 are under management and franchise agreements: the Meliá Doha (317 rooms), the second hotel for the Meliá brand and third project in the GCC region, Tryp Leira (70) in Portugal, Tryp Castellon Center (78) and Tryp Valencia Feria (127) in Spain, Tryp Belo Horizonte (151) and Meliá Ibirapuera (227) both in Brazil. Under lease agreements, the opening of the lifestyle hotel Meliá Paris La Défense (369) in the heart of Paris vibrant business district with spectacular panoramic views of the city and its key landmarks, the ME Milan il Duca (132) the first Italian luxury lifestyle hotel, and the Innside Manchester (208). Disaffiliations (1 hotel / 118 rooms) During the period, only 1 hotel have been disaffiliated, the Tryp Oviedo (118) an unprofitable lease located in Spain. Future incorporations (61 hotels / 14,190 rooms) The Company has the goal of 25-30 new hotels in 2015, all under low capital-intensive formulas and with a high international component, with special emphasis on positioning in emerging markets. America: Melia, international leader in the resort hotel segment has worked on the progressive extension of its footprint in all major holiday destinations, and also in major US cities such as New York. In this regard, the Meliá pipeline in the area includes 18 hotels with almost 4,400 rooms, of which only one will be operated under lease, the Innside New York, with 312 rooms, scheduled to open at the end of the year, becoming the first hotel for the Innside brand in the US after its success in Europe. The remaining contracts will be operated under management, including in 2015 the opening of the Meliá Jamaica, ME Miami and Melia Costa Hollywood in Florida reinforcing the Company s strategy increasing its presence in the English Caribbean speaking area. Asia: another important focus for global expansion, In South Asia Pacific the current pipeline reaches 18 hotels with nearly 4,000 rooms (all in management). In 2015 the Group has strengthened its focus on Asia with the signing of 5 new hotels (1,148 rooms), expanding the company s footprint into new markets in the Asia-Pacific region, specially in resort areas, one of the main objectives for growth in the coming years. EMEA: Meliá has 23 hotels with 4,478 rooms in its pipeline, of which 50% will be operated under lease and 50% in management. The new openings will intensify the positioning of the Company in major European capitals, as well as facilitate access to new markets. 10 Mediterranean: The region has 2 hotels in the pipeline with around 1,500 rooms, all of them outside Spain.

DEVELOPMENT 11

2. OTHER BUSINESS & OVERHEADS REAL ESTATE Within the framework of the asset rotation activity, it is worth mentioning the agreement reached for the sale of 6 resort hotels in to a new Joint Venture Company, owned 80% by a subsidiary of the Starwood Group and 20% by the Company, this transaction generated 178.2 million euros (net cash of approx. 150 Mn) and capital gains at the EBITDA level of 40,1 million euros. (Revenues 48,7 million euros and other expenses -8,6 million euros). During the first semester 2014, the Company generated 14.7 million euros as capital gains due to the sale of 261 apartments at the hotel Sol Aloha Puerto, located in Torremolinos, (Spain). Taking into consideration the above, together with other minor capital gains generated during the period, total capital gains up to June 2015 reached 42.5 million Euros, compared to 15.3 million Euros in the first half of 2014. The Company reaffirms its commitment to dispose of assets for a minimum of 200 million euros in 2015 to decrease net debt levels. A new asset apraisal has been released today. CLUB MELIA Sales at Club Meliá in the first quarter grew by 16.5 million euros, mainly explained by improved performance from the two hotels included in the Club together with the appreciation of the USD compared to the EUR, given that almost all of the Club Meliá revenues are in USD. The number of weeks sold were slightly below the first half of the previous year, in part due to the slowdown of sales in Puerto Rico linked to the asset disposal process which penalizes Club Meliá sales, and also due to sales reductions to customers from some emerging markets in order to avoid country risk. On the positive side the new higher-margin Destinations product and upgrade activity has helped to compensate the slowdown in the number of weeks sold. OVERHEAD DEPARTMENTS Recall that this item only includes the overheads in Meliá Hotels International. The changes versus the same period in 2014 lies with the evolution of the onerous contracts, during the first semester 2015 the Company has reduced the provision in 0.5 million euros compared with 5.5 million euros in 2014. A contract is onerous when the inevitable costs of fulfilling the contractual obligations exceed the expected economic benefits. Estimated future results from rental agreements are reviewed annually based on expected flows from the relevant cash-generating units, applying a suitable discount rate. Should costs exceed benefits, the Group recognizes a provision for the difference. In view of the result of the rentals renegotiations with the owners of the hotels (operated under lease agreement) the Company could reduce the provision. Sol House Mallorca Trinidad 12

BUSINESS SEGMENTATION OF MELIÁ HOTELS INTERNATIONAL 13

3. COMMITMENT AND CORPORATE RESPONSIBILITY Throughout the first half of the year, Meliá Hotels International has made further progress in the responsible management of natural resources. Its internal energy efficiency programme (SAVE) continues to generate positive trends in reducing emissions and consumption, as shown in the following table: The Company has invested two million euros in the installation of efficient systems and products in hotels that have allowed a reduction in CO2 emissions between 7% and 15% throughout the year. The Company also remains committed to implementing energy efficiency projects under the ESCO model, with the actions taken under the system in different hotels in Europe leading to an average reduction of more than 15% in CO2 emissions. Sustainable construction also remains a priority as part of the integration of sustainability standards in the Meliá global business model. One example is the reform of the ME Ibiza, which has been recognized as one of the best sustainable hotel rehabilitation projects at the Rethink Hotel Awards organized by Habitat Futura. The Company also continues to promote the use of renewable energy, and in the first half of the year renegotiated its electricity contract portfolio in Spain and Italy to ensure that 100% of its power supply in 2016 is from renewable energy sources. In addition, Meliá has joined the Climate Commitment campaign promoted by the Ministry of the Environment, which aims to encourage greater urgency for action against climate change at the upcoming summit in Paris. Social Commitment and Responsibility In June, Meliá Hotels International published its Annual Report & CSR 2014, prepared under the Integrated Report criteria defined by the International Integrated Reporting Council (IIRC) for the second consecutive year. The Company presented its activities within the context of its Strategic Plan, reflecting their results and their impact on the different stakeholders. The report was also prepared taking into account the standards and principles of the Global Reporting Initiative (GRI version 4). With regard to corporate reputation, Meliá Hotels International retained its position as the travel company with the best corporate reputation according to the Corporate Reputation Business Monitor (Merco), also climbing 13 places to 18th position in the global ranking of the 100 best companies in Spain. This historic ascent is the highest recognition of the excellence of the Company business model and corporate responsibility. In social terms, and in its capacity as strategic partner of UNICEF since 2010, Meliá has announced its commitment to the State Pact for Children project. The company is the first hotel company to express its support and commitment to the project and will extend information to all of its main stakeholders to generate maximum support. Finally, as a result of its policy to achieve sustainable tourism certification, to date the Company has achieved TripAdvisor GreenLeader certification in 102 hotels. 14

4. INCOME STATEMENTS Revenues Total revenues increased by 19.2%. Hotel revenues increased by 13.6% thanks to an 11.4% improvement in RevPAR, 83% of which is explained by an increase in the Average Room Rate. Club Meliá also reported good figures with 18.3% growth. The contribution of the Real Estate division in the first half was +29.9 million euros compared with the same period last year, due to higher capital gains from asset disposals. Excluding changes in the scope, the impact of the appreciation of the USD against the EUR, capital gains from asset disposals, the impact of the change to SIMADI exchange rate of the Venezuelan Bolivar, and some other extraordinary items, total revenues would have increased by 6.8% Operating Expenses Raw materials, Personnel expenses and Other operating expenses increased by 14.3%, 7.1% and 20.3% respectively, affected by the changes in the perimeter, the appreciation of the USD, and the devaluation of the VEF. On a like-for-like basis, the evolution of expenses would be as follows: Raw materials +4.1%, Personnel expenses +3.1% and Other operating expenses +6.3%. Rental expenses grew by 18%. It should be noted that during the first half of 2014 the company reduced the existing onerous contracts provision by 5.5 million euros, this year the reduction was 0.5 million euros, so on a comparable basis the increase was +7.5% due to the incorporation of the Meliá Vienna, Innside Wolfsburg, Meliá Jardines del Teide, Innside Manchester and ME Milan compared with the first half 2014, partially offset by the renegotiation of some leases and the consolidation of the Meliá Milano. EBITDA All the above mentioned factors allowed Meliá to register an improvement in EBITDA of +43% (Ebitda without capital gains +22.1% compared with the first semester 2014). At the Profit/(Loss) from Associates and JV level, the lower results are mainly explained by the impact form the hyperinflation and the change to SIMADI exchange rate of the Venezuelan bolivar partially offset by the better results of Altavista Hotelera (Meliá Barcelona Sky), the Meliá Castilla and Evertmel (resort complex in Magalluf - Mallorca). To end this chapter, of note is the impact of the Discontinuing Operations which registered losses of 25.3 million euros. The economic situation in Puerto Rico that has had its Government to fail in the payment of its obligation is making more difficult to find active stakeholders in the transaction, so taking into consideration principles of prudence, the Company performed a new appraisal of its Puerto Rico hotel generating a new impairment amounting to 28.7 million euros despite hotel EBITDA contribution (3.4 million euros). Meliá Cala Galdana Menorca 15

(Million Euros) December 2015 December 2014 ME MILANO - IL DUCA 16

5. BALANCE SHEET The increase in Goodwill of 25.7 million Euros is due to the consolidation of Inmotel Inversiones Italia S.R.L. (owner of the Meliá Milano hotel). The decrease in Tangible Assets of -37.2 million Euros is mainly linked to the book value of the assets sold during the second quarter, the amortization and depreciation for the period, and the exchange differences mainly related to the change to SIMADI exchange rate of the Venezuelan Bolivar, all partially offset by the appreciation of the US dollar and other currencies against the Euro, maintenance capex and the consolidation of the Meliá Milano. Investment in associates decreased by -8,9 million Euros due to the net effect of the incorporation of the new joint ventures related to the deal with the Starwood Capital Group, partially offset by the integration by the full consolidation method of Inmotel Inversiones Italia S.R.L (Meliá Milano), after the Company purchased 100% of the participation. The Non current assets held for sale which is related to the value of the assets in Puerto Rico, decreased by -14.1 million Euros due to the impairment of 28.6 million Euros, partially offset by the appreciation of the US dollar vs the Euro. ME IBIZA 17

INNSIDE PALMA CENTER 18

6. FINANCIAL RESULT AND DEBT FINANCIAL RESULTS Financial results improved by 45.8% compared to the previous year due to the net effect of: a) Reduction in Bank financing of -20.2Mn due to the lower gross debt and improved average interest rate compared to the first half of 2014. b) Increased income in Other financial results of 2.2 Mn, mainly due to lower financial expenses related to the restatement of accounts in Venezuela due to the adjustment for hyperinflation, offset by lower interest income from associates due to the reduction / capitalization of loans and the reduction of interest on deposits. c) Improved exchange rate differences of 4.5mn, motivated mainly by the appreciation of the USD. Regarding the evolution of the average cost of debt in the first half of the year, the Company has reduced its average financial cost to 4.5% (compared to 5.3% in the first half of 2014). DEBT Company net debt decreased compared to December 2014 by 118.2Mn, reaching 868.6Mn, largely explained by the asset sale agreement with Starwood Capital and by the positive performance of the free cash flow generation, partially offset by the purchase of 58.5% of the company that owns Melia Milano which was in the hands of third parties. Gross debt has been reduced by 140.4Mn The company maintains its guidance for the year end, where the ratio of net debt to EBITDA excluding capital gains will be below 3.5 times. This net debt target will be supported by asset sales and free cash-flow generation. The debt maturity profile is as follows, excluding credit facilities: million euros 19

7. CASH FLOW STATEMENT Cash flow from operating activities ( +144 Mn) includes gross capital gains generated through the asset rotation activity ( +40 Mn). Cash flow from investment activities ( +28.6Mn) is primarily explained by: a) the investments made in fixed assets and property investments, ( -21 Mn) linked to maintenance capex, b) the payments to associates ( -18,Mn) after compensating payments and proceeds from third parties, the majority of these amounts are related with some investments and have been recovered during the month of July C) the purchase of a 58,5% stake in Inmotel Inversiones Italia S.R.L (owner of the Meliá Milano Hotel) and the contribution (20%) to the news joint venture related with the deal with Starwood Capital Group and d) offset by the sales of assets ( +138.2Mn) Cash flow from financing activities reached -194.8Mn including the issue and amortization of debt, together with the interest paid. 20

8. MELIÁ ON THE STOCK MARKET The stock price rose by +3,2% during the second quarter of 2015. The Ibex Medium Cap and the Ibex 35 decreased by -5,9% and -6.5% respectively. For the first half 2015, the stock price rose by +33,6%. Source: Bloomberg NOTE: Meliá s shares are listed on the IBEX Medium Cap and FTSE4Good Ibex index. On January 2015, 14.3Mn newly-issued ordinary shares to attend partially the conversion of the convertible bond were admitted to trading to the Spanish Stock Exchanges. 21