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22 Sep 2017

BY Edward Robertson

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TRFBLI

Saga hastens delivery of second cruise ship due to consumer demand

Saga has confirmed and brought forward the delivery of a second cruise ship thanks to consumer demand.

Saga Spirit of Discovery.jpg
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The Spirit of Adventure will now be delivered in August 2020

Announcing the company’s positive half year results for the period ending July 31, 2017, group chief executive said the ship, Spirit of Adventure, would now be delivered in August 2020.

 

He added: "Saga is on track to deliver a fourth consecutive year of growth. Underlying profits are up again and so is our dividend. Our retail broking and travel divisions are performing well.

 

“Saga’s new ship, Spirit of Discovery, will arrive in June 2019, and pre-sales are very strong.

 

“Our confidence in demand has supported our decision to purchase our second new ship, Spirit of Adventure, and to bring forward delivery to August 2020.”

 

The results show that Saga made an underlying profit before tax of £110.2 million, a growth of 5.5%, although profit before tax fell 6.3% to £103 million due to refinancing and net fair value losses on derivatives.

 

However, much of the good news was found in the travel division where its tour operations business generated a 7.6% increase in revenue to £183.4 million despite an increase in passengers of less than 1% to 96,000.

 

The increased spend was driven by the weaker pound, but also by a product shift to higher value long-haul, river cruise and third party cruise products.

 

This meant profit before tax increased by 8.8% to £7.4 million.

 

Of this, Saga Cruising delivered revenue of £44.8 million, compared to £37.5 million the previous year, reflecting an increase in passenger days of 29,000.

 

The Saga Pearl was out of operation for scheduled maintenance for 21 days in February, compared with 63 days of maintenance on the Saga Sapphire in the previous year.

 

Profit before tax from the cruising business was £4.5 million, a £4 million improvement year on year, led by the increase in passenger days and lower fuel prices, but offset by initial marketing spend for the group’s new ship that is under construction, the Spirit of Discovery.

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