Insurance company Saga has posted a pre-tax profit of £47.8m in its annual results, a figure up 25% on the previous year.

The group’s underlying revenue rose by 5% in the year to 31 January, to £768.2m, which it said was driven primarily by growth across its travel businesses.

Saga said it had repositioned itself for future growth in the last year, having successfully signed a new 20-year insurance broking partnership with wholly owned UK subsidiaries of Ageas SA/NV, and agreed the sale of its insurance underwriting business.

These moves helped Saga to “materially reduce the risk and complexity” of its insurance business going forward, it said, as the insurer also indicated that the coming year would be “one of transition”.

“Following the completion of these important objectives, our focus has shifted to the long-term growth plans for the group, building on our established businesses by continuing to explore complementary partnerships and unlocking new avenues for growth beyond our current business and product lines,” Saga group CEO, Mike Hazell, commented.

Saga added that a “material increase in financing costs” mean it is forecasting a lower pre-tax profit in 2025/26. However, the company expects a “return to growth thereafter”, it added.

“By continuing to be a delivery-focussed business, with our customers always front of mind, I am confident that the plans we have in place will step change our financial performance within the next five years, delivering a business with annual underlying profits of at least £100m, strong cash generation and leverage of less than 2.0x EBITDA,” added Hazell.

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