IWG PLC on Tuesday reported strong revenue growth in the third quarter of 2022 as a result of rising demand for hybrid workspaces and improved pricing.

The office-space provider said that, during the third quarter of the year, revenue has grown 25% year-on-year thanks to continuing global demand for ‘hybrid working solutions’.

Revenue in the three months ended September 30, totalled £737 million, up from £551 million a year prior.

Revenue growth was also aided by ‘substantially’ improved pricing and improving occupancy, the firm added. Occupancy increased 650 basis points across IWG’s estate, against the previous year.

IWG said the revenue growth has translated into an improvement in earnings before interest, taxation, depreciation, and amortisation performance in all its regions. Though it noted the improvement was weighted primarily towards suburban and provincial centres.

As a result, the firm said it remains ‘cautiously optimistic’ about the outlook for the full-year, especially as monthly profitability continues to grow.

Full-year adjusted Ebitda is now expected to be towards the lower end of market estimates of between £304 million and £380 million, IWG said.

In 2021, pre-IFRS 16 adjusted Ebitda totalled £79.6 million. Adjusted Ebitda, as reported, was £1.06 billion.

‘The third quarter has shown continuing strong revenue growth, margin improvement and underlying cash generation. We are well placed to deliver the full year results and enter 2023 with a strong foundation for delivering further growth and reducing leverage,’ commented Chief Executive Mark Dixon.

Shares in IWG were up 3.6% at 136.70 pence on Tuesday morning in London.

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