LONDON (ShareCast) - (Sharecast News) - Hostelworld Group reported a strong performance for the first half of 2024 on Wednesday, with net bookings reaching 3.7 million, a 9% year-on-year increase, driven by record performances in Asia and Central America.

The London-listed firm said despite a 10% decrease in the net average booking value to €13.60, attributed to a higher proportion of bookings in Asian destinations and an increase in solo travellers, the company's net revenue grew by 1% to €46.4m.

It said its strategic focus on cost efficiency had paid off, with direct marketing expenses reduced to 45% of revenue, down from 51% in the same period last year, resulting in a 23% year-on-year growth in net margin.

Operating costs decreased by 2% to €12.5m.

The board highlighted the sharp increase in adjusted EBITDA, which surged 88% year-on-year to €9.6m, enhancing the adjusted EBITDA margin from 11% to 21%.

It said the proportion of bookings from social members rose to 80%, up from 74% in the fourth quarter of 2023, indicating successful engagement strategies within that customer segment.

Hostelworld closed the first half with a cash position of €5m and net debt of €2.6m, having fully repaid its AIB debt facility.

Looking ahead, Hostelworld said it was well-positioned to capitalise on market demand and maintained its full-year 2024 adjusted EBITDA guidance in line with market expectations.

"I am very pleased with our performance for the year to date, driven by strong consumer demand for low cost destinations in Asia and Central America," said group chief executive officer Gary Morrison.

"Over the balance of the year, we expect consumer demand for low cost destinations to continue, resulting in revenue growth lagging net bookings growth on a full-year basis.

"I am also pleased that marketing expense as a proportion of revenue has improved significantly year-on-year resulting in a 23% increase in net margin year-on-year driven primarily by our social strategy, despite the significant growth in lower cost destinations driving lower ABV's."

Morrison said that net margin growth coupled with its continuing focus on cost had delivered an 88% increase in adjusted EBITDA year-on-year, which had enabled the company to fully repay its residual debt facility with AIB, well ahead of schedule.

"Looking ahead, I remain very confident in our growth strategy and that we are well positioned, well financed and firmly on track to deliver against our objectives outlined in our capital markets day presentation in November 2022."

Hostelworld said it would report its half-year results for the six months ended 30 June on 8 August.

At 1023 BST, shares in Hostelworld Group were down 4.94% at 154p.

Reporting by Josh White for Sharecast.com.

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