Saga plc Reports Wider Loss Despite Increased Revenue

Saga plc experienced a wider loss before tax in the first half, despite reporting a 13% increase in revenues. The company remains optimistic about achieving a full-year underlying profit consistent with last year, while also negotiating a significant insurance partnership.

Date: 11-10-2024

AI Rating: 6

Saga plc has reported a wider loss before tax of £104.0 million for the first half, compared to a loss of £77.8 million from the previous year. Despite this, the company reported a significant improvement in their underlying profit before tax, which rose from £8.0 million last year to £27.2 million this year. This suggests operational improvements are being made, even if the bottom line remains impacted by higher losses.

The revenue growth of 13% to £404.8 million from £358.1 million last year is a sign of positive market performance. Moreover, underlying revenue increased by 11%, indicating that ongoing services or products are performing well. The trading EBITDA saw a 27% increase, from £53.0 million to £67.4 million, hinting at stronger operational efficiency or cost management despite the losses.

Saga is also in negotiations for a 20-year insurance partnership with Ageas SA/NV, indicating potential future revenue streams and market strength. They reported that the gross written premiums in the insurance sector exceeded £479 million, pointing to a robust financial opportunity. The partnership could further enhance Saga's market presence and leverage its brand.

Stocks: SAGA.L