TOP NEWS: Old Mutual 2017 Beats Forecasts As Separation Rolls Onward

15th Mar 2018 08:54

LONDON (Alliance News) - FTSE 100 Old Mutual PLC boosted its dividend on Thursday as 2017 results were "ahead of expectations" with profit rising strongly amid progress in its ongoing business separation due to complete by the end of 2018.

In 2017, pretax profit expanded to GBP617 million from GBP306 million the year prior. Adjusted operating pretax profit also rose, to GBP2.04 billion from GBP1.67 billion the year before. Adjusted net asset value rose to 242.3 pence per share from 228.6p per share in 2016.

Old Mutual hiked it second interim dividend by 5% to 3.57 pence from 3.39p the year before. For the full year, the dividend grew to 7.10 pence from 6.06 pence the year prior.

"We are delivering on both of the commitments we made in March 2016 when we announced the managed separation," Old Mutual Chief Executive Officer Bruce Hemphill said. "First, as these results demonstrate, we have improved the performance of the underlying businesses and set them up for continued future growth. Second, we have carried out the preparation needed to give effect to the managed separation."

Old Mutual said it was "on track" to separate its Old Mutual Ltd and Quilter businesses by the end of 2018. Old Mutual Emerging Markets and Old Mutual Wealth businesses are ready for independence, with separate balance sheet finalised, Old Mutual said. The company said it is on track to deliver around GBP95 million in annual central costs savings.

Total one-time separation costs are expected to be around GBP230 million, it said.

"The process has already delivered significant value through cost and debt reduction, and we are on track for material completion of the managed separation with the listings of Old Mutual Ltd and Quilter within our expected timetable," CEO Hemphill added.

Old Mutual added 2018 had started well with a positive global economic backdrop. Its Old Mutual Ltd business have started the year on a "positive" note. Quilter has been trading "in line" with expectations.

Shares in Old Mutual were 1.0% higher at 253.30 pence on Thursday.

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