Delivering inclusive capitalism - Legal & General Group investment projects & expenses (53)...

download Delivering inclusive capitalism - Legal & General Group investment projects & expenses (53) (40) (33)

of 38

  • date post

    20-Sep-2020
  • Category

    Documents

  • view

    0
  • download

    0

Embed Size (px)

Transcript of Delivering inclusive capitalism - Legal & General Group investment projects & expenses (53)...

  • Delivering inclusive capitalism

    Sharing success with investors, customers and society LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS – AUGUST 2018

  • Forward looking statements

    This document may contain certain forward-looking statements relating to Legal & General, its plans and

    its current goals and expectations relating to future financial condition, performance and results. By their

    nature, forward-looking statements involve uncertainty because they relate to future events and

    circumstances which are beyond Legal & General’s control, including, among others, UK domestic and

    global economic and business conditions, market related risks such as fluctuations in interest rates and

    exchange rates, the policies and actions of regulatory and Governmental authorities, the impact of

    competition, the timing impact of these events and other uncertainties of future acquisitions or

    combinations within relevant industries. As a result, Legal & General’s actual future condition,

    performance and results may differ materially from the plans, goals and expectations set out in these

    forward-looking statements and persons reading this document should not place reliance on forward-

    looking statements. These forward-looking statements are made only as at the date on which such

    statements are made and Legal & General Group Plc. does not undertake to update forward-looking

    statements contained in this document or any other forward-looking statement it may make.

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 2

  • Financial highlights: consistently delivering

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 3

    NIGEL WILSON: GROUP CHIEF EXECUTIVE

    Operating profit from divisions

    £1,059m (H1 2017: £994m1)

    +7%

    Earnings per share

    13.00p (H1 2017: 14.19p1)

    1. Excludes £126m base mortality release, as a result of continuing greater than expected mortality experience

    2. A formulaic approach is used to set the interim dividend, being 30% of the prior year full year dividend

    Interim dividend2

    4.60p (H1 2017: 4.30p)

    +7%

    SII operational surplus generation

    £0.7bn (H1 2017: £0.6bn)

    +11%

  • Consistently delivering

    NIGEL WILSON: GROUP CHIEF EXECUTIVE

    Operating profit from divisions (£m)

    10% CAGR 2011 – 2018

    518 609 655 715

    853 942 994 1,059

    591 668 674

    768

    849 960

    1,040

    1,109

    1,277 1,329 1,483

    1,702

    1,902 2,034

    2011 2012 2013 2014 2015 2016 2017 H1 2018

    Note: 2017 excludes £126m base mortality release in H1 and £206m trend mortality release in H2

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 4

  • Consistently delivering

    NIGEL WILSON: GROUP CHIEF EXECUTIVE

    Earnings per share (p)

    10% CAGR 2011 – 2018

    Note: 2017 excludes £274m mortality release (net of tax) and £246m one-off tax benefit

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 5

    6.13 6.93 7.82 8.51

    9.79 11.20

    14.19 13.00

    6.29 6.91

    7.38 8.19

    8.37

    10.02

    8.91

    12.42 13.84

    15.20 16.70

    18.16

    21.22

    23.10

    2011 2012 2013 2014 2015 2016 2017 H1 2018

  • Consistently delivering

    NIGEL WILSON: GROUP CHIEF EXECUTIVE

    Dividend per share (p)

    10% CAGR 2007 – 2018

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 6

    1.87 2.01 1.11 1.33 1.66 1.96 2.40 2.90

    3.45 4.00 4.30 4.60

    4.10 2.05

    2.73 3.42

    4.74 5.69

    6.90

    8.35

    9.95 10.35

    11.05

    5.97

    4.06 3.84 4.75

    6.40

    7.65

    9.30

    11.25

    13.40 14.35

    15.35

    2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1 2018

  • Surplus

    Consistently delivering

    NIGEL WILSON: GROUP CHIEF EXECUTIVE

    8.3 7.9 7.8 7.7 7.4

    5.3 5.7 6.7 6.9 6.9

    H1 2016

    H2 2016

    H1 2017

    H2 2017

    H1 2018

    1. On a shareholder basis

    (£bn)

    2016

    H1 H2 Total

    Operational surplus generation 0.5 0.7 1.2

    New business strain - (0.1) (0.1)

    Net surplus generation 0.5 0.6 1.1

    (£bn)

    2017

    H1 H2 Total

    Operational surplus generation 0.6 0.7 1.3

    New business strain (0.1) - (0.1)

    Net surplus generation 0.5 0.7 1.2

    (£bn)

    2018

    H1 H2 Total

    Operational surplus generation 0.7

    New business strain (0.1)

    Net surplus generation 0.6

    SCR

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 7

    Solvency II Position1(£bn)

    Coverage Ratio 163% 171% 186% 189% 193%

    Own Funds £13.6bn £13.6bn £14.5bn £14.6bn £14.3bn

    Growing

    Solvency II

    surplus

    generation

    Strengthening capital position

  • LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018

    Structural growth drives profit

    Legal & General

    Retirement:

    Institutional

    Legal & General

    Insurance

    Legal & General

    Retirement: Retail

    Legal & General

    Capital

    Legal & General

    Investment

    Management

    General Insurance

    361

    154

    119

    172

    203

    (6)

    8

    Operating Profit (£m)

    NIGEL WILSON: GROUP CHIEF EXECUTIVE

    H1 2018

    Total 1,003

    333

    147

    107

    142

    194

    15

    H1 2017

    938

    • Actively quoting on £20bn UK PRT business,

    £7bn+ exclusive

    • $25bn US PRT market opportunity

    • UK & US premium growth both up 3%

    • GP turnaround on track

    • LTM £600m H2 target

    • Individual Annuities premiums up 16% in Q2

    • CALA and L&G Homes build-to-sell

    • Further investment in urban regeneration and

    clean energy

    • US LDI / Fixed income positive trends continuing

    • Several UK & US DC mandate wins

    • Double digit growth in direct premium

    • Strong distribution pipeline

    8

    5

    11

    21

    5

    -

    Var %

    7

    INVESTING &

    ANNUITIES

    INSURANCE

    INVESTMENT

    MANAGEMENT

    H2 2018 Growth Drivers

    Note: H1 2017 excludes £126m base mortality release

  • LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 9

    Financial Highlights Jeff Davies, Group Chief Financial Officer

    LGIM Personal Investing campaign launched in June

  • £m H1 2018 H1 2017 %

    Operating profit from divisions excluding mortality release 1,059 994 7

    Group debt costs (97) (92) (5)

    Group investment projects & expenses (53) (40) (33)

    Operating profit excluding mortality release 909 862 5

    Mortality release - 126 n/a

    Operating profit 909 988 (8)

    Investment & other variances (including minority interests) 33 175 (81)

    Profit before tax 942 1,163 (19)

    Net release from continuing operations1 658 673 (2)

    Return on equity (%) 20.3 26.7

    Solvency II operational surplus generation (£bn) 0.7 0.6 11

    Solvency II coverage ratio (%) 193 186

    Consistent delivery

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018 10

    JEFF DAVIES: GROUP CHIEF FINANCIAL OFFICER

    1. Net release from continuing operations, excluding Mature Savings (H1 2018: £22m, H12017: 51m), which has been disposed of

  • LGRI 36%

    LGRR 12%

    LGIM 20%

    LGC 17%

    LGI 15%

    Including mortality release

    Operating Profit (£m) H1 2018 H1 2017 % H1 2017 %

    Legal & General Retirement Institutional (LGRI) 361 333 8 402 (10)

    Legal & General Retirement Retail (LGRR) 119 107 11 164 (27)

    Legal & General Investment Management (LGIM) 203 194 5

    Legal & General Capital (LGC) 172 142 21

    Legal & General Insurance (LGI) 154 147 5

    General Insurance (GI) (6) 15 -

    Operating profit from continuing operations 1,003 938 7 1,064 (6)

    Benefits of a diversified business model

    11

    JEFF DAVIES: GROUP CHIEF FINANCIAL OFFICER

    LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018

    Operating

    profit from

    continuing

    divisions

    £1,003m

  • LEGAL & GENERAL GROUP PLC | HALF YEAR RESULTS | AUGUST 2018

    Investing in the business

    12

    JEFF DAVIES: GROUP CHIEF FINANCIAL OFFICER

    Technology:

    LGIM: New Digital Capability

    LGR: New Admin Platform

    GI: SmartQuote

    GI: SmartClaim

    M&A:

    Canvas ETF

    Cala Homes

    Buddies

    Salary Finance

    Customer:

    My account

    legalandgeneral.com

    Cyber security

    Regulatory:

    IFRS 17