Hostelworld grew bookings by 6% last year

Firm has published a pre-close trading update ahead of its preliminary results

Richard Segal (right), former chairman, and Feargal Mooney, chief executive. Photograph: Dave Meehan/The Irish Times

Richard Segal (right), former chairman, and Feargal Mooney, chief executive. Photograph: Dave Meehan/The Irish Times

 

Irish travel website Hostelworld grew its bookings by 6 per cent last year, the company has said.

Results for the full year to December 31st, 2017, are in line with the board’s expectations, it said in a pre-close trading update ahead of its preliminary results for the year, which will be announced on April 10th.

The group has delivered 6 per cent overall bookings growth for the year. Bookings growth in the second half was, as anticipated more modest, up 1 per cent on the second half of the year.

Bookings on the company’s flagship brand Hostelworld increased by 13 per cent, with growth of 6 per cent in the second half of the year. Gross average booking value for 2017 was €11.5, flat on the prior year and up 2 per cent on a constant currency basis.

Hostelworld continues to make “good progress” in its mobile business, with mobile and tablet now representing over 54 per cent of group bookings for the year. This is up from 47 per cent in 2016.

The company’s business model continued to generate “excellent” free cash flow resulting in a strong balance sheet at the year end.

Hostelworld chief executive Feargal Mooney said the firm was well positioned to make further progress in the coming year.

“We are pleased with the performance of the business in 2017,” he said. “During the second half of the year we delivered an efficient booking mix with marketing costs for the full year marginally lower than our previously guided range.

“We continue to execute well on our strategy and this positions the group well to make further progress in 2018.”

Davy said in a note it expects net revenue of €86 million for 2017, which is up 7 per cent from €80.5 million in 2016.

It also expects and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of €25.5 million, up 6 per cent from €23.9 milliojn the year before.

“Within this, volume and pricing trends were broadly in-line with our expectations,” said an analyst. “Our forecasts imply free cash flow of €20 million in the year.”

Hostelworld is currently searching for a new chief financial officer following the resignation of Mari Hurley last month.