RAA says its energy plans will save consumers a bundle, as it reports a profit for the year

RAA is weeks away from releasing energy plans it says will save members hundreds of dollars, while the organisation itself delivered a profit for the first time in three years.

RAA chief executive Nick Reade said the organisation had a strong financial year.

RAA has delivered strong growth in member numbers, travel revenue and insurance policy numbers, while also booking its first profit in three years.

The South Australian-based member organisation’s chief executive Nick Reade said it was a great result for the more than 120-year old organisation, which had been budgeting for a loss on the back of a strong investment in infrastructure and new business divisions.

RAA is just weeks away from launching a retail energy offer as part of its growing energy division, which includes solar panel and battery installation, and a statewide network of electric vehicle chargers.

Mr Reade said select customers were already testing out the energy offer, and members could expect to save hundreds of dollars per year on their energy bills, even thousands in some cases.

On the financial front, RAA made a profit of $2.1m after tax on revenue of $782.4m. This followed an after tax loss of $53.9m the previous financial year, which was heavily affected by adverse weather events impacting the insurance business, and a $9.6m loss the previous year.

RAA grew member numbers by 18,000 to more than 823,000 last financial year, and the number of insurance policies under management increased by 22,000 to more than 656,000. The roadside assistance division responded to 911,000 calls and members enjoyed $53.4m in savings and discounts. The travel division grew revenues 37 per cent.

RAA also launched a new marketing campaign based around Trev the Bee, who Mr Reade said had been well-received and which was driving strong engagement.

Mr Reade said the launch of the company’s energy division was part of a diversification strategy to make the organisation less reliant on insurance revenues, which could be volatile.

There was also a strong alignment with the organisation’s member-focused mandate around delivering cost of living benefits as well as a benefit to the environment and the community.

Mr Reade said RAA performed well against its strategic goals, and the fact that the organisation had increased its lead in being the strongest brand in the state was evidence they were on the right track.

“We’ve actually increased our lead in South Australia from a brand sentiment perspective by 4 per cent so that’s very strong,’’ Mr Reade said.

“And interestingly, increased it even more among non members by 7 per cent so that’s really exciting because it means potentially, the pipeline for new membership will be strong.

“We’re very happy with the outcome (and) we think this year coming up will be stronger again.’’

Mr Reade said the organisation had been considering getting into the energy retailing space for about two years, and had been testing its model for the past six to nine months.

“We are very close now to getting it out there,’’ he said.

“Whilst the launch proposition will be strong, it’s not the only thing. It’s the first step in multiple propositions under the banner of RAA energy.

“We’re pretty confident we’ll have a really meaningful proposition and then grow it over time, because at its heart it’s about helping our members with the energy transition and creating a sustainable proposition in their household.’’

Future energy options could involve offering home energy infrastructure such as heat pumps and electric heating, as well as financing options around those. Users of the retail offer will also have a smart meter installed free of charge which will be able to provide insights on home energy use.

RAA is also looking at improving and rebranding its member benefits program into a new, expanded “RAA Rewards” program.

“We do want to come out with stronger offers for our members on the things that really impact the household budget, so in the shopping space, in the fuel space, so we’re working on that,’’ Mr Reade said.

“We haven’t got that landed yet, but we’re very confident of improving those offers over time. And when you combine those - fuel and shopping - with energy, I think we’ve got the big three covered.’’

Mr Reade said the new marketing campaign was performing better than those it succeeded, and the brand attribution was strong, driving “a lot better outcomes for the same or less money.’’

“Our brand recognition off the back of our advertising is well above ads that were in market for two or three years before that,’’ he said.