August 9, 2018 / 8:11 AM / 3 months ago

Breakdown service AA shrugs off poor weather, maintains guidance

LONDON (Reuters) - Roadside recovery group and insurer AA (AAAA.L) affirmed on Thursday its full year core earnings guidance as strong motor policy growth offset higher costs due to poor weather, pushing its shares up.

The London-listed company said in a trading update it remained on track to deliver its previously announced guidance of trading earnings before tax, interest, depreciation and amortization (EBITDA) of between 335 million pounds to 345 million pounds for the financial year ending in 2019.

Its insurance business has seen a 7 percent growth in motor policies to around 659,000 since July 31, 2017, in line with the company’s expectations, it said.

AA shares were up 1.45 percent at 116 pence by 0733 GMT.

The AA, whose distinctive yellow livery has been a feature of Britain’s roads for more than a century, has been reeling from the unexpected departure of its executive chairman last year and from profit warnings, prompting a strategic review earlier this year.

Bob Mackenzie was fired for gross misconduct over a “serious incident”.

AA’s largest shareholders include hedge fund Parvus and Woodford Investment Management.

Reporting by Dasha Afanasieva; editing by Emelia Sithole-Matarise

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