Monarch collapse impacts Saga
However, Saga will see an increase in profitability in the travel business by next year.
The revelation was made in a trading update for the period from August 1 to December 5, 2017.
For the year ending January 31, 2018 the group’s growth in underlying profit before tax is expected to be between 1% and 2%.
This has been impacted by challenging trading in insurance broking during the period and the Monarch Airlines’ administration.
Saga mentioned that the travel segment will continue to trade well and will be strong in the year ahead. But the tour operation business has been hit by Monarch Airlines collapse with an approximate one-off cost of £2 million.
Saga’s review of its operating structure revealed that approximately it will realize £10 million of annualised savings next year.
Lance Batchelor, chief executive mentioned that though challenges in trading conditions continues in our final quarter the business will develop for the long term. This is the right time for Saga to make investments, he was confident that there will be better quality of earnings and profit growth across the business and will benefit the shareholders.
Tags: Lance Batchelor, Monarch Airlines, saga