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Safestay has revealed that its total revenue increased by 26% to £18.4m in the full-year ended 31 December 2019, with like-for-like sales up 7%.
The hostel group said that 49%, or £9m of its net revenue was now coming from mainland Europe, up from the 43% reported in 2018.
Over the full-year period, a 77.3% occupancy was reported, up from 75.6% the year prior, which Safestay said was a reflection of “good demand”.
There was also a 5.4% increase in the average bed rate to £21.4, up from £20.3 in 2018.
Over the period, the group increased its sites from 13 to 20, marking a bed increase from 3,200 to 4,900 beds. Almost £1m was invested into renovation projects in order to “to maintain the premium positioning of the Safestay brand”.
In its latest update, the group said that it had reached an agreement with HSBC to increase its debt facility from £17.9m to £22.9m, under the same terms as its previous facility, for a new five year term until January 2025.
It is also preparing for a staggered reopening plan, initially targeting the domestic market in each of the countries that it operates in.
Under the reopening plan, there will be protective changes introduced to its check-in, food service and cleaning rotas, alongside the temporary closure of common spaces and shared rooms. Rooms will be sold to individuals or “groups known to each other”.
Larry Lipman, chairman of the company, said: “2019 was a transformational year for Safestay. We added 7 new hostels increasing our number of sites to 20 making us a leading premium hostel operator in Europe.
“Our financial performance reflected this expansion with revenues up 26% and while we also made a good start to trading in 2020, the sudden spread of COVID-19 has meant we have had to adapt quickly to an unexpected phase.”
He added: “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.
“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.”
