International Workplace Group PLC announced ‘strong’ revenue growth on Tuesday for the three months ended September 30, driven by a surge in demand from its franchised workspaces.

IWG is a Zug, Switzerland-based provider of hybrid workspace for companies and individuals under Regus and other brands. Its shares were up 3.0% to 166.00 pence midday Tuesday.

Revenue was $931 million in the third quarter, up 1.3% from $919 million a year before. Revenue was flat annually on a constant-currency basis. In the nine months that ended September 30, revenue was $2.77 billion, up 0.4% from $2.76 billion a year before. This also was flat at constant currency.

Revenue from owned and leased workspaces was $809 million in the third quarter, flat from $808 million a year ago, but revenue from managed and franchised workspaces grew by 17% to $157 million from $136 million.

Revenue from Worka, International Workplace’s marketplace, was up 3.1% to $99 million from $96million a year ago. The company said Worka has been hurt by ‘digital product delays’.

IWG said it is confident that earnings before interest, tax, depreciation, and amortization, as well as net financial debt, for all of 2024 will be in line with its expectations.

It also reiterated its medium-term target for $1 billion in annual Ebitda, which it first announced back in December of last year. Ebitda was £403 million in 2023, about $523 million, up from £311 million in 2022.

IWG has since changed its reporting currency to dollars. On Tuesday, it said it will implement US GAAP accounting standards by 2025.

Chief Executive Officer Mark Dixon said: ‘This has been a good quarter for us with strong fee revenue growth of 46% in the Managed & Franchised segment, margin expansion in the Company-Owned & Leased segment and further cashflow production which has reduced net debt.’

Net financial debt was reduced to $734 million from $775 million a year ago.

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