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Saga (LON:SAGA) increased its pre-tax profits for the six months ended 31st July by 3.2% to £109 million as it benefited from a £2.2 million fair value movement. However, underlying profits dropped due to planned increases in investment and higher customer acquisition costs in the insurance sector. Management have kept the interim dividend steady at 3p.
Chief executive Lance Batchelor said: “At the end of last year, we announced our intention to invest in new customer acquisition. I am pleased to report significant progress in the first half of the year. Our Retail Broking policy count is back to the levels seen in the first half of 2017, despite a more competitive pricing landscape. Underwriting results continue to be strong, with another excellent claims management performance.
“Travel has delivered a solid performance and we are seeing encouraging demand for our new ship, Spirit of Discovery, in line with our ambitious plan. Construction is on track, with keel laying this summer, ahead of her maiden cruise next year.
“The Group is benefitting from lower operating expenses across the business, reflecting a more efficient operating structure and investment in our IT systems.
“The business continues to be highly cash generative allowing us to pay a dividend of 3.0p. We remain confident in the Group’s prospects.”
Shares in Saga rose by 2.54% to 129.30p (as of 12:40 BST).