15th Jan 2015 08:06
LONDON (Alliance News) - Saga PLC Thursday said it expects its dividend for the current financial year to be at the top end of its targeted 40-50% pay-out range, as the company reported that trading is in line with market expectations.
In a statement, Saga, which provides products and services including insurance and holidays to people aged over 50, said it will seeks to maximise returns for investors by optimising its balance of investment, dividends and debt reduction.
Saga's trading update was made as part a Capital Markets Day to update investors and financial analysts on its strategy, which revealed a number of planned changes.
As well as creating Saga Investment Services, a wealth management partnership with Tilney Bestinvest, Saga said it intends to launch a motor broking panel to broaden accessible client base without assuming any incremental underwriting risk. The company has also decided to divest the local authority section of its healthcare business, Allied Healthcare, and focus on privately funded healthcare.
"In the ten months that I have led the business, I have seen the depth of insight into our core demographic that our unique database provides, the potential of our brand, the consistent performance of the group - in particular our insurance business - and the quality of our people," Lance Batchelor, chief executive, said in a statement.
Batchelor said he is "very clear" that Saga's model is predominantly that of a broker, finding the best products for clients and providing high standards of customer service.
"This model works best when superior customer knowledge and a trusted brand work together to create a competitive edge, helping to build enduring relationships directly with our customers," Batchelor said.
"The strategy that we outline today shows how we intend to use these competitive strengths to unlock the potential of our existing businesses and to continue to explore new areas of growth, while maintaining our capital-light, cash-generative operating model. This will drive growth in our existing businesses, provide scope for investment in new products and underpin a progressive dividend policy," the CEO added.
By Samuel Agini; [email protected]; @samuelagini
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