10th Sep 2014 09:48
LONDON (Alliance News) - Safestay PLC Wednesday said it has potential acquisition opportunities and said it expects to expand its portfolio of hostels.
The news came within the boutique hostel owner and operator's interim results statement, which showed a GBP137,000 pretax profit on GBP502,000 of revenue in the period between January 29 and June 30.
Although the results are for the period from incorporation to the end of June, the group began trading on May 2 due to the listing and acquisition of the Safestay joint venture. Therefore, the results only include trading from May 2 to June 30.
The company acquired the Safestay joint venture after raising GBP7.6 million from new investors under its initial public offering. It also utilised a Coutts & Co loan facility of GBP5.6 million to help with the acquisition and to provide working capital.
At the time of admission, the joint venture owned a freehold property in Elephant & Castle from which it operated a hostel. The company acquired a second hostel, in York, for GBP2.4 million on May 24.
On Wednesday, Safestay said occupancy rate at the Elephant & Castle hostel improved to 75.6% from 64.1% in 2013. It said this was above budget for the period. The average bed rate increased by 12.2% over the same period last year, the company said, adding that the combination of the factors resulted in an overall increase in bed revenue.
Safestay York also enjoyed an increase in occupancy rate, moving to 50.9% from 44.1% in the same period in 2013. Since the end of June, the company has begun to refurbish and rebrand the hostel, which management expects to result in higher occupancy and bed revenue.
Safestay shares were Wednesday quoted down 0.9% at 56.0 pence.
By Samuel Agini; [email protected]; @samuelagini
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
Safestay