15th May 2025 10:41
(Alliance News) - Aviva PLC on Thursday reported positive business performances across general insurance, wealth management and retirement products in the first quarter of 2025, as it prepares to integrate smaller peer Direct Line Insurance Group PLC.
The London-based insurer and asset manager recorded GBP2.9 billion in general insurance premiums in the three months that ended March 31, up from GBP2.7 billion a year before. Within this, premiums in the UK & Ireland were up 12% to GBP2.0 billion from GBP1.8 billion, while premiums in Canada were up flat at GBP900 million, though they were up 5% at constant currency.
The UK business result was flattered by the GBP242 million acquisition of Probitas Holdings Ltd last year.
Wealth net flows were positive GBP2.25 billion, representing 5% of opening assets under management and down from GBP2.65 billion a year before. Growth in Platform flows offset an outflow caused by a large Workplace scheme switching providers, Aviva said.
As of the end of April, net flows were GBP4.0 billion, ahead of GBP3.5 billion a year before, as a different Workplace scheme was onboarded.
Within Aviva Investors, net flows were GBP994 million in the first quarter, down 56% from GBP2.28 billion a year before, though total assets under management rose by 1% to GBP240 billion from GBP238 billion a year before.
Retirement sales were GBP1.8 billion in the first quarter, up 4% from GBP1.7 billion a year before, while Protection & Health sales were GBP126 million, up 19%.
Aviva said its Solvency II shareholder cover ratio remained strong at 201%, down slightly from 203% a year before.
Looking ahead, Aviva confirmed the targets it set with its 2023 annual results, including operating profit of GBP2 billion per annum by 2026. Operating profit was GBP1.77 billion in 2024.
Back in December, Aviva agreed to buy Direct Line in a GBP3.7 billion cash-and-shares deal that will leave Direct Line shareholders as owners of 12.5% of the enlarged group.
On Wednesday, the UK Competition & Markets Authority opened an inquiry into the acquisition, inviting comments ahead of a phase 1 decision.
Aviva on Thursday said the takeover of Direct Line is "firmly on track". It expects to complete the acquisition in the middle of the year.
It said integrating the Direct Line business will support Aviva's goal of becoming a more 'capital-light' business. At that point, 70% of operating profit will come from capital-light business, up from 56% currently.
"We continue to be very positive about the outlook for 2025," said Chief Executive Officer Amanda Blanc.
"Our balance sheet is strong, we have a clear customer-focused strategy which we continue to deliver at pace and our market-leading businesses are growing well, especially in capital-light areas. We are increasingly confident about Aviva’s prospects and meeting our financial targets."
Aviva shares were up 2.8% to 588.00 pence on Thursday morning in London.
The company also confirmed that its GBP200.0 million in 8.375% and 8.750% cumulative irredeemable preference shares will be cancelled from trading on the London Stock Exchange from Thursday.
By Tom Waite, Alliance News editor
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