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Travelodge revenues have risen by 1.7% to £486.7m in the first half of the year, up from £478.7m, reflecting “resilient” customer demand, though earnings over the period were hit by ongoing investments. EBITDA of £82.2m was impacted by planned, “significant” investments, as well as overall inflationary pressures, and the impact of freehold property acquisitions over the period.
According to the group, continued strategic investments delivered positive results however, with investments in an accelerated refit programme and multi-channel advertising campaign driving commercial and customer benefits.
Upgrades to property management and IT systems are also ongoing, along with continued investment in technology to optimise digital conversion.
In its latest update, Travelodge acknowledged its financial performance reflects these investments, in conjunction with slightly softer market demand amid fewer events, weather and strikes, particularly in London.
Despite this, Travelodge delivered good occupancy growth, reflecting “resilient demand from its diverse range of both leisure and business customers”.
UK revenues in the third quarter to date were modestly below 2023 levels but the group said it was “encouraged” by improving trends during July, with UK revenues ahead of 2023 in that month.
Jo Boydell, Travelodge CEO, said: “Travelodge Group delivered a first-half performance in line with expectations, with our financial performance reflecting our continued investment in the business to drive growth and quality, including freehold acquisitions, as well as inflationary cost pressures and softer market demand, particularly in London.
“Revenue growth was supported by resilient customer demand from both leisure and business guests, with encouraging trends including continuing staycation demand, more people working in offices again and more face-to-face meetings.”
She added: “We continued to invest in our accelerated refit programme, upgrading our estate to next generation rooms, with our ongoing multi-channel advertising campaign promoting the transformation. This is already showing positive customer and commercial benefits, and we will have upgraded 50% of our room estate by the end of 2024.”
