Saga plc (SAGA.L) witnessed a surge in its share price, climbing over 8% in early trading, following the release of its unaudited preliminary results for the year ended January 31, 2026.
The specialist in products and services for the over-50s market reported a return to profit and significant revenue growth, exceeding previous guidance and bolstering investor confidence.
The company reported a profit before tax of £2.1 million, a stark contrast to the £160.2 million loss recorded in the prior year. Underlying profit before tax also saw a substantial increase, rising 19% to £44.2 million from £37.2 million. This performance was primarily driven by strong results in both the Travel and Insurance divisions.
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Revenue climbed 12% to £660.0 million, up from £588.3 million, with underlying revenue increasing by 11% to £654.6 million. Trading EBITDA also experienced a significant boost, increasing 16% to £134.9 million.
Saga significantly reduced its net debt by 16% to £499.5 million. This deleveraging is reflected in the improved leverage ratio, which fell from 4.4x to 3.7x. The company’s strong cash generation is underscored by an 88% increase in available operating cash flow, reaching £205.9 million.
The company’s focus on shareholder value is further enhanced by the deleveraging efforts, paving the way for future strategic investments and potential dividend considerations as profitability continues to improve. Saga is targeting an Underlying Profit Before Tax of at least £100.0m by January 2030, and a corresponding reduction in Leverage Ratio to below 2.0x over the same period.
Mike Hazell, Saga’s Group Chief Executive Officer, said: “This has been a transformational year for Saga…The result was an excellent trading performance that drove growth across all our core businesses, and a strong financial performance, with Underlying Profit Before Tax and the Leverage Ratio significantly ahead of our original guidance.”
The market’s response to Saga’s turnaround story is overwhelmingly positive, suggesting a potential buying opportunity as the company continues to execute its strategic plan and capitalize on the growing demand for services tailored to the over-50s demographic. The company’s successful debt refinancing and strategic partnerships position it well for sustained growth and profitability.
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