Meliá Hotels International (MHI) has concluded its Fourth Quarter and Full Year 2023 Earnings Conference Call on a positive note, highlighting a year of solid demand and robust performance across all regions. The company reported significant increases in revenue per available room (RevPAR) for both owned and leased, as well as system-wide properties, attributing the growth to price increases and volume recovery.
Consolidated revenues saw a 14.8% rise, reaching €1,929 million, with direct sales through melia.com growing by 17.4%. Meliá's net profit improved to €117.7 million, and the company reduced its net debt by €59.9 million. An agreement was signed with Banco Santander (BME:SAN)'s investment vehicle for a €300 million subscription of new shares in a subsidiary. Looking ahead, Meliá aims to return to pre-COVID net debt-to-EBITDA ratios by the end of 2024 and anticipates strong demand with double-digit RevPAR growth.
Key Takeaways
- Owned and leased RevPAR increased by 17.3% for the full year, while system-wide RevPAR rose by 10%.
- Consolidated revenues grew to €1,929 million, a 14.8% increase.
- Direct sales through melia.com improved by 17.4%.
- Operating expenses went up by 12.6%, but EBITDA exceeded the target at €486 million.
- Net profit reached €117.7 million, with net debt reduced to €2,613 million.
- The company signed 26 new hotel agreements and opened 12 hotels in 2023.
- Customer satisfaction reached a record level, and demand for bookings continues to be strong.
- Meliá expects to generate at least €500 million in EBITDA in 2024 and resume dividend payments.
Company Outlook
- Meliá aims for a net debt-to-EBITDA ratio of 2.5 times by 2024.
- The company plans to open 4,500 new rooms in 2024, net of terminations.
- A €50 million asset rotation plan is in place, which includes key money.
- Meliá is negotiating the sale of a minority stake in a Dominican Republic vehicle, expected to close in Q2.
- Refinancing plans are underway with €280 million maturing this year, aiming for a maturity profile of around €150 million annually.
Bearish Highlights
- The impact on EBITDA for 2024 is projected to be smaller, with a 3% increase assumed.
- In 2024, Meliá will not have €75 million in revenue and €10 million in EBITDA from leases for eight malls.
Bullish Highlights
- Strong performance is expected in the Americas and luxury brands.
- Q1 is already contributing to the double-digit RevPAR growth anticipated for 2024.
- The luxury brands represented almost 15% of operating hotels and 35% of the expansion pipeline, contributing over 25% of total hotel revenues in 2023.
Misses
- Maintenance CapEx is typically higher, but the company has reduced it for the current year and will reassess for the following year.
Q&A Highlights
- Meliá discussed its positive evolution in pricing strategy, strong product mix, and premium locations.
- The company emphasized its growth in Mexico and emerging holiday hotspots like Albania and Malta.
- Meliá provided a breakdown of 2024 CapEx, with 50-60% allocated to maintenance and the remainder to investment and key money.
- The company confirmed its aim to generate free cash flow of more than €100 million this year.
Meliá Hotels International continues to focus on its luxury and premium strategy, which has been a significant driver of its qualitative RevPAR and record customer satisfaction levels. The company's expansion plans, including the signing of new hotel agreements and the opening of new rooms, coupled with its strategic financial management, indicate a commitment to growth and shareholder value. With strong demand and a positive outlook for 2024, Meliá is poised to maintain its momentum in the hospitality industry.
Full transcript - None (SMIZF) Q4 2023:
Stephane Baos: Hi. Good afternoon, everyone and welcome to Meliá's Fourth Quarter and Full Year 2023 Earnings Conference Call. I am Stephane Baos, Head of Investor Relations. For the time being, all participants will be in the listen-only mode. After the presentation, anybody who is interested will have a chance to ask questions so we can cover any additional doubts. Please note, this event is being recorded. Before we begin, I would like to remind you that our discussion this afternoon will include forward-looking statements. Actual results could differ from those indicated in the forward-looking statements and forward-looking statements made today speak only to our expectations as of today. This afternoon, as usual, on the call with me today are Gabriel Escarrer, our President and Chief Executive Officer; Andre Gerondeau, our Chief Operating Officer; Angel Luis Rodríguez our Chief Financial Officer; Juan Ignacio Pardo, our Chief Real Estate Officer; and myself. Our President and CEO will provide an overall overview for the company's performance. Andre will then review our fourth quarter onwards. Following today's remarks, we will be happy to take your questions. In any case the Investor Relations team will be available following this conference call to give you a chance to clarify anything else you might need. You can find our earnings release on our Investor Relations website at meliahotelsinternational.com. And now I'm pleased to turn the call over to Gabriel.
Gabriel Escarrer: Thank you, Stephane and good afternoon, everyone and thanks for joining us today. 2023 has been a positive year. A year that went from good to better in almost all regions with a solid underlying demand. Thanks to our premium and luxury positioning with a quality mix of leisure and pleasure destinations we have been able to capitalize on the strong momentum in all segments. The solid overall trend of the year is confirmed in the fourth quarter where our year-on-year owned and leased RevPAR increased by 10.6% mainly driven overall by price, which is plus 6.3% compared to 2022. Occupancy was 2.5 percentage points above 2022 and our system-wide RevPAR increased by 6.6% in this case mainly driven by volume increase. On a yearly basis, RevPAR for our owned and leased hotels increased by 17.3% driven by overall equal gains in average daily rate and occupancy. Our system-wide RevPAR increased by 10%, thanks to volume recovery. It should be noted that this RevPAR increase is affected by pricing decrease in Q1 which is explained by the devaluation of the local currency. Excluding this effect, our system-wide RevPAR increased by 16% with both occupancy and average daily rate fostering this increase. In this context turning to results for the full year and fourth quarter. From a year-on-year perspective, consolidated revenues excluding capital gains stood at €1,929 million representing an increase of 14.8%. Comparing to 2019, the increase is of 7.3% owned and lease available rooms are minus 8.7% compared to the same period. This shows the positive contribution of RevPAR increase and the retention within our management systems of the hotels changing from owned and leased towards management contracts. Sales through melia.com direct channel strategy continued to show increases of 17.4% compare to last year accounting to more than 46% of our centralized sales. Our digital and direct channels remain important drivers to increase demand at a more efficient cost to us and our owners. In 2024, we are celebrating our 30-year anniversary of our loyalty platform, Meliá Rewards with more of 16 million of registered customers. Operating expenses, increased by 12.6% with respect to the previous year and by 7.5%, compared to 2019. Despite wages and OpEx inflation, profit margins at EBITDAR level are in line with pre-pandemic. Thanks to the cost control implemented by the company, without affecting our service quality while enhancing client satisfaction. Regarding EBITDA margins, these are not fully comparable, due to the change in the equity portfolio of rental agreements, switching from fully fixed amounts to fully variable. We are glad to see that this change in strategy has bottom-line contribution of this portfolio, compared to 2019. As we anticipated in our Annual Shareholder Meeting, I am glad to announce that our objective to reach at least €475 million of EBITDA has been achieved, thanks to the strong demand and margin recovery. Our strong top line combined with cost control measures, allow us to post-EBITDA, excluding capital gains of €486 million, an increase of 16.2% compared to 2022 -- of 3.3% compared to 2019. Net financial result, has been impacted by the higher financial interest rate during the year. In 2023, our average financial interest rate stood at 5.16%, compared to 3.13% in 2022. Interest rate increase for this year, could be softened, thanks to our fixed interest rate debt exposure which at the end of 2023 stands at 35.5%. It is worth nothing that the outlook for the upcoming months suggests that rate hikes have reached their peak. This together with that reduction should write financial expenses down from now on. Effective income tax rate for the year is up 12.9% lower than the rates of around 25% at which the group has historically stood. Essentially, this reduction is a consequence of the impact of the Constitutional Court declaring certain resets of Royal Decree-Law 3/2016 void, and in particular, regarding the reassessment upwards of the application of tax losses against future profits and the corresponding recognition of deferred tax assets. Therefore, the consolidated net profit of the parent company reached a positive €117.7 million, improving by €7 million, compared to the previous year and also surpassing 2019 figures. Turning to the balance sheet, with regards to debt, a decrease of €59.9 million was registered during the course of the year ending with €2,613 million of net debt. Pre-IFRS 16, financial net debt decreased by €46.7 million, closing the year with an amount of €1,163 million, showing our progress towards debt reduction. Regarding asset rotation, in 2023, progress has been made. We have received advanced payment amounting to US$30 million related to the sale of a minority stake in a subsidiary, which owns a hotel in Mexico, pending to be approved by Mexican competence authorities. This transaction will generate capital gains in 2024 once the approval from the competence authorities has been issued. I would like to briefly discuss one of our most recent announcements. On February 19 this year, we announced the signing of an agreement with an investment vehicle from Banco Santander for the subscription of new shares in a subsidiary owned by Meliá. By means of this transaction, the investment vehicle takes a participation of 38.2% stake in that subsidiary, which will own three premium hotel assets locations located in premium locations. This transaction amounts to a total of €300 million, which will be received during the month of April. This transaction is part of our strategy to continue to strengthen our balance sheet. The value of the transaction is in line with the asset appraisal we published in July 2022, allowing us to catalyze asset valuation. Apart from this, an additional asset rotation operation is currently underway, which we expect to complete during the course of the following months in the Caribbean and another one in the Canary Islands. These transactions will be made through a sale of a minority stake. Regarding our investments, it should be noted that in 2023, the company made key money agreement payments of €31 million of ensuring long-term management contract of various hotels, including the equity in wellness portfolio. At the end of the year, the liquidity situation amounts to €330 million. It should be noted that before year-end, we have been able to refinance part of our 2024 and 2025 debt commitments in order to smooth debt commitments for the nearest future. We remind that Meliá does not have any debt with financial covenants, while mortgage debt stands at approximately €250 million. This implies a loan-to-value of 27.4% of mortgage assets. I would like to reiterate our commitment to continue to strengthen our balance sheet. As of today, I would like to commit to return to our pre-COVID net debt-to-EBITDA multiples by the end of 2024. That is 2.5x net debt-to-EBITDA pre-IFRS multiple. With this we are anticipating one year our objectives. I will now turn the call over to Andre to talk about our operational performance during the fourth quarter and forward in more detail. Andre, please?
Andre Gerondeau: Thank you, Gabriel, and good afternoon, everyone. Supplementing previous remarks, after a solid summer season, the fourth quarter continued with the upward trend. We have seen a strong performance in all regions with a year-on-year system-wide RevPAR increase of 6.7%, driven by strong Domestic and International demand for both our resorts and leisure hotels. Going into regions. European cities have seen a surge in volumes compared to 2022, with occupancy unlocking RevPAR increase for the area. This increase is supported by our pricing strategy, which remains strong. In America, our hotels in Dominican Republic stand out with a RevPAR increase year-on-year surpassing 10%, purely driven by price increases. It is worth noting that repositioning of Paradisus Palma Real, which also allowed us to increase occupied rooms. Our hotels in Spain has delivered a really strong fourth quarter, with RevPAR increases year-on-year of 20.9%. The positive combination of winter season in both cities and the Canary Islands, have been key on achieving a 12.5% increase in prices and 4.7 percentage points in increased occupancy. The Asia region is capitalizing on demand pace increase during the final stages of the year. The continent has been the latest definitely leave the pandemic restrictions demand and therefore is benefiting from still an unconsumed ramp-up demand. As a sign of tangible recovery, RevPAR in the region is up 31.7% year-on-year, but still below pre-pandemic levels. This remains a key lever going forward, not only for the region itself, but as an outbound source of tourists traveling abroad. Lastly, our hotels in Cuba have continued with the trend seen along the year, with a positive evolution of International travelers, but with domestic demand negatively impacted due to the devaluation of the local currency. Turning to our yearly view. Overall, the continued trend along the 12 months where all quarters RevPAR outperformed year-on-year figures on a system-wide perspective. This trend shows the positive evolution of our pricing strategy based on our luxury and premium positioning, reflected in our strong product mix, our premium locations and our brands. Regarding the segments, we are keen to see that there is a positive evolution in all of them. Important to note that meliá.com and the rest of our direct channels, continues to solidly deliver results as previously explained. Tour operators have also performed well and we celebrate the continuing positive trend with our most appreciated partners around the world. A special mention should be made to MICE, which has seen a solid performance along the year. Our business generated to MICE in 2023 has exceeded both 2020 2019 and 2022 levels and our perspective for 2024 is encouraging. As far as development, in 2023, Meliá's growth is intricately tied to our brand strategy, featuring significant advancements such as the consolidation of our unique luxury hotels brand, Meliá Collection with eight hotels already in operation and eight more slated to open in the future. The Zel brand created in collaboration with Rafael Nadal made its debut and continues to expand its pipeline for the coming years with three openings in 2024. Additionally, we saw the much anticipated arrival of the resort brand, Paradisus by Meliá in Europe, with Paradisus Salinas Lanzarote and Paradisus Gran Canaria, both in the Canary Islands. 2024 marks a pivotal year for the ME brand as well, with planned openings of the hotels, ME Malta, ME Sayulita, ME Guadalajara in Mexico and ME Lisbon in Portugal. Throughout 2023, the company signed agreements for a total of 26 new hotels adding 4465 new rooms and opened another 12 hotels. Highlights include the Gran Meliá Palazzo Cordusio in Milan, the ZEL Mallorca hotel, the Gran Meliá Nha Trang in Vietnam, our first Gran Meliá in Southeast Asia and Innside Bangkok in Thailand. The company emphasizes its growth in destinations like Mexico, while also solidifying its presence in emerging holiday hotspots like Albania and Malta. The Group's Luxury strategy has a positive impact on the portfolio's evolution with luxury brands already representing almost 15% of operating hotels and 35% of expansion pipeline. These brands contributed over 25% of total hotel revenues in 2023 and the luxury brands' portfolio experienced from RevPAR increase of plus 18.3% in 2023 and of 31% compared to 2019, with solid growth for 2024 expected. Thanks to this potential, combined with growing market demand and resilience to economic cycles, the luxury and premium strategy has solidified as a competitive strength, contributing to maintaining a more qualitative RevPAR. Important to note, a record year in customer satisfaction with a 53% net promoting score system-wide, which validates our vision and strategy in terms of Personalized Service and Tailored Experiences for our guests. In terms of the outlook, demand is still strong, with both insured and corporate clients presenting an encouraging outlook. Our on-the-book reservations are double-digit above last year, with pricing still showing mid-single-digit increases. Reservations are being increasingly anticipated and even though last year's bookings continue to be relevant, this is a positive factor since we are expecting to also extend the season in our resort hotels. Going into regions, America, Q1 2024, strategy focused on maintaining a solid occupancy base, while driving the average room rate in our superior categories and suites, allowing us to foster last-minute demand which is predominant along local clientele. International demand into the region, is again led by the US and Canadian customers. So far, we're seeing revenue and price increases in the Caribbean region, driving a strong percentage of our RevPAR increase for 2024. Regarding MICE, our hotels in Dominican Republic are seeing a higher base of events scheduled for the near future. Spain, forecast for city hotels are positive after a strong fourth quarter. We are expecting to continue to grow in prices and keep progressing in occupancy. Corporate travelers are also keeping up with the recovery. We expect 2024 corporate business in Spain, to regain pre-COVID volumes. So far Q1 is showing this trend. Resort hotels in Q1, is mainly focused on the Canary Islands, showing solid increase and positive last-minute demand for superior rooms and suites again. Our hotels have confirmed a stronger base for the beginning of the season. The UK and German markets continue to lead demand into the region, where also Spanish National's are expecting to grow, compared to 2023. EMEA region expects a higher volume compared to last year, with price increase and recovering occupancy versus last year with corporate segment pushing demand. Events scheduled in the near future together with MICE again, will also benefit from our hotels in a region. Asia region, expects to consolidate and definitely leave behind the pandemic effects. The region will benefit from both from increased Internal Demand and also International travelers flowing into the region. According to recent statistics release from IATA, The International Air Transport Association, International flight seat capacity from and into Asia are still approximately minus 45% below pandemic. Even though forecast did not expect a full recovery in 2024, there is definitely a shift in perspective which we will try to capitalize. Cuba will continue as in recent months the positive outlook for International travels which should provide a better occupancy base and pick up RevPAR increases year-over-year, thanks to an increased volume. I will now turn back the call over to Gabriel, to summarize the main messages of the call.
Gabriel Escarrer: Thank you, Andre. To end, I would like to highlight the following messages. We are expecting low double-digit increase in RevPAR for this year, compared to last year. We have attained the objective set in the General Shareholder Meeting of generating at least, €475 million in EBITDA for last year. Today, I would like to state, a further commitment for year 2024, to generate at least €500 million in EBITDA, excluding capital gains. The announcement of an agreement with Banco Santander not only proves the value of our hotels, but also the confidence in the hotel industry. With this transaction, I would also like to commit to end 2024 with a net debt EBITDA ratio of 2.5 times pre-IFRS. Regarding development, we expect to open not less than 4,500 rooms in 2024. And thanks to the good performance and the work made to strengthen the balance sheet, the Board of Directors will propose to the General Shareholder Meeting to resume the dividend payment. Further details on our fourth quarter and full year can be found in the earnings release we issued early today. We will now be happy to answer any questions you may have. Please let me remind you that I'm here with André Gerondeau, Ángel Luis Rodríguez, Juan Ignacio Pardo and Stephane Baos.
A - Stephane Baos: [Operator Instructions] First question is -- first person is going to be João from Santander. Please go ahead, João.
João Safara Silva: Yes. Good afternoon. Thank you for taking my questions. I will start with two questions. The first just to bridge the cash flow for 2024, and just taking into account, what is your new target of net debt-to-EBITDA of 2.5 times. I mean obviously with the transaction -- the Real Estate transaction you're doing, you'll be very close to those levels already. But I wanted to understand what are you going to do on top of that considering that you're also proposing a dividend. So basically the -- my question is more in terms of what is the guidance for CapEx? And also, what is the amount that you expect to receive from the other asset rotation? So that would be my first question. And then the second one just on the transaction you announced. I mean some -- I have just a couple of questions here. The first is, if there is any preferred dividends that this vehicle will have to pay as part of the transaction? And the second, I understand there is a lease agreement between this vehicle and Meliá. What I wanted to understand here is the tenure of this lease agreement, for how long is the lease, and that's basically my question.
Ángel Luis Rodríguez: Hi. Ángel Luis, speaking. Good to speak with you again. Look with regard to cash flow for 2024 and our objective to reduce the ratio to 2.5 times as Gabriel has said, there will be three elements that will contribute to achieve that target. One is obviously a transaction that we recently signed; secondly is the generation of cash flow from the business; and third, the asset rotation. It's not going to be particular, but we expect additional around €50 million coming from that angle this year. So that will take us to this objective and we are fully committed to do so. Concerning the CapEx. What we have decided this year to be more strict, And for example in terms of IT investments, what we're going to do is, we are doing now like take an inventory, hold a little bit and then -- and therefore be more conservative in terms of that and we'll be CapEx in about €100 million this year on all aspects. With regard to the transaction itself, there is a preferred dividend to our partner Santander, which is not obviously a guaranteed dividend. And it's a preferred which is very, very reasonable. It's [indiscernible] and with the business case we have for this vehicle, we expect that will always be in a situation to get that and so there's not a big deal on that. In terms of the lease agreement, it was -- it's -- I would say it's instrumental, because Santander couldn't cope with having employees on the vehicle. So we decided to do this structure, which at the end of the day is eliminated on a consolidation basis. So, we are running the hotels and we've set that structure because it was a requirement from Santander. It made very easy in terms of GD as well. So that is the optimal structure to make the deal go through the finish line.
João Safara Silva: Okay. Just a follow-up there. If I understood correctly, you -- I mean two follow-ups actually. The asset rotation you mentioned €50 million and CapEx is €100 million. And the question here is, does it include key money or not?
Angel Luis Rodríguez: Yes. Yes, all included.
Gabriel Escarrer: It's all the CapEx, João.
João Safara Silva: Okay clear. And the asset rotation is €50 million, right?
Gabriel Escarrer: That's correct.
Angel Luis Rodríguez: Yes.
João Safara Silva: Okay. Thank you.
Angel Luis Rodríguez: I think, Gabriel mentioned this transaction that we are now negotiated in Dominican Republic and we're selling a minority stake in a vehicle. We've been negotiating now for months and we expect to close that transaction in Q2.
João Safara Silva: Great. Thank you.
Stephane Baos:
.:
Jaina Mistry: Hi, thank you, very much for taking my questions and congratulations on such a strong end to the year. I've got three questions as well. My first question is on 2024 and your guidance, the low double-digit RevPAR. I wondered how this breaks down by region in terms of what you're seeing? My second question is on what you're seeing for Q1 RevPAR so far? And how it compares versus your full year low double-digit guidance? And then lastly, I wanted to ask about your room openings. You're guiding to 4,500 new rooms in 2024. Is this net of terminations? Or how many terminations should we expect this year?
Andre Gerondeau: Jaina, this is Andre. Thank you again and thank you for congratulating us. We are very excited. This -- there are several drivers on the RevPAR guidance of low double digits. The first one would be the Americas region which is performing very strong and we have Mexico and Dominican Republic with a strong base of business. And secondly, it's our premium and luxury strategy. So the combination of both elements, it's going to contribute. So, that I would like to break it. First would be the Americas, second would be Spain, urban and leisure and third would be, EMEA. First would be luxury brands and then would be the premium brands. And of course, the fact that when we include Meliá's hotels Asia support will be very relevant. Secondly...
Jaina Mistry: My follow-up on that. So, I was interested in your comments around EMEA, because EMEA RevPAR was probably flat in Q4. So, what drives, an acceleration in 2024, in that region?
Stephane Baos: [indiscernible]
Andre Gerondeau: A couple of things, Jaina. Number one is, we have the Olympic games going into Paris. So France, is going to have quite, a strong 2024 all over. Secondly, we have seen that, fairs congresses and corporate business is coming back in Germany. And last year was challenging, and beginning of Q4, we saw how that was moving. Thirdly, we have a strong base of MICE and congresses in general in EMEA. So, that's what is driving, our outlook – Italy, is looking strong as well. I don't know if, that answers your question, Jaina.
Q – Jaina Mistry: That does it. Very helpful.
Andre Gerondeau: Great. Now, when it comes to Q1, you will see that we have positive growth. So, yes, definitely Q1 is already contributing to this double-digit RevPAR growth for 2024. We have a strong performance in the Canary Islands. We have a strong performance in bleisure secondary cities in Spain. And as I said, the Americas, please remember that, for us Q1 in the Caribbean, is very strong. And third, yes, the 4,500 rooms are net of termination. So, this is net increase on system-wide rooms.
Q – Jaina Mistry: Very clear. Thank you.
Andre Gerondeau: Thank you.
Stephane Baos: Thank you, Jaina. Then, next is going to be Andre Juillard from Deutsche Bank. Andre [indiscernible]
Q – Andre Juillard: Hi, [indiscernible] good evening, and congratulations for these good results. My questions are, first, about the sales that you could have from the operating environment, because you're saying that more or less, all of your markets are very well oriented. You are guiding on low double digit. But, what could negatively impact, if we wanted to be, a little bit more cautious? First, question. Second question, is about all the asset management deals, you're planning to do or you have already announced. Could you give us slightly more detail, about the breakdown between the Republic Dominican -- Dominican Republic, sorry, Mexico, the Canary Island. And I had a specific question, about the Santander deal. Do you have any call option or does Santander has a put option, on the respective participation, even if I perfectly understood, that we were talking about a long-term deal. Last question, if I may, about refinancing. You've got €280 million to refinance this year, if am I right? And €163 million next year, what is the plan for this refinancing? Are you thinking about traditional bonds, credit lines or anything else? Thank you.
Andre Gerondeau: This is – Hello this is André Gerondeau. This is to your first question, so far and we're not underbooked, but in terms of the pace of the reservations, the underbooked business, which is not only strong for Q1, but it's also showing a strong pace for summer, at levels of between 15% and 20% already for the summer. So, there's an early booking window, which is very relevant and that's going to allow us to do a lot of yield management, with direct channels being part of the strategy. There is nothing, as we speak today, that we are overcautious about. Obviously, there are some geopolitical issues, that we do not control, but we have to say that given the situation, the unfortunate situation in Gaza or the situation in Ukraine, we have not seen really an impact, I wouldn't say, a positive impact. But please remember, how resilient the distribution of our portfolio is between the Caribbean primary cities and resorts. So there is nothing right now that we can share that we're already cautious. Obviously, we are being sensitive and we're taking it quarter-by-quarter as well. The pace that we have for our group and life business is also very strong. Bear in mind that we manage two very large convention centers one in Palma and another one recently in Barcelona, and that we have strong life operation in the Caribbean. So hopefully, there's nothing that is going to make us change our mind. But as of today, it wouldn't be fair for us to say anything specific other than the overall situation.
Juan Ignacio Pardo: Juan Ignacio Pardo speaking. As I said again in the July session, real estate team's priority has been entirely driven by the asset rotation strategy. As we have mentioned already, we keep our focus on partial disposals, other directly to joint ventures or introducing partners to assets for the upcoming period. The company, as the Chairman has mentioned, has saw the rotation operations plan and they have been both in Spain and in the Caribbean. And we hope that we will communicate and be able to communicate the results there for coming months.
Angel Luis Rodríguez: Andre, bonjour. Angel speaking. Concerning your first question on the Santander deal, I think the most significant part is that we -- Santander has no put on us whatsoever. And then, obviously, we are retaining majority control on this vehicle. And that will give us a lot of optionalities when if necessity comes. But the most significant part of it is that there's no put option on Santander against Meliá. And then concerning the maturity profile, yes, we have €280 million maturing this year. We already signed a reorganization with Santander on December last year. And so we moved €50 million from 2024 and €50 million from 2025 to 2026. Now in Q1, there will be maturities for €60 million. We have cash enough to pay. And we are already sticking with all our lenders and we are expecting to close a reorganization of our maturities along with the reduction in April, May at the latest. So, we are in dialogue with Santander. And our objective would be to end up with a profile of around €150 million of maturities each year.
Stephane Baos: Okay. Andre [indiscernible].
Andre Juillard: Perfectly clear. Thank you very much.
Stephane Baos: Next question [ph]. Now, we go to Iñigo Egusquiza from Kepler. Hi, Inigo.
Iñigo Egusquiza: Hello, Stephane, Hello, Gabriel, and the rest of the team. Thanks for taking my two questions. The first one is a quick follow-up on the target Gabriel that you are mentioning to reduce the net debt to EBITDA to 2.5 times by 2024. I'm doing more or less the numbers. And if we assume that the cash inflow from the Santander transaction is €230 million. On top there is €50 million on new asset rotation, you are implicit assuming that the free cash flow or the annual free cash flow generation would be around €100 million. And the first question is, this number is more or less okay? And the second question on your guidance for 2024. You are giving top line low-double-digit RevPAR guidance growth for 2024, but which is -- I don't know if it's optimistic but at least it's a strong RevPAR expected for 2024. But on EBITDA you are only assuming 3% over 2023 EBITDA. Why is that the impact that is smaller at the EBITDA level? Thank you.
Andre Gerondeau: Hi, Inigo. You're right basically. I mean free cash flow of the company is going to be hopefully higher than €100 million this year. So that is the third element of the ammunition that we're going to have to review that. I think basically that was your question, right?
Iñigo Egusquiza: Yeah. Thank you.
Stephane Baos: Okay. I will talk about the guidance of RevPAR that Gabriel gave and also the EBITDA. It's true that you need to remember that we have in 2024, we are not going to have for the full year equity more or less as a lease. And remember, only when you compare with the figures that we have in 2023, at the revenue level, we are talking about €75 million that we had in 2023 and we are not going to have in 2024. And also, I would like to include also that the EBITDA generated by these orders along these eight malls that we had on lease was around €10 million. This is something that we have a one-off in 2023 and we are not going to have in 2024. And also, let to point that Gabriel said at least, because we never know what is going to happen. But then the goal of the company at least is going to be €500 million for 2024. It's okay, Inigo?
Iñigo Egusquiza: Yes, very clear. Thank you, Stephane. Just a small follow-up on the asset rotation. Gabriel, you mentioned that this €50 million additional asset rotation will come from the sale of two minority stakes. You mentioned one in Dominican Republic and another one in the Canary Island. Is this right?
Gabriel Escarrer: Yes, absolutely. Yes, you're right.
Iñigo Egusquiza: Okay. Thank you.
Stephane Baos: Now, please Fernando from Alantra. Please go ahead. Fernando Martorell.
Fernando Abril-Martorell: Hi. Thank you. Sorry, but most of them have already been answered. Just a follow-up on CapEx, because you've mentioned you expect to generate around €100 million free cash flow generation this year. Just I was wondering the breakdown in CapEx for 2024 between key money, maintenance CapEx, development CapEx and investments in your JVs if possible, please? Thank you.
Gabriel Escarrer: Yeah. It's around 50-50, 60-40 Fernando sorry, we can be more precise if you want, we can send you a note. But it's going to be yes €50 million €60 million in maintenance and the other one in between
Angel Luis Rodríguez: Within investment and key money.
Gabriel Escarrer: Investment and key money basically yeah. It's okay, Fernando?
Fernando Abril-Martorell: Yes. I thought that maintenance CapEx normally was higher than around €50 million a year.
Gabriel Escarrer: Yes, yes, yes. It used to be and this year what we've decided is as I explained before also with the IT, look with heavily CapEx our properties within the last year. And so, we don't think we are jeopardizing the stages. We're going to be very strict. We're going to do an inventory of the real needs and we're going break a little bit this year and then take it from there next year.
Fernando Abril-Martorell: Okay. Thank you.
Stephane Baos: Okay. Then thank you. I think that's all for today. That concludes our question-and-answer session. We hope that we have been helpful here. Please do not hesitate to contact us or to go to our Investor Relations department any further questions you might have. Thank you and good night.
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