Booking site in currency warning

ONLINE hostel-booking firm Hostelworld has warned markets that it is facing adverse foreign exchange movements and increased competition in Europe.

However, despite the challenges, the company has reaffirmed its expected earnings for 2018.

At its AGM yesterday, the Dublin-listed group said the introduction earlier this year of a free cancellation product had “significantly” improved its product offering, resulting in growth in both volume and average value of bookings on the site.

Commenting on the update, Ross Harvey, analyst at Davy stockbrokers, said he expects the group to report earnings of €23.8m for the financial year 2018, down 10pc on the previous year, reflecting the different accounting treatment for free cancellation bookings.

However, he said this would be cancelled out in 2019. In addition, Mr Harvey said that he expects Hostelworld to experience growth of around 4pc this year.

Yesterday also marked the start date for the group’s new CEO, Gary Morrison.

Mr Morrison joins the group from Expedia, where he has worked for the past seven years, most recently as its head of retail operations. Before that, he was in charge of Expedia’s EMEA region. He has also previously worked with Google and Motorola.

Commenting on the appointment, Mr Harvey said Mr Morrison had an impressive CV, and would bring to the group considerable experience from the online travel world. Hostelworld notched up 7.5 million bookings last year, with its net revenue rising 8pc to €86.7m.