Saga cruises on

To stake a claim on some of the money no longer ear-marked for an annuity, the company will also launch a wealth management service later this year in partnership with Tilney Bestinvest. Saga has already built up more than £5bn of retail deposits.

The travel business is much better established. "Our ships are almost full at the moment," says chief financial officer Stuart Howard. Revenues from the cruise business rose 15 per cent to £381m for the year to the end of January, with about half of the increase coming from the acquisition of luxury tour operator Destinology.

Meanwhile, motor insurance revenues were down 12 per cent at £312m as premium rates continued to fall in a saturated market. But Saga managed to improve its profitability: the combined operating ratio (of claims to premia) for its core motor underwriting business improved from 88.4 per cent to 77.9 per cent. This division will be enlarged by the acquisition of motorbike insurer Bennetts, which has more than 200,000 "highly complementary" customers. The group is also creating a panel of underwriters for its motor customers to boost the competitiveness of its pricing.

Statutory figures were suppressed by a £178m goodwill writedown relating to the public sector business of Allied Healthcare, which Saga put up for sale in January, as well as the cost of the flotation. But cash profits were up 6 per cent at £227m, a narrow beat versus consensus. For the 160,000 or so customers that became retail shareholders at the time of the flotation, Saga will issue one free share for every 20 held to those on the share register on 26 May.

Broker Numis Securities expects pre-tax profit of £195.8m this year, which gives EPS of 13.8p.