The over-50s specialist said its half-year loss was down to a £59.8 million “impairment” charge for its travel division due to the impact of Covid, as travel revenue slumped 77.5% year-on-year to £49.3 million for the six months to 31 July.
Saga added that it expected the cash “burn” for its travel businesses to be between £6 million and £8million per month for the rest of the year.
The company’s financial results were released as it was revealed that its luxury tour operator Destinology has ceased trading. Saga had been seeking a buyer for Destinology in the past few months.
Saga also confirmed its plan, revealed last week, to raise £150 million in new funding, including a £100 million investment by the company’s former boss Sir Roger de Haan, who sold the business for £1.35 billion six years ago.
Saga’s travel operations have remained suspended since the middle of March when the pandemic took hold across the UK and Europe.
The company expects its cruise ships to resume sailing later this year with tour operations set to recommence from April 2021. Saga added that more than 65% of customers had retained their cruise bookings rather than requesting refunds.
Chief executive Euan Sutherland said: “While taking decisive action to react to the Covid-19 outbreak, we have also continued to make progress in our businesses.
“This is clearly shown in cruise by the imminent arrival of our second new ship, Spirit of Adventure. We are excited about the opportunities ahead, whilst mindful of the fact that we face into challenges with the continuation of the Covid-19 pandemic.
"We have conducted a comprehensive review of strategy and have developed a plan which we believe will strengthen our brand, improve our focus on our customers, deliver exceptional experiences for them, and return both our insurance and travel businesses to growth.
“The capital raising, supported by Sir Roger De Haan’s cornerstone investment, will allow us to build on our actions to date by enhancing our resilience and financial strength.”
The raising of new investment will see De Haan join Saga’s board as non-executive chairman.
"Saga is a special company and I am very optimistic about its future as a result of the strategy that is being outlined today,” said De Haan.
“Euan Sutherland and his new management team have shown that they really understand the business and they are already being successful. I am proud to be playing my part in ensuring that Saga is back on the right track."
