Legal & General Grp

Legal & General 1st Quarter Results 2014

RNS Number : 4119G
Legal & General Group Plc
07 May 2014
 



LEGAL & GENERAL GROUP PLC QUARTER 1 2014 INTERIM MANAGEMENT STATEMENT

 

Stock Exchange Release

7 May 2014

 

LEGAL & GENERAL: NET CASH UP 21% WITH RECORD SALES

 

GROUP HIGHLIGHTS:

•               NET CASH GENERATION UP 21% TO £301M (Q1 2013: £249M)

•               OPERATIONAL CASH GENERATION UP 6% TO £297M (Q1 2013: £281M)

 

BUSINESS HIGHLIGHTS:

•               RECORD BULK PURCHASE ANNUITY PREMIUMS OF £3,045M (Q1 2013: £357M)

•               ANNUITY ASSETS UP 15% TO £38.3BN (Q1 2013: £33.3BN)

•               LGIM TOTAL AUM UP 5% TO £462.6BN (Q1 2013: £441.2BN)

•               LGIM INTERNATIONAL AUM UP 21% TO £63.2BN (Q1 2013: £52.4BN)

•               LGIM NET FLOWS OF £3.8BN (Q1 2013: £4.7BN)

•               UK RETAIL PROTECTION SALES UP 56% TO £42M (Q1 2013: £27M)

•               WORKPLACE AUA UP 32% TO £9.1BN (Q1 2013 £6.9BN)

•               COFUNDS AUA UP 25% TO £65.6BN (Q1 2013 £52.3BN)

•               US PROTECTION SALES UP 12% TO $38M (Q1 2013: $34M)

•               £1.0BN OF DIRECT INVESTMENTS COMPLETED IN Q1

 

 

Nigel Wilson, Group Chief Executive, said:

"Legal & General delivered record results in Q1. Net cash and Operational cash, up 21% and 6% respectively, are at their highest-ever levels. LGIM AUM of £463bn is at an all-time high, Retail Protection sales hit a new Q1 record and Cofunds grew AUA to £66bn. Our record annuity sales were driven by the UK's largest ever Bulk Purchase Annuity transaction, the £3bn deal for the ICI Pension Fund."

 

"We already benefit from favourable demographic trends; we have economically and socially useful products for customers; and with our LGIM economists forecasting 3% plus economic growth in the UK and US, we are excited about the prospects for our business."

 

"There is strong demand for our pension de-risking and protection products in both markets - the £1.8 trillion of UK DB liabilities will provide substantial future business. We believe the UK DC market will grow from around £250bn today to £3 trillion by 2030. LGIM's recent agreement to acquire Global Index Advisors (GIA), a US based DC provider will accelerate our US growth.  In Q1 we invested in UK infrastructure and housing at a rate of around £100m per week, completing £1bn of transactions including Cala's acquisition of Banner Homes and a £252m investment in affordable housing provider Places for People which will finance 7,000 new homes."

 

GROUP CASH GENERATION

 

£m

Q1 2014

Q1 2013

Growth %

3 months to 31 March




Operational cash generation

297

281

6

New business surplus / (strain)

4

(32)

n/a

Net cash generation

301

249

21

 

 

    LEGAL AND GENERAL RETIREMENT (LGR)

 

£bn

Q1 2014

Q1 2013

Growth %

3 months to 31 March




Annuity sales

3.3

0.8

331

Annuity net flows

2.8

0.4

600

Annuity assets

38.3

33.3

15

 

 

         LEGAL & GENERAL INVESTMENT MANAGEMENT (LGIM)

    

£bn

Q1 2014

Q1 2013

Growth %

3 months to 31 March




LGIM net flows

3.8

4.7

(19)

LGIM AUM

462.6

441.2

5

 

         

        LEGAL & GENERAL ASSURANCE SOCIETY (LGAS)

 

          

£m

Q1 2014

Q1 2013

Growth %

As at 31 March




UK Protection new business annual premiums

62

47

32

UK Protection gross premiums

353

325

9

Savings net flows (£bn)

1.6

(0.3)

n/a

Savings AUA (£bn)

115.3

61.7

87

 

 

LEGAL & GENERAL CAPITAL (LGC)

 

 

£bn

Q1 2014

Q1 2013

Growth %

As at 31 March




LGC assets

4.8

n/a

n/a

 

 

 

LEGAL & GENERAL AMERICA (LGA)

 

$m

Q1 2014

Q1 2013

Growth %

3 months to 31 March




LGA new business annual premiums

38

34

12

LGA gross premiums

269

238

13

 

Financial PERFORMANCE - operational cash up 6% and net cash up 21%

Operational cash generation for the Group is up 6% to £297m in the first three months of the year (Q1 2013: £281m) reflecting growth in our business especially in LGR and Workplace savings. New business surplus of £4m (Q1 2013: strain of £32m) resulted in net cash up 21% to £301m (Q1 2013: £249m). The new business strain benefited from a positive new business surplus arising from the significant volumes of annuities and UK Retail Protection written in the quarter. The net cash also includes the LGA 2014 ordinary dividend of $73m, 11% up on 2013, equating to £44m (Q1 2013: $66m equating to £43m).

BUSINESS PERFORMANCE - A STRONG START TO THE YEAR

Legal & General Retirement (LGR)

LGR new business premiums quadrupled to £3.3bn (Q1 2013: £0.8bn). This growth was primarily due to securing the largest ever UK Bulk Annuity contract with ICI Pension Fund covering £3bn of the Fund's liabilities, demonstrating the strength of our diversified proposition in the DB scheme de-risking market.

Individual Annuity sales were down 40% to £244m (Q1 2013: £406m). This sales result includes a c£15m impact from cancellations during the extended cooling off period which we offered to our customers post the budget.

Total annuity assets increased to £38.3bn (Q1 2013: £33.3bn), reflecting record net inflows of £2.8bn for Q1 2014.

Legal & General Investment Management (LGIM)

LGIM received net flows of £3.8bn in the quarter (Q1 2013: £4.7bn) and now has assets under management (AUM) of £463bn, up 5% on Q1 2013 (£441bn).

LGIM achieved net inflows from International clients of £2.6bn (Q1 2013: £6.7bn) with continued strong growth in LGIM America's LDI and Active Fixed Income products.  Due to the potentially large flows from our institutional client base, quarterly flows are inherently uneven. International AUM now total £63.2bn up 21% on Q1 2013 (£52.4bn).

Our Solutions business performed strongly with AUM increasing 7% to £76.5bn (Q1 2013: £71.4bn). In addition derivative notional overlays associated with this business, which also drive revenue, increased in the UK by £5.4bn in the quarter and 17% in the year, increasing to £165.5bn (Q1 2013: £140.9bn).

Our DC business continues to gather momentum, with AUM increasing 11% to £31.8bn (Q1 2013: £28.7bn). We continue to build our UK DC proposition and invest in our capabilities in order to benefit from the expected growth in the market.

UK retail AUM continued to grow with net flows of £0.3bn (Q1 2013: £(0.3)bn) as passive funds become more popular in the retail market post the Retail Distribution Review (RDR). LGIM's bolt-on acquisition of US based Global Index Advisors for up to $50.4m, announced in February, is on track for completion in May 2014. The assets of $15.6bn (as at FY 2013) will provide the Group scale and distribution in the $6 trillion US DC market.

Legal & General Assurance Society (LGAS)

Retail Protection had a record Q1 with sales up 56% to £42m (Q1 2013: £27m) as a result of our well positioned, competitively priced range of products provided through leading technology. Growth is broad based across all key distribution channels, including our direct sales.

UK Group Protection achieved sales of £20m (Q1 2013: £20m) benefiting from the robustness of our market proposition. In France our Group Protection business has increased by 38% (Q1 2014: €40m, Q1 2013: €29m) following continued collaboration with the UK and early progress on building our distribution network.

In Q1 our LGAS Savings net inflows were £1.6bn (Q1 2013: outflows of £0.3bn) with assets under administration (AUA) now at £115.3bn (Q1 2013: £61.7bn).

Our digital platforms continue to grow.  Cofunds generated net inflows of £1.5bn leading to an increased AUA of £65.6bn

Our Workplace savings net flows were £0.5bn (Q1 2013: £0.3bn). Gross inflows of £0.7bn (Q1 2013: £0.5bn) continued on a steady upward trend benefiting from incremental enrolment into pre-existing schemes and new schemes in the quarter. Participation rates remain high at more than 90% as opt outs continue to be low and the platform now has AUA of £9.1bn (Q1 2013: £6.9bn). Workplace savings now has 1 million customers on the platform (FY 2013: 903k).  We continue to target halving the losses of £29m per annum experienced in 2013 as the business benefits from increased scale and continued automation.

General Insurance gross premiums were slightly lower, down 2%, to £84m (Q1 2013: £86m) reflecting disciplined pricing although direct sales continued to grow.

Legal & General America (LGA)

LGA continued to deliver growth in sales with Q1 up 12% to $38m (Q1 2013: $34m). LGA has focussed term assurance and universal life offerings with high quality service and value for money pricing.  Gross premiums are up 13% to $269m (Q1 2013: $238m) and LGA now has over 1 million customers. 

 

LEGAL & GENERAL CAPITAL (LGC)

During the period LGC made over £1.0bn of new direct investments including a £252m investment into Places for People which will finance the building of 7,000 new homes in the UK. These strategic investments provide a risk adjusted yield enhancement to our traded fixed income portfolio and were part of the asset portfolio backing the £3bn bulk annuity deal completed by LGR. LGC also invested £52m to support the acquisition of Banner Homes by CALA. This will make CALA a UK national housebuilder with a target for 2017 turnover exceeding £800m. Direct Investments have reached £4.1bn across LGC, LGR and LGA with a strong pipeline of attractive investment opportunities.

 

OUTLOOk

We reiterate the operational cash guidance we gave at the full year results to deliver operational cash generation from LGR of around £290m in 2014 (2013: £260m), from LGAS excluding General Insurance of around £430m in 2014 (2013: £421m) and from LGA of around £45m (2013: £44m).

We are on track in 2014 to exceed the £4.1bn annuity premiums we wrote in 2013 with a strong quote pipeline in bulk annuities.  We expect the Individual Annuity market to contract by c50% in 2014 and by a further half in 2015.  Our market leading Retail Protection business has good momentum. LGIM continues to see strong demand for its Liability Driven Investment and Active Fixed capabilities and we continue to build our international presence, particularly in the Gulf, Europe and the US. LGC has good opportunities to make further direct investments, some of these we expect to be in new areas diversifying our portfolio and enhancing our capabilities.

 

DIVERSIFIED BUSINESSES FOR A MODERN PENSIONS MARKET

The Chancellor of the Exchequer and the Pensions Minister have supported a clear pro-choice, pro-consumer agenda to modernise pensions: a direction of travel that has been clear for some time. We agree with these objectives and welcome the Budget reforms, which we expect will accelerate the evolution of a modern pensions market in the UK.  We believe these changes will be good for customers and also for Legal & General since we have aligned our diversified businesses to benefit from these trends. We look forward to working closely with government to help ensure smooth implementation of these reforms.

We expect to write growing volumes of BPA business to more than offset individual annuity reductions

·      Private sector UK DB liabilities of around £1.8 trillion1, of which £600bn2 already in payment, mean demand for BPA is likely to grow regardless of the DB to DC transfer consultation outcome.

·      DB to DC transfers are unlikely to materially affect the BPA market. Transfers will need to be subject to appropriate consumer protection and fairness safeguards, but in the event of significant transfers, DB schemes are likely to find de-risking solutions more affordable.

·      The BPA market is very different to Individual annuities. It requires a strong and sustained track record, a robust capital base and specialist expertise across longevity, investment management and asset transitioning. Legal & General has all these competitive advantages, built up over 27 years and is a market leader in this field. As a result, we expect to continue achieving our target return on capital.

 

Ideally placed to provide alternative solutions to annuities

·      Our established mass market distribution combined with our expertise in both investment and longevity management mean we can offer a wide range of new and existing products to customers deciding how to convert savings into retirement income.

·      We are developing low cost income drawdown products with a range of options for customers to choose how much risk they wish to take and how much they want to be guaranteed.

Savings level will increase

·      The greater flexibility will make pension savings more attractive which, together with the higher ISA limits, will mean higher rates of saving.

·      We have market leading Workplace savings products, a comprehensive suite of low cost retail solutions including our unit trust and ISA business and the largest retail savings platform in Cofunds.

·      The recently announced 75bps cap for auto-enrolment default funds will focus attention on charges. We expect to benefit as we already operate with a maximum 50bps charge for our auto-enrolment default fund which is based on LGIM's passive fund and asset allocation capabilities.

 

We have a diversified portfolio of low cost savings, protection and retirement solution products. This together with our proven track record in specialist investment capabilities and our increasing international footprint means we are well placed to deliver high quality solutions to our customers while growing returns for our shareholders.

 

 

1. The Purple Book: PPF / The Pensions Regulator - November 2013 on a full buy-out basis.

2. Legal & General estimate based on The Purple Book: PPF / The Pensions Regulator - November 2013.

 

Enquiries

Bernie Hickman          Group Financial Controller and Investor Relations Director               020 3124 2043

Laura Doyle                 Investor Relations Manager                                                                020 3124 2088

Stephen Thomas        Investor Relations Manager                                                                020 3124 2047

John Godfrey               Group Communications Director                                                     020 3124 2090

Richard King               Head of Media Relations                                                                   020 3124 2095
Michelle Clarke            Tulchan Communications                                                                020 7353 4200

Katharine Wynne        Tulchan Communications                                                                020 7353 4200

Notes

A copy of this announcement can be found in "Results", under the "Financial information" section of our shareholder website at http://www.legalandgeneralgroup.com/investors/results.cfm.

There will be a teleconference at 09.30 BST.  Investors should dial +44 (0)20 3059 8125. A replay of the teleconference can be accessed by dialling +44 (0)121 260 4861 (PIN code: 4243267#).



FINANCIAL CALENDAR 2014:

  

Date

Annual general meeting

21-May-14

Payment date of 2013 final dividend

04-Jun-14

Half-year Results 2014

06-Aug-14

Q3 Interim Management Statement 2014

04-Nov-14

 

DEFINITIONS:

Operational cash generation is the expected release from in-force business for the UK non-profit LGAS and LGR businesses, the shareholder's share of bonuses on with-profits business, the post-tax operating profit on other UK businesses, including the expected investment return on LGC invested assets, and dividends remitted from our international businesses.

Net cash generation is defined as operational cash generation less new business strain.

FORWARD LOOKING STATEMENTS:

This announcement 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 acquisition 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 announcement 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 announcement or any other forward-looking statement it may make.

 

 

Asset and premium flows

 

Legal & General investment management assets under management

  





  




  




Active

  




  



Index

fixed

Solu-

Property

Active


  



funds

interest

tions

& other

equities

Total

For the three months ended 31 March 2014


£bn

£bn

£bn

£bn

£bn

£bn

  





  




  





  




As at 1 January 2014


269.8 

89.4 

70.4 

11.3 

8.6 

449.5 

External inflows



4.7 

1.9 

2.1 

0.3 

9.0 

External outflows



(5.7)

(1.0)

(1.2)

(0.1)

(8.0)

  





  




  





  




External net flows



(1.0)

0.9 

0.9 

0.2 

1.0 

Internal net flows



0.1 

2.0 

0.3 

0.5 

(0.1)

2.8 

  





  




  





  




Total net flows



(0.9)

2.9 

1.2 

0.7 

(0.1)

3.8 

Market and other movements



1.5 

2.9 

4.9 

(0.1)

0.1 

9.3 

  





  




  





  




As at 31 March 2014


270.4 

95.2 

76.5 

11.9 

8.6 

462.6 

  





  




  





  




 

  




Active

  




  



Index

fixed

Solu-

Property

Active


  



funds

interest

tions

& other

equities

Total

For the three months ended 31 March 2013

£bn

£bn

£bn

£bn

£bn

£bn

  





  




  





  




As at 1 January 2013


243.2 

82.2 

64.0 

8.9 

7.7 

406.0 

External inflows



11.0 

2.2 

1.1 

0.1 

14.4 

External outflows



(7.1)

(0.9)

(1.1)

(0.1)

(9.2)

  





  




  





  




External net flows



3.9 

1.3 

0.1 

(0.1)

5.2 

Internal net flows



0.1 

(0.7)

0.1 

(0.5)

  





  




  





  




Total net flows



4.0 

0.6 

0.1 

0.1 

(0.1)

4.7 

Market and other movements



20.1 

2.0 

7.3 

0.3 

0.8 

30.5 

  





  




  





  




As at 31 March 2013


267.3 

84.8 

71.4 

9.3 

8.4 

441.2 

  





  




  





  




 

  




Active

  




  



Index

fixed

Solu-

Property

Active


  



funds

interest

tions

& other

equities

Total

For the year ended 31 December 2013


£bn

£bn

£bn

£bn

£bn

£bn

  





  




  





  




As at 1 January 2013


243.2 

82.2 

64.0 

8.9 

7.7 

406.0 

External inflows2,3



31.3 

11.0 

8.6 

1.0 

0.1 

52.0 

External outflows



(31.8)

(5.0)

(5.2)

(0.3)

(0.4)

(42.7)

  





  




  





  




External net flows



(0.5)

6.0 

3.4 

0.7 

(0.3)

9.3 

Internal net flows



0.7 

(1.7)

0.8 

0.2 

(0.2)

(0.2)

  





  




  





  




Total net flows



0.2 

4.3 

4.2 

0.9 

(0.5)

9.1 

Market and other movements



26.4 

2.9 

2.2 

1.5 

1.4 

34.4 

  





  




  





  




As at 31 December 2013


269.8 

89.4 

70.4 

11.3 

8.6 

449.5 

  





  




  





  




1. Solutions includes liability driven investments and multi-asset funds.

2. Includes unit trust business, both retail and institutional, now part of LGIM, following the organisational changes effective from 1 July 2013.

3. Includes £2.9bn of Legal & General France assets.

 

 

Legal & General investment management assets under management (continued)


  





  




  





  

12 

  





  

months

months

months

  





  

to

to

to

  





  

31.03.14

31.03.13

31.12.13

  





  

£bn

£bn

£bn

  





  




  





  




LGIM total net flows  





  

3.8 

4.7 

9.1 

Attributable to:





  




International





  

2.6 

6.7 

15.7 

UK Institutional





  

(1.4)

(1.0)

(5.3)

UK Retail





  

0.3 

(0.3)

0.4 

Annuities2, 3





  

3.2 

1.4 

Mature Savings





  

(0.9)

(0.7)

(3.1)

  





  




  





  




1. FY 2013 International net flows includes £2.9bn of Legal & General France assets.

2. Pension funds already managed by LGIM that switch into LGR annuities are excluded.

3. Q1 2014 Annuities net flows includes £0.34bn of Lucida assets previously managed externally.

 

 

 

Legal & General investment management assets under management quarterly progression

  





  




  




Active

  




  



Index

fixed

Solu-

Property

Active


  



funds

interest

tions

& other

equities

Total

Year ended 31 December 2013


£bn

£bn

£bn

£bn

£bn

£bn

  





  




  





  




At 1 January 2013


243.2 

82.2 

64.0 

8.9 

7.7 

406.0 

External inflows



11.0 

2.2 

1.1 

0.1 

14.4 

External outflows



(7.1)

(0.9)

(1.1)

(0.1)

(9.2)

  





  




  





  




External net flows



3.9 

1.3 

0.1 

(0.1)

5.2 

Internal net flows



0.1 

(0.7)

0.1 

(0.5)

  





  




  





  




Total net flows



4.0 

0.6 

0.1 

0.1 

(0.1)

4.7 

Market and other movements



20.1 

2.0 

7.3 

0.3 

0.8 

30.5 

  





  




  





  




At 31 March 2013


267.3 

84.8 

71.4 

9.3 

8.4 

441.2 

  





  




  





  




External inflows



6.2 

1.3 

4.6 

0.2 

12.3 

External outflows



(7.9)

(0.5)

(0.7)

(0.1)

(0.3)

(9.5)

  





  




  





  




External net flows



(1.7)

0.8 

3.9 

0.1 

(0.3)

2.8 

Internal net flows



0.4 

(0.8)

0.6 

0.2 

  





  




  





  




Total net flows



(1.3)

4.5 

0.1 

(0.3)

3.0 

Market and other movements



(3.9)

(1.9)

(5.0)

(0.4)

(11.2)

  





  




  





  




At 30 June 2013


262.1 

82.9 

70.9 

9.4 

7.7 

433.0 

  





  




  





  




External inflows2,3



8.0 

4.8 

2.2 

0.4 

0.1 

15.5 

External outflows



(8.3)

(2.0)

(1.7)

(0.1)

(12.1)

  





  




  





  




External net flows



(0.3)

2.8 

0.5 

0.3 

0.1 

3.4 

Internal net flows



0.6 

0.1 

(0.1)

0.6 

  





  




  





  




Total net flows



(0.3)

3.4 

0.5 

0.4 

4.0 

Market and other movements



3.2 

1.4 

0.1 

0.6 

0.3 

5.6 

  





  




  





  




At 30 September 2013


265.0 

87.7 

71.5 

10.4 

8.0 

442.6 

  





  




  





  




External inflows



6.1 

2.7 

0.7 

0.3 

9.8 

External outflows



(8.5)

(1.6)

(1.7)

(0.1)

(11.9)

  





  




  





  




External net flows



(2.4)

1.1 

(1.0)

0.2 

(2.1)

Internal net flows



0.2 

(0.8)

0.1 

0.1 

(0.1)

(0.5)

  





  




  





  




Total net flows



(2.2)

0.3 

(0.9)

0.3 

(0.1)

(2.6)

Market and other movements



7.0 

1.4 

(0.2)

0.6 

0.7 

9.5 

  





  




  





  




At 31 December 2013


269.8 

89.4 

70.4 

11.3 

8.6 

449.5 

  





  




  





  




1. Solutions includes liability driven investments and multi-asset funds.

2. Includes unit trust business, both retail and institutional, now part of LGIM, following the organisational changes effective from 1 July 2013.

3. Includes £2.9bn of Legal & General France assets.

 

 

 

 

 Legal & General investment management assets under management quarterly progression (continued)

 

  









 

  




 

  




months

months

months

months

months

 

  




to

to

to

to

to

 

  




31.03.14

31.12.13

30.09.13

30.06.13

31.03.13

 

  




£bn

£bn

£bn

£bn

£bn

 

  









 

  









 

LGIM total net flows




3.8 

(2.6)

4.0 

3.0 

4.7 

 

Attributable to:









 

International




2.6 

1.8 

6.4 

0.8 

6.7 

 

UK Institutional




(1.4)

(3.8)

(3.2)

2.7 

(1.0)

 

UK Retail




0.3 

0.1 

0.3 

0.3 

(0.3)

 

Annuities2, 3




3.2 

(0.1)

1.4 

0.1 

 

Mature Savings




(0.9)

(0.6)

(0.9)

(0.9)

(0.7)

 

  









 

  









 

1. Q3 2013 International net flows include £2.9bn of Legal & General France assets.

 

2. Pension funds already managed by LGIM that switch into LGR annuities are excluded.

 

3. Q1 2014 Annuities net flows includes £0.34bn of Lucida assets previously managed externally.

 

 

 

 Assets under administration




  


  


 

  

  

  




  


  


 

  

  

  




Consol-


  


 

  

  

Mature



Overseas

idation


Retail


 

  

  

Retail

Work-

Suffolk

LGAS

adjust-

Total

Invest-


 

For the three months

Platforms

Savings

place

Life

Savings

ment

LGAS

ments

Annuities

 

ended 31 March 2014  

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

 

  

  

  




  


  


 

  

  

  




  


  


 

As at 1 January 2014

64.1 

36.3 

8.7 

6.6 

4.5 

(6.8)

113.4 

17.0 

34.4 

 

Gross inflows

2.6 

0.4 

0.7 

0.3 

0.1 

(0.1)

4.0 

1.1 

3.3 

 

Gross outflows

(1.1)

(1.1)

(0.2)

(0.1)

(0.1)

0.2 

(2.4)

(0.8)

 

Payments to annuitants

(0.5)

 

  

  

  




  


  


 

  

  

  




  


  


 

Net flows

1.5 

(0.7)

0.5 

0.2 

0.1 

1.6 

0.3 

2.8 

 

Market and other  

  

  




  


  


 

movements

0.5 

(0.1)

0.1 

(0.1)

(0.1)

0.3 

0.2 

1.1 

 

  

  

  




  


  


 

  

  

  




  


  


 

As at 31 March 2014

65.6 

36.1 

9.1 

6.9 

4.4 

(6.8)

115.3 

17.5 

38.3 

 

  

  

  




  


  


 

  

  

  




  


  


 

  

  

  




  


  


 

  

  

  




Consol-


  


 

  

  

Mature



Overseas

idation


Retail


 

  

  

Retail

Work-

Suffolk

LGAS

adjust-

Total

Invest-


 

For the three months

Platforms

Savings

place

Life

Savings

ment

LGAS

ments

Annuities

 

ended 31 March 2013  

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

 

  

  

  




  


  


 

  

  

  




  


  


 

As at 1 January 2013

8.6 

36.2 

6.0 

5.1 

4.5 

(1.4)

59.0 

15.6 

32.2 

 

Gross inflows

0.2 

0.4 

0.5 

0.2 

0.1 

1.4 

0.7 

0.8 

 

Gross outflows

(0.2)

(1.2)

(0.2)

(0.1)

(0.1)

0.1 

(1.7)

(1.0)

 

Payments to annuitants

(0.4)

 

  

  

  




  


  


 

  

  

  




  


  


 

Net flows

(0.8)

0.3 

0.1 

0.1 

(0.3)

(0.3)

0.4 

 

Market and other  

  

  




  


  


 

movements

0.5 

1.7 

0.6 

0.3 

(0.1)

3.0 

1.0 

0.7 

 

  

  

  




  


  


 

  

  

  




  


  


 

As at 31 March 2013

9.1 

37.1 

6.9 

5.5 

4.5 

(1.4)

61.7 

16.3 

33.3 

 

  

  

  




  


  


 

  

  

  




  


  


 

  

  

  




  


  


 

  

  

  




Consol-


  


 

  

  

Mature



Overseas

idation


Retail


 

  

  

Retail

Work-

Suffolk

LGAS

adjust-

Total

Invest-


 

For the year ended

Platforms

Savings

place

Life

Savings

ment

LGAS

ments

Annuities

 

31 December 2013  

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

 

  

  

  




  


  


 

  

  

  




  


  


 

As at 1 January 2013

8.6 

36.2 

6.0 

5.1 

4.5 

(1.4)

59.0 

15.6 

32.2 

 

Gross inflows

11.0 

1.4 

2.1 

1.3 

0.1 

(0.3)

15.6 

3.2 

4.0 

 

Gross outflows

(3.1)

(5.1)

(0.6)

(0.4)

(0.1)

0.5 

(8.8)

(3.3)

 

Payments to annuitants

(1.9)

 

  

  

  




  


  


 

  

  

  




  


  


 

Net flows

7.9 

(3.7)

1.5 

0.9 

0.2 

6.8 

(0.1)

2.1 

 

Cofunds acquisition

45.7 

(5.4)

40.3 

 

Market and other  

  

  




  


  


 

movements

1.9 

3.8 

1.2 

0.6 

(0.2)

7.3 

1.5 

0.1 

 

  

  

  




  


  


 

  

  

  




  


  


 

As at 31 December 2013

64.1 

36.3 

8.7 

6.6 

4.5 

(6.8)

113.4 

17.0 

34.4 

 

  

  

  




  


  


 

  

  

  




  


  


 

1. Platforms includes Investor Portfolio Services (IPS) and Cofunds since acquisition.

  


 

2. Mature retail savings products includes with-profit products, bonds and retail pensions.

  


 

3. Consolidation adjustment represents Suffolk Life and Mature Retail Savings assets included in the Platforms column.

 


 

4. Retail Investments includes unit trust products (both LGIM and externally managed) and structured products (deposits and investments). It also includes £1.2bn of Cofunds assets since acquisition.

 

5. Platforms gross inflows include Cofunds institutional net flows.

  


 

 

 

 Assets under administration quarterly progression


  


   

  

  




  


  


   

  

  




Consol-


  


   

  

Mature



Overseas

idation


Retail


   

  

Retail

Work-

Suffolk

LGAS

adjust-

Total

Invest-


For the year ended  

Platforms

Savings

place

Life

Savings

ment

LGAS

ments

Annuities

31 December 2013

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

£bn

   

  

  




  


  


   

  

  




  


  


At 1 January 2013

8.6 

36.2 

6.0 

5.1 

4.5 

(1.4)

59.0 

15.6 

32.2 

Gross inflows  

0.2 

0.4 

0.5 

0.2 

0.1 

1.4 

0.7 

0.8 

Gross outflows  

(0.2)

(1.2)

(0.2)

(0.1)

(0.1)

0.1 

(1.7)

(1.0)

Payments to annuitants  

(0.4)

   

  

  




  


  


   

  

  




  


  


Net flows  

(0.8)

0.3 

0.1 

0.1 

(0.3)

(0.3)

0.4 

Market and other   

  

  




  


  


movements  

0.5 

1.7 

0.6 

0.3 

(0.1)

3.0 

1.0 

0.7 

   

  

  




  


  


   

  

  




  


  


At 31 March 2013

9.1 

37.1 

6.9 

5.5 

4.5 

(1.4)

61.7 

16.3 

33.3 

   

  

  




  


  


   

  

  




  


  


Gross inflows

1.7 

0.4 

0.5 

0.3 

2.9 

1.0 

0.6 

Gross outflows  

(0.7)

(1.4)

(0.1)

(0.1)

(2.3)

(0.9)

Payments to annuitants  

(0.5)

   

  

  




  


  


   

  

  




  


  


Net flows  

1.0 

(1.0)

0.4 

0.2 

0.6 

0.1 

0.1 

Cofunds acquisition  

45.7 

(5.4)

40.3 

Market and other   

  

  




  


  


movements  

(2.1)

(0.4)

0.3 

(2.2)

(0.3)

(1.2)

   

  

  




  


  


   

  

  




  


  


At 30 June 2013

53.7 

35.7 

7.3 

5.7 

4.5 

(6.5)

100.4 

16.1 

32.2 

   

  

  




  


  


   

  

  




  


  


Gross inflows

4.5 

0.3 

0.5 

0.4 

(0.1)

5.6 

0.9 

2.3 

Gross outflows  

(1.2)

(1.4)

(0.1)

(0.1)

0.2 

(2.6)

(0.8)

Payments to annuitants  

(0.5)

   

  

  




  


  


   

  

  




  


  


Net flows  

3.3 

(1.1)

0.4 

0.3 

0.1 

3.0 

0.1 

1.8 

Market and other   

  

  




  


  


movements  

1.3 

1.4 

0.2 

0.1 

(0.2)

2.8 

0.5 

0.5 

   

  

  




  


  


   

  

  




  


  


At 30 September 2013

58.3 

36.0 

7.9 

6.1 

4.5 

(6.6)

106.2 

16.7 

34.5 

   

  

  




  


  


   

  

  




  


  


Gross inflows

4.6 

0.3 

0.6 

0.4 

(0.2)

5.7 

0.6 

0.3 

Gross outflows  

(1.0)

(1.1)

(0.2)

(0.1)

0.2 

(2.2)

(0.6)

Payments to annuitants  

(0.5)

   

  

  




  


  


   

  

  




  


  


Net flows  

3.6 

(0.8)

0.4 

0.3 

3.5 

(0.2)

Market and other   

  

  




  


  


movements  

2.2 

1.1 

0.4 

0.2 

(0.2)

3.7 

0.3 

0.1 

   

  

  




  


  


   

  

  




  


  


At 31 December 2013

64.1 

36.3 

8.7 

6.6 

4.5 

(6.8)

113.4 

17.0 

34.4 

   

  

  




  


  


   

  

  




  


  


1. Platforms includes Investor Portfolio Services (IPS) and Cofunds since acquisition.

  


2. Mature retail savings products includes with-profit products, bonds and retail pensions.

  


3. Consolidation adjustment represents Suffolk Life and Mature Retail Savings assets included in the Platforms column.

4. Retail Investments includes unit trust products (both LGIM and externally managed) and structured products (deposits and investments).

5. Platforms gross inflows include Cofunds institutional net flows.

 

 

 Annuities single premiums




 

  









 

  






Single

Single

Single

 

  






premiums

premiums

premiums

 

  






31.03.14

31.03.13

31.12.13

 

  






£m

£m

£m

 

  









 

  









 

Individual Annuities






244 

406 

1,277 

 

Bulk Purchase Annuities






3,045 

357 

2,812 

 

  









 

  









 

Total Annuities






3,289 

763 

4,089 

 

  









 

  









 

 

 

 Annuities single premiums quarterly progression  





  









  




  




months

months

months

months

months

  




to

to

to

to

to

  




31.03.14

31.12.13

30.09.13

30.06.13

31.03.13

  




£m

£m

£m

£m

£m

  









  









Individual Annuities




244 

200 

323 

348 

406 

Bulk Purchase Annuities




3,045 

199 

1,943 

313 

357 

  









  









Total Annuities




3,289 

399 

2,266 

661 

763 

  









  









 

 

 Insurance new business








  









  






Annual

Annual

Annual

  






premiums

premiums

premiums

  






31.03.14

31.03.13

31.12.13

  






£m

£m

£m

  









  









Group Protection






20 

20 

70 

Retail Protection






42 

27 

148 

France (LGF) Protection






33 

21 

21 

Netherlands (LGN) Protection






US Protection






23 

22 

99 

Longevity Insurance






175 

270 

  









  









Total Insurance new business






120 

267 

615 

  









  









 

 Insurance new business annual premiums quarterly progression

  









  




  




months

months

months

months

months

  




to

to

to

to

to

  




31.03.14

31.12.13

30.09.13

30.06.13

31.03.13

  




£m

£m

£m

£m

£m

  









  









Group Protection




20 

13 

17 

20 

20 

Retail Protection




42 

43 

40 

38 

27 

France (LGF) Protection




33 

21 

Netherlands (LGN) Protection




US Protection




23 

26 

28 

23 

22 

Longevity Insurance




95 

175 

  









  









Total Insurance new business




120 

179 

86 

83 

267 

  









  









 

 

 Gross written premiums on Insurance business






  









  




12 



  




months

months

months



  




to

to

to



  




31.03.14

31.03.13

31.12.13

 


  




£m

£m

£m



  









  







Group Protection


  




99 

85 

336 

Retail Protection


  




254 

240 

990 

General Insurance


  




84 

86 

375 

France (LGF) Protection


  




46 

43 

168 

Netherlands (LGN) Protection


  




14 

14 

54 

US Protection


  




162 

154 

654 

Longevity Insurance


  




84 

32 

212 



  









  







Total gross written premiums on Insurance business

743 

654 

2,789 



  









  







 

 

 Gross written premiums on Insurance business quarterly progression


















months

months

months

months

months





to

to

to

to

to





31.03.14

31.12.13

30.09.13

30.06.13

31.03.13

 




£m

£m

£m

£m

£m



















Group Protection




99 

54 

74 

123 

85 

Retail Protection




254 

256 

250 

244 

240 

General Insurance




84 

95 

97 

97 

86 

France (LGF) Protection




46 

41 

41 

43 

43 

Netherlands (LGN) Protection




14 

13 

14 

13 

14 

US Protection




162 

172 

156 

172 

154 

Longevity Insurance




84 

60 

60 

60 

32 



















Total gross written premiums on Insurance business

743 

691 

692 

752 

654 



















 

 

Overseas new business in local currency  



  









  


Annual

Single


Annual

Single



  


premiums

premiums

APE

premiums

premiums

APE

APE

  


31.03.14

31.03.14

31.03.14

31.03.13

31.03.13

31.03.13

31.12.13

  









  









US Protection ($m)


38 

38 

34 

34 

155 

  









Netherlands (LGN) (€m)


35 

41 

23 

  









France (LGF) (€m)


40 

83 

48 

29 

72 

36 

57 

  









India (Rs m) - Group's 26% interest


202 

1,474 

349 

309 

1,751 

484 

917 

  









Egypt (Pounds m) - Group's 55% interest

46 

46 

40 

40 

136 

  









Gulf (US$m) - Group's 50% interest


  









  









 

 

 Worldwide new business  








  









  


Annual

Single


Annual

Single



  


premiums

premiums

APE

premiums

premiums

APE

APE

  


31.03.14

31.03.14

31.03.14

31.03.13

31.03.13

31.03.13

31.12.13

  


£m

£m

£m

£m

£m

£m

£m

  









  









Individual Annuities


244 

24 

406 

40 

128 

Bulk Purchase Annuities


3,045 

305 

357 

36 

281 

  









  









Total LGR


3,289 

329 

763 

76 

409 

  









  









Group Protection


20 

20 

20 

20 

70 

Retail Protection


42 

42 

27 

27 

148 

France (LGF)  


33 

69 

40 

25 

61 

31 

48 

Netherlands (LGN)  


28 

35 

19 

Workplace Savings


153 

250 

178 

176 

258 

202 

735 

Platforms (Cofunds & IPS)


16 

869 

103 

208 

26 

288 

Suffolk Life

352 

35 

198 

19 

133 

Mature Retail Savings


200 

22 

189 

22 

90 

With-profits


16 

22 

18 

14 

27 

17 

61 

  









  









Total LGAS


284 

1,790 

463 

274 

976 

371 

1,592 

  









  









Retail Investments


965 

100 

711 

74 

355 

  









  









US Protection


23 

23 

22 

22 

99 

  









  









India (26% share)


14 

21 

10 

Egypt (55% share)


13 

Gulf (50% share)


  









  









Total Emerging Markets new business


15 

22 

11 

25 

  









  









Total Worldwide new business


317 

6,059 

923 

307 

2,472 

554 

2,480 

  









  









1. Total LGR new business excludes £nil (Q1 13: £175m; FY 13: £270m) of APE in relation to longevity insurance transactions. It is not included in the table due to the unpredictable deal flow from this type of business.

2. Platforms APE includes retail business only and includes Cofunds from acquistion in Q2 2013.

3. Includes bonds and retail pensions.

4. Includes retail unit trusts and structured products only.

 

 

 Worldwide new business APE quarterly progression  





  









  




  




months

months

months

months

months

  




to

to

to

to

to

  




31.03.14

31.12.13

30.09.13

30.06.13

31.03.13

  




£m

£m

£m

£m

£m

  









  









Individual Annuities




24 

20 

33 

35 

40 

Bulk Purchase Annuities




305 

20 

194 

31 

36 

  









  









Total LGR




329 

40 

227 

66 

76 

  









  









Group Protection




20 

13 

17 

20 

20 

Retail Protection




42 

43 

40 

38 

27 

France (LGF)




40 

31 

Netherlands (LGN)




Workplace Savings




178 

240 

166 

127 

202 

Platforms (Cofunds & IPS)




103 

99 

94 

69 

26 

Suffolk Life




35 

44 

39 

31 

19 

Mature Retail Savings




22 

25 

21 

22 

22 

With-profits




18 

17 

13 

14 

17 

  









  









Total LGAS




463 

489 

401 

331 

371 

  









  









Retail Investments




100 

83 

94 

104 

74 

  









  









US Protection




23 

26 

28 

23 

22 

  









  









India (26% share)




Egypt (55% share)




Gulf (50% share)




  









  









Total Emerging Markets new business




11 

  









  









Total Worldwide new business




923 

642 

756 

528 

554 

  









  









1. Total LGR new business excludes £nil (Q1 13: £175m; FY 13: £270m) of APE in relation to longevity insurance transactions. It is not included in the table due to the unpredictable deal flow from this type of business.

2. Platforms APE includes retail business only and includes Cofunds from acquisition in Q2 2013.

3. Includes bonds and retail pensions.

4. Includes retail unit trusts and structured products only.

 

 

 Worldwide APE by channel  




  









  





Annual

Single



  





premiums

premiums

APE

% of

For the three months ended 31 March 2014



£m

£m

£m

total

  









  









Employee benefit consultants





221 

3,329 

554 

60 

Retail independent and restricted





61 

2,276 

289 

32 

Tied including bancassurance





27 

321 

59 

Direct





133 

21 

  









  









Total Worldwide APE by channel





317 

6,059 

923 

100 

  









  









1. Includes Lucida business.









  









  





Annual

Single



  





premiums

premiums

APE

% of

For the three months ended 31 March 2013



£m

£m

£m

total

  









  









Employee benefit consultants





233 

636 

296 

54 

Retail independent and restricted





43 

1,389 

182 

33 

Tied including bancassurance





26 

331 

59 

10 

Direct





116 

17 

  









  









Total Worldwide APE by channel





307 

2,472 

554 

100 

  









  









  









  





Annual

Single



  





premiums

premiums

APE

% of

For the year ended 31 December 2013



£m

£m

£m

total

  









  









Employee benefit consultants





796 

3,597 

1,156 

47 

Retail independent and restricted





228 

7,871 

1,015 

41 

Tied including bancassurance





95 

1,418 

237 

10 

Direct





27 

449 

72 

  









  









Total Worldwide APE by channel





1,146 

13,335 

2,480 

100 

  









  









1. Includes Lucida business.










 

 

Worldwide APE by channel quarterly progression  


  









  




  




months

months

months

months

months

  




to

to

to

to

to

  




31.03.14

31.12.13

30.09.13

30.06.13

31.03.13

  




£m

£m

£m

£m

£m

  









  









Employee benefit consultants




554 

283 

386 

191 

296 

Retail independent and restricted




289 

279 

295 

259 

182 

Tied including bancassurance




59 

61 

58 

59 

59 

Direct




21 

19 

17 

19 

17 

  









  









Total Worldwide APE by channel




923 

642 

756 

528 

554 

  









1. Includes Lucida business.  









 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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