Hostelworld shrugs off travel industry terror fears with return to growth

Alys Key
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The company's advertising push helped to boost booking numbers (Source: Hostelworld)

Shares in travel firm Hostelworld closed up more than 15 per cent today, after the company revealed a return to revenue growth.

The figures

Group net revenue increased in the first half by 16 per cent to €46.6m (£42.7m), recovering from a six per cent drop last year.

Adjusted underlying earnings jumped 27 per cent to €12.9m.

Bookings grew 11 per cent, with the core Hostelworld brand up 21 per cent.

Shares in the London-listed company closed up 15.32 per cent at 335p.

Read more: IAG's new airline Level has topped 100,000 bookings since its March launch

Why it's interesting

The group said a marketing push had helped to improve booking numbers, with its "Meet the World" tagline drawing in travellers.

But it also said that the six months to 30 June last year were adversely affected by terrorist attacks, which knocked consumer confidence. Chief executive Feargal Mooney said that growth in the summer period since had been softer.

This could suggest that the effect of terror on the travel industry is weakening, as attacks in Nice, Berlin, London and Manchester all occurred since the end of the first half of 2016.

Earlier this year, London hotels performed well despite recent terror attacks, with business holding up better than it had in Brussels and Paris following terrorist incidents in those cities.

Read more: Boss of O2 owner AEG on why live music is thriving despite terrorism

What the company said

CEO Feargal Mooney said: "The level of growth in the first half of 2017 was somewhat flattered by a weak comparative in the first half of 2016, and growth rates in the June to August period have been more modest."

Commenting on the volatility of the travel market, he said: "We remain confident in our long-term strategy and execution and will continue to manage the risks to our business posed by the impact of terrorist attacks on travel demand alongside general macroeconomic uncertainties and currency fluctuations."

Read more: Travel industry trains 23,000 staff in how to deal with terrorist incidents

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