Annual Report 2015 Published by Designed by

Hostelling International Mousetrap Design 2nd Floor, Gate House www.mousetrap-design.co.uk Fretherne Road Welwyn Garden City Most photos are courtesy of our Hostelling International and the Hostelling International logos Hertfordshire Member Associations, thanks are registered trademarks of Hostelling International. AL8 6RD, England to YHA Australia, HI Canada, Danhostel, HI Iceland, HI Mexico, Telephone +44 (0)1707 324170 YHA New Zealand, HI Norway, Qatar Facsimile +44 (0)1707 323980 YHA, HI Singapore, HI Slovenia, Email: [email protected] Stayokay, HI-USA. www.hihostels.com

Registered Charity (in England & Wales) No. 1117014

Company No. 02250706

Contents

04 - 05 President’s words Mission 06 - 07 About Hostelling International “To promote the education of all young people of all nations, but 08 - 09 Promoting the mission especially young people of limited means, by encouraging in 10 - 11 Building a Sustainable Network them a greater knowledge, love and care of the countryside and an appreciation of the cultural values of towns and cities in all 12 - 15 Strengthening the network parts of the world, and as ancillary thereto to provide hostels or other accommodation in which there shall be no distinction of 16 - 19 Revenue generation and service delivery race, nationality, colour, religion, sex, class, or political opinions 20 - 22 Governance & Board of Trustees and thereby to develop a better understanding of their fellow men, both at home and abroad.” 23 Auditor’s report Article 4 of the Memorandum and Articles of Association 24 - 27 Summary Financial Statements of Hostelling International 28 - 29 HI Member Associations and Associate Organisations

Chicago, USA 04 Annual report 2015 05

President’s words

2015 was a year of mixed operations for Hostelling International (HI), during the course of the The Board has continued to be open and transparent in its work with the aim of improving year HI had to make a number of readjustments to its work as it continued to operate in a difficult communication and cooperation with National Associations and opening up new opportunities for working environment. The Board and the Senior Staff had to set the course for HI’s future engagement and exchange. We were elected by our Members to serve them to the best of our operations in line with the agreed values, whilst trying to secure a solid financial base. Despite ability and we therefore have a responsibility to report back to them on our activities. the uncertain economic climate, HI remains committed to supporting the network of National Associations across the globe to enable and motivate them to offer consistently high quality During the course of the year representatives of the Board have attended events within the sustainable products to the customers. network such as the CEO Meeting held in Vienna, the European Regional Conference and the Asia, Arab, Africa regional meeting. In addition when holding a meeting within the network The Board recruited and appointed a new Chief Executive, Darren Barker, who took up the the Board has invited the relevant National Association to attend part of its meeting and share position at the International Office in April. The Board appointed Darren as we were convinced details of their operations and development plans. We have worked in closer cooperation with that he embodied the right combination of experience and new ideas which gave HI a new leader our Members involving their expertise and knowledge on IT and other matters such as business with a fresh perspective and an innovative approach. He has made a great difference to the planning to develop a new and sustainable vision for HI which is in line with our strengths and operation of HI and under his guidance the International Office has been reshaped and aligned to values. better serve the needs of the members. In September HI was elected as Vice President of the Affiliate Members Programme of the The previous year HI had launched its new hihostels.com web platform and unfortunately World Tourism Organisation (UNWTO). This role on the Board is an advisory position to advise performance was not as good as predicated, this in turn impacted on our financial results. As UNWTO on strategy and mission, reviewing plans and giving feedback. Their mission is similar a consequence efforts were focused on improving the performance of the web platform and to ours and this relationship will bring benefits to both bodies. Since the early 1930’s HI has been reducing costs, especially on conversion improvements, organic searches and referrals. With encouraging and enabling responsible youth travel. Through travel young people can learn by regard to savings costs all operations and activities of the International Office were reviewed and experience, develop social skills, an understanding of different cultures and develop an awareness a number of activities were stopped or reduced. The Board also implemented a number of costs of environmental conservation. HI has an incredibly strong history and mission which is still very savings and held two of their meetings on-line rather than meeting in person. much alive and relevant in today’s modern world. We will continue to seek out partners whose mission and activities are aligned with ours to strengthen our work and outreach.

We believe that during the past year we have set the right course and stabilised HI’s base of operations and it will now be more equipped to face the challenges that might arise in 2016.

Angela Braasch-Eggert HI President

Board meeting, Qatar

HI Quick Facts • 88 countries • 64 Member Associations • 3 Associate Organisations • Licensed hostels in 23 countries • 3,900 hostels • 290,000 beds • 34.7 million overnights per year • 3.4 million members

Approximate figures as available at time of publication. 06 Annual report 2015 07

About Hostelling International Awards and Honours

Hostelling International (HI) is a non- Our mission statement summarises the 2015 governmental, not-for-profit organisation objectives of the organisation which are • HI elected Vice-Chairman of the UNWTO Affiliate Members representing 64 Member Associations and to support youth travel and enable young Programme. three Associate Organisations from all over people of different nationalities, cultures and • HI elected to be part of the UNWTO Committee on Tourism and the world. It is one of the world’s largest youth social backgrounds to meet informally, share Sustainability (CTS) membership organisations and it is recognised experiences and to learn about themselves, • HI-Quality & Sustainability standards recognized by Global by UNESCO (United National Educational each other and their surroundings. Sustainable Tourism Council Scientific and Cultural Organisation) and Affiliate Member of UNWTO (United Nations We refer to the public benefit guidance given World Tourism Organization) since 2014. by the Charity Commission when evaluating our aims and objectives. Furthermore these 2014 HI is the only global network of youth hostel factors are considered when planning future • HI became a member of the UNWTO Affiliate Members associations. Its nearly 3.4 million members activities. Because of our mission and our Programme. have a choice of more than 3,900 hostels focus on social responsibility, environmental worldwide, all of which meet internationally sustainability and economic viability we are assured quality standards. HI’s Membership uniquely placed within the market and we are 2013 Savings Programme also gives access to one of the earliest examples of the movement • HI received the Ambassador for Peace Award from the International thousands of travel-related savings. which is now known as Sustainable Tourism. Institute for Peace Through Tourism (IIPT) for its work encouraging Since its creation in 1932, Hostelling young people to travel in order to break down cultural barriers and International has been working together with promote peace. its Member Associations to promote a greater • HI received a number of distinctions for the Big Blog Exchange understanding of people, places and cultures, programme: through the education of peace, environment - WYSE Travel Confederation’s Global Youth Travel Award for and global friendship, by providing safe, low Marketing Innovation. cost hostel accommodation for people on their travels. - British Youth Travel Awards for Best Marketing.

- Recognition from the UNWTO, 2nd runner-up for the Award for Key historical facts Excellence and Innovation in Tourism. in the category ‘Non- Governmental Organizations’. 1909 The concept of hostelling was founded in Germany by Richard Schirrmann, a school teacher. • Finalists at the Hertfordshire Business Awards - HI Groups in International Business of the Year category 1912 The first official youth hostel opened in Burg Altena, after which the youth hostel - Big Blog Exchange in Innovation category. movement grew rapidly.

1931 There were 12 Youth Hostel Associations in Europe, operating a total of 2,600 hostels. 2012 1932 The International Youth Hostel Federation was founded at the first International • HI received the myclimate award for Newcomer of the year in the hotel industry. Conference in Amsterdam, where Richard Schirrmann was elected first President.

1952 Minimum standards for all hostels were adopted by the International Conference.

1965 to Saw large city hostels became more and more common all over the world. 2011 1970 • HI received the Golden Backpack Awards UK by TNT Magazine / Winner in Best Hostels category. 2007 The International Youth Hostel Federation started operating as Hostelling International.

2009 The 100th anniversary was celebrated all over the network of nearly 4,000 hostels. 2010 • HI became a member of the Global Sustainable Tourism Council 2010 The 48th International Conference adopted a Sustainability Charter demonstrating (GSTC) International Standard Working Group (ISWG). the commitment of the movement to “intensifying their efforts to achieve a worldwide network of sustainable organisations and hostels”.

2014 The 50th International Conference took place in Bangkok, Thailand celebrating a still unified network. 08 Annual report 2015 09

Promoting the mission Worldwide network initiatives

Engagement with young people During the year our National Associations undertook a wide variety of activities – from innovative social media campaigns to grassroot volunteer programmes - which promote a greater understanding of people, places and cultures, through the education of peace, environment and Social media Erasmus Student Network global friendship. Here are a few examples of social initiatives in the HI network. We continued to increase customer In 2015 Hostelling International signed an engagement to assist brand loyalty through agreement with Erasmus Student Network, Sleep for peace The Cultural Kitchen is a curriculum-based our core social media platforms by sharing a non-profit international student organisation For its third edition in 2015, the Sleep for educational program in HI USA providing resources of inspiration and information to offering services to over 190,000 students Peace project was taken to a global level young students with a cross-cultural assist traveller plans. At the end of the 2015 each year. HI agreed to give ESN cardholders to reinforce the mission of building peace experience, during which they focus their we reached a Facebook milestone, hitting free eMembership in return for brand logo through promoting intercultural understanding studies on a certain country, before sharing over 100,000 Facebook fans. We had 47,000 presence on the ESN card. Over 70,000 cards amongst young people travelling at home and a meal with international travellers, showing Google+ followers, 11,200 Twitter followers were distributed across the ESN network abroad. the results of their studies and spending a and 1,500 members in our LinkedIn group. reaching students in 37 countries. night in a hostel. Existing at HI Chicago for The HI blog, blog.hihostels.com, also an This initiative happening during the week 15 years, the Cultural Kitchen is spreading its important channel was updated weekly with of the 21st of September (United Nations wings and is intended to expand to HI New news and inspiration from around the world. International Day of Peace) reinforces the York City. The programme’s anticipated reach purpose of HI by celebrating the peace- is over 600 this year, including students, staff Towards the end of 2015, HI started to building benefits of travel, and staying at HI members and volunteers – an increasing encourage the National Associations (NAs) hostels in particular. National Associations number of young people aware of how to further engage with young people on organised their own in-hostel activites cultural differences can benefit our society. social media and to promote domestic designed to get guests thinking and talking Another great example of engagement in and international travel to the benefit of about peace, including building and decorating environmental protection action is HI Iceland’s their neighbouring associations. Using the a “peace-tent”, or engaging in a professionally volunteer project, funded by Erasmus+. The strength of the network combined with the facilitated discussion over a shared meal. volunteer Green Messengers are there to local cultural and linguistic expertise of each raise awareness of how environmental issues NA we will maintain and hopefully grow the We were very pleased that 31 National are a part of travelling, daily life at the hostels impressive following HI has on social media. Associations in 29 countries participated, and the destination visited. They have created involving over 2,900 guests in more than 140 a range of tools, workshops and activities to hostels worldwide. help each individual, staying in the hostels, understand their role and change their behaviours.

Danhostel Sønderborg-Vollerup, Denmark Sleep for Peace - HI Norway Students at Cultural kitchen

Hostel Pekarna, Slovenia

Sleep for Peace - Qatar Green messengers - Iceland 10 Annual report 2015 0911

Building a sustainable network Sustainability Charter signed in 2010 Hostelling International, and its Member Associations, This map shows the variety in location and theme of sustainability initiatives in commit to intensifying their efforts to achieve a worldwide the HI Network. network of sustainable organisations and hostels. In doing so, we recognise that true sustainability involves the development of clear and measurable objectives in the Over 1 million guests and local following areas: Social, Environmental and Economic. communities benefit from our sustainability initiatives

HI supports over 5,000 sustainability initiatives worldwide

a better \ Community support Eco certified hostels ... Mobility/ Accessibility Volunteerism Social education Cultural education ...and be part of it! Environmental sustainability myclimate projects Intercultural exchange

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Environmental sustainability

The environmental performance for the HI network has seen a steady increase over the past Hostelling International years and two of our key measures are the certifications achieved by our members and the Sustainability Fund (HISF) praise our customers give to our hostels with the ‘Green Rating’ introduced in 2012 as the first in the hospitality industry. The HISF, a customer-based fund, reflects and CO2 emissions in Youth Hostels. More our true passion for pioneering projects than 4,800 people across the globe voted This rating is an indicator from our customers on their perception of all our bookable hostels’ and commitment to sustainable travel by for 9 worldwide projects, all of which aim to environmental achievements and all the initiatives implemented to minimise our impact on supporting actions by hostels in the HI minimise the impact on climate change. climate change. In 2015 we wanted to increase our overall “Green rating” from 82.6% in 2014, network to reduce their impact, and the and achieved a proud 84%. impact of travellers, on the environment. The three winnings projects were selected by a combination of the vote of the public, In 2015 the fund spent £12,000 for innovative HI’s sustainability coordinators and of a panel Sustainability projects working towards achieving carbon of International Jury formed of sustainability certifications in neutrality by reducing energy consumption experts, selected by HI. the network myclimate

In 2015 our network continued to increase HI continued the partnership with myclimate the number of environmentally or sustainably in 2015 by passing through the relevant part certified hostels, achieving a small year on of customer donations received through year increase, and reaching a total of 360. bookings on www.hihostels.com. During the Across our network over 20 different labels year, we have collected £7,285 on behalf of 1st place: Iceland: HI Iceland joins forces are represented; the most popular being: myclimate in customer donations, and these with Landvernd, the Icelandic Environment European Eco-Label, The Green Key, Green funds helped offset 392 tonnes of CO2. Association in order to offset the CO2 Tourism or Ibex Label. These funds make a sustainable contribution emissions of staff and guests staying at to voluntary climate protection projects with the HI Iceland Hostels by offering them the Each Member Association has implemented not just a clear reduction in CO2 emissions chance to take part in restoration and carbon a certain label for different reasons with the but a beneficial impact in social sustainability, sequestration initiatives. The project was best customer recognition in the country or improving lives and giving back to the granted £7,000. supported by their government. communities. We continued support for the three projects: Stove Efficient Qori Q’oncha The HI-Q&S certification, a tool to educate, (Peru); Stove Efficient Impact Carbon (China); implement, monitor and audit the standards in and Stove Efficient Hestian (Malawi). In order a hostel, is also making its way in the network to give more visibility to the achievements 2nd place: Netherlands: Programme and includes 10 areas to work on: sustainable through the funded projects, an evolving to involve guest in the realisation of an management system in place; protection of graphic of the key figures mentioned above investment in wind energy. By developing an natural & cultural capital; the building; water; has been added to the booking page of extra tool on our website where guests can waste; mobility; staff; communities; food & customers donating to the fund. They are then offset the CO2 emissions of their stay. The beverages; and fair profit. made aware of what they are contributing to. total amount obtained from the voluntary fee will be invested in wind energy. The project was granted £1,500.

3rd place: Implementation of existing solar power installation at HI-Athabasca Falls in the Jasper National Park in Alberta to become totally independent of the current diesel generator in operation. The project was granted £3,500.

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Strengthening the network

As an organisation HI strives to encourage implementation of, and adherence to, collective Conference and CEO Meeting decisions as well as nurturing strong, collaborative relationships and best practice exchange between the National Associations.

Events Regular events are the chance for our geographically dispersed network to get together to discuss important topics, take decisions and share best practises or successes as well as enjoy some leisure time catching-up with colleagues and discovering a new destination or hostel.

CEO Meetings in 2015 CEO Meeting, Toledo Our first CEO meeting was in February in The CEO meeting is normally an annual Toledo, Spain, it was co-hosted by REAJ event however, with the announcement (Spanish National Association) in the San of a new vision for the International Office Servando Hostel. It was well attended by 53 it was decided to bring forward the 2016 delegates from 42 National Associations. CEO meeting in order to allow CEOs of the network to make their contributions to the Skills and knowledge The key focus areas were the current financial business plan and thus fulfil their duties as an situation of HI, a presentation of the future advisory body. exchange business plan and an introduction to the HI Core Values – Inclusivity, Learning and An advanced CEO meeting took place in HI Connect Understanding, Sustainability and Authenticity November in Vienna at the eco-friendly HI and a group of National Associations The programme was previously run by four – which were approved earlier in 2014 by Brigittenau Youth Palace Hostel; with a good created a skills and knowledge exchange/ National Associations (YHA England & Wales, the Board of trustees. We also introduced attendance of 50 delegates from 40 National mobility programme for their staff and DJH in Germany, Stayokay in the Netherlands a new creative, collaborative session with Associations. volunteers called HI Connect. Participants and REAJ in Spain) exchanging staff amongst the delegates following the principles of the have the chance to discover new practices one another but in 2015 HI launched the ‘Open space’ concept which was very well abroad and hopefully, bring back the best to programme to all National Associations. As received. transfer the knowledge at home. this was the first year we aimed for a small increase in participation and were pleased The vision of this programme is “To provide when HI Iceland and HI Norway took part. In Investing in quality staff and where appropriate, volunteers and total 153 people took part. young people, with a unique opportunity to Quality certifications HI-Q Luxembourg have started in all their hostels). experience life and work in another country; The programme steering group, made up of HI-Q is a Quality Management System Furthermore, HI-Q&S met all of the to enhance life skills and confidence; to HR specialists, sustainability coordinators and that helps to focus on customers within requirements to be recognized by the GSTC. engage within our sustainability projects; to HI’s Sustainability Manager will continue to every activity in both hostels and their This important step of recognition by such embrace the culture and environment of the develop the programme and encourage more National Association head offices. In 2015, an influential external organization comes host county; to enhance their ability to learn National Associations to join. 44 National Associations and 437 hostels as excellent news, with great benefits that another language; to create new friendships have successfully participated in HI-Q. HI-Q will certainly help grow the credibility and and promote mobility of people across Light, a version of the quality certification visibility of HI-Q&S. They are strong assets programme has been tailored to the needs to provide travellers with an experience of boundaries”. of hostels with less than 10,000 overnights high quality, which also has a positive effect per year, was launched in 2012. At the end of on local economy, communities and the 2015, 58 hostels participated in HI-Q Light. environment. HI is aiming to engage over 200 hostels in the HI-Q&S certification process HI-Quality & Sustainability (HI-Q&S) in 2016. HI-Q&S enlarges the existing HI-Q System with Social and Environmental elements based on the Global Sustainable Tourism Council (GSTC) criteria. This innovative tool will help all National Associations implement the Sustainability Charter agreed by the 2010 and 2014 Conference. Certifications have started in 2015, with four hostels obtaining the certification (two in Canada, one in Finland and one in Iceland) and other First HI-Q&S Hostel, Reykjavik Meeting HI-Connect, Hamburg associations engaging in the process (HI Loft Hostel

Visit www.hihostels.com 16 Annual report 2015 17

Revenue generation and service delivery

Hostelling International’s website hihostels.com provides an easy way for the international Top 10 destinations by overnights Top 10 source markets by overnights traveller to access the majority of the network’s hostels in one place, and in the process provides booked 2015 booked 2015 HI and the network the revenue in order to continue to provide their charitable activities. In 1 USA addition, hihostels.com provides the booking engine technology which drives some of our key 1 USA National Associations’ websites. Below are the key metrics from 2015: 2 Iceland 2 Germany 3 France 3 France 4 UK 4 Canada 2014 actual 2015 target 2015 actual 5 Norway 5 UK Bookings 237,937 279,700 202,513 6 Italy 6 Australia Overnights 859,648 953,523 690,333 7 Netherlands 7 Switzerland Revenue £19,147,779 £20,977,500 £15,569,843 8 Canada 8 Spain 9 Spain 9 Brazil The figures above represent the gross booking revenues generated through hihostels.com. 10 Belgium 10 Japan HI retained a 6% to 8% commission with the balance payable to the hostel on arrival.

The outturn for the year was disappointing advertising, which formed a large part of the Top 10 hostels by bookings (on hihostels.com) 2015 compared to our targets, and the various planned growth in revenue. factors which influenced the 2015 results are 1 USA HI Chicago shown below. For languages, our planned re-introduction of 2 USA HI Boston Brazilian Portuguese and Japanese resulted in 3 USA HI San Francisco - Downtown The market segment for online hostel a strong increase in interaction, engagement 4 USA HI New York City booking has seen intensified competition and booking patterns with customers 5 USA HI Los Angeles - Santa Monica over the past year. Booking.com continue to speaking those languages. 6 USA HI Seattle at the American Hostel pursue younger customers and invested in 7 France Paris Yves Robert TV adverts in 2015 that featured hostelling. One of the major hurdles for organic search 8 France Paris Le D’Artagnan Hostelworld and Hostelbookers were both re- traffic has been the impact of the single URL 9 USA HI San Francisco Fisherman’s Wharf branded and relaunched with new websites structure for all language versions on Search and TV campaigns. Expedia are starting to Engine Optimisation, which hampered our 10 France Paris Jules Ferry push into the segment with efforts in some ability to attract new customers. However, of the English speaking territories around the work began to address this in the second globe. half of 2015 and separate language version Customer satisfaction URLs were deployed at the start of 2016. This The cost of buying advertising with Google for should bring a long term benefit to visibility Overall customer satisfaction for hostel preferences of young travellers. In addition to terms like ‘hostels’ has more than doubled in of hihostels.com on search engines such as overnights sold via hihostels.com reached the standard quality-related questions such as the past year and this impacted our ability to Google. 86.7% at the end of 2015 against 86.2% in Friendliness, Cleanliness and Safety, we also attract new customers through pay-per-click 2014. 2015 marked the first full year of the added some new questions such as ‘Would new customer satisfaction questionnaire you recommend HI to a friend?’ to gauge which provides rich information for our loyalty - this reached 87% against our target members as well as insight into the of 85%.

1 Switzerland Interlaken Youth Hostel 94.5% 2 USA HI-Martha’s Vineyard 94.1% 3 Iceland Reykjavik Downtown 94.0% 4 Iceland Reykjavik Loft Hostel 93.7% 5 USA HI-Chicago 93.4% 6 Iceland Berunes 93.0% 7 Japan Kyoto-Utano Youth Hostel 93.0% 8 USA HI-Nantucket 92.6% 9 USA H-Sacramento 92.3% 10 Iceland Reyðarfjörður 92.1% Sydney Harbour YHA, Australia

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HI Groups

HI Groups is a membership based scheme enquiries, which was below our target of where National Associations or hostels pay 7,590, representing 544,059 overnights for a flat fee for sales and marketing services the network. The group types we cater for are Best hostel awards offered by the scheme. mainly school and university/college groups. These awards highlight the hostels and staff in our network that go that extra mile and The hostels which are part of HI Groups are make our customers’ experiences especially showcased on the website, memorable. HI would like to thank all who groups.hihostels.com, where group leaders ensure that our customers have “the real can make a booking enquiry in a few clicks hostel experience”. for any of the 243 hostels in 32 countries. Throughout the year we have received 5,207 The winners of the prestigious HI-5ives awards in 2015 were the following: Reykjavik Downtown hostel team • Best Hostel Overall – Reykjavik – Downtown Hostel, Iceland (94.2%) • Friendliest Hostel – HI Martha’s Vineyard, USA (97.2%) • Most Comfortable – HI Phoenix, The Metcalf House (97.8%) • Green Hostel – HI Portland, Hawthorne Hostel (96.7%) • Best HI Hostel Network – HI USA (89.7%)

HI Portland Hawthorne Hostel, USA

Customer engagement During 2015 we built engagement and loyalty by optimising database segmentation using the Salesforce CRM system. We improved data processing and customer reporting to create more personalised and relevant marketing communication. Our active School group, Inverness customer database has risen by 25% to approximately 150,000 for 2015.

Throughout the year we made significant improvements to our email customer journey. Following the introduction of a ‘welcome’ series and revised customer survey in 2014, we added a customer pre-stay email with hostel details and weather forecast, HI New York City, USA improved eMembership communication, launched hostel product emails based on customer preferences, as well as introducing a basket abandon email to encourage booking completion for those that drop out in the final The Verbinators stages of purchase.

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Governance & Board of Trustees

The directors of the charitable company are The International Office is managed by Risk management conducting Board Meetings via video its trustees for the purpose of charity law and the Chief Executive, who is accountable to At each Board meeting during 2015, the conferencing rather than face to face throughout this report are collectively referred the Board. The office is located in Welwyn Board reviewed the risk management strategy to as the trustees. Garden City, Hertfordshire, UK. A new Chief prepared by the International Office. It Other Recognised Gains and Losses show Executive, Darren Barker, joined the team identified the following as the major risks that overall losses of £36,763 (2014 overall gains of Small Company Exemptions in April 2015 following the interim Chief could seriously affect the work of HI: £2,792), a decrease of £39,555. The Report of the Board of Trustees has been Executive, Jon Rabbett. prepared in accordance with the provisions Risk Mitigation Hostelling International’s investment policy applicable to small companies entitled to the HI Board Governance Policy Disturbances of the HI operates worldwide seeks to maintain purchasing power and The role of the Board is governance rather youth travel market: which reduces reliance achieve long-term capital growth of UK small company’s exemption including the war, terrorism, on any particular exemption to not include a strategic report. than management, which is the responsibility natural disaster, travel country or region inflation plus 3% while operating with an of the Senior Leadership Team at the restrictions, economic average risk tolerance. The balanced portfolio, crises Board of Trustees International Office. Governance focuses on comprising bonds and equities, money- The following trustees were elected at the the wider issues of the organisation and the Failure of website Investigating possible market holdings and other investments, is technical infrastructure outsourcing of managed by Brewin Dolphin in London. The 50th International Conference in 2014 and establishment and monitoring of policy and hihostels.com to a served throughout the year: strategic direction. third party performance of the portfolio is measured against the WM Total Charity (Total Return) Increased competition HI supports its own President: Angela Braasch-Eggert The Board work closely in partnership with the in the provision of quality system (HI-Q) benchmark. During the year the portfolio (Germany) Chief Executive and Senior Leadership Team quality economy whilst recognising (calculated on a total return basis, before accommodation aimed other, already management fees but after trading expense) 1st Vice President: Brent Czarnecki to ensure that their goals are achieved by at the international established, quality (Canada) means of resourcing and supporting the team youth traveller systems. achieved a return of 2.98%, 1.07% below the benchmark. Performance was affected by the 2nd Vice President: Alex Zilkens (Australia) to carry out their duties. Trustees’ Indemnity Insurance requirement to draw down on the portfolio Treasurer: Eric Oetjen (USA) The charitable company has purchased during the year. Members: Abdulla Salem AD It is the responsibility of the Chief Executive insurance for the trustees and officers of the Al- Bikri (Qatar) at the direction of the Board or otherwise charity against liability arising from wrongful Total accumulated general funds at 31 Sander Allegro to propose new strategies or revise existing acts in relation to the charity. December 2015 were £2,775,990 (2014 (The Netherlands) strategies for the Board’s consideration. Upon £3,775,384). Hostelling International’s Fernando Cruz-Tagle approval from the Board, the Chief Executive Key management personnel remuneration reserves policy is to ensure that sufficient (Chile) shall develop implementation plans and take A new Chief Executive Office, Darren funds are available to cover a minimum of two Benoit Graisset-Recco necessary steps to action them. Progress Barker, was recruited during 2015 and his years’ worth of core activities. The deficits (France) reports are brought to the Board’s attention on remuneration was set by the Board following experienced in 2014 and 2015 have resulted a regular basis. advice from an external recruitment agency. in general funds which have fallen below the Board members are elected by Member levels required by the reserves policy. The Board give direction for the overall Association delegates at the International Finance The new strategic plan (see below) addresses Conference which is held every two years. operations of HI, but are not directly Total Incoming Resources of £1,854,453 the need to overcome the ongoing deficits The 51st International Conference will be held responsible for the day-to-day operations (2014 £2,142,805) represents a decrease of and build up reserves to ensure that Hostelling in September 2016. Following a change to the of the organisation, which is the task of the £288,352 from 2014, mainly as a result of a International can continue to operate into the Memorandum and Articles of Association, Chief Executive. The Board, however, have decrease in booking volumes booked through foreseeable future. trustees are now elected for staggered, 4 the ultimate responsibility for the sound the new hihostels.com website. year terms, whilst the President continues to management and financial security of HI. There was one designated fund at 31 stand for election every two years. To achieve The Board approve the annual budget prior to Total Resources Expended (before gains December 2015 totalling £69,923 (2014 staggered terms of service (only half of the the beginning of every financial year of HI. and losses on investments) of £2,803,806 £61,699). Board stands for election every two years), (2014 £3,124,707) represents a decrease of three trustees will be required to stand for £320,901 from 2014 due to: The restricted fund was established in 2012 as election at the 2016 International Conference. Gratitude part of HI’s work with sustainability. The Board would like to take this opportunity • The biennial International Conference costs The trustees have a reasonable expectation Newly elected Board Members are provided to express their thanks to all the volunteers in 2014, which were not repeated in 2015 that the organisation has adequate resources with a comprehensive induction pack covering and professionals involved in the international • The severance costs of the outgoing CEO to continue in operational existence for the all aspects of Hostelling International’s hostelling movement. Without their support in 2014 foreseeable future and the trustees consider operations. Additionally, the first Board and assistance, the important work to deliver • Reduction in the direct costs of operating that the use of the going concern basis of Meeting following Conference is traditionally the vital mission of this global organisation the web platform following the launch of accounting is appropriate in preparing the held at the International Office to enable could not take place. the new website in April 2014 annual financial statements. Despite showing Board Members to meet staff face-to-face • Reduction in expenditure through the net current liabilities, the trustees do not and learn first-hand about the day-to-day Richard Schirrmann Designated Fund as consider liquidity risk to be a material financial running of the office. the Big Blog Exchange was not repeated risk as the charitable company has funds in 2015 which are represented by cash or investments • A reduction in the movement on the bad managed by Brewin Dolphin which can be debt provision converted to cash with one week’s written • Various cost saving initiatives including notice.

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Independent auditor’s statement Governance & Board of Trustees to the members of the International (continued) Youth Hostel Federation

The future 2) Partnerships – Working with 3rd parties to We have examined the summary financial Opinion During the year the Board of Trustees help us deliver the mission and strengthen statements contained within the Annual In our opinion, the summary financial approved the new 2015-2019 Vision for the HI the network. Report for the year ended 31 December 2015 statements contained within the Annual International Office, which will form strategic 3) Programs, Standards and Sustainability – which comprise the Summary Statement of Report are consistent with the full annual focus of Hostelling International for 2016 and Working with standards, best practice and Financial Activities and the Summary Balance financial statements for the year ended 31 beyond: to co-ordinate efforts of the network. Sheet. December 2015. We have not considered the 4) Operations – Running the www.hihostels. effects of any events between the date on “A world-class Business To Business (B2B) com website This report is made solely to the charitable which we signed our report on the full annual charitable organisation with an international 5) Support – Including finance, legal, HR, IT, company’s members, as a body, in financial statements, 19 June 2016, and the mind-set; valued by National Associations and governance. accordance with the terms of our letter of date of this statement. for its representative work in promoting the engagement with the company dated 6 hostelling mission and strengthening the Trustees’ statement January 2016. Our work has been undertaken network.” The financial information set out in the annual so that we might state to the charitable report does not constitute statutory accounts company’s members those matters we The focus of the resource had previously been as defined in section 435 of the Companies are required to state to them in an auditors’ on end-consumers and this vision puts the Act 2006. The summary of financial report and for no other purpose. To the fullest Reza Motazedi FCA needs of the Member Associations firmly information on pages 24 to 27 has been extent permitted by law, we do not accept or (Senior Statutory Auditor) in focus. HI will work to help strengthen the extracted from the full financial statutory network and have the National Associations accounts, which were approved 19 June assume responsibility to anyone other than for and on behalf of Deloitte LLP deliver the hostelling mission to the best of 2016 and have been submitted to the Charity the charitable company and the charitable Chartered Accountants and Statutory Auditor their ability. Where consumer facing tasks are Commission and Register of Companies. The company’s members as a body, for our audit 30 June 2016 required, HI will look to use the expertise of auditor’s report on the charitable company’s work, for this report, for our audit report, or for the network or carefully selected 3rd parties. annual accounts, and the auditor’s statements the opinions we have formed. In particular, the forthcoming 51st International with regard to whether the information Conference will decide whether to continue contained in the trustees’ report is consistent Respective responsibilities of trustees Professional Advisors to operate the current www.hihostels.com with the accounts was unqualified. The and auditors Bankers: platform in-house or outsource to a 3rd party. auditor’s report did not contain statements The trustees are responsible for preparing HSBC under s498 (2) or (3) of the Companies Act the Annual Report (which includes the Howardsgate 2015 was therefore a transitional year where 2006. summary financial statements) in accordance Welwyn Garden City, AL8 6BH much of HI’s resource was focussed on with applicable United Kingdom law. Our England forming the new vision, and so resources A copy of the full statutory accounts, together responsibility is to report to you our were diverted away from many of our end with the Trustees’ and Auditor’s reports opinion on the consistency of the summary Auditor: Deloitte LLP consumer focussed goals. thereon, can be obtained from the registered financial statements contained within Chartered Accountants and Statutory Auditor office. the Annual Report with the full annual 2 New Street Square Strategic plan financial statements. We also read the other The International Office will focus on three London, EC4A 3BZ information contained in the Annual Report areas. The first is helping the network to England as described in the contents section, and become stronger and more coherent, an Signed on behalf of the Board by consider the implications for our report if we activity which will look to ensure they can Investment Bankers: become aware of any apparent misstatements deliver the mission in the most effective way. Brewin Dolphin or material inconsistencies with the summary The second relates to sharing knowledge and 12 Smithfield Street bringing the network closer together though financial statements. London, EC1A 9BD engagement and sharing of success stories Angela Braasch-Eggert Eric Oetjen England and best practice. The final area of strategic President Treasurer We conducted our work in accordance focus is on sourcing partnerships that will help with Bulletin 2008/3 issued by the Auditing Solicitors: the network to be financially sustainable and 30 June 2016 Practices Board. Our report on the charitable Russell-Cooke LLP fulfil the mission. HI is in a unique position company’s full annual financial statements 2 Putney Hill representing a truly global, mission-based, describes the basis of our opinion on those London, SW15 6AB not-for-profit collection of entities. financial statements and Trustees’ report. England

Organisational structure To support the new vision, the organisation was restructured in late 2015 and now operates with five teams which are aligned to the vision and strategies. These teams are: 1) Engagement - Working with our Member Associations. Visit www.hihostels.com 24 Annual report 2015 25

Summary Financial Statement prepared from the audited Financial Statement for the year ended 31 December 2015 Statement of financial activities Unrestricted Restricted Total Total Income from: funds 2015 (£) funds 2015 (£) funds 2015 (£) funds 2014 (£)

Donations - 16,849 16,849 19,447 Charitable activities 1,735,665 - 1,735,665 2,013,432 Other trading activities 15,901 - 15,901 26,951 Investment income 86,038 - 86,038 82,917 Other: Gain on disposal of fixed assets - - - 58 Total Income 1,837,604 16,849 1,854,453 2,142,805

Expenditure on:

Raising funds 8,683 - 8,683 12,999 Investment management costs 12,689 - 12,689 23,801 Charitable activities Promoting the mission 106,288 11,815 118,103 245,127 Strengthening the network 212,488 - 212,488 236,068 Service delivery 2,451,863 - 2,451,863 2,606,712 Total Resources Expended 2,792,011 11,815 2,803,826 3,124,707

Net (outgoing) / incoming resources (954,407) 5,034 (949,373) (981,902)

Other Recognised Gains/(Losses) Realised gains on investment assets 23,700 - 23,700 309,968 Unrealised (losses)/gains on investment assets (47,899 ) - (47,899 ) (294,550) Realised (losses) on foreign exchange (12,564) - (12,564) (12,798) Unrealised gains on loan accounts - - - 172 Total Other Recognised Gains / (Losses) (36,763) - (36,763) 2,792

Net Movement in Funds (991,170) 5,034 ( 986,136 ) (979,110)

Total funds brought forward 3,837,083 6,598 3,843,681 4,822,791 Total funds carried forward 2,845,913 11,632 2,857,545 3,843,681 All operations are classified as continuing.

Incoming Resources 2015 Resources Expended 2015

Total £1,854,453 Total £2,803,826 Donations 1% Charitable Activities 94% Investment management Strengthening the network 8% costs 1% Other trading activities 1% Service delivery 87% Promoting the mission 4% Investment income 4%

Net Movement in Funds

- £979,110 2014

-£986,136 2015

Visit www.hihostels.com 26 Annual report 2015 27

Balance sheet as at 31 December 2015

Total Assets 2015 Fixed Assets 2015 (£) 2014 (£)

Tangible fixed assets 1,461,611 1,916,077 Total £3,389,958 Investments 1,580,425 2,334,702 Programme related Tangible fixed assets 43% Programme related investments 80,002 105,728 investments 2% Investments 47% Total Fixed Assets 3,122,038 4,356,507 Current assets 8%

Current Assets Funds 2015 Stock 13,049 12,003 Debtors 147,311 126,483 Cash at bank and in hand 107,560 133,337 Total Funds £2,857,545

Designated funds 2% Total Current Assets 267,920 271,823 General funds 98%

Liabilities

Creditors: Amounts falling due within one year 467,413 784,649

Net Current (Liabilities) (199,493) (512,826)

Total assets less liabilities 2,922,545 3,843,681

Provisions for liabilities and charges 65,000 -

Total net assets 2,857,545 3,843,681

The Funds of the Charity

Unrestricted funds General fund 2,775,990 3,775,384 Designated funds 69,923 61,699 Restricted funds 11,632 6,598

2,857,545 3,843,681

Danhostel Copenhagen City, Denmark

Note to the Summarised Financial Statements The Foregoing financial statements are a summary of the information contained in the unqualified accounts of Hostelling International for the year ended 31 December 2015. These summarised accounts may not contain sufficient information to allow for a full understanding of the financial affairs of the organisation. For further information, the full report of the Board of Trustees, including notes to the Financial Statements, should be consulted. This can be obtained from HI by sending an email at [email protected].

Visit www.hihostels.com 28 Annual report 2015 29

HI Member Associations (64)

ALGERIA FRANCE MOROCCO THAILAND Fédération Algérienne des Auberges Fédération Unie des Auberges de Jeunesse Fédération Royale Marocaine Thai Youth Hostels Association de Jeunesse (FUAJ) des Auberges de Jeunes www.tyha.org www.fuaj.org AUSTRALIA NETHERLANDS TUNISIA YHA Australia GERMANY Stayokay Association Tunisienne des www.yha.com.au DJH Hauptverband www.stayokay.com Auberges de Tourisme de Jeune www.jugendherberge.de AUSTRIA NEW ZEALAND UNITED ARAB EMIRATES Österreichischer Jugendherbergsverband HONG KONG YHA New Zealand United Arab Emirates Hauptverband (ÖJHV) Hong Kong Youth Hostels Association www.yha.co.nz Youth Hostel Association www.oejhv.at www.yha.org.hk www.uaeyha.com NORWAY Österreichisches Jugendherbergswerk (ÖJHW) HUNGARY Norske Vandrerhjem – HI Norway URUGUAY www.oejhw.at Magyarországi Ifjúsági Szállások Szövetsége www.hihostels.no Asociación de Alberguistas (Hungarian YHA) del Uruguay BAHRAIN www.hihostels.hu PAKISTAN www.hosteluruguay.org Bahrain Youth Hostels Society Pakistan Youth Hostels Association www.byhs.org.bh ICELAND www.pakistanyouthhostels.net USA HI Iceland Hostelling International USA BELGIUM www.hostel.is PERU www.hiusa.org Les Auberges de Jeunesse (LAJ) Administradora Peruana de Albergues www.lesaubergesdejeunesse.be INDIA www.hostellingperu.com.pe Youth Hostels Association of India Vlaamse Jeugdherbergen (VJH) www.yhaindia.org PHILIPPINES www.jeugdherbergen.be Youth and Student Hostel Foundation IRELAND (Northern) of the Philippines BOLIVIA Hostelling International-Northern Ireland http://yshfp.wordpress.com Hostelling International Bolivia www.hini.org.uk www.hostellingbolivia.org POLAND IRELAND (Republic of) Polskie Towarzystwo Schronisk Mlodziezowych BOSNIA AND HERZEGOVINA An Óige (Irish Youth Hostel Association) (Polish Youth Hostel Association) Youth Hostel Association of Bosnia www.anoige.ie www.ptsm.org.pl and Herzegovina HI Associate www.ferijalni.org ISRAEL PORTUGAL Israel Youth Hostels Association MOVIJOVEM BRAZIL www.iyha.org.il www.pousadasjuventude.pt Organisations (3) Federaçao Brasileira dos Albergues da Juventude ITALY QATAR www.hihostelbrasil.com.br Associazione Italiana Alberghi Qatar Youth Hostels Association BULGARIA per la Gioventù (AIG) Bulgarian Youth Hostel Association CANADA www.aighostels.it SAUDI ARABIA Hostelling International - Canada Saudi Arabian Youth Hostels Association NEPAL www.hihostels.ca JAPAN www.sayha.org.sa Nepal Youth Hostel Council Japan Youth Hostels Inc www.youthhostel-nep.org CHILE www.jyh.or.jp SCOTLAND Asociación Chilena de Albergues Turisticos Scottish Youth Hostels Association SYRIA Juveniles JORDAN www.syha.org.uk The Youth Tourism Organization (Syrian Youth www.hostelling.cl Jordan Youth Hostels Commission Hostels Association) SERBIA CHINA KOREA (South) Ferijalni i Hostelski savez Srbije YHA China Hostelling International Korea (Youth Hostels Association of Serbia) www.yhachina.com www.kyha.or.kr www.serbia-hostels.org Member Associations and Associates accurate CHINESE TAIPEI KUWAIT SINGAPORE as of time of publication Chinese Taipei Youth Hostel Association Kuwait Youth Hostel Committee Hostelling International Singapore www.yh.org.tw www.hisingapore.org.sg LEBANON CROATIA Lebanese Youth Hostels Federation SLOVENIA Hrvatski Ferijalni i Hostelski Savez www.hostelslebanon.org PZS – Hostelling International Slovenia (Croatian YHA) www.youth-hostel.si www.hfhs.hr LIBYA Libyan Youth Hostel Association SPAIN CZECH REPUBLIC Red Española de Albergues Czech Youth Hostel Association (CZYHA) LUXEMBOURG Juveniles (REAJ) www.czechhostels.com Centrale des Auberges de www.reaj.com Jeunesse Luxembourgeoises DENMARK www.youthhostels.lu SUDAN DANHOSTEL Sudanese Youth Hostel Association www.danhostel.dk MALAYSIA HI- Malaysia SWEDEN EGYPT www.hi-malaysia.org.my Svenska Turistföreningen Egyptian Youth Hostels Association www.svenskaturistforeningen.se MALTA ENGLAND & WALES NSTS Hostelling International YHA England & Wales www.nsts.org SWITZERLAND www.yha.org.uk Schweizer Jugendherbergen MEXICO www.youthhostel.ch FINLAND Hostelling International Mexico Suomen Retkeilymajajärjestö-SRM www.himexico.com www.hostellit.fi

Visit www.hihostels.com Costa Sands Resort YH, Singapore

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