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Interim Results

Hostelworld margins improve

23 August 2016 07:45

Hostelworld reports first half adjusted EBITDA of €10.1m (H1 2015: €10.0m) on revenues of €40.2m (H1 2015: €43.9m), benefiting from strong focus on higher quality revenues and more efficient PPC marketing.

Adjusted EBITDA margin improved to 25% (H1 2015: 23%).

Total group bookings fell to 3.5m (H1 2015: 3.6m), reflecting reduced investment in lower margin bookings, particularly on non-core supporting brands, combined with the impact of more difficult market conditions.

Group adjusted profit after tax was €7.7m (H1 2015: €8.8m) and adjusted pro-forma earnings per share fell to €0.08 (H1 2015: €0.09).

The interim dividend of 4.8 euro cents per share is in line with the stated dividend policy and the group says it is on track to meet expectations for the full year.

Chief executive Feargal Mooney said: "The core Hostelworld brand has delivered strong growth in the first half of the year against a background of more challenging market conditions, particularly in Europe as a consequence of a number of terrorist attacks in key European destinations.

"Reflecting a key strategic focus of the Group on the Hostelworld brand and more profitable channels and to discontinue lower margin business, bookings in our supporting brands now represent just 15% of the Group total.

"Trading during the key months of July and August has been in line with our expectations, underpinned by the strength of our brand and platform. We will continue to manage the risks to our business posed by the impact of terrorist attacks on travel demand and patterns and by macro-economic uncertainties and currency fluctuations surrounding Brexit and, based on performance for the year to date, our expectations for the full year are unchanged".

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