Hostelworld swings to a loss as revenues plummet during pandemic

Hostelworld cancels dividend payout for 2020

Hostelworld (LON:HSW) swung to a loss as the company’s bookings dropped by 79% during the past year.

The Dublin-based accommodation provider also reported a €17.3 million loss at ebitda level, down from €20.5 million profit in 2019.

Net annual revenue fell by 81% from €80.7 million to €15.4 million in 2020.

The fall meant the firm swung to an earnings loss of €17.3m, down from a €20.5m profit in 2019.

Hostelworld confirmed €6.2m in cancellations fees as travellers ditched their plans due to the effect of the pandemic.

The group announced it would not be paying out a dividend for the year on account of its performance.

Gary Morrison, chief executive at Hostelworld, commented on the results:

“2020 has been an extremely challenging year for both Hostelworld and the entire global travel industry. In light of the unprecedented challenges presented by the pandemic, our key priorities have been to (i) support our employees, customers and hostel partners; (ii) increase our liquidity, and (iii) accelerate the execution of our core platform roadmap,” Morrison said.

“During the year we delivered significant improvements in marketing capabilities, user experience and inventory competitiveness. These improvements will have further strengthened the competitiveness of our platform relative to our capabilities in Q4’19, when we had returned bookings to growth.”

“As vaccination programmes continue to be rolled out in our key geographies across the world, I am confident our loyal customer base has a strong desire to travel once restrictions allow, even more so after a prolonged period of confinement. Furthermore, I continue to see significant opportunities to build a broader catalogue of relevant experiential travel products and services beyond hostel accommodation, and opportunities to connect like-minded travellers with each other via social features on our platform.”

“I remain confident that Hostelworld will emerge from the pandemic stronger than before and able to seize market opportunities when normal travel patterns resume”.