Saga hikes profit expectations following Ageas deal
Saga, the financial services and travel provider for over-50s, has said it expects to report an underlying profit before tax above previous guidance.
In a trading update, the firm said it expected underlying profit before tax for the last six months of 2024 to come in marginally higher than the year before.
Saga’s travel arm is expected to report an underlying profit before tax “in the high single-digit millions”, compared to the £1.5m reported in the prior year, it added. This would represent revenue growth of 15 per cent and passenger growth of nine per cent.
In the last six months, Ocean Cruise delivered a load factor of 91 per cent, three per cent ahead of the previous year.
Meanwhile, River Cruise’s load factor came in at 89 per cent, with combined ticket prices and onboard revenue per passenger of £327, a total of 15 per cent higher than last year.
“We continued to generate strong demand for both our cruise and travel businesses,” said Saga CEO Mike Hazell.
Saga and Ageas
The firm announced a 20-year partnership for motor and home insurance with Belgian insurance giant Ageas last month, which will see Saga’s price-comparison website, pricing, claims and customer service activities taken over by the insurer.
Earlier this week, City broker Peel Hunt downgraded Saga’s stock rating, noting that the firm faced “a refinancing hurdle” this year.
With the money from the Ageas partnership, the firm said it would use some of the cash from the deal to refinance £325m of outstanding debt by the spring of this year.
As a result of the deal, Peel Hunt downgraded its price target for the stock to 120p. Saga’s shares have fallen more than nine per cent since the start of 2025.
Looking ahead to the rest of this year, Saga noted both Ocean Cruise and River Cruise’s booked load factors were running ahead of last year.
The firm’s River Cruise arm is set to introduce a new ship in July 2025, the Spirit of the Moselle, which will increase capacity.
Travel booked revenue is currently £126m, 10 per cent ahead of the same point in the prior year, with 39,000 passengers booked in, 11 per cent ahead of last year.
Saga’s preliminary results for the year are due out on 9 April.