Global office rental firm IWG has today reported a 34% jump in annual core profit, buoyed by increased demand for its flexible working spaces and pricing strength, and forecast 2024 earnings in line with its expectations.
Landlords have seen a gradual growth in the utilisation of their office spaces since mid-2023 as tenants increasingly scrap pandemic-induced permanent remote working plans and employees switch to a hybrid-work model by being in the office for a specific number of days in a week.
"While 2023 was a record year for both revenue and network size, we continue to see significant growth potential," IWG's chief executive Mark Dixon said in a statement.
The company, which operates in more than 4,000 locations across over 120 countries, said annual group revenue rose 8% to £3.3 billion - the highest ever in its 35 year history.
The London-listed owner of the Spaces and Regus brands said core profit came in at £403m for the year ended December 31, compared with LSEG average analysts' estimates of £397.6m.
Last week the company said it was opening four new flexible workspaces in Ireland - in Blanchardstown and Blackrock in Dublin, Clonmel in Co Tipperary and in Limerick as it said the demand for hybrid working rapidly accelerates in Ireland.
Speaking on Morning Ireland, Mr Dixon said IWG is working on creating a network in Ireland of between 100 and 150 buildings.
"We are partnering with the Irish property industry to create these locations," he said. "We are adding locations in the suburbs and rural locations where people live and want to work. Technology makes it possible so why commute into other cities to work when you can work locally."
Mr Dixon said Ireland is "very dynamic as a commercial market, as a country full of start-ups and there's very good demand across the country".
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IWG said today that demand for hybrid working solutions continues to grow as businesses globally are still seeking to reduce costs and respond to the needs of their workers.
In its results statement, the group said it remains cautious in its outlook and continues to focus on driving efficiencies and cost control.
The company, which said in December it would resume regular dividend payouts, has proposed a final dividend of one pence per share.
IWG said that revenue per available room (RevPAR) came to £381 a month in 2023 with an estimated RevPAR of about £250 once all rooms including the signed pipeline have opened and matured.
Mark Dixon, chief executive of IWG plc, said the company enters 2024 continuing its momentum from 2023 as it continues to grow its customer base, its global partnerships and its best-in-class network.
"While 2023 was a record year for both revenue and network size, we continue to see significant growth potential. With 1.2 billion white-collar workers globally and a potential audience valued at more than $2 trillion, there is substantial room for growth and as a company, we have a laser-like focus on capturing more of this market over the coming months and years," he added.
