AA touts 'robust' annual performance as profit more than doubles

Roadside assistance company AA said it expected full-year performance this fiscal year to be 'robust' and only 'slightly down' after the company reported that profit more than doubled in the 12 months through March.

'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,' the company 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. This confidence in our performance reflects our resilient business model both in trading earnings (EBITDA) performance and in positive predictable cash generation,' it added.

The outlook came as performance in April had slowed owing to the nationwide lockdown after profit in 2019 more than doubled.

'April trading has seen more variable activity levels due to the nationwide lockdown which came into force on 23 March 2020. In response to this, the business has implemented swift changes to its operations and cost base to mitigate the ongoing effects during the lockdown,' the company said.

For 2019, pre-tax profit rose 102% o £107m on-year and revenue climbed 2% to £995m.

The company attributed the sharp jump in profit was attributed to 'the benefit of improved operational and financial performance during the year and the lower costs of adjusting operating items, mainly due to the one-off £22m pension past service cost in the prior year.'

Looking ahead, the company said it expected membership in its roadside business to be down during the first half of the year amid the ongoing lockdown measures, followed by some recovery as restrictions ease.

At 9:06am: (LON:AA.) AA Plc share price was +2.38p at 28.73p