Saga PLC said on Tuesday that its earnings in its cruise and travel operations were well ahead of last year, but conditions are tricker in the insurance arm.
Saga, a UK specialist in products and services for people over 50s, said that momentum was building in the cruise, travel, money, and media sectors in the period between February 1 and June 19.
Saga said that the booked Ocean Cruise load factor for the year was 79%, up from 72% a year earlier.
It projects a full-year load factor of at least 80%, which would be an increase from 75% in the year ended January 31, 2023.
‘We remain on-track to deliver £40 million [earnings before interest, tax, depreciation, and amortisation] per ship (excluding overheads). Due to expected seasonality in the late summer, this will be weighted towards the second half of the year,’ Saga said.
The company noted that the launch of the 2024 to 2025 Ocean Cruise season was the strongest on record.
Chief Executive Officer Euan Sutherland said: ‘Four months into the financial year, we have continued to build on the momentum in our cruise and travel operations, while making further progress in our growth agenda through the development of our newer businesses.’
In contrast, it has been a tricker start to the financial year on the insurance side, amid a ‘challenging market’.
Saga said that its total policy sales across all products in Insurance Broking were down 6% from the previous year in the four months ended May 31.
‘In insurance, market conditions, particularly in motor, continue to weigh on our group result,’ Saga noted.
Saga said that the sales process for its Insurance Underwriting business remained ongoing, and is consistent with the company’s overall aim of reducing debt and moving towards a capital-light model.
Saga announced the plan to sell its in-house insurance underwriting business back in January, and has been in discussions for the disposal of its Acromas Insurance Co Ltd, the underwriter in its home and motor insurance business.
Saga concluded that the potential disposal of its underwriting business was consistent with the company’s strategy and would enhance long-term returns for shareholders.
Saga said that it remains on track to deliver another year of growth in revenue and underlying profit, and that it plans to launch a series of new products in the second half of the current financial year.
‘We are developing a series of new products in Saga Money and preparing for the July launch of Saga Spaces, our new subscription-based online platform that will offer customers social interaction and a series of online services,’ it said.
Shares in Saga were up 0.5% at 131.02 pence in London on Tuesday.
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