Business travellers help boost profits at Travelodge
Business travellers have helped to boost first half profits at Travelodge. - Credit: PA
Budget hotel chain Travelodge said today that its earnings jumped by almost a fifth in the first half of the year as it revealed plans to boost its expansion plans by building 45 hotels over the next two years.
Travelodge said earnings rose 19% to £90.1million in the six months to the end of July, compared with a year ago, driven by a growth in business travellers.
The firm said during the period it opened five hotels, bringing the estate up to 519 hotels, or 38,665 rooms, in the UK, Spain and Ireland.
The business, which is undergoing a £100m modernisation, said it would speed up its development programme, adding 45 hotels, or more than 3,600 rooms, over the next 24 months.
Chief executive Peter Gowers said: “Our development momentum is beginning to accelerate. We have already exchanged contracts for more new rooms in the first half of 2015 than we did in the whole of 2014.
“Boosted by our strong trading performance and the attractions of the value segment, major developers and financial institutions are showing their confidence in the future of new Travelodge.”
The business added that it had appointed Deutsche Bank to advise it on its long-running plans to float the business at an estimated value of £1billion, three years after its near-collapse.
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The chain’s current owners Goldman Sachs, Avenue Capital and GoldenTree Asset Management took control in 2012 after Travelodge faced the threat of collapse under a £500m debt mountain.
The firm, which celebrates its 30th anniversary this year, did not give a timetable on its expected flotation that has been the subject of City speculation for some time.
Travelodge opened its first hotel in Barton-under-Needwood in Staffordshire in 1985.
