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Insurance division helps Saga post small profit for first half

08:08, 22 September 2021

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Saga posts small profit – Photo: Shutterstock

The UK-based group Saga, which specialises in products and services for people over 50, posted a small profit for the first half on Wednesday compared to a loss a year earlier.  Earnings from its insurance division made up for the shortfall in its cruise operations during the coronavirus pandemic.

In the six months to 31 July 2021, the insurance-to-cruises company made a pre-tax profit of £0.7m ($0.95m). The firm posted an underlying pre-tax loss of £2.8m across the group.

Saga said that 835,000 motor and home policies were sold – a 0.5% improvement compared to the prior period, with 58% of new business acquired directly, adding that retention remained strong at 80.6%.

Covid-19 travel restrictions impacted operations but since rules were eased the company said it has been able to strengthen its balance sheet again. Cruise bookings for next year are "ahead of pre-pandemic levels" and the firm reported tour operation bookings for 2021-22 at £18m and for 2022-23 at £109m. 

Overcoming Covid-19

Euan Sutherland, Saga's group chief executive officer, said the company has made strong progress.

"We have achieved this performance at a time of unprecedented challenge for our businesses, and I would like to thank each of my colleagues for their hard work and dedication.

"We have successfully recommenced our travel operations, including the launch of our newest ship, Spirit of Adventure. I am delighted with the positive feedback received so far and encouraged by the strong pipeline of future bookings," he said.

Customer retention

Sutherland also said that in its insurance business, customer retention remained strong and the attraction of its offer is borne out by the increased uptake of its new three-year fixed-price product.

"From a financial perspective, we further strengthened our position through a series of financing transactions, including the recent completion of our bond issue," he added.

Future potential 

According to the firm, since the travel business has got back off the ground, it is now continuing to work towards a full return to service, "while remaining mindful of future potential volatility relating to Covid-19".

"As we have demonstrated through the last 18 months, we will continue to take an agile, proactive approach to navigate any challenges.

"As we plan to relaunch our brand in the coming months, I am confident that we have the right strategy, team and structure in place to return Saga to sustainable growth and create significant long-term value for all our stakeholders," Sutherland added.

Read more: Evergrande to pay interest on one of two coupons due

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