by business editor Trevor Sturgess

Acromas Holdings, the owner of Kent-based Saga and the AA, posted higher sales and gross profit last year, although financing costs contributed to losses of more than £500 million.

The business pushed up turnover by 4.4 per cent to £1.6bn and gross profit to £877m. But financing costs and exceptional items accounted for the loss of £506.7m (up from £255.7m in 2008).

Earnings before interest, taxes, depreciation and amortisation (EBITDA) grew to £547.2m, a 13 per cent increase on the previous year.

Saga, the Folkestone-based financial services and holiday company, which recently acquired a 28-year old cruise ship, contributed £750m to turnover, up from £264m the previous year.

Saga’s financial services contributed £471m (2008 - £154.5m) with £265.5m (2008 - £104.6m) coming from the travel business. During the year, Saga acquired a new call centre building in Folkestone.

Acromas acquired the AA and Saga in September 2007. Between them, they employ more than 12,000 people and created nearly 500 new jobs in the year ended January 31. They serve almost 19 million customers.

In its annual report, Acromas said that Saga Services had been recognised as Best Business for Customer Services and that an Ipsos Mori Corporate Image survey put the AA and Saga in joint first place for “customer favourability.”

Andrew Goodsell, chief executive, said in his review of the business: “At the end of the first full year of trading for Acromas Holdings, I can report that our two iconic brands he AA and Saga have delivered a strong performance in what have been economically uncertain times.”

He added: “I am not complacent about the challenges that lie ahead, but I trust in our abilities and look to the future with confidence.”