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Saga Plc Posts Pretax Loss In Full Year; Revenue Down 2.2% - Quick Facts

Saga plc (SAGA.L), the UK's specialist in products and services for life after 50, reported a loss before tax of 134.6 million pounds after Goodwill impairment of 310 million pounds for the year ended 31 January 2019. Loss per share for continuing operations was 14.5 pence compared to profit of 13.1 pence, prior year. Underlying profit before tax was 180.3 million pounds, a decrease of 5.4% in comparison to the prior year. Underlying EPS for continuing operations was 13.1 pence compared to 13.8 pence.

Fiscal year revenue decreased by 2.2% to 842 million pounds from 860 million pounds, due to a decrease in Retail Broking revenues, as lower margin new business policies replaced higher margin renewal policies, partially offset by increases in Cruising revenue. Total customer spend with Saga was broadly stable at 1.21 billion pounds.

The Board has proposed a final dividend per share of 1.0 pence and a full year dividend per share of 4.0 pence. The Group said it is targeting a sustainable payout ratio of around 50% of earnings over the next few years.

Lance Batchelor, Group CEO, said: 'We are launching a fundamental change to the Group's strategy to return the whole business to its heritage as an organisation that offers differentiated products and services. As a first step, we are announcing the launch of a new approach to Insurance. This focuses on direct channels and products that offer attractive innovative features, moving the conversation from price to value As a result of lower margins in Insurance, a change in approach to renewal pricing, lower reserve releases and investment in new products, underlying profit before tax for the 2019/20 financial year is expected to be between 105 million pounds-120 million pounds. Therefore, we have taken the difficult decision to reduce our final dividend and write down goodwill."

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