Saga expects to beat market expectations despite choppy waters
The company said that its insurance business was facing a tough inflationary market
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Your support makes all the difference.Cruise and insurance company Saga revealed on Wednesday that it expects to beat market expectations this year with its profit rebounding from a poor showing in the first six months.
The business said that it now expects to grow profit by double digits this year. On an underlying pre-tax basis it had fallen 4% in the half year to the end of July to £13.4 million, with revenue rising 15%.
Saga said that “we expect to achieve significant double-digit growth in revenue and underlying profit before tax when compared with the prior year, ahead of current estimates.”
Reported pre-tax loss narrowed from £262 million to £77.8 million, the business said.
Saga said that both its river cruises and the much larger ocean cruises business returned to an underlying pre-tax profit in the period.
“I am pleased to announce a 15% increase in revenue for the first half of the year, due to the continued growth of our Cruise and Travel businesses, in addition to further debt reduction,” said chief executive Euan Sutherland.
“Alongside this, under consistent accounting standards, we report an underlying half year profit that is broadly in line with the prior year.”
Shares in the business rose by 1.3% following the news.
Mr Sutherland added: “In ocean cruise, bookings are on track to achieve our targets for the full year, reflecting continued strong customer demand, while our river cruise business has returned to profit with a 34% increase in guest numbers. Travel is also on track to return to profit for the full year.”
He said that the business’s insurance division had faced “a difficult inflationary market.” Its travel and private medical insurance segments grew revenue, but the company’s motor insurance unit weighed on earnings, it said.
Mr Sutherland said: “Overall, I am pleased with the progress made in the year to date. Looking ahead to the full year, we are keeping tight control of our costs and are confident that we will deliver significant double-digit growth in revenue and underlying profit that is ahead of market estimates.”