Tag: settlements

Meliá’s Profits Up By 18% Despite One-Off Impacts

26 February 2016 – Expansión

Meliá ended 2015 with a net attributable profit of €36 million, which represents a 18% increase compared with the previous year. The hotel chain said, however, that the two periods are not comparable, given that last year’s figures were affected by a higher tax rate, following the results of tax inspections launched in 2014 regarding corporation tax settlements made between 2009 and 2012.

In this regard, and in order to reflect the possible impact of these actions, Meliá made a provision amounting to €33 million. The hotel chain also clarified that having analysed the possible consequences in the years open to inspection, it does not expect any significant additional impact on the consolidated accounts in the future. “The company is cooperating with the authorities and hopes to reach a satisfactory agreement”, added the company in a document that it submitted to Spain’s National Securities Market Commission (CNMV).

Puerto Rico

Excluding extraordinary effects, such as a €29 million impairment on the Group’s hotel in Puerto Rico, and the provisions required for the aforementioned tax adjustment, Meliá’s net profit before tax amounted to €67 million, up by 200%.

In 2015, the company generated revenues of €1,738 million, which represents a 16% increase (compared with 2014).

The chain highlighted the strong performance of all its divisions in the hotel business, which allowed it to increase its revenues per available room (RevPAR) by 15.1%, thanks to the improvement in the general environment and economies in its key markets, as well as its strategy for branding and repositioning its products.

According to the financial plan, Meliá’s net debt amounted to €768.8 million at the end of the year, which represented a reduction of €216 million with respect to 2014.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Reyal Urbis To Appeal Judge’s Latest Ruling

28 September 2015 – El Economista

Reyal Urbis is just one step away from liquidation after Commercial Court Nº 6 in Madrid dismissed the real estate company’s proposed agreement to exit from bankruptcy, which it filed for more than two years ago.

On Friday, the company announced that it will lodge an appeal against the ruling made by the judge Francisco Javier Vaquer and will request the suspension of the effects arising from it, until the appeal has been settled.

The previous intervention by the judge took place on 6 March, when he asked Reyal Urbis, which has bankruptcy debt amounting to €4,236 million, to remedy some of the errors identified in its proposal. Specifically, the judge demanded a “necessary and essential objective justification” of the proposed discounts and settlements.

The real estate company, led by Rafael Santamaría (pictured above), proposed two payment alternatives for its primary creditors. Under the first, the loans would have a discount of 90% and the remaining 10% would be paid through the transfer of assets in lieu of payment. The batches would be awarded to the entities by drawing lots, a process that Reyal confirmed was conducted in the presence of a notary on 10 February. The second option for these loans consists of applying discounts of between 88% and 93%, on the basis of the syndicated loan tranches, and then deferring the loan repayments for 6 years, with a further 4 years of interest-only payments.

The judge also asked that the “drag effect” be eliminated, since Reyal was planning to extend the effects of the agreement to any dissident creditors, if approval was obtained from 75% of them. According to sources close to the process, this would mean that creditors with joint mortgages would lose their privileged position, since the current law does not provide for this effect, and so it would only be possible if the creditors voluntarily relinquished their rights.

Insolvent until 2023

According to the bill that the Economista has had access to, these matters have not been remedied by the company. Moreover, the judge ruled that the restructuring proposed by the real estate company is “clearly detrimental to the rights of the creditors” and does not guarantee the viability of Reyal. Thus, the real estate company will record “negative equity until the end of 2023 for amounts exceeding €90 million, and the plan does not set out how to eliminate this cause of company dissolution from a situation of insolvency”.

Original story: El Economista (by Alba Brualla and Lourdes Miyar)

Translation: Carmel Drake