Travelodge benefits from ‘resilient’ business travel sales

Budget hotel chain Travelodge performed “in line with expectations” during the first half of 2024 thanks to “resilient” business and leisure demand.

The UK-based company, which also has a growing portfolio in Spain, saw total revenue rise by 1.7 per cent year-on-year to £486.7 million for the six months to the end of June.

Travelodge said this increase in revenue was driven by “strong occupancy growth from our diverse range of both leisure and business customers, and new hotels”.

Although the hotel firm noted that there had been “softer market demand”, particularly in London where sales in the first half of 2024 were impacted by “fewer events, weather and strikes”.

Jo Boydell, Travelodge’s CEO, added: “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.

“UK revenues in the third quarter to date are modestly below 2023 levels but we were encouraged by improving trends during July, with UK revenues ahead of 2023 in that month.

“Forward bookings are also positive, with booked revenue to the end of the year ahead of 2023 levels at this point, driven by strong event demand.”

Travelodge’s group EBITDA (earnings before interest, taxes, depreciation, and amortisation) was £82.2 million for the half-year period, which the company said was impacted by planned investments, such as its hotel refit programme and a major advertising campaign.

“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,” said Boydell.

“This is already showing positive customer and commercial benefits, and we will have upgraded 50 per cent of our room estate by the end of 2024.” 

The company said its Spanish business had also been “performing strongly” as it continues to expand its portfolio in this market.

“Spain remains a key growth market for Travelodge, with the acquisition of five hotels from Louvre Group, agreement to acquire one further hotel and deals signed for three new builds in San Sebastian, Cadiz and Alicante,” said Boydell.

Travelodge is also expanding in the UK with five new hotels opening so far this year including London Bermondsey, Rotherham, Colchester, Bristol and London Oval. A further new UK property is due to open by the end of 2024.