In 2023, online travel agent Hostelworld experienced a surge in revenues, reaching a historic peak, driven by strong growth in bookings across all regions. The Dublin-based company achieved a revenue of €93.1 million for the year, marking a notable increase of 34% compared to the previous year. Furthermore, the net gross merchandise value, representing the gross transaction value of bookings minus cancellations, reached a record €618.7 million, reflecting a 32% increase from 2022.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also witnessed a significant surge, reaching €18.4 million, a substantial rise from the €1.3 million reported in the prior year, surpassing the projected guidance for 2023. Profit after tax amounted to €5.1 million by the end of 2023, a stark contrast to the €17.3 million loss recorded in 2022.
The company experienced a remarkable increase in net bookings, soaring by 37% to 6.5 million throughout the year. Notably, bookings in Asia reached an all-time high, contributing to this growth. Despite this, the average booking value saw a slight decrease of 4% to €14.36, primarily due to the increased bookings in Asia where bed prices are comparatively lower, effectively counterbalancing inflationary trends.
“Europe remains our largest market in terms of both volume and value,” stated Caroline Sherry, the chief financial officer. “We have witnessed robust double-digit growth across all regions.”
Hostelworld disclosed that marketing expenditure accounted for approximately 50% of revenue last year, while operating expenses increased by €400,000 to €25.3 million.
By the end of 2023, the company held €7.5 million in cash, a decrease from €19 million reported a year earlier, with net debt totaling €12.3 million. This marked a decline from €21.6 million at the conclusion of 2022. The remaining balance of €7.5 million from the AIB revolving credit facility was fully repaid in February 2024.
“Throughout 2023, we expanded our market share, achieved record revenues, and enhanced operating leverage by reducing marketing expenditure (as a percentage of revenue) and maintaining disciplined operating cost control, resulting in €18.4 million EBITDA, exceeding our projected range of €17.5 million to €18.0 million,” remarked chief executive Gary Morrison.
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