Hostelworld’s revenues jump ahead of pre-pandemic levels as its new social network strategy pays off
- The business, which started in 1999, is headquartered in Dublin
- Hostelworld shares went up 0.87% trading at 76.56p Wednesday morning
- Based on current performance, the business says it expects to be ‘modestly EBITDA positive for the Financial Year 2022’
Hostelworld net revenues for September were 4 per cent higher than 2019, with bookings also back on track following the pandemic.
The Dublin-headquartered company reported net bookings last month reached 83 per cent of 2019 levels, ‘driven by the continuing recovery of Asia and Oceania regions’, which have now grown to 70 per cent of 2019 levels compared to 43 per cent in June.
Hostelworld also attributed the rise in bookings to its new social network strategy, which resulted in ‘strong growth week over week’ in the number of customers signing up to its app.
Hostelworld has revealed that net revenue for September was 4 per cent higher than 2019, with bookings also back on track following the pandemic
The business, which started in 1999, said in a statement: ‘In particular, as of the end of September almost 50 per cent of all customers had signed up to the platform (since launching in April); driving a significant increase in the volume of bookings through our Apps.
‘This, along with strong net booking and average booking value (ABV) growth, has translated into increased revenues, lower marketing costs and improved margins.’
Hostelworld shares jumped 1.5 per cent, trading at 77p by midday Wednesday.
Based on current performance, the business says it expects to be ‘modestly EBITDA positive for the Financial Year 2022’.
It also notes that the outlook for 2023 is ‘encouraging’ and it expects its growth strategy to ‘continue to deliver further significant benefits in FY 2023 and beyond’.
CEO Gary Morrison said: ‘I am very encouraged by the clear financial and operational progress we have delivered year to date. In particular, I am very pleased with the positive trends we are seeing from our innovative ‘social’ strategy which is driving more customers to use our Apps, and reduced marketing as a percentage of net revenue.
‘In parallel, I am also pleased to welcome new research published by Bureau Veritas which confirms that hostels produce on average 75 per cent less carbon than hotels.
‘We know travellers are increasingly environmentally conscious, constantly looking for ways to minimise their carbon footprint while visiting new destinations. This report confirms that hostels are the sustainable tourism choice.
‘While recognising that wider macro-economic conditions are challenging and highly volatile, I remain very encouraged by the growth outlook for our business, underpinned by our highly differentiated Social strategy, data driven marketing allocation and disciplined cost control.’