FTSE 100: 7471.01 ▲ 17.53 (0.24%)
2 of 6
|No. of shares out||1,120m|
|No. of shares floating||1,111m|
|No. of common shareholders||not stated|
|No. of employees||5269|
|Trading volume (10 day avg.)||3m|
|Profit before tax||£240m|
|Earnings per share||14.02p|
|Cashflow per share||17.55p|
|Cash per share||4.96p|
A profit warning from over-50s group Saga (SAGA) saw the share price drop and Hargreaves Lansdown warns that throwing money at the situation may not be the best solution.
Saga announced it expected full year growth in underlying profit before tax to be just 1-2% compared to the 5.5% it achieved last year as it takes a hit on its insurance broking business and feels the impact of the collapse of Monarch Airlines on tour operating. The shares slumped 22.8% to 140p yesterday on the news.
‘The collapse of Monarch Airlines and industry-wide headwinds in home insurance are outside Saga’s control,’ said analyst Nicholas Hyett.
‘But lower reserve releases and a rapid decline in benefits from the introduction of the motor broker panel shouldn’t be coming as a surprise to management.’
He said the fact the company ‘feels the need to throw more cash at customer acquisition is also less than reassuring’.
‘Saga’s pitch was always that its huge mailing list means all the clients it could ever want are just a mail drop away, the extra spending suggests it might not be as clean cut as that,’ said Hyett.