Hybrid working trend drives up IWG’s revenue but shares tumble
9 August 2022, 10:44
The flexible workspace group said its system-wide revenue grew 22.3% to £1.3 billion in the first half of the year.
Flexible workspace company IWG has said the post-pandemic hybrid working trend drove up its revenue this year but shares fell as the provider reported another year of losses.
IWG, which provides co-working offices around the world, said its system-wide revenue grew 22.3% to £1.3 billion in the first half of the year, up from £1 billion a year earlier.
Underlying earnings jumped substantially to total £122.9 million, rising from £5.4 million in 2021 when lockdowns shut offices during the first few months of the year.
The company, formerly known as Regus, said its pre-tax losses amounted to £70.2 million as it faced the reintroduction of lockdowns in Asia and soaring inflation pushed up staff costs.
However, losses more than halved from £163.3 million in 2021.
Shares in IWG tumbled by more than 13% on Tuesday as investors reacted to the trading update.
The provider has not yet restarted dividend payments which were paused over two years ago. It confirmed on Tuesday that the uncertain economic and political climate is slowing growth.
But bosses are confident in the group’s outlook with hybrid working becoming the preferred option for many global companies.
Office attendance has gone up by a third since January with workers enjoying flexible hours in co-working spaces closer to home, IWG said in July.
Chief executive Mark Dixon said: “With hybrid working becoming the preferred operational model for a rapidly growing number of companies, we remain confident about the continuing structural growth drivers at play in our industry.
“We continue to build resilience and cost efficiency into our business, and we have repeatedly demonstrated our ability to address new challenges.
“These attributes will be important as we continue to navigate the headwinds created by increased geopolitical tensions in Europe, general inflationary pressures, and the ebb and flow of Covid-related restrictions in some markets.
“Overall therefore, we look forward with cautious optimism to the remainder of 2022.”
