Saga, the cruise operator and insurance firm for over-50s, today announced it had refunded £44m of advance payments to customers whose travel plans were disrupted by the coronavirus pandemic.
The firm, which has cancelled all of its voyages until the end of August, said that it was expecting some travel to begin by the end of the year.
It added that it had modelled a range of scenarios, including one where it did not restart its services until 2021.
Saga has been one of many cruise operators to have been hammered by the pandemic, which has seen passengers abandon ship due to health concerns and travel bans.
Prominent firms such as Royal Caribbean Cruises and Carnival have also suspended all voyages until 31 July.
Last week Norwegian Cruise Lines said it would extend its suspension of services until the end of September due to the pandemic.
Saga said that the decline in its travel business had had a knock-on effect on its insurance arm, with its total number of policies falling five per cent between February and June.
“Market conditions continue to be challenging, in part due to Covid-19, with an easing of competitive conditions in February and March but with signs of a return to more competitive conditions in motor and home in the last month,” the company said.
In April, Saga said full year revenue could be down around 65 per cent for tour operations and cruises, if the cruise business was to be suspended for six months.
The revenue drop would result in a 15 per cent to 20 per cent fall in earnings for tour operations and a 55 per cent to 60 per cent cut in profit for its cruise business.
Saga has already scrapped its dividend after posting a 39 per cent fall in profit for the year to the end of January.
William Ryder, equity analyst at Hargreaves Lansdown, said: “Travel restrictions have hit SAGA hard.
“Despite what management describes as “exceptional” customer loyalty in the cruise division the group has spent a lot of money supporting its travel operations.
“Saga needs its cruise ships to get cruising and its tours to get touring again as soon as possible. We don’t know how profitable these operations will be in a world of social distancing, but anything will be welcome.
“The sooner the travel division can start making money again the better, without it the group may need further shareholder support to secure a long term future.”