Budget travel site Hostelworld reports record revenues for last year

Hostelworld reported record revenues in 2023, ahead of full-year results in March

Sarah Collins

Revenues at the Irish online travel group Hostelworld were up by a third last year to record highs, thanks to a spike in bookings on the back of a successful social-media campaign.

In a trading update on Wednesday the budget-booking platform, which is listed in Dublin and London, reported revenues of €93.7m for last year, up 32pc on 2022 and a historic high.

Net gross merchandise value — the gross transaction value of bookings minus cancellations — was also at a record high at €619m, up 32pc on the previous year.

Net bookings totalled 6.5 million, an increase of 37pc year on year, with net bed nights of 22.7 million, up 30pc year on year.

The increased revenue and bookings came despite a 4pc dip in net average booking value, due to higher but cheaper bookings in Asian destinations, offset by bed price inflation elsewhere.

The group’s active social-media strategy has driven down the cost of marketing, from 51pc to 50pc of net revenues.

Full-year adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) last year came in at around €18.3m, ahead of market expectations.

At the end of last year the group had €7.5m in cash and net debts of €12.3m, after paying down some of its loans and agreeing a new facility with AIB.

Full-year results for 2023 are due to be published on March 21.

Gary Morrison, the chief executive, said 2023 marked another year of “strategic progress” for the budget booker as it continued to power ahead after a Covid lull.

“Over 2023 we grew market share, delivered record revenues and increased operating leverage through a combination of reduced marketing spend (as a percentage of net revenue) and continued operating cost discipline to deliver EBITDA which exceeds the upper end of our guidance range,” he said.

The group is “strongly positioned to deliver” against its commitments in 2024, he added.

Goodbody analysts Dudley Shanley and Patrick O’Donnell said the group had issued “another solid trading update”.

“Overall, we view this as another excellent update from Hostelworld Group which has developed an enviable track record of meeting or exceeding the ambitious targets outlined at the capital markets day towards the end of 2022,” they said.

Hostelworld shares were up more than 5pc in morning trading in London on the back of Wednesday’s update.