Hostel company Safestay said today it boosted revenue in 2019 as it laid out plans to reopen its hostels as the coronavirus crisis begins to abate.
Safestay said revenue for the year to 31 December increased 26 per cent to £18.4m with like-for-like sales up seven per cent.
The company posted a loss before tax of £0.6m.
Safestay also said it had a staggered reopening plan with the aim of opening locations as they would become profitable after it closed all hostels on 1 April.
The company said that post-year end it had extended its debt facility with HSBC from £17.9m to £22.9m for a new five-year term until January 2025.
Safestay said it had also agreed a £5m overdraft with HSBC, used “available government reliefs” and is now “well placed to weather the current crisis”.
The company said the reopening plan would initially target the domestic market in each country it operates in.
It said there would be protective changes introduced to check-in, food service, cleaning rotas and the closure of common spaces.
Safestay said it would no longer offer shared rooms and instead rooms will be sold to individuals or “groups known to each other”.
Safestay chair Larry Lipman said: “We secured the financial stability of the business and we are now working on our plans to re-open our hostels on a staggered basis, over the course of 2020, as and when we believe they can be profitable.
“Our focus is on ensuring the safety of our guests, initially targeting the domestic markets in each country, and then looking to gradually return to normal trading patterns.
“Navigating the re-engagement of the business will require us to be highly flexible as we test and match demand in individual markets, however, we are confident of being able to do this and making sure that we balance increased operational cost with increased income.
“From an industry perspective, the hostel market is highly fragmented with a large number of small operators who are under pressure as a result of the pandemic and this may well create unique opportunities for Safestay”.