12th Mar 2025 09:00
(Alliance News) - Legal & General Group PLC on Wednesday rewarded shareholders with a higher dividend and launched a GBP500 million share buyback, as it hailed a year of "significant strategic progress".
The London-based provider of life insurance, pensions, retirement and investment services said that it is seeing "positive commercial momentum" and that its recent strategic moves had strengthened its ability to generate sustainable growth.
L&G reported a pretax profit of GBP542 million in 2024, jumping from GBP195 million in 2023. Core operating profit improved 5.6% to GBP1.62 billion from GBP1.53 billion, in line with market consensus.
In response, shares in L&G were 1.0% lower at 242.50 pence each in London on Wednesday morning. The wider FTSE 100 index was up 0.3%.
In the Institutional Retirement division, operating profit rose 7.5% to GBP1.11 billion from GBP1.03 billion.
In the Asset Management arm, assets under management rose 3.2% over the course of 2024 to GBP1.135 trillion. Operating profit here fell 10% to GBP401 million from GBP448 million.
Net outflows eased to GBP48.5 billion in 2024 from GBP52.0 billion in 2023.
Retail operating profit rose 12% to GBP504 million from GBP449 million.
The solvency II coverage ratio improved to 232% in 2024 from 224% in 2023.
Chief Executive Officer Antonio Simoes said: "2024 has been a year of significant strategic progress and strong financial performance.
"We are seeing positive commercial momentum as we execute our strategy with rigour and pace. By sharpening our focus and simplifying our portfolio - through the sale of Cala and US Protection - alongside our strategic partnership with Meiji Yasuda and our investment in Taurus, we are strengthening our ability to generate sustainable growth in our core businesses: Institutional Retirement, Asset Management and UK Retail," he added.
L&G upped its final dividend by 5.0% to 15.36 pence from 14.63p a year before. Its total annual dividend amounts to 21.36p, up 5.0% from 2023.
The company also announced a new GBP500 million share buyback, part of plans to return GBP5 billion to shareholders over three years via dividends and buybacks.
L&G reiterated guidance. Between 2024 to 2027, L&G is targeting 6% to 9% compound annual growth in core operating EPS and a more than 20% operating return on equity. It aims for GBP5 billion to GBP6 billion cumulative solvency II capital generation over 2025 to 2027.
L&G said this long-term vision requires near-term investment in its operating model to "position us for structural growth trends in our businesses".
"This in turn will move the business towards a more capital-light model," it added.
By Jeremy Cutler, Alliance News reporter
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