Travelodge profits soar 63% as owners consider £1bn sale

Budget hotel chain Travelodge has been able to report a 63.5% leap to £66.2m (€91.7m, $97m) in earnings before interest and tax in its full year results.

It's a remarkable turnaround for the brand which just three years ago was on the brink of collapse after it racked up debts of around £500m.

Revenue was up by 14.9% to £497.2m while it outpaced the market average with a 16.8% increase in revenue per room.

Such has been the U-turn from Travelodge that the owners – Goldman Sachs, Avenue Capital and GoldenTree Asset Management – are reportedly close to selling it for £1bn. Rumours of a sale surfaced in the early hours of 13 April.

The Times broke the news but Travelodge chief executive Peter Gowers fanned the flames when he appeared on BBC Radio 5's Wake Up To Money.

Gowers said: "There's probably never been a better time to run a value hotel business than now because the value hotel sector is huge. Britain is becoming a nation of value shoppers," adding that the current owners, which took over when it was teetering on the edge of insolvency, were "not natural long-term holders of the business".

He added: "I think you'd expect them always to be thinking about ways to realise value from their shareholdings, but for now we stay focused on running the business we have got."

Travelodge is hoping to have another 15 hotels open before the end of 2015.