Britain’s Saga asks for debt relief

LONDON: British over-50s holidays and insurance specialist Saga warned on Thursday it could suspend all cruises and vacations until 2021 under a worst case coronavirus scenario and said it was asking for a year’s debt holiday.

Saga, whose shares have fallen nearly 70% in 2020, said the future was “uncertain” as it ditched its dividend after posting a 39% fall in profit for the year to the end of January.

Saga, which has suspended its cruises until May, also said it was looking to halt debt payments.

“The Group will apply for a waiver of the covenants in the ship debt and is likely to apply for a debt holiday for the period to 31 March 2021 under a package of proposals that are being put together for the cruise industry,” Saga said.

Shares in Saga, one of several cruise operators forced to halt all sailings by the coronavirus pandemic, were down 4.1% to 16.92 pence after saying its 2019-20 results would include a 370 million pound ($460 million) impairment charge.

As countries across the world impose clampdowns on movement and activities to contain the damage caused by the coronavirus outbreak, Saga’s suspension date is seen as optimistic.

“With the way things are going in terms of lockdowns, the firm might have to push back the date to resume service,” CMC Markets analyst David Madden wrote.

Outbreaks on a handful of cruises, and subsequent quarantines, coupled with the industry’s focus on elderly customers more at risk, have hit the industry hard.