(Alliance News) - Safestay PLC on Friday said that it had swung to a loss but revenue was up, noting it was beginning to return to pre-Covid-19 levels.
The London-based city centre hostels operator swung to a pretax loss in 2022 of GBP724,000 from a profit of GBP692,000 in 2021.
Revenue trebled to GBP19.1 million from GBP6.4 million. Safestay said this reflected a return to near normal trading, with hostel accommodation multiplying to GBP17.2 million from GBP4.9 million last year.
"2022 was our first near normal trading year since the start of the pandemic and it was therefore very pleasing to see that when allowed to trade, our hostels immediately attracted back a high level of guests," said Chair Larry Lipman.
Cost of sales tripled to GBP3.1 million from GBP1.2 million last year, with the company saying this was due to direct room supplies and sales commissions also trebling to GBP2.7 million from GBP951,000 last year.
Safestay's administrative expenses similarly increased by 33% to GBP13.8 million from GBP10.4 million.
Total tax charge for the year was GBP441,000, swinging from a tax gain of GBP1.3 million last year, and total staff costs increased 64% to GBP5.4 million from GBP3.3 million.
Average bed rate increased by 20% to GBP23.6 from GBP19.7 last year. Occupancy increased to 63% from 35.4% last year, but was still low compared to pre-COVID levels of 77% in 2019.
Safestay declared no dividend in 2022, unchanged from 2021.
Looking forward, Safestay said it expects to sustain an average room rate at or above 2022 levels, and that it will benefit from the return of large school and college bookings.
"If occupancy continues to grow into 2023, which we believe it will, and we are able to maintain our average bed rate levels, then the business is in a strong position," said Chair Lipman.
Shares in Safestay were up by 3.8% at 30.10 pence in London on Friday.
By Will Neill, Alliance News reporter
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Safestay (SSTY)