Safestay H1 adjusted EBITDA falls 28pc

(Sharecast News) - Hostel operator Safestay said on Tuesday that first-half revenue and profits had fallen, as macroeconomic pressures and softer demand weighed on performance across its European portfolio.

Safestay said revenues had dropped 5.6% to �10.1m in the six months ended 30 June, while adjusted underlying earnings fell 28.1% to �2.3m, citing inflationary cost pressures and reduced consumer spending as key factors behind the decline.

However, pre-tax profits came in at �591,000, up from last year's interim pre-tax loss of �113,000.

Occupancy across the estate averaged 68.2%, with average bed rates down 7.9% year-on-year at �20.40.

The AIM-listed firm stated that despite the weaker headline figures, it remained confident in its long-term strategy, and noted that demand had picked up in July and August, with bookings for September also showing improvement.

Safestay also said its portfolio remained well-positioned to benefit from a recovery in youth travel and group bookings, particularly in key cities such as Paris, Berlin, and Barcelona.

Chairman Larry Lipman said: "Safestay delivered further strategic progress in H1 2025 despite the challenging trading environment across the European hostel market.

"Looking ahead, our ambition is to deliver sustainable growth and to crystallise value for shareholders, whilst over the medium-term growing the portfolio. With a proven model, well-invested systems and technology, a clear strategy, and a strong pipeline of opportunities, we are confident in our ability to deliver sustainable expansion."

As of 0940 BST, Safestay shares had slumped 5.78% to 21.20p.

Reporting by Iain Gilbert at Sharecast.com