15th Mar 2018 09:45
LONDON (Alliance News) - Phoenix Group Holdings on Thursday reported a narrowed loss for 2017, despite a significant drop in revenue, as it increased its future dividend policy.
The company's pretax loss for 2017 was GBP7.0 million, narrowed from GBP70.0 million in 2016, while revenue fell to GBP6.08 billion from GBP7.37 billion.
One boost in the year was a change in insurance liabilities, with 2017 booking a positive GBP1.39 billion compared to a negative GBP1.97 billion in 2016.
Net investment income declined to GBP4.99 billion from GBP6.36 billion, while gross premiums written increased slightly to GBP1.13 billion from GBP999.0 million.
Cash generation during the year was GBP653.0 million, up from GBP486.0 million, and it expects to hit the top end of its GBP1.00 billion to GBP1.20 billion cash generation target for the two-year period 2017-2018.
Phoenix raised its final dividend by 5% to 25.10p, taking its total to 50.20p. In the future, cash flow will enable to company to increase its 2018 dividend to an annualised level of GBP338.0 million, with the total dividend in 2017 representing GBP198.0 million.
The new long-term cash generation target for 2018 to 2022 is GBP2.5 billion, Phoenix said.
The company's solvency II surplus was GBP1.8 billion as of the end of December, compared to a figure of GBP1.1 billion at the end of the previous year, while its shareholder capital coverage ratio was 164% on the same date, compared to 139% a year earlier.
Phoenix said the integration of AXA Wealth and Abbey Life business is "substantially" complete, ahead of schedule, and combined cost savings of GBP27.0 million were delivered against a GBP17.0 million target.
Chief Executive Clive Bannister said: "Phoenix has enjoyed a highly successful year. The group continues to deliver strong cash generation and remains on track to achieve its targets, supported by capital and cost synergies from the integration of the AXA and Abbey Life acquisitions which are now substantially complete. Our success with integrating both acquisitions demonstrates our ability to deliver benefits for both investors and policyholders alike."
"Our proposed acquisition of Standard Life Assurance and the Strategic Partnership with Standard Life Aberdeen plc announced last month is consistent with our strategy and value accretive," Bannister added. "We look forward to welcoming Standard Life Aberdeen as a 19.99% shareholder in the enlarged group. It will make Phoenix the pre-eminent closed fund consolidator in Europe and deliver increased size in an industry that rewards scale."
Shares were down 0.6% on Thursday morning at 785.00p each.
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Phoenix Group Holdings
