REG - SAGA Plc - Trading Update

SagaAnnouncement

30/01/2025 07:15

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250130:nRSd1952Va&default-theme=true

RNS Number : 1952V  SAGA PLC  30 January 2025

30 January 2025

Saga plc

Trading Update

Significant strategic progress, alongside expected growth in underlying profit

Saga plc (Saga or the Group), the UK's specialist in products and services for
people over 50, provides the following update on trading covering the period
from 1 August 2024 to 29 January 2025.

Performance in 2024/25

·      The Group expects to report an Underlying Profit Before Tax that
is marginally higher than the prior year, on a like-for-like basis(1), and
ahead of our previous guidance.

·      Ocean Cruise has had another excellent year and, building on the
momentum of 2023/24, delivered a load factor of 91%, 3ppts ahead of the 88%
achieved in the prior year, and a per diem of £358, 8% ahead.

·      River Cruise Underlying Profit Before Tax continued to grow,
supported by a load factor of 89% and per diem of £327, 4ppts and 15% higher
than the prior year.

·      Travel is expected to report an Underlying Profit Before Tax in
the high single-digit millions, compared with £1.5m in the prior year,
reflecting revenue growth of around 15% and passenger growth of 9% on a
comparable basis.

·      The Insurance Broking trends, observed towards the end of the
first half of the year, continued and were in line with guidance. Underlying
Profit Before Tax will be materially lower than in 2023/24, with both the
number of policies in force and policy sales across all products around 15%
lower.

·      We expect Insurance Underwriting(1) to report an Underlying
Profit Before Tax in the high-single digit millions and a net current year
reported combined operating ratio of just over 100%, compared with 117.1% in
the prior year.

·    As stated with our interim results, Available Cash is expected to be
lower at 31 January 2025 than at 31 July 2024, in the range of £60-70m,
excluding the £50m undrawn Revolving Credit Facility and £10m undrawn
portion of the facility provided by Roger De Haan. Net Debt at the same date
is expected to be slightly lower than the £614.6m reported at 31 July 2024.

Looking ahead to 2025/26

·      The Ocean Cruise booked(2) load factor is 67%, 1ppt ahead of the
same point in the prior year and the per diem of £393, is 7% ahead.

·      The River Cruise booked(2) load factor, for the first half, is
77%, which compares with 74% in the prior year. We will continue to grow our
River Cruise business, supported by the introduction of our new ship, Spirit
of the Moselle, which will join our fleet in July 2025, increasing capacity.
For the full year and including bookings for this new ship, the load factor is
55% and the per diem is £357, which compare with 59% and £335 respectively
at the same time last year.

·      Travel booked(2) revenue is £126m, 10% ahead of the same point
in the prior year, and passengers of 39k, are 11% ahead.

·      The preparation necessary for a successful transfer of our motor
and home insurance operations to Ageas has commenced and is on track to allow
the new arrangement to go live in Q4 2025. A significant proportion of our
current home and motor insurance colleagues will transfer to Ageas as part of
this migration, simplifying our insurance operations thereafter. In line with
previous guidance and as a result of the transition, Insurance Broking
Underlying Profit Before Tax is expected to fall in 2025/26, before partially
recovering in 2026/27.

·      Subject to the satisfaction of certain conditions, including the
receipt of regulatory approvals, the sale of our Insurance Underwriting
business, Acromas Insurance Company Limited (AICL), is expected to complete in
Q2 2025. The transaction is expected to generate approximately £43m of net
proceeds, which will be used to reduce the Group's leverage, and will also see
the transfer of the colleagues assigned to claims handling services for AICL,
to Ageas.

·      Separately, we announced this morning that the Group has
successfully refinanced its corporate debt in full, strengthening its
financial position and enhancing liquidity. The new facilities, combined with
the low-cost fixed-rate Ocean Cruise ship debt facilities which will be
retained, will result in an initial pro forma blended interest rate of c.7.6%.

·      Net Debt is expected to further reduce in 2025/26, supported by
underlying cash generation and the net proceeds from the sale of AICL, with
the reduction expected to accelerate thereafter.

 

Mike Hazell, Saga Group Chief Executive Officer, said:

"Throughout the last financial year, we made significant operational and
financial progress. We concluded our review of opportunities that would
optimise Saga's financial and strategic outlook and entered into the 20-year
arrangement with Ageas for our motor and home Insurance Broking business and
the sale of AICL, our Insurance Underwriting business. Alongside this, we
successfully refinanced our corporate debt. We continued to generate strong
demand for both our Cruise and Travel businesses and the Group expects to
report an Underlying Profit Before Tax that is marginally higher than the
prior year on a like-for-like basis(1) and ahead of our previous guidance.

"As we look ahead, we expect the momentum to continue to build in our Cruise
and Travel businesses. As previously outlined, we anticipate that Insurance
Broking earnings will fall in the short-term, ahead of the start of the
partnership with Ageas, but are pleased that work on the transition is on
track to allow the new arrangement to go live Q4 2025.

"We remain focused on Saga being the largest and most-trusted brand for older
people in the UK, continuing to drive growth, reducing debt, growing our
customer base and deepening the connections we have with our customers."

The Group's preliminary results for the year ending 31 January 2025 are
scheduled for Wednesday 9 April 2025.

For further information, please contact:

 Saga plc
 Emily Roalfe, Director of Investor Relations and Treasury  Tel: 07732 093 007
                                                            Email: emily.roalfe@saga.co.uk (mailto:emily.roalfe@saga.co.uk)

 Headland Consultancy
 Susanna Voyle                                              Tel: 07980 894 557
 Will Smith                                                 Tel: 07872 350 428
                                                            Tel: 020 3805 4822
                                                            Email: saga@headlandconsultancy.com (mailto:saga@headlandconsultancy.com)

Notes to editors

Saga is a specialist in the provision of products and services for people over
50. The Saga brand is one of the most recognised and trusted brands in the UK
and is known for its high level of customer service and its high quality,
award-winning products and services including cruises and holidays, insurance,
personal finance and publishing. www.saga.co.uk (http://www.saga.co.uk)

END

(1) Following agreement of the transaction with Ageas, Insurance Underwriting,
our claims handling businesses and the associated accounting adjustments will
be classified as discontinued operations for the year ended 31 January 2025

(2) Bookings at 26 January 2025

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTPKCBDKBKBQDB