27th Apr 2005 07:00
Legal & General Group PLC27 April 2005 27 April 2005 Legal & General Group Plc ========================= New business results - first quarter 2005 ========================================= • Worldwide sales up 43% to £307m APE (Note 1) - Core UK individual life and pensions up 21% - Exceptional growth in retail investments and group life and pensions • New fund management business of £3.4bn - Total funds under management £167bn New business APE Q1 2005 Q1 2004 ChangeUK individual business- life and pensions £158m £131m +21%- retail investments £75m £39m +92%- total individual business £233m £170m +37%UK group life and pensions £50m £23m +117%UK total £283m £193m +47%International (including unit trusts) £24m £22m +9%Worldwide total £307m £215m +43% Note 1: Annual Premium Equivalent (APE) is total new annual premiums + 10% of single premiums for life, pensions and retail investment business. Group Chief Executive, David Prosser, said: "Legal & General's carefully built brand, distribution and product strengthshave delivered an impressive start to 2005. Worldwide new business has grown by43% and, within this, UK new business has increased by 47%. "Our UK individual life and pensions business grew 21%, driven by superiorperformance in both unit-linked bonds and individual pensions. Our retailinvestments business benefited from some significant one-off contributions.Group life and pensions business has more than doubled, with high levels of bulkpurchase annuity sales and good growth in group risk at maintained margins. Wehave recently experienced some increased competition in the individualprotection market, but market conditions and pricing for other life and pensionsproducts remain unchanged. "For the twenty-ninth consecutive quarter, Legal & General Investment Managementhas averaged over £1bn of new funds each month. "Looking forward to the rest of 2005, we expect to continue to build our marketshare profitably." Overview======== Our UK business continued to benefit from our broad spread of good valueproducts and our wide distribution network. Individual life and pensionsbusiness was 21% ahead of the corresponding quarter last year, albeit lower thanthe final quarter of 2004, reflecting both the housing market downturn andincreased competition in life protection products. In the corporate market, wemade good progress in both group risk business and in bulk purchase annuities. Our Continental European businesses have shown good growth in single premiumsalthough in the USA, new annual premium business was slightly lower. Legal & General Investment Management achieved strong growth in funds undermanagement to £167bn (2004: £143bn) adding a further £3.4bn of new business. UK new business=============== Individual life--------------- Annual premium sales for mortgage related protection business fell to £20m(2004: £25m) as the impact of a slowing housing market was only partly offset byextending distribution. Other protection business remained steady at £12m.Although overall volumes were lower, we are confident Legal & General hasmaintained its leading market share in life protection business. Continued strong demand for unit-linked bonds, where volumes rose 66%, more thanoffset the decline in with-profits bond sales. In aggregate, single premiumsales for the quarter rose to £491m (2004: £384m), an increase of 28%. Individual pensions-------------------New annual premium business benefited from an improved service offering, growing32% to £37m (2004: £28m). Single premium new business also grew strongly - up47% to £400m (2004: £273m) with a significant increase in pension transferbusiness and maintained individual annuity volumes. Unit trusts and ISAs--------------------While regular and single payment ISA sales fell, single payment unit trust salesmore than trebled to £634m. In total, ISA and unit trust sales grew to £75m APE(2004: £39m). This figure included £15m APE of institutional sales (2004: £5m) and further benefited from the restructuring of a number of Barclays UK funds which resulted in a one off benefit of £32m APE in new business to Legal & General. Group life and pensions-----------------------New business increased to £50m APE (2004: £23m), with good progress in grouprisk business and significantly increased levels of bulk purchase annuities.Group risk new annual premiums were £22m over the quarter (2004: £13m). Singlepremiums for bulk purchase annuity business, where we continued to maintainpricing discipline, were £264m from 55 schemes compared to £91m in thecorresponding quarter last year. Institutional fund management============================= Legal & General Investment Management is the largest UK equity investor andcontinued its record of averaging £1bn new business per month with total newbusiness of £3.4bn over the quarter. At 31 March 2004, total funds undermanagement were £167bn. International business====================== In the USA, annual premium new business was $19m (2004: $22m). New businessreceived was lower in the first quarter of 2005 but recent levels ofapplications have recovered. Our Continental European operations produced increased new business of €20m APE(2004: €16m). Annual premium business was broadly stable but single premiumbusiness, including unit trusts, grew by 26%. In sterling terms and based on average exchange rates, total international newbusiness increased to £24m APE (2004: £22m). UK distribution=============== Late in 2004 we announced an important, single tie agreement with Bradford &Bingley. We started advising customers on term assurance in the middle ofJanuary and have introduced the first stage of our multi-fund proposition at thebeginning of April. At the beginning of March, Barclays Bank announced that their existing IFA andtied advisers will switch to a multi-tied basis. The existing mortgage relatedterm assurance business will remain tied to Legal & General. As mentioned above,we have also benefited from the restructuring of some of Barclays UK investmentfunds. Earlier this month, we announced an £18.6m investment in the distributionplatform Cofunds, reinforcing our commitment to fund choice for advice basedsales in insurance bonds, unit trusts, ISAs and pensions. Cofunds is one of thefastest growing platforms and one which is committed to supporting financialintermediaries. The introduction of the regulation of mortgage advice at the end of last yearprovided an opportunity for us to further develop mortgage related distribution.Legal & General Partnership Services has established a network of over 2,200tied mortgage advisers selling Legal & General protection products. Oure-enabled proposition is market leading and provides an excellent platform forgrowth. Outlook======= We believe our first quarter results show further improvement in consumerconfidence in savings and investment products. Additionally, we expect the trendfor market share concentration to continue and with Legal & General's strengthsin brand, distribution and good value for money products, we believe we willcontinue to gain market share profitably. Enquiries========= For further information contact: Investors: Media:Peter Horsman John MorganHead of Investor Relations Head of Public Relations020 7528 6362 01737 375353 Nicola Marshall Anthony CarlisleInvestor Relations Manager Citigate Dewe Rogerson020 7528 6263 07973 611888 Notes: 1. A copy of this announcement can be found in the shareholder section of our website at http://investor.legalandgeneral.com/releases.cfm 2. Financial Calendar: 28 July 2005 Interim results and second quarter new business 20 October 2005 Third quarter new business. LEGAL & GENERAL GROUP PLCUNAUDITED NEW BUSINESS PREMIUMSTHREE MONTHS TO 31 MARCH 2005 NEW UK BUSINESS Three months to=============== 31 March increase/ 2005 2004 (decrease) £m £m % INDIVIDUAL LIFE AND PENSIONS BUSINESS New annual premiumsLife:- Mortgage related 20 25- Protection 12 12Pensions:- Individual pensions 37 28 ------- ------- ------Total new annual premiums 69 65 6 Single premiumsLife:- With-profits 57 123- Unit linked 434 261Pensions:- Individual pensions 212 87- Annuities - individual 183 182- DWP rebates 5 4 ------- ------- ------Total single premiums 891 657 36 ------- ------- ------Individual life and pensions APE 158 131 21 ======= ======= ====== ISAS, PEPS AND UNIT TRUSTS New annual premiums- ISAs/PEPs (excluding cash ISAs) 3 6- Unit trusts 0 1 ------- ------- ------Total new annual premiums 3 7 (57) Single premiums- ISAs/PEPs (excluding cash ISAs) 84 122- Unit trusts 634 201 ------- ------- ------Total single premiums 718 323 122 ISAs, PEPs and ------- ------- ------unit trusts APE 75 39 92 ======= ======= ====== ------- ------- ------Total individual business APE 233 170 37 ======= ======= ====== GROUP LIFE AND PENSIONS BUSINESS New annual premiums- Group risk 22 13- Group pensions 1 1 ------- ------- ------Total new annual premiums 23 14 64 Single premiums- Annuities - bulk purchase 264 91- Other group business 1 1 ------- ------- ------Total single premiums 265 92 188 ------- ------- ------Group life and pensions APE 50 23 117 ------- ------- ------Total UK APE 283 193 47 ======= ======= ====== INSTITUTIONAL FUND MANAGEMENT UK Managed Funds- Pooled funds 3,314 4,412- Segregated funds 42 962 ------- ------- ------ 3,356 5,374 (38) UK Other 57 57 ------- ------- ------ 3,413 5,431 (37) ======= ======= ====== LEGAL & GENERAL GROUP PLCUNAUDITED NEW BUSINESS PREMIUMSTHREE MONTHS TO 31 MARCH 2005 WORLDWIDE NEW BUSINESS====================== Three months to 31 March increase/ 2005 2004 (decrease) £m £m %Annual premiumsLife and pensions:- Life 54 50- Pensions 38 29 ------- ------- ------UK 92 79 16 - USA 10 12- Netherlands 4 3- France 1 0 ------- ------- ------Total life and pensions 107 94 14 Retail investment business:- UK 3 7 ------- ------- ------Total new annual premiums 110 101 9 Single premiumsLife and pensions:- Life 491 384- Pensions 665 365 ------- ------- ------UK 1,156 749 54 - USA 0 0- Netherlands 46 41- France 47 30 ------- ------- ------Total life and pensions 1,249 820 52 Retail investment business:- UK 718 323- France 5 4 ------- ------- ------Total single premiums 1,972 1,147 72 Annual premium equivalent (APE)- UK life and pensions business 208 154- Overseas life and pensions business 24 22 ------- ------- ------Total life and pensions business 232 176 32 - UK retail investment business 75 39- Overseas retail investment business 0 0 ------- ------- ------Total retail investment business 75 39 92 ------- ------- ------Worldwide APE 307 215 43 ======= ======= ====== LEGAL & GENERAL GROUP PLCUNAUDITED NEW BUSINESS PREMIUMSTHREE MONTHS TO 31 MARCH 2005 OVERSEAS OPERATIONSIN LOCAL CURRENCY================= Three months to 31 March increase/ 2005 2004 (decrease)USA ($m):New annual premiums 19 22Single premiums 0 0 APE 19 22 (14) Netherlands (•m):New annual premiums 5 4Single premiums 66 60 APE 12 10 20 France (•m):New annual premiums 1 1Single premiums 68 45Unit trusts 6 6 APE 8 6 33 UK INDIVIDUAL APE BY CHANNEL============================ Three months to 31 March 2005 Annual Single Total APE £m £m £m % Independent financial advisers 48 89 137 59Single tie 21 66 87 37Direct 3 6 9 4 ------ ------ ------ ------ 72 161 233 100 ====== ====== ====== ====== Three months to 31 March 2004 Annual Single Total APE £m £m £m % Independent financial advisers 38 63 101 60Single tie 30 28 58 34Direct 4 7 11 6 ------ ------ ------ ------ 72 98 170 100 ====== ====== ====== ====== This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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