Budget hotel chain Travelodge started to see their financial restructuring pay off over the course of 2016, with hotel upgrades attracting a higher proportion of business customers.
Operating profits for 2016 rose by £5 million to £110 million, with revenue rising 7 percent to £597.8 million aided by a 14 percent boost in food and drink sales.
The chain has undergone a massive restructuring since 2012, after piles of debt almost saw it file for bankruptcy. It was bought by two US hedge funds who managed to save the group, initiating a £100 million modernisation programme that has started to have an effect.
Former Hilton deputy chief executive Brian Wallace was appointed as chairman of the group in 2013, while Peter Gowers, who has previously held senior roles at Holiday Inn owner InterContinental Hotels, joined as chief executive later that year.
“This year just gone, we’ve overtaken [revenue from] leisure customers with business customers for the first time… since our restructuring,” said Travelodge chief executive Peter Gowers.
“Historically, our mix tended to be about 55 percent leisure, 45 percent business. Since the investment in quality, we’ve had a lot more success at winning over not just small businesses, which you might expect, but also around half the FTSE 100 use Travelodge in some way, shape or form.”
The firm is set to open another 60 hotels over the next three years, including one in central London.