Travelodge Group
First half performance solid against challenging market conditions; strategic progress reinforces strong fundamentals and supports medium-term growth
Travelodge Group financial results for the six months ended 30 June 2025
- Revenue of £471.3 million (H1 2024: £486.7 million) – reflecting softer demand, particularly in Greater London, and event phasing weighted to H2, partially offset by contribution from new hotels, continued growth in F&B and strong growth in Spain
- Group EBITDA of £47.3 million (H1 2024: £82.1 million) – impacted by decline in UK revenue and significant industry-wide cost inflation, in line with expectations
- Continued strong cost control and industry-leading operating cost model – as well as driving further efficiencies, helping to mitigate inflationary pressures
- Largest development programme in over a decade – 11 new UK hotels opened so far in 2025, at least 9 more expected by year-end; continued expansion in Spain with two new freehold developments secured in Q2
- Spanish business continues to perform strongly – revenue up c.30% and EBITDA up over 30% to £4.8 million, driven by like-for-like revenue growth and contribution from new hotels acquired in 2024
- Continued investments driving customer and commercial benefits – refit programme now at c.65% of the estate; rollout of next generation rooms, enhanced digital offering and introduction of new customer features such as ‘Choose Your Room’ customer feature and ‘StaySmart,’ an expansion of our self-serve hotel trial
- Strong liquidity position – period-end Group cash of £152.5 million, maintaining flexibility to continue to invest for growth
- Improved trading conditions in first few weeks of Q3 – Travelodge total revenue in the quarter to date is c.4% ahead of 2024, with solid performance in London and regions; forward booking patterns positive; limited forward visibility
Jo Boydell, Chief Executive of Travelodge, said: “Travelodge delivered a solid first-half performance given the challenging market backdrop. During the period, we welcomed leisure guests attending major events such as the Six Nations Rugby, Radio One Weekend in Liverpool, the Grand National and the London Marathon, as well as business travellers for key conferences like Infosecurity Europe.
“As previously highlighted, demand was softer in the first half, particularly in Greater London, and event phasing has shifted more activity into the second half of the year. Profits were impacted by approximately £20 million of inflationary cost increases, including around £9 million from National Living Wage uplifts and additional National Insurance costs. Despite these headwinds, our diversified business and leisure customer base supported strong occupancy of over 82%, and the performance of our Spanish business was a particular highlight, delivering strong revenue and profit growth.
“We are undertaking our largest development programme in over a decade – having opened 11 new UK hotels so far this year, with at least nine more to come in the second half, and continuing with upgrades across our estate, with approximately 65% of our rooms now refitted to next generation standards. Alongside this, we continue to enhance our customer proposition through digital innovation and new features, including the rollout of the ‘Choose Your Room’ customer feature; our first hybrid ‘StaySmart’ hotel, which offers flexible self-serve check in options via mobile app, kiosk, or reception; and a new AI assistant, Ara – all supporting long-term growth and quality.
“Looking ahead, we are encouraged by the improving trading conditions we have seen in the third quarter so far, with total revenue to-date around 4% ahead of last year, and forward bookings to the year-end also ahead of 2024 levels, supported by strong event demand, although with the normal limited visibility. While the macroeconomic environment remains uncertain, we are confident in our strategy and are well-positioned to deliver sustainable growth over the medium-term.”
21 August 2025 – Travelodge Group, the UK’s first budget hotel brand which operates more than 610 hotels, today announces its half-year results for the six months ended 30 June 2025.
Travelodge delivered a solid first-half performance in a challenging market environment. The Group reports revenue of £471.3 million (H1 2024: £486.7 million), reflecting softer market demand, particularly in Greater London, and the phasing of events into the second half, partially offset by the contribution from new hotels, continued growth in F&B and strong growth in Spain.
Travelodge continues to face significant industry wide cost inflation, and profits were impacted by c.£20 million of inflationary cost increases, with approximately £9 million due to the annualisation of the 2024 and 2025 increases in the National Living Wage of c.10% and 7% respectively, alongside the National Insurance Contributions’ impact from April 2025. Costs also increased due to the multi-year inflationary impact on rent costs where a proportion of rent reviews are uncapped, due to the 5 yearly review cycle. Travelodge’s industry-leading operating model and continued focus on cost efficiencies and savings are helping to mitigate inflationary pressures.
Travelodge continued to benefit from resilient demand across a diverse mix of business and leisure guests, maintaining high occupancy levels of over 82%, significantly ahead of the market average. Leisure guests used Travelodge as a base for major events such as the Six Nations Rugby, Radio One Weekend in Liverpool, the Grand National, the London Marathon, and, post-period, concerts including Oasis, Ozzy Osbourne and Black Sabbath’s “Back to the Beginning” and Coldplay’s tour. Business guests included those travelling for meetings, working away from home, and those attending major industry events such as Infosecurity Europe (Europe’s leading cyber security event) and the Global Offshore Wind Conference (the largest offshore wind event in the world).
Travelodge’s Spanish business continues to perform strongly, with revenues up c.30% and EBITDA increasing by over 30% to £4.8 million (H1 2024: £3.6 million), driven by like-for-like revenue growth as well as the contribution from six freehold hotels acquired in 2024.
At the end of the period, Travelodge maintained a strong liquidity position, with cash and cash equivalents of £152.5 million. The business generated positive free cash flow in the period, reflecting EBITDA profit and seasonal working capital inflow, partially offset by continued investment in the refit programme, new hotel development and enhancements to Travelodge’s customer proposition.
So far in quarter three, Travelodge has seen improving trading conditions, as expected, with strong event demand and the good weather in the Group’s largest trading period. Travelodge’s total revenue in the quarter to-date is c.4% ahead of 2024, including the benefit from new hotels. This reflects solid performance in London and strong growth in the regions. Forward booking patterns and event-led demand are encouraging, with booked revenue to the end of 2025 ahead of the prior year, supported by positive trends in both leisure and business travel. Forward visibility remains limited in line with normal trading patterns.
Largest development programme in over a decade
During the period, Travelodge undertook its largest development programme in over a decade.
In the UK, 11 new hotels have opened so far in 2025, with at least nine more expected by year-end, reflecting both freehold and leasehold development models. This includes the acquisition of a portfolio of nine hotels in April – eight of which are now trading as Travelodge and due to complete their refits later this year, with the final one in the process of being refitted ahead of opening. The Group also completed the acquisition of an office building in prime Central London, opposite Liverpool Street station, to be converted to a hotel subject to planning.
In Spain, Travelodge continues to build on its strong momentum, with two new freehold development opportunities exchanged in Bilbao (opening 2026) and Madrid (opening 2027), and a growing pipeline of new-build and conversion projects. The Spanish market remains highly attractive, with strong business and leisure demand and low penetration of branded budget hotels.
Continued investments to drive growth, quality and efficiencies
Travelodge continues to make good progress on its strategic priorities, investing in growth, quality and the customer proposition.
Travelodge’s refit programme is well advanced, with c.65% of the estate now refitted with next generation rooms, a re-designed reception and upgraded bar café in our new 85 Bar Café design, delivering a warmer and more welcoming environment. The programme is delivering both commercial and customer benefits, with over 96% of Travelodge hotels now rated four dots or above on Tripadvisor.
New features such as ‘Choose Your Room’ – now being rolled out across the estate – give customers the option to select their exact room, with strong early take-up.
Travelodge continues to evolve its customer proposition, including the expansion of self-serve options with the launch of its first hybrid ‘StaySmart’ hotel trial at London City, in July 2025. Customers can now check in via the ‘StaySmart’ mobile app, a kiosk, or the reception desk, building on positive feedback and high technology adoption from the initial self-serve hotel in St Albans.
Travelodge’s recently launched ‘Buy Now, Pay Later’ payment options are also delivering encouraging initial results, offering customers greater flexibility.
Our new mobile app, featuring Apple Pay, Google Pay, biometric login and personalised experiences, has also been well received, achieving 4.8* customer reviews.
Travelodge launched a new AI assistant, Ara, now available to guests at UK hotels. Ara uses generative AI to help customers with questions about their upcoming stays, providing quick, helpful answers on topics such as parking, breakfast options and nearby attractions.
Outlook
While the macroeconomic and political environment remains uncertain, the UK midscale and economy segment continues to show resilience, underpinned by a strong domestic focus and a balanced business/leisure mix.
Travelodge’s strong brand, efficient operating model and leading direct distribution model position the business well for medium-term growth. The Group remains confident in the structural outlook for the budget hotel segment and is excited about the significant growth opportunities ahead, in both the UK and Spain.
ENDS
Enquiries:
| FGS Global
Jenny Davey Anjali Unnikrishnan |
Tel: 0207 251 38 01 |
About Travelodge
Founded in 1985, Travelodge is Britain’s very first budget hotel chain and today is one of the largest budget hotel chains in the UK, with a portfolio of over 610 hotels and over 47,000 bedrooms across the UK, Ireland and Spain.
In Spain, Travelodge has an established profitable presence and has ambitious growth plans within this market and has identified the top key locations where it would like to open additional hotels in Spain.
Welcoming over 22 million guests annually across the UK, Ireland and Spain, the majority of Travelodge hotels are located in major cities, towns and holiday hotspots as well as by airports and key business hubs. With over 96% of its hotels rated 4 dots or above on TripAdvisor, Travelodge is proud to offer guests across its diverse customer base a good value experience – whether they are travelling for business or leisure.
Whether out celebrating a birthday, going to a concert or sporting event, visiting friends and family, taking a business trip, working away from home, or taking a short break, we help people to go and do their thing by Being the Brilliant Base.
Travelodge continues to invest in its ongoing hotel refit programme and has already upgraded approximately 65% of the Travelodge room estate to its new design. The brand is also continually evolving its quality offering to deliver a better experience for its diverse mix of business and leisure guests such as its new look Bar Café design, 85 Bar Café, which has been rolled out to selected UK hotels as part of the refit programme.
Travelodge is focusing on its environmental and social impact, with sustainability integral to its business strategy. Its Better Future sustainability plan aims to build a more sustainable future for its customers, colleagues and the planet, underpinned by three core pillars: Inclusive – ensuring we are accessible, inclusive and well-priced to our customers and colleagues; Caring – creating a caring and healthy environment for our colleagues and customers and ensuring their wellbeing; and Conscious – Travelodge is conscious of its impact on the planet, taking into account the waste it produces, the energy and other resources it consumes and the carbon emissions it generates.
For further information visit travelodge.co.uk or the Travelodge Hotels Limited LinkedIn page.