Budget hotel company Travelodge has seen ¡°improving¡± trading conditions in the third quarter of 2025 after UK revenue declined in the first half of the year.

The firm said demand for its UK properties had been ¡°softer¡± in the first six months of 2025, particularly in London, with total revenue dipping by 3.2 per cent year-on-year to ?471.3 million. More positively, Travelodge highlighted that sales in Spain had grown by 30 per cent over the same period.

Travelodge¡¯s CEO Jo Boydell added:?¡°Travelodge delivered a solid first-half performance given the challenging market backdrop. 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.¡±

Boydell said Travelodge¡¯s half-year profit was impacted by around ?20 million in inflationary cost increases, including rises in the UK¡¯s National Living Wage and National Insurance. As a result, the group¡¯s ebidta (earnings before interest, taxes, depreciation and amortisation) dropped by 42 per cent year-on-year to ?47.3 million for the first half of 2025.

¡°Despite these headwinds, our diversified business and leisure customer base supported strong occupancy of over 82 per cent, and the performance of our Spanish business was a particular highlight, delivering strong revenue and profit growth,¡± she said.

Travelodge has continued to expand in the UK with 11 new hotels opening so far this year and another nine properties set to debut by the end of 2025.

In Spain, the company is planning to develop hotels in Bilbao and Madrid, which are due to open in 2026 and 2027 respectively, alongside a ¡°growing pipeline¡± of new-build and conversion projects.

¡°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 per cent 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,¡± said Boydell.

¡°While the macroeconomic environment remains uncertain, we are confident in our strategy and are well-positioned to deliver sustainable growth over the medium-term.¡±