Saga suspends cruise operations until May 1 following spread of coronavirus

The travel and insurance specialist said the move follows updated advice from the Government advising people aged 70 and over and those with pre-existing health conditions against going on cruises.

It said that while cancellations had increased in recent weeks, demand for cruises was “very positive”, with bookings of around 80% of its sales target for the year.

The statement said: “It is estimated that a cessation of Cruise trading for the next 6 weeks will reduce Cruise profit before tax by between £10m and £15m. Related advance customer receipts for this period are £22m.

“While the travel environment remains uncertain, the group continues to have significant available liquidity, underpinned by a £100m undrawn revolving credit facility, £33m of cash at the end of February and the strong cash generation of the Insurance business. As previously noted, the insurance business is not expected to be significantly impacted by COVID-19 and has had a good start to the current financial year. The two disposals recently announced are also expected to generate an additional £37m of cash proceeds in the first half.

“There are a range of further mitigating actions the group will take including additional cost efficiencies and reducing discretionary spend.”