Online travel agent Hostelworld (HSW) reported in a trading update its best first half trading on record, with a 57% year-on-year increase in net gross merchandise value (gross transaction value minus cancellations) to €339.5m. Revenues also shot up 57% to €51.5m.
Similarly, net bookings were up 64% from last year to 3.4 million, driven by strong performance in the company's European, Asian, and Oceania markets. Net average booking value remained broadly unchanged at €15.15 as an increase in Asian destination bookings was offset by continued bed price inflation.
H1 2023 adjusted EBITDA was €5.1m, compared to a loss of €5.2m in H1 2022.
Direct marketing as a percentage of revenue totalled 51%, down 9% from 60% in H1 2022. Hostelworld also managed to lower the interest rate on its debt from 3.75% to 3.25% over EURIBOR after a €2.5m reduction in its balance to €5.0m. Closing cash was €10.7m with a debt of €16.2m.
Overall, Hostelworld delivered another strong half with record generated revenues and improved EBITDA margins, facilitated by its "Social growth strategy", an asset-light business model, and a continued focus on operational progress and cost control. As a result of this performance, HSW shares have risen 36% in the past year. Shares rose 3.31% on today's news.
Hostelworld reiterated its full-year guidance of adjusted EBITDA within the range of €16.5m-€17.0m. The company remains well financed as it continues to pay down its debt, with strong momentum to deliver another record half. Audited half-year results are expected on 10 August 2023.
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