Travelodge has published its latest financial figures, showing record results for the third quarter.
The budget hotel group reported an EBITDA profit of £93.8 million for the quarter ending September 30, 2022, compared to £57.5 million for the same period in 2019.
Travelodge also reported record results for the first nine months of 2022, and said it had surpassed its 2019 full year results by the end of the third quarter.
Occupancy was at 86 per cent in the third quarter (up from 85 per cent in 2019), with average room rates up 31.7 per cent at £74.81 (compared to £56.79 in 2019).
The group has opened five new hotels so far this year, with a further ten expected to be unveiled in 2023, and it currently has a network of 595 properties and 45,624 rooms (as of September 30).
Among these include the first hotels featuring Travelodge’s new “budget luxe” design concept, with features including a new “timeless classic style” reception with leather bench seating and wooden style flooring, as well as a contemporary Bar Cafe concept.
The group said the results had been “driven by strong leisure and ‘blue-collar’ business demand, more than offsetting the more gradual recovery in ‘white-collar’ demand”, adding that “Trading in the first weeks of quarter four has continued to benefit from strong leisure and ‘blue-collar’ business demand with encouraging improvements in ‘white-collar’ demand and sustained outperformance against the market segment”.
Travelodge entered into voluntary insolvency proceedings in 2020 shortly after the onset of Covid-19, which included a break clause for landlords wishing to change brands.
Later that year the group confirmed that it had retained 578 of its properties.
Commenting on the news Jo Boydell, Travelodge chief executive, said:
“Travelodge has delivered a record set of financial results, significantly ahead of 2019, driven by strong demand for our great value hotels as customers return to both business and leisure travel. Our purpose is to provide affordable travel for everyone and amid the growing cost of living pressures, we have seen that more customers are choosing to stay with us.
“We have continued to outperform against the competitive segment, for the eighth consecutive year, and it’s particularly pleasing to see these trends continue in the first weeks of the fourth quarter.
“Our cash position remains strong, and we have continued to invest in the business whilst also further de-leveraging, with the term loan repaid in full on 26 October. We were also pleased that on 17 November Moody’s upgraded our credit rating from Caa1 to B3, reflecting the businesses strong performance.
“Looking ahead, we are very mindful of the cost-of-living crisis and are doing all we can to navigate the cost pressures on our business. The near-term trading signs are positive, but booking patterns remain short-lead and we therefore have limited visibility. However, the budget end of the hotel segment is the most resilient, with budget brands historically performing strongest in tough economic times.”