The group confirmed on Thursday (9 April) underlying profits before tax across its travel division fell by £1.8 million for the full-year to 31 January from £21.6 million to £19.8 million.
Its cruise segment generated £10.6 million profit, up 54% from £6.9 million during 2018/19 thanks in part to the launch in August of the first of its two new-build ships Spirit of Discovery.
However, tour operator profits fell 37% from £14.7 million to £9.2 million, with Saga citing "weak customer demand" which would likely accelerate "due to the impact of Covid-19".
"Bookings for cruise have been resilient in the current situation," said Saga, with forward bookings for September to January 2021 so far achieving 66% of target revenue, and 2021/22 some 16%.
Saga has though temporarily stopped marketing its 2021/22 season to new customers due to the coronavirus pandemic.
It hailed in its annual report, issued on Thursday, the first six months of Spirit of Discovery’s inaugural year. "The new ship also met financial expectations with Ebitda [earnings before interest, tax, depreciation and amortization] in the second half of the year of £20 million.
While there is uncertainty over the delivery date for [sister ship] Spirit of Adventure as a result of the Covid-19 crisis, the group’s expectation is that this will be completed within the next 12 months."
Saga added delivery of Spirit of Adventure, which had been due this August, would "complete the transformation" of its cruise business.
Tour operator bookings for 2020/21, meanwhile, are down 34% compared to this time last year. "The tour operations business has had a more challenging year with weak customer demand, which has accelerated due to the impact of Covid-19," said Saga.
"The group has continued the repositioning of the business to focus on differentiated products, with a need now to accelerate this transformation."
Euan Sutherland, Saga Group chief executive, said: "The progress we have made during the year has been overshadowed by the ongoing concerns about Covid-19 and its impact on the whole of the travel industry.
"We have taken action to protect our customers and colleagues, including suspending our cruise business and tour business.
"We have also increased our operational resilience by accelerating our ‘smarter working’ programme for our colleagues to ensure we have the operational flexibility to react to disruption within the UK."
