Saga raises profit guidance as first-half underlying profit nearly doubles

Saga plc (LON:SAGA), the UK’s specialist in products and services for people over 50, has announced its interim results for the six-month period ended 31 July 2026.

Financial highlights

The Group reported a strong set of financial results for the first half of the year, ahead of expectations and driven by growth across all core businesses.

·      Underlying Profit Before Tax¹ grew 98%, from £23.5m to £46.6m.

·      Underlying Revenue¹ grew 14%. Statutory revenue increased 12%, to £367.5m.

·      Profit before tax from continuing operations increased from £3.7m to £28.0m, as a result of strong trading and lower exceptional costs.

·      Underlying Available Operating Cash Flow¹ was 27% higher, at £101.0m, reflecting growth in Travel and Insurance, alongside reduced capital expenditure.

·      Net Debt¹ reduced by £70.4m since 31 January 2026, to £429.1m, resulting in the Leverage Ratio¹ falling from 3.7x to 2.7x.

·      First half performance and outlook for the full year ahead of the original trajectory, with the Group now likely to reach its medium-term targets, of £100.0m Underlying Profit Before Tax¹ and a Leverage Ratio¹ below 2.0x, ahead of January 2030.

Operational and strategic progress

Transformation towards a lower-risk, less complex and more customer-focussed business model continued to gather pace, alongside the development and launch of several new product offers:

·      Motor and home insurance new business has now fully transitioned to Ageas³. Work continues in preparation for the transition of policy renewals around the end of the financial year. An additional £10.5m contingent consideration was received from Ageas³ in June 2026.

·      A new pet insurance partnership has been agreed with Allianz UK and is due to launch later this year, offering pet insurance with features designed specifically to meet Saga customers’ needs.

·      Product development continued across our Holidays business. A trial of college and university breaks proved very popular this summer and, later in the year, we will be operating a series of new UK Christmas hotel stays. Further afield, we have relaunched holidays to China in response to customer demand.

·      River cruises on board our newest ship, Spirit of the Lorelei, are now on sale for 2027, with booking levels already matching those of our other river ships.

·      The NatWest Boxed savings partnership has attracted 51k new customers and over £2.1bn of deposits since launching in December 2025, demonstrating the power of our partnership strategy.

·      Uptake of our new Experience is Everything podcasts accelerated in the first half, with 15.8m views since launching in December 2025. A new podcast series, focussed on health, was added in July 2026.

·      Operational simplification continues, most recently with the launch of a new technology partnership, which will simplify and modernise infrastructure and service delivery and drive sustainable cost efficiencies through greater standardisation and automation.

Outlook

This strong first-half performance has increased profit and cash flow expectations for the full year and reinforced our confidence in exceeding our medium-term targets earlier than anticipated. As a result, we are upgrading our profit guidance and now expect full year Underlying Profit Before Tax¹ to be materially higher than in the prior year and in the range of £65-70m.

The Group remains focussed on reducing Net Debt¹ and the Leverage Ratio¹, with both expected to remain broadlyb flat for the full year, before continuing to reduce thereafter.

While always mindful of the potential for economic headwinds, financial performance continues to track significantly ahead of the original trajectory underpinning our medium-term targets, with the Group now likely to reach its targets, of £100.0m Underlying Profit Before Tax¹ and a Leverage Ratio¹ of below 2.0x, before the original target date of January 2030.

Mike Hazell, Saga Group Chief Executive Officer, said:

“Saga has delivered another very strong set of financial results, building on the substantial progress we made last year. Our simplified approach to business has brought strategic clarity to our decision making and ensured customer focus is our number one priority.

“Profitability has increased significantly in the first half of the year and we expect this to drive a strong full year outcome, ahead of our previous guidance. All our core businesses are growing, cash generation has increased and debt continues to fall. Underpinning all of this, customer satisfaction has increased further, with our transactional net promoter score rising for the third consecutive year.

“In April 2025, we laid out our medium-term targets, with plans to achieve underlying profits of £100.0m by January 2030 and leverage of less than 2.0x. Eighteen months on, we are significantly ahead of that trajectory. While conscious of potential economic headwinds and volatile global conditions, our performance this year further demonstrates the resilience of our business model and target customer group, increasing our confidence in achieving our medium-term targets ahead of plan.”