(Sharecast News) - Roadside assistance company and insurer AA reported a more than doubling of its full-year profits on Thursday but said membership numbers were set to decline due to the Covid-19 pandemic.
In the year to the end of January 2020, pre-tax profit jumped 102% to ?107m on revenue of ?995m, up 2% on the year. Basic earnings per share rose to 14.1p from 6.9p.
The AA had already said in March that there would be no final dividend in light of the virus outbreak.
The jump in profit was attributed to solid performances from both the roadside and insurance businesses, as the company returned its paid membership base to growth. Trading earnings before interest, tax, depreciation and amortisation ticked up 3% to ?350m, of which ?290m related to the roadside segment and ?60m to the insurance division.
The company said trading in February and March was in line with its expectations. However, April trading has seen "more variable activity levels" due to the lockdown that came into place on 23 March.
"We expect membership to be down during the first half of the year as we go through the lockdown followed by some recovery as restrictions ease," the AA said.
"Given the recurring nature of many of our income streams, the benefit of the actions already taken and our flexibility to adjust to further changes in trading, we currently expect our performance this year to be robust in the circumstances and only slightly below that of FY20," it said.
"This is assuming a partial lifting of the lockdown restrictions in early/midsummer and a gradual return to a more normalised trading environment during the rest of the year."
At 1015 BST, the shares were up 13.4% at 29.88p.
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