Hostelworld Group PLC has released its interim results for 2024, reporting strong financial performance and bookings growth. The company saw a 9% year-on-year increase in net bookings, driven by record performances in Asia and Central America. The net average booking value decreased by 10% year-on-year, primarily due to a greater proportion of bookings in Asian destinations and an increase in solo customers. Despite this, the net revenue increased by 1% year-on-year, with direct marketing as a percentage of revenue decreasing to 45%, resulting in a 23% increase in net margin year-on-year.
The company's operating costs decreased by 2% year-on-year, leading to an operating profit of €4.0m compared to a loss of €1.7m in H1 2023, representing a 335% year-on-year increase. The adjusted EBITDA for H1 2024 was €9.6m, an 88% increase from H1 2023, with the adjusted EBITDA margin increasing from 11% to 21%. Hostelworld also reported a cash balance of €5.0m as of 30 June 2024, with a net debt position of €2.6m, down from €12.3m as of 31 December 2023.
Gary Morrison, Chief Executive Officer, expressed satisfaction with the strong growth in net bookings and net margins, driven by the company's social strategy. He also highlighted the progress made in enhancing the social network product features, adding more hostel inventory to the platform, and upgrading the platform towards a fully cloud-native architecture. Additionally, the company launched the 'Staircase to Sustainability' platform to deliver ongoing sustainability improvements in the hostel industry.
The trading update revealed that net bookings grew by 9% year-on-year, primarily driven by strong consumer demand for low-cost destinations, resulting in a 10% year-on-year contraction in average booking values. The marketing cost as a percentage of revenue decreased from 51% in H1 2023 to 45% in H1 2024, driven by the social strategy, leading to a 23% increase in net margin year-on-year. Hostelworld also reported strong operating cash performance, with cash generation of €12.4m in H1 2024, enabling the early repayment of the remaining AIB debt facility and the commencement of the repayment of warehoused payroll taxes to the Irish Revenue Commissioners.
Overall, Hostelworld Group PLC's interim results for 2024 demonstrate strong financial performance, driven by robust bookings growth and effective cost management. The company remains well-positioned for further profitable growth, with a focus on enhancing its social network strategy and delivering sustainability improvements in the hostel industry.