As I mentioned in a previous message, there are a lot of new cruise ships due to go into service in the next few years............so many cruise brands will be looking to capitalise on market share; so personally speaking I think your expectations from what SAGA can gain business wise is not realistic, but I am happy to be proved wrong on the matter (especially as I have just upped my share holding in SAGA by 70% approx in last few weeks and have a dividend to come).
I actually think, that in the next 10 years, SAGA Cruises as such will no longer exist, as they will have been bought by either Carnival Group UK (on behalf of Carnival Corp) or Royal Caribbean Int.........and run as 'Adult' only ships (not specifically those of SAGA age).
The real problem SAGA has with their existing ships and the two new ones is there ability to make money. The new ships are 999 passenger capacity........... great for those who like small or smaller size ships. However, based on conversations with fellow passengers we have met along the way on our cruises, the majority seem to avoid small ships; and it is quite apparent that family groups (so mum, dad, granddad, grandma, kids and grand kids) are on the rise to take advantage of 3rd & 4th berth occupancy in a cabin offers, so they have to look to other brands and not SAGA.
Also mentioned in a previous message; a cruise ship only starts to make money once it is at sea, as many ship company's use the 'cost a passenger pays' to cover fuel and docking fees. The cash machine for them is what passengers spend onboard (bars, casino, photographs, fine dining, tours, galley tours etc). So with only 999 passengers, of which you will have a percentage of nominal spenders onboard, scope to make money is that harder.
I was going to attach a link to a Facebook thingy (good technical term that) my wife saw on Facebook yesterday of quantities of various items (food and drink) consumed on a typical two week cruise on P&O Azura.....it is staggering.............but she cannot locate it this morning, so I have found the following article from 2015 on Go Cruise and Travel; the second photo/image kind of represents what I mean about 'bums on seats' matter (and size comes into play) in the consumption of booze as an income provider >>>>>>. http://www.gocruise.co.uk/blogs/how-much-food-drink-carried-on-a-cruise-ship.phtml
Thanks for the link MM.
One would deduce that premiums are so high based on the risk/reward ratio.
As we get older, sadly, we do succumb to age related illnesses.
I would also think that due to the varying costs of medical care from country to country, cruise insurance would be devilishly hard, and time consuming to price accurately.
I'd prefer us to concentrate on 'getting our act together' filling our fleet, particularly our new additions, with happy customers.
As someone who takes cruise holidays a few times a year; I recently posted on here that if SAGA were to get the act in gear and bring out a whole range of travel policies (suitable for both fly and cruises (cruise travel policies have different cover sections) from cheap to expensive, they could get a lot of business. I also mentioned the totally ridiculous cost of cruise insurance for those of an older age.
I also mentioned that many on cruises holidays lie to the cruise companies that they have cover.....but don't. My wife has a relative who has travelled all around the world a number of times and has never taken out insurance, instructing her family to 'complain and create a fuss' to the travel agents, air company or cruise company should anything happen to her, in the hope that the company will cough up and pay out!
Today, on the 'Thisismoney' site there is a an article about the many thousands of Brits who travel abroad (especially to Europe) who don't take out travel insurance as they think the EHIC (old E111) card covers them, even outside of Europe no doubt in some cases.
The head bullet points from the article are as follows;- Millions of holidaymakers risk huge medical bills after failing to get the right kind of travel insurance or not buying it at all -
38 per cent of travellers didn't have the right insurance in the last year
By not buying it they put themselves at risk of huge overseas medical bills
The majority thought the EHIC would cover them instead while on holiday
But it is not a replacement for insurance and doesn't provide as much cover
We are fortunate to get free travel insurance cover as part of benefits received from my former employer/union as a pensioner; but we still ensured (and paid a one off fee) that the policy gave us additional cover for our cruises and that I have cover as I have a health condition............. so personally speaking I/we would not need to buy a travel policy from Saga or indeed from anyone else.......but as the article shows, many need the cover and if you can give people cover at a reasonable prices, I am sure many would take it.
Perhaps Saga needs to approach people like P&O, Cunard, Easy Jet, Ryan Air to name a few; and see if they can be an appointed over 50's travel insurance supplier???????
yesterday, indicating that the new man in charge is steadily getting to grips with things, which might lie behind the sp having picked up usefully in recent days; makes for a pleasant change, anyway - sasa.
Today (Saturday) the Money Mail online edition is actually carry an interesting article on cruise insurance........ and detail that many standard travel insurance policies don't cover them.
If the people at SAGA have got the heads screwed on, they should take advantage of this and bring out a whole range of policies or options.........as the insurance required on (say) a Mediterranean cruise, would be totally different if you was sailing direct to New York.
From our own experience when on cruises, loads of people do not buy travel insurance of any type (and lie that they have it) and many just buy what the travel agent flogs them, whether it is suitable or not. Everyone's requirements for insurance cover will differ, as everyone's circumstances are different............we always take out additional cover for her jewellery whilst on a cruise, even though it is kept in the safe.
The biggest issue with cruise insurance is the cost........my wife is taking her mum on a 2 night jaunt over to Belgium in a few weeks......her mum is 79 no medical issues, and one insurance quote we gt for the 2 nights was £99.......but typically in the £60 region.
As it happens, I approached my old union, and they are arranging cover for £25.00
But Saga could mop the market up, if they were to act quick.
Southampton's "Ocean" and "QE2" Cruise Terminals at Port Gate 4 are like very old friends to us, as we have sailed from them virtually every cruise...... in fact since 2008 when doing our first cruise, this years cruises will be 33 and 34...........and hopefully we shall have good weather, fine wine and more sizeable wins in the Casino!
I totally accept that It is each to their own but I think it is true that the vast majority of 'doubters' quickly change their mind once they have 'dipped their toes' . If you choose the right cruise line for your needs then once on board it is a holiday within a holiday. With the 4 and 5 star lines whilst on board You get good food 24 hours a day, good and varied entertainment, plus things like ice rinks, surfing flow riders , bumper cars and casino etc etc . Then you have the chance in a 2 week med cruise for example to get off in 6 or 7 different ports from which you can visit places like Rome, the leaning tower of Pisa, Venice, Dubrovnik, Santorini, Barcelona. Monte Carlo Lisbon, Gibraltar Etc etc. and all without having to board a plane. Get on and off at Southampton with unlimited luggage. For under £2,000 apart from school summer holidays , that represents pretty good value against the cost of 14 nights in a quality hotel plus restaurant bills etc. Just my view but it suits me and, this July, 60 family and friends with a wedding on board.
From experience, over 50's can also cause major issues, especially if they have been drinking all day...... but most cruise brands have adult only ships................ so the choice is yours.
All I would say is; cruise ships don't put up with the aggravation you get at some land hotels; if people are causing issues to other passengers, they are usually warned once, warned a second time (perhaps by a Senior Officer) and if they have to..........on a third time, the passengers and their luggage are kicked off at the next port of call...........................and it does happen!
Size matters for some..........some people like little ones, but in the main, people like big, as they ride out the storms better........but it's a choice you have to make. Equally it suits us to bigger ships as there are more things to do.......but that is our choice.
But a new ship in itself, is not a game changer, unless it was the only new ship in the whole wide world.................. and it's not.
Also you have to bear in mind TUI Cruises are small and are a rival to SAGA ships (not passenger age wise though), likewise Fred Olsen and the new Ocean Viking Ships and others......... everyone has rivals except Cunard on their regular Transatlantic crossing schedule.
" Personally I wouldn't be seen dead on a cruise ship of any description, but that is my choice. "
Me neither, but if I really really absolutely had to go on a cruise I'd much rather choose a smaller ship for the over 50's with no young ruffians allowed, rather than the hideously monstrous floating blocks of flats whose owners allow riff-raff onboard complete with screaming rug-rats (no offence intended to the riff-raff or their screaming rug-rats). ...So I can see the attraction of Saga's smaller cruise ships, if you like that kind of thing, which I don't.
Food for thought there MedwayMan, thanks for your opinion.
When assessing Saga I thought the smaller sized cruise ships would be an attraction to quite a few customers?
It would certainly attract me if I were inclined to cruise(which I am not) and one would assume the Saga ships can dock at smaller ports that the larger ships cannot?
I bought a few Saga last week, 120-130p seemed good value to me. I wouldn't have paid much more and will 'jump ship' at the first sign of trouble...
I actually said that in the cruising passenger community......SAGA Cruises are viewed as.......... etc etc.
Everyone has the right to choose who they sail with.......all I was pointing out is that people should not be thinking that new SAGA cruise ships are a game changer.....they are not.
Equally you must remember that in many cases, the cost of a cruise (for many cruise brands) often only pays for the ships fuel (and flight fare, if a flight is involved), they make money from bums on seats.......the money spent in bars, fine dining restaurants, casinos etc.....................so if you have little ships (according to SAGA cruises site the total capacity for the 3 ships currently in service is 2168 - with largest 999 passengers) which SAGA currently has, then there is less scope to make money....especially compared to a ship that has 4000+ passengers
Should you choose not to do a cruise, that's your choice.........I have no choice as such, as a flight could kill me, due to a medical condition.
So what you are saying is that SAGA shouldn't bother with cruise ships as Medway Man and his mates have their favourite supplier and like to make jokes about SAGA just to prove they are right in that choice.
They might as well give up the insurance business as there are people who are loyal to their own choice of company.
SAGA aims its products at people over 50. These people , by and large, are NOT imminently going to shuffle off this mortal coil, they DO have more money than those younger people (though there role in the bank of Mum and Dad might affect this) and might well choose a SAGA cruise.
Personally I wouldn't be seen dead on a cruise ship of any description, but that is my choice.
If memory serves me right... 2.5million UK passengers now cruise per year, the bulk of which sail on Carnival Group (UK/USA)Ships which include the brands of P&O, Cunard, Princess, Carnival, Costa and others.
People have been making reference to SAGA and its cruises and planned new ships on here over recent days........As someone who does 2 or 3 cruises a year with a competitor; SAGA cruises have two major negative issues (justified or not)! The first issue is an image issue, that in the passenger cruising community the in joke is "you have to take your own coffin as part of your luggage on a SAGA cruise" as the average age (rightly or wrongly) is very old................. the second issue is, that because they are geared to the elder person, their prices are exceptionally dearer than others; I guess they assume the silver hair brigade (of which I am one) have more disposable money.
As to their new ships........ unless they have real stand out features etc, they could well be out marketed by others. For instance, P&O have a new ship coming into service in 2020 of which we plan to be on the maiden cruise; which is bigger than the current flag ship Britannia....... and my wife thinks she read somewhere on a cruise blog, they have announced 2 further ships. No doubt RCI, Princess etc will all be adding more ships in the coming 5 years.
Cruise passengers do actually become very loyal to a brand and a ship......and no doubt those who cruise with SAGA will continue to do so; but that is likely to be true of passengers on their competitors - you might get a tiny increase, for people who will try a new ship just to see or novelty value.....but then they go back to their preferred ship or brand.
Please don't think I am trying to knock SAGA cruises, I am not; I am just telling it, as it is......... I will openly admit, SAGA does not feature in my thoughts for when we book a cruise, but there again, neither does RCI (awful)................each to their own!
SAGA Saga Ltd making a recovery here from a very firm base. The technicalls point to a very quick recovery to former highs as resistance above is very weak. Cruises are the New Hip thing here pushing growth. P/E going forward 9.7, cheap imo.
"Saga growth will stall but dont worry, says Peel Hunt
Weak growth awaits broker Saga (SAGAG) but Peel Hunt says the shares were still undervalued and the business attractive.
Analyst Andreas van Embden retained his buy recommendation and target price of 195p on the stock, after mixed full-year results that showed profit before tax increased 1% to £190 million but with a disappointing mix. The shares jumped 5.7% to 123.7p yesterday on the news.
Sagas transition towards an affinity broker model came under pressure last year, with the broker losing competitive momentum due to Saga-specific issues, he said. At a price/earnings of c.9x 2018/19 earnings per share, the shares are undervalued relative to a typical 16-18x broker multiple.
While we acknowledge weak growth ahead, fundamentally we believe Saga is an attractive business with strong cash generation potential once the transition is achieved."
"Overall I'm disappointed with myself for not seeing the fall in sp coming but buying at 136 "
Yep - sentiment mirrored, and the same in price for me at 136.28 on 28Sep2017 - so a 6 1/2 months of dead money so far. With the 6p dividend and the 3p back in October it'll be closer to break even if the shares stay around the 125 level.
"Fading fears of a full-blown trade war between the US and China has been a big positive for global stockmarkets, but equity investors are now taking money off the table ahead of possible US air strikes against Syria.Already at odds with Russia ..."
With the final dividend now increased to 6p (ex div in May) that makes an annual dividend of 9p worth 7.3% with a current sp of 123.
Satisfying to read this in the results:
" The increase in the dividend to this level reflects our ongoing confidence in the stability of our highly cash generative model. "
I see the venture into cruise ships as a positive - it's a well known profitable business model that caters primarily for the older generation - a demographic Saga knows well. I just hope they don't have some of the new cruise ship teething problems that hit the headlines a few years ago...
Overall I'm disappointed with myself for not seeing the fall in sp coming but buying at 136 gets me a running yield of 6.6% so mustn't grumble and I'm holding for the long term anyway.
1. Cash generation allowed debt leverage to be reduced from 1.9X to 1.7X so heading in the right direction.
2. Confidence to increase the dividend by 5.9% to 6p in May
3. At least the fudged profit figure shows a 1.4% increase
4. The travel business looks to be doing well with a 36% jump in profits
5. They seem to be getting their in house underwriting to work profitably
6. Building 2 cruise ships - let's hope the fad for cruising doesn't fall off by 2020
So far it's up 7.35% in a flat market -- bit of luck I might break even on this one lol !
" Must admit I'm having difficulty understanding exactly what it means."
looks like JPM have initiated a position with 5.18% of the shares in Saga.
The voting rights seem to be split 1.2% for the shares and 3.98% via financial instruments.
Not sure how that last part works, as a financial instrument sort of implies the right to buy like a bought option or sold a put option. Neither of which should qualify for voting rights until the shares are taken.
Nonetheless 5% interest, from no previous position I assume, is very significant and JPM seem to believe in it.
The RNS proposing Patrick O'Sullivan as the new C.E.O indicates a serious move towards the insurance side of the business as a growth area. As more people see retirement approaching and longer life expectations, the need for insurance cover for the over-40's, let alone over-50's is becoming so important.
The low sp presents a buying opportunity for the big funds and the paying of a dividend is always a factor in their investment decisions. The fly in the ointment will be the cruise ship ventures in a highly competitive market.
needs cleaning up as goodwill exceeds market value by £250m or so. So a substantial chunk of goodwill needs writing off. Divi should be cut by up to two thirds at the same time so that savings can be invested in the business/reduce debt.
Such actions now will prevent greater problems down the road.
Just x3 holdings RNS in that time.
x2 show an INCREASE in holdings, x1 shows a reduction.
From all accounts more shares bought than sold by funds and institutions yet the price not only drops but gets absolutely hammered!
Make sense? No and certainly nothing to justify or explain a halving in share price.
Reasonable balanced response. I purchased 10,000 @ £1.15 last week as my research indicated that it is somewhat oversold given the known financials. Broker forecasts although reduced look ok. Also we are an ageing population so a renewed marketing strategy expenditure seems sensible to promote what has always been a respected brand. Not expecting £2 this year but somewhere around £1.60 appears reasonable assuming they stick to their stated dividend policy. As always DYOR as all IMHO.
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