Saga plc reported a loss before tax of £61.2 mill for 2020, which reflected a £59.8 mill impairment charge of travel goodwill in the first half of last year.
The group claimed a strong liquidity position, with total available cash of £75.4 mill and undrawn revolving credit facility (RCF) of £100 mill as at 31st January, 2021.
A strengthened balance sheet and improved financial resilience was secured as a result of decisive actions taken over the last 12 months, including a successful £150 mill capital raise in September, 2020, recent review of covenants attached to term loan and RCF, and further deferral in relation to ship facilities.
For the travel division, detailed work was completed for return to service. Customer retention was reported as strong with a high demand for post pandemic travel.
Saga said it was ready to resume its tour operations and cruise businesses this year with specific timing being subject to government restrictions.
Total Cruise bookings of £154 mill for 2021/22 and 2022/23 combined, compared to £128 mill at the same point last year, representing a 20% improvement. This excludes 2020/21 bookings that were cancelled where the customer has indicated that they wanted to rebook but have yet to do so on a specific cruise.
A significant number of operational changes were implemented, ensuring the highest level of health and safety standards. For example, Saga was awarded Lloyd’s Register’s first Shield+ accreditation, the highest level of health assurance available.
The cruise division also introduced a policy that guests are fully vaccinated at time of travel.
The cash burn rate for the second half of last year was at lower end of £6-8 mill per month.
Euan Sutherland, Saga’s Group CEO (pictured), said: “Saga has made significant progress in a year of unprecedented challenge, during which our key focus has been on serving our customers and keeping our colleagues safe.
“At the same time, we have continued the work to strengthen our financial position and started to deliver against our new strategy, outlined in September, which will return Saga to sustainable growth. Central to this is our plan for our people which saw us launch a new purpose, values and engagement programme. Overwhelmingly positive feedback has been received to date and is reflected in our colleague engagement score, which has increased from September, 2020.
“The progress we have made is clear in the resilient performance delivered by our Insurance business and in Cruise where our high levels of customer retention show clear loyalty to our differentiated boutique offering. At the same time, we have been working to develop the plans to refresh our brand and to invest in data and digital to improve the customer experience.
“Looking ahead, while we are mindful of economic headwinds and the potential ongoing impacts of COVID-19, it is clear that there is significant pent-up demand among our customer base, the vast majority of whom have now been vaccinated and are ready to enjoy post-lockdown freedom. We look forward to relaunching our brand later in 2021, which will only enhance our ability to unlock the potential in Saga, returning the business to sustainable growth and creating significant long-term value for all our investors and stakeholders.”