Safestay (LSE:SSTY) reported revenue from continuing operations of £8.4 million for the first half of 2026, down 10.6% from the corresponding period a year earlier.
Adjusted EBITDA declined to £0.6 million, while the hostel operator recorded a post-tax loss of £1.9 million.
The company reported lower occupancy and reduced group bookings during the period, against what it described as a challenging consumer and tourism environment.
Cash holdings increased 70% to £4.6 million, supported by proceeds from the sale of Safestay’s Glasgow property. The group also reduced debt following the disposal.
Average Bed Rate Rises as Occupancy Declines
Safestay increased its Average Bed Rate by 8.3% during the period as part of its pricing strategy. However, revenue per available bed declined as occupancy decreased.
The company also cited cost pressures relating to VAT, business rates and wages.
As part of changes to its portfolio, Safestay closed its loss-making Berlin Kurfürstendamm location and agreed the sale of its London Kensington Holland Park hostel.
The group is also implementing guest-experience initiatives and making smaller additions to capacity at parts of its existing portfolio.
Safestay Pursues Asset-Light Strategy
Safestay said it is continuing to move towards an asset-light operating model across Europe, with franchise and leasehold arrangements forming part of its expansion strategy.
The company is considering additional property disposals and sale-and-leaseback transactions as part of this approach.
Safestay has also entered a marketing partnership with Indian hostel network Zostel. According to the company, the partnership creates a combined network of more than 8,000 beds across the UK, continental Europe and India.
About Safestay
Safestay plc is a hostel operator with a portfolio of 20 hostels and one hotel across the UK and continental Europe.
Its accommodation includes private and shared rooms, while its portfolio spans markets including Spain, Portugal, Italy, Greece, Poland, Austria, Belgium, Czechia, Slovakia and the UK.
The company is pursuing an asset-light expansion strategy incorporating franchises, leaseholds and partnerships.
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