Hostelworld forecasts continued recovery although caution raised over Ukraine

Hostelworld forecasts continued recovery although caution raised over Ukraine

Specialist OTA confident that sales will return to pre-pandemic levels despite unforeseen events

Low cost accommodation OTA Hostelworld expects bookings to return to close to pre-pandemic levels this year provided the war in Ukraine does not escalate further.

The firm disclosed that 2021 bookings of 1.5 million totalled just 21% of 2019 levels.

The adjusted earnings [ebitda] loss of €17.3 million remained flat year-on-year as booking values rose by 30% and cancellations fell by 43%.

The company reported a strong start to the year and a “consistent recovery” in weekly net bookings and revenues as travel restrictions eased, confidence returned and normal trading patterns resumed.

“Our business model is highly geared to travel recovery, and we anticipate seeing a continued recovery in bookings throughout the year,” the firm said.

“Whilst our recent trading data would indicate that the impact of Covid-19 on the travel industry is starting to recede, we, like many other businesses and industry sectors, face new uncertainties related to the effects of the Russian invasion of Ukraine.

“Whilst it is difficult to predict what the mid to long term effects of these events might be in continental Europe or further afield, we are hopeful on a humanitarian level that there will be a swift and peaceful resolution of the conflict.

“The year has started strongly and confidence in the ability to travel freely is growing.

“The current trends are encouraging and suggest that net bookings will continue to recover towards 2019 levels, in the absence of any further escalation of the conflict in the Ukraine or other unforeseen events.

“As we approach the important second quarter it is too soon to give definitive guidance for the year.”

Chief executive Gary Morrison said: “While 2021 was a challenging year both for Hostelworld and the global travel industry, I am pleased to say we saw a consistent recovery throughout the year in both bookings and revenue versus 2019, save for the last few weeks where we saw travel concerns over the Omicron variant.

“I am also pleased to report that we made solid progress on all elements of our strategy during the year whilst continuing to significantly reduce our operating expenses versus 2020 levels.

“Overall, I remain confident that our loyal customer base has more desire than ever to travel and meet other like-minded travellers once restrictions are eased.

“The improvements we continue to make to our platform and our differentiated growth strategy mean we are well-positioned to capitalise on those opportunities as demand continues to return.”