Shares in Saga increased by almost 10% earlier today after the products and services provider for those aged 50+ stated that it has traded in line with expectations in the first four months of its financial year.

The firm reported in its trading update for the four months to 29 June that its travel division has continued to trade strongly, with its cruise sector performing ahead of expectations.

Its holidays division revenue is set to be ahead of the prior year, although passenger numbers have dropped slightly year-on-year as a result of the Middle East conflict.

Trading in its insurance broking sector also remains in line with expectations, adding that the start of its “long-term relationship” with Ageas is progressing well.

Saga stated that new business, for both motor and home insurance, is now live with Ageas and renewals are expected to follow later this year. As a result of the strong performance of these divisions, it has triggered a contingent consideration payment of £10.5m from Ageas, which it expects to receive in the coming days.

Furthermore, its net debt has continued to reduce, standing at £464.7m on 31 May, marking a £104.8m year-on-year reduction, and its available cash totalled £186.5m.

As part of its trading update, the firm said that it remains on track to deliver its full-year guidance.

Group CEO at Saga, Mike Hazell, said: "Saga has made a strong start to the year, building on the significant growth we achieved last year. Our momentum in travel has continued, demonstrating the resilience of our customers and our diverse offering, despite the current geopolitical uncertainty.

"At this early stage of our partnership with Ageas, we are already seeing encouraging signs to support our long-term growth ambitions, and the performance in our wider Insurance business continued to benefit from the more simplified and customer-focused operating model we now have.

"Looking ahead, we are focused on continuing to grow our travel businesses and completing the transition to our new Insurance model. We remain on track to deliver our full-year guidance and continue to make clear progress towards our medium-term targets of at least £100m underlying profit before tax and a leverage ratio of below 2x by January 2030."


Saga will announce its half-year trading results for the six months to 31 July on 30 September.

---