Saga Group has reported a loss of £55 million for the six months to the end of July as the company battles the fallout from the Covid-19 pandemic.

The figure included a £60 impairment charge related to the outbreak.

In response, the insurance and travel group has announced it will raise £150 million in fresh equity.

Saga said the move would allow the company to reduce leverage and significantly balance sheet risks.

Euan Sutherland, Saga Group chief executive, explained: “Saga has made significant progress in the first half.

“Through this year our priorities have been serving our customers and keeping colleagues safe during a period of major disruption and further strengthening our financial position.

“While taking decisive action to react to the Covid-19 outbreak, we have also continued to make progress in our businesses.

“This is clearly shown in Insurance with the success of our three-year fixed-price product and our Covid-19 travel insurance product, and in cruise by the imminent arrival of our second new ship, Spirit of Adventure.”

He added: “We have conducted a comprehensive review of strategy and have developed a plan which we believe will strengthen our brand, improve our focus on our customers, deliver exceptional experiences for them, and return both our insurance and travel businesses to growth.”

Saga argued the capital raising, supported by fresh investment from former chief executive Roger De Haan, would rebuild financial strength.

“Saga is a proud British business, with a strong brand, loyal customers and great people and we are excited about the opportunities ahead.

“With our strengthened financial position and a refreshed strategy, we expect to be well positioned to unlock all the potential in Saga, returning the business to sustainable growth and creating significant long-term value for all our investors,” concluded Sutherland.