Saga (SAGA) H1 2025 earnings summary

Executive summary

• Underlying profit before tax rose to £27.2m, more than tripling year-over-year, driven by strong Cruise and Travel growth and improved Insurance Underwriting, offset by Insurance Broking challenges and a £138.3m goodwill impairment.

• Net debt reduced by £42.8m to £614.6m, with leverage ratio improving from 7.0x to 4.6x year-over-year.

• Entered exclusive negotiations with Ageas for a 20-year affinity partnership and sale of the insurance underwriting business, aiming for a capital-light, lower-risk model.

• No interim dividend declared as debt reduction remains a priority.

• Customer engagement and digital initiatives led to increased web traffic and customer consents.

Financial highlights

• Underlying revenue grew 11% to £393.3m; underlying profit before tax reached £27.2m, up over threefold year-over-year.

• Trading EBITDA increased 27% to £67.4m; leverage ratio improved to 4.6x from 7.0x.

• Available operating cash flow was £54.4m, down 37% due to prior year one-off benefits and lower insurance broking earnings.

• Reported statutory loss before tax of £104m due to a £138.3m goodwill impairment in insurance broking.

• Net finance costs increased to £12.9m (H1 2023: £11.5m).

Outlook and guidance

• Full-year underlying profit before tax expected to be broadly consistent with FY 2023/24.

• Ocean and river cruise bookings and profitability expected to remain strong, though H2 cruise profitability will be lower due to seasonality and dry dock.

• Travel segment to see higher H2 passenger volume and material profit growth.

• Insurance broking headwinds expected to persist in H2; insurance underwriting to benefit from pricing actions and deliver further profitability growth.

• Net debt expected to be slightly higher at year-end due to ship loan repayments and working capital unwind.