Slide 1: Interim Results for the six months ended 31 July 2023
INTERIM RESULTS for the six months ended 31 July 2023 27 SEPTEMBER 2023
Slide 2: Speakers and Agenda
SPEAKERS AGENDA Euan Sutherland Overview Euan Group CEO Financial James performance James Quin Group CFO Core business Euan updates Data progress and Mike Michael O’Donohue next steps Chief Data Officer Conclusion Euan Q&A Euan 2 Interim results for the six months ended 31 July 2023
Slide 3: Overview
OVERVIEW Euan Sutherland Group CEO
Slide 4: Cruise and Travel drive growth alongside insurance optimisation
CRUISE AND TRAVEL DRIVE GROWTH ALONGSIDE INSURANCE OPTIMISATION Under previous IFRS, Underlying Profit Before Tax broadly in line with the prior year Performance across Cruise, Travel and Money on track: Ocean Cruise Underlying Profit Before Tax, cash flow, load factor, per diem and tNPS all ahead o
Slide 5: Highlights in our core businesses
HIGHLIGHTS IN OUR CORE BUSINESSES Cruise Travel Money Insurance 83% 25.7k £3.2bn 1.6m Ocean Cruise Savings policies in Passengers balances load factor (HY 2022 – 20.6k) force (HY 2022 – 66%) £333 First (HY 2022 – £3.5bn) 43% (HY 2022 – 1.7m) £56 Ocean Cruise private jet Equity Motor and home tour re
Slide 6: Financial Performance
FINANCIAL PERFORMANCE James Quin Group CFO
Slide 7: Increased cash generation and further deleveraging
INCREASED CASH GENERATION AND FURTHER DELEVERAGING HY 2023 HY 2022 Change Significant revenue increase driven by £m Cruise and Travel recovery (restated) Revenue* 355.3 309.8 15% UPBT broadly in line with the prior year under previous IFRS Underlying Profit Before Tax 13.4 14.0 (4%) (Under Previous
Slide 8: Cruise and Travel return to profit but Insurance weighing on earnings
CRUISE AND TRAVEL RETURN TO PROFIT BUT INSURANCE WEIGHING ON EARNINGS HY 2023 HY 2022 Change Cruise and Travel businesses return to £m profit for the first time post-pandemic (restated) Cruise and Travel 11.8 (11.6) 202% Reduction in Insurance Broking contribution mainly due to lower motor Insurance
Slide 9: Ocean Cruise on track to achieve EBITDA target, supported by strong demand
OCEAN CRUISE ON TRACK TO ACHIEVE EBITDA TARGET, SUPPORTED BY STRONG DEMAND £m HY 2023 HY 2022 Change Substantial revenue increase, driven by Revenue 103.8 75.7 37% higher load factor and per diems Gross profit 36.1 11.9 203% Positive cash generation compared with cash outflow the year before Marketi
Slide 10: River Cruise returns to profit
RIVER CRUISE RETURNS TO PROFIT £m HY 2023 HY 2022 Change Increasing guest numbers leading to growth in revenue and gross profit Revenue 23.4 16.5 42% Return to Underlying Profit Before Tax Gross profit 6.5 1.3 400% despite increased marketing and Marketing expenses (2.8) (1.6) (75%) operating expens
Slide 11: Small underlying H1 Travel loss in line with guidance
SMALL UNDERLYING H1 TRAVEL LOSS IN LINE WITH GUIDANCE, BEFORE FY RETURN TO PROFIT £m HY 2023 HY 2022 Change Significant revenue growth offset by increased marketing and operating Revenue 69.7 44.0 58% costs to fund future growth Gross profit 13.6 7.6 79% Small Underlying Loss Before Tax in line with
Slide 12: Continued challenge in Motor but Home, PMI and Travel ahead
CONTINUED CHALLENGE IN MOTOR BUT HOME, PMI AND TRAVEL AHEAD OF PRIOR YEAR Year-on-year movement in written Insurance Broking Underlying Profit Before Tax (£m) 0.2 0.8 0.3 1.3 37.0 (16.1) (5.3) 18.2 1 2 3 4 HY 2022 Motor new Motor renewals Home PMI Travel Underlying HY 2023 (restated) business contri
Slide 13: Effect of IFRS 17 on loss before tax
EFFECT OF IFRS 17 ON LOSS BEFORE TAX Removal of IFRS 4 management 1 margin but inclusion of events not HY HY Note in data and risk adjustment £m 2023 2022 New approach to reserve margin 1 (1.8) (1.1) Increase to discount rate offset by 2 higher wage inflation assumptions Change in valuation of PPO r
Slide 14: Claims inflation continues to weigh on underwriting
CLAIMS INFLATION CONTINUES TO WEIGH ON UNDERWRITING HY 2022 HY 2022 combined operating ratio (restated) HY 2023 3.9% 81.9 78.5 113.3% 117.2% HY 2022 (restated) 15.8 HY 2023 (3.6) Gross Reinsurance Net Insurance revenue Underlying Profit Before Tax (before reinsurance arrangements) HY 2023 combined o
Slide 15: Costs in line with guidance
COSTS IN LINE WITH GUIDANCE Underlying marketing costs (£m)* Overall, £4.0m increase to underlying 1.4 5.3 0.3 marketing expenditure: (1.5) (0.1) Cruise and Travel increase to support business growth 22.2 Underlying increase of 4.0 16.8 Reduction in Insurance marketing, largely due to lower policy s
Slide 16: Net debt reduction continues
NET DEBT REDUCTION CONTINUES Movement in Net Debt (£m) 10.9 21.3 10.3 (15.7) (7.0) (1.1) (26.0) (47.0) Available Operating Cash Flow before repayments from 711.7 Cruise and Travel of 12.9 657.4 Available Operating Cash Flow of 85.9 1 Feb 2023 Unrestricted Dividend Working Capital River Cruise and Oc
Slide 17: Net debt outlook
NET DEBT OUTLOOK Debt reduction remains a key priority Deleverage profile Group Net Debt Net Debt for the full year expected to be slightly Spirit of Adventure higher than at 31 July due to exceptionally strong Spirit of Discovery Cruise and Travel cash flows in H1 and restructuring costs £150m May
Slide 18: Looking ahead to the full year and beyond
LOOKING AHEAD TO THE FULL YEAR AND BEYOND Expecting significant full year double-digit growth in revenue and Underlying Profit Before Tax, under both IFRS 4 and IFRS 17 Ocean Cruise expected to exceed £40m Trading EBITDA (Excluding Overheads) per ship for 2023/24, with further growth in 2024/25 Rive
Slide 19: Core Business Updates
CORE BUSINESS UPDATES Euan Sutherland Group CEO
Slide 20: Ocean Cruise ahead of expectations; River Cruise returns to profit
OCEAN CRUISE AHEAD RIVER CRUISE OF EXPECTATIONS FOR RETURNS TO THIS YEAR AND NEXT PROFIT 2023/24 2023/24 86% £332 85% £285 Load factor* Per diem* Load factor* Per diem* 82 transactional NPS 57 Return to tNPS profit On track to deliver 2024/25 £40m EBITDA per ship (excl. overheads) 2024/25 30% £321 L
Slide 21: Strong momentum in Travel, set for return to profit
2023/24* STRONG MOMENTUM Revenue IN TRAVEL, SET FOR ↑46% RETURN TO PROFIT £155.8m First private jet tour departed earlier this month with three further departures No. of passengers planned for 2024/25 ↑27% Expansion of hosted stays product to the 57.8k Mediterranean for winter 2024/25 2024/25* Distr
Slide 22: Insurance continues to represent a significant proportion of earnings
INSURANCE CONTINUES TO REPRESENT A SIGNIFICANT PROPORTION OF EARNINGS Greater proportion of future earnings 0.8m expected to come from home, PMI and 84% Total policy sales £8.7m travel Motor and (HY 2022 - 0.9m) Travel revenue home retention (HY 2022 - 83%) (HY 2022 - £7.3m) PMI partnership with Bup
Slide 23: Money now creating a platform for growth
MONEY NOW CREATING A PLATFORM FOR GROWTH Existing products Expansion plan Savings New products launched Supported by £3.2bn assets under Range of fixed rate savings accounts new website management, maximum under Legal services including wills, probates launching current ring-fence and lasting powers
Slide 24: Data Progress and Next Steps
DATA PROGRESS AND NEXT STEPS Michael O’Donohue Chief Data Officer
Slide 25: Proven opportunity to maximise customer lifetime value
PROVEN OPPORTUNITY TO MAXIMISE CUSTOMER LIFETIME VALUE Core target market 6.6m increasingly digitally-savvy customers, with a lifetime value of c.£584 amongst loyal customers Strong consideration for Saga products and services, with the majority of target customers already known to us Three-step str
Slide 26: Plans to scale up data-driven marketing over the next 18 months
PLANS TO SCALE UP DATA-DRIVEN MARKETING OVER THE NEXT 18 MONTHS Money Attract Use content and newsletters to engage customers and capture intent for marketing Insurance Drive engagement, retention and capture intent to fuel Welcome and in-life Group cross-sell Travel Harvest intent from 17m web visi
Slide 27: Campaigns connect to manage the whole customer journey
WHEN CAMPAIGNS ARE IN PLACE FOR MULTIPLE LIFECYCLE STEPS, THEY CONNECT TO MANAGE THE WHOLE CUSTOMER JOURNEY Consent and intent: Data feeds into all areas to help unlock the marketing strategy Consent and intent Hand back cross-sell intent signals Insurance Insurance Insurance Travel Cruise Money Att
Slide 28: Conclusion
CONCLUSION Euan Sutherland Group CEO
Slide 29: Optimising Saga for the future
OPTIMISING SAGA FOR THE FUTURE Strong progress in Cruise, Travel and Money Identified cost efficiencies supporting Insurance result against challenging external backdrop Continuing to evaluate options for Insurance Underwriting to maximise value generation Reduction of Central Cost base as we move t
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Slide 31: Dates for the diary
DATES FOR 2024 THE DIARY 30 January – Trading Update 27 March – Preliminary results for the year ended 31 January 2024 31 Preliminary results for the year ended 31 January 2023
Slide 32: Appendix
APPENDIX SAGA
Slide 33: Saga plc consolidated income statement
SAGA PLC CONSOLIDATED INCOME STATEMENT HY 2023 Change HY 2022 £m (restated) Revenue* 355.3 15% 309.8 Underlying Profit Before Tax Cruise and Travel 11.8 202% (11.6) Insurance Broking (earned) 23.8 (35%) 36.7 Insurance Underwriting (3.6) (123%) 15.8 Total Insurance 20.2 (62%) 52.5 Other Businesses an
Slide 34: Consolidated income statement (under previous IFRS)
SAGA PLC CONSOLIDATED INCOME STATEMENT (UNDER PREVIOUS IFRS) £m HY 2023 Change HY 2022 Revenue* 319.4 24% 258.3 Underlying Profit Before Tax Cruise and Travel 11.8 202% (11.6) Insurance Broking (earned) 22.5 (37%) 35.5 Insurance Underwriting 3.1 (81%) 16.4 Total Insurance 25.6 (51%) 51.9 Other Busin
Slide 35: Underlying to statutory marketing and administration costs
UNDERLYING TO STATUTORY MARKETING AND ADMINISTRATION COSTS HY 2023 HY 2022 £m (restated) Underlying marketing costs (page 15) 22.2 16.8 Underlying administration costs (page 15) 74.6 62.4 Total underlying marketing and administration costs 96.8 79.2 Restructuring costs 5.9 2.2 FX movement on river c
Slide 36: Cruise and Travel income statement
CRUISE AND TRAVEL INCOME STATEMENT HY 2023 Change HY 2022 Ocean River Travel Cruise Ocean River Travel Cruise Cruise Cruise and Cruise Cruise and £m Travel Travel Revenue 103.8 23.4 69.7 196.9 45% 75.7 16.5 44.0 136.2 Gross profit 36.1 6.5 13.6 56.2 170% 11.9 1.3 7.6 20.8 Marketing expenses (6.5) (2
Slide 37: Insurance Broking income statement
INSURANCE BROKING INCOME STATEMENT Motor Home Other Total Change Total £m Broking Broking Broking HY 2023 HY 2022 (restated) Broked 61.9 78.3 70.0 210.2 18% 178.8 Underwritten 86.9 - 1.7 88.6 (10%) 98.9 Gross written premiums 148.8 78.3 71.7 298.8 8% 277.7 Broker revenue 4.7 12.1 23.3 40.1 (27%) 55.
Slide 38: Insurance Underwriting income statement
INSURANCE UNDERWRITING INCOME STATEMENT Re- HY 2023 Change HY 2022 Gross insurance Net Gross £m (restated) Insurance revenue A 78.5 (8.0) 70.5 (4%) 81.9 Incurred claims (current year claims) B (91.5) 19.2 (72.3) (17%) (78.3) Claims handling costs in relation to incurred claims C (7.9) - (7.9) (16%)
Slide 39: Other Businesses and Central Costs income statement
OTHER BUSINESSES AND CENTRAL COSTS INCOME STATEMENT HY 2023 HY 2022 £m Other Central Total Change Other Central Total Businesses Costs Businesses Costs Revenue Money 3.7 - 3.7 (10%) 4.1 - 4.1 Media and CustomerKNECT 5.8 - 5.8 14% 5.1 - 5.1 Insight 0.5 - 0.5 100% - - - Other - - - (100%) - 0.8 0.8 To
Slide 40: Cash flow and liquidity
CASH FLOW AND LIQUIDITY HY 2023 Change HY 2022 £m (restated) Insurance Broking Trading EBITDA 27.5 (31%) 40.0 Other Businesses and Central Costs Trading EBITDA (10.0) 18% (12.2) Trading EBITDA from unrestricted businesses 17.5 (37%) 27.8 Dividends paid by Insurance Underwriting business 7.0 (53%) 15
Slide 41: Cruise and Travel cash flows
CRUISE AND TRAVEL CASH FLOWS Ocean Cruise Available Operating Cash Flow of 47.0 Significant increase in net advance customer 31.4 receipts due to increased forward bookings (3.1) Net trading income represents cash received (8.1) on departed cruises, partially offset by running costs of those cruises