2025 Annual Financial Report
Summary by AI BETAClose X
16 March 2026
Standard Life plc: 2025 Full Year Results
Strong operating momentum and excellent progress against 3-year strategy
Uniquely positioned in attractive markets
Strong execution of strategic priorities
Profitable growth driving balance sheet strengthening
"Our results demonstrate strong progress delivering on our strategic priorities. Further profitable growth and a strengthened Solvency balance sheet have supported increased shareholder returns and greater financial flexibility for the future, underpinned by the significant and growing levels of excess cash our business generates. We are firmly on track to deliver our 2026 financial targets, building momentum by continuing to sharpen our competitive position in one of the world's most attractive savings and retirement markets. Operating as Standard Life plc brings our most trusted brand to the forefront, demonstrating our commitment to helping our customers achieve better outcomes and greater financial security in later life. We look to the future with confidence."
Andy Briggs, Group Chief Executive Officer
Strong FY 2025 financial performance across all key metrics:
|
|
31 December 2025 |
31 December 2024 |
Change |
|
Operating Cash Generation1 |
£1,474m |
£1,403m |
+5% |
|
Total cash generation2 |
£1,711m |
£1,779m |
-4% |
|
Shareholder Capital Coverage Ratio3,4 |
176% |
172% |
+4%pts |
|
Solvency II surplus4 |
£3.6bn |
£3.5bn |
+2% |
|
Solvency II leverage ratio5 |
33% |
36% |
-3%pts |
|
IFRS adjusted operating profit |
£945m |
£825m |
+15% |
|
Cumulative annual run-rate cost savings delivered |
£180m |
£63m |
+286% |
|
IFRS loss after tax |
£(394)m |
£(1,078)m |
+63% |
|
IFRS adjusted shareholders' equity |
£3,098m |
£3,656m |
-15% |
|
2025 Final dividend 2025 Total dividend |
28.05pps 55.40pps |
27.35pps 54.00pps |
+2.6% +2.6% |
5% growth in Operating Cash Generation1 and 15% growth in IFRS adjusted operating profit driven by continued operating momentum in core businesses
Pensions and Savings (Workplace and Retail): momentum in flows and improving margins driving strong growth
· 23% IFRS adjusted operating profit growth in our capital-light fee-based business to £389m driven by 7% growth in average assets under administration ('AUA') to £204.6bn (FY 2024: £191.5bn) and cost efficiencies driving a 2bps margin improvement to 19bps (FY 2024: 17bps)
· 13% Operating Cash Generation1 ('OCG') growth to £396m (FY 2024: £350m)
· Workplace net inflows of £5.3bn (FY 2024: £5.3bn) comprised £10.0bn gross inflows (FY 2024: £9.3bn); new Workplace members up 14% in 2025 to 247k, total Workplace customers 3 million
· Retail net outflows6 improved to £7.8bn (FY 2024: £8.6bn) reflecting retail strategy green shoots
Retirement Solutions (Annuities): increased contribution to operating cash benefiting from new business and in-force management actions
· 3% OCG1 growth in our capital-utilising spread-based business to £879m driven by growth in average AUA to £40.2bn (FY 2024: £39.0bn) and OCG margin improvement to 219bps (FY 2024: 218bps), supported by our capital efficiency, scale and recurring management actions
· 19% IFRS adjusted operating profit growth to £563m (FY 2024: £474m)
· Group Contractual Service Margin ('CSM') (gross of tax) grew 17% to £3,806m (FY 2024: £3,257m)
· £1.2bn individual annuity premiums written in 2025 (FY 2024: £1.0bn) and market share increased to 15%
· £3.9bn Pension Risk Transfer ('PRT') volumes written in 2025 (FY 2024: £5.1bn) included our largest ever deal at £1.9bn
· Disciplined capital deployment maintained through total annuities strain £162m (FY 2024: £206m) and the generation of lifetime IRRs of more than 20% in PRT
Strong execution across all strategic priorities
· Continued execution across all our strategic priorities, with an emphasis on customer engagement, distribution and continued strong trading in our Workplace and Annuities businesses
Grow: meeting more of our existing customer needs and acquiring new ones
· Deepened customer engagement
o Launched our in-house Retail advice proposition to help those who wouldn't usually consider paid advice gain access to the support they need
o Widened distribution of our products via adviser partnerships; our smoothed managed fund is now available on the Quilter platform
o Launched Annuity Desk for Standard Life customers to support a digital customer experience
o Broadened our wide range of digital tools including our Family Finance Hub and Mixed Income Builder to support households with engaging planning and budgeting options
· Expanded product build-out
o Completed our portfolio of innovative retirement income solution products with the launch of the Guaranteed Lifetime Income plan
o Innovated PRT solutions through longevity insurance novations and gender equalising benefits, making our PRT proposition more attractive to customers
Optimise: optimising our scale in-force business and balance sheet
· Unique in-house expertise delivering better customer outcomes and enhancing returns
o £560m recurring management actions delivered in 2025 (FY 2024: £537m)
o £7bn of £41.8bn annuity-backing assets managed in-house, with planning progressing to in-house a further £20bn
· Excess cash generation has enabled further deleveraging
o $250m debt repaid in February 2025 and £197m repaid in December 2025
o Solvency II leverage ratio5 33% (FY 2024: 36%)
Enhance: transforming our operating model and culture
· Cumulative run-rate cost savings increased to £180m (FY 2024: £63m), £55 million ahead of our original delivery profile by 2025.
· Progressing our migrations
o 1.9m policies migrated to TCS BaNCS in 2025
o Entered into a strategic partnership with Wipro; ALPHA platform covering 1.9m policies now transferred and serviced by Wipro
o 75% policies are now on their end-state technology, up from 45% in 2024
A progressive and sustainable ordinary dividend policy7
· The Board is recommending a 2.6% increase in the Final 2025 dividend to 28.05p per share; Total dividend 55.40p per share (FY 2024: 54.00p per share)
· At 31 December 2025, distributable reserves at Standard Life plc, the Group's holding company that pays the dividends to shareholders, stood at £5,800m (FY 2024: £5,571m)
· Alongside distributable reserves, when assessing dividend affordability the Board considers the quantum and trajectory of the Group's OCG1 and Shareholder Capital Coverage Ratio3
Uniquely positioned in attractive, growing markets and strengthening our competitive advantages
· The UK long-term savings and retirement market is set to grow by c.70% over the next decade8
· Positioned to win as our competitive advantages of customer engagement, capital and cost efficiencies strengthen
· Workplace:
o Expectations of c.£80bn9 annual market flows with ambitions to consolidate our top-3 position with potential for accelerated growth from market consolidation and expected contribution increases
o £1.0bn of wins secured for 2026 to date with a medium term opportunity pipeline of more than £10bn
· Retail:
o Expectations of c.£150bn10 annual market flows with ambitions to move from a top-10 position to top-5
o Focus on realising the significant opportunity still available to leverage digital infrastructure across our 12m strong customer base
· Annuities:
o Expectations of c.£35-55bn11 annual market flows in PRT and £8-9bn12 in individual annuities, with ambitions to maintain our top-5 position across annuities
o Continued disciplined capital deployment in annuities consistent with our diversified business mix and focus on value over volume. Expectation to deploy up to c.£200m of capital across PRT and individual annuities in 2026
o £1.6bn of PRT transactions completed or at an exclusive stage in 2026 to date
Outlook
Firmly on track across all 2026 financial targets
· Firmly on track to deliver all 2026 financial targets which support our progressive and sustainable dividend policy7 and creates financial flexibility
· We expect to deliver c.£500m of excess cash in 2026
|
|
Financial target |
Progress to date |
|
Cash |
· Mid-single digit percentage growth p.a. in Operating Cash Generation1 |
· 5% growth year-on-year in FY 2025
|
|
· Total cash generation2 3-year target of £5.1bn across 2024-26 |
· £3.5bn achieved cumulatively across 2024-25 |
|
|
Capital |
· Operate within our 140-180% Shareholder Capital Coverage Ratio3 operating range |
· 176% at the end of FY 2025 |
|
· SII leverage ratio5 of c.30% by the end of 2026 |
· 3% point improvement to 33% in FY 2025 |
|
|
Earnings |
· c.£1.1bn of IFRS adjusted operating profit in 2026 |
· 15% growth year-on-year in FY 2025 to £945m |
|
· £250m of annual run-rate cost savings by the end of 2026 |
· £180m run-rate savings achieved by the end of FY 2025 |
· Mid‑single digit OCG growth going forwards supports the generation of at least £1bn Free Cash Flow per annum and over £400m in excess cash
· 2026 is our final year of using excess cash to de-lever. Excess cash generated post-2026 will be available to be deployed to the highest returning opportunities, in line with our capital allocation framework
· In 2027, our aim is for IFRS shareholders' equity to grow, excluding economics
· We anticipate announcing our post-2026 plan in Q4 2026
FY 2025 financial summary:
|
Financial performance metrics: |
31 December 2025 |
31 December 2024 |
YoY change |
|
|
Cash
|
Operating Cash Generation1 |
£1,474m |
£1,403m |
+5% |
|
Of which Pensions and Savings |
£396m |
£350m |
+13% |
|
|
Of which Retirement Solutions |
£879m |
£850m |
+3% |
|
|
Of which Europe and Other |
£123m |
£129m |
-(5)% |
|
|
Of which With-Profits |
£76m |
£74m |
+3% |
|
|
Recurring management actions |
£560m |
£537m |
+4% |
|
|
Operating Cash Generation margin (annualised) |
|
|
||
|
Pensions and Savings |
19bps |
18bps |
+1bps |
|
|
Retirement Solutions |
219bps |
218bps |
+1bps |
|
|
Total cash generation2 |
£1,711m |
£1,779m |
-4% |
|
|
IFRS |
Adjusted operating profit |
£945m |
£825m |
+15% |
|
Of which Pensions and Savings |
£389m |
£316m |
+23% |
|
|
Of which Retirement Solutions |
£563m |
£474m |
+19% |
|
|
Of which Europe and Other |
£83m |
£96m |
-14% |
|
|
Of which With-Profits |
£24m |
£41m |
-41% |
|
|
Of which Corporate Centre |
£(114)m |
£(102)m |
-12% |
|
|
Adjusted operating profit margin (annualised) |
|
|
||
|
Pensions and Savings |
19bps |
17bps |
+2bps |
|
|
Retirement Solutions |
140bps |
122bps |
+18bps |
|
|
Loss after tax |
£(394)m |
£(1,078)m |
+63% |
|
|
Dividend |
Final dividend per share |
28.05p |
27.35p |
+2.6% |
|
|
Total dividend per share |
55.40p |
54.00p |
+2.6% |
|
|
|
|
|
|
|
Balance sheet metrics: |
31 December 2025 |
31 December 2024 |
YoY change |
|
|
Solvency II capital |
Shareholder Capital Coverage Ratio3,4 |
176% |
172% |
+4%pts |
|
Solvency II surplus4 |
£3.6bn |
£3.5bn |
+2% |
|
|
Leverage |
Solvency II leverage ratio5 |
33% |
36% |
-3%pts |
|
IFRS |
Shareholders' equity |
£244m |
£1,213m |
-80% |
|
Gross Contractual Service Margin |
£3,806m |
£3,257m |
+17% |
|
|
Adjusted shareholders' equity |
£3,098m |
£3,656m |
-15% |
|
|
Assets |
Assets under administration |
£317bn |
£292bn |
+8% |
Group Chief Executive Officer's report
Successful delivery against our strategy
2025 highlights
• Full product suite now available for all customers' life stages; launched the Standard Life Guaranteed Lifetime Income plan
• Progressed customer engagement including the launch of our Retail advice proposition
• Strong trading performance with Workplace gross inflows of £10 billion; signed our largest-ever Pension Risk Transfer deal; Retail gross inflows continuing to improve
• Firmly on track to deliver all our 2026 financial targets
• Generating c.£1 billion free cash flow, comfortably covering our dividend and creating further financial flexibility
Standard Life has an exciting opportunity to shape our industry. Our 2025 results show our commitment to better customer outcomes while increasing shareholder returns and strengthening our financial flexibility.
Standard Life is a retirement specialist focused entirely on retirement savings and income, and is proud to manage £317 billion of assets under administration ('AUA') on behalf of our 12 million customers. Our purpose of 'helping people secure a life of possibilities' is embedded in everything that we do as we help customers journey to and through retirement.
Around two-thirds of our business by assets is Pensions and Savings, our capital-light fee-based business, which comprises our Workplace and Retail offerings. 13% of our business by assets is Retirement Solutions, our capital-utilising spread-based business, comprising our annuities offering across Pension Risk Transfer ('PRT') and individual annuities.
In March 2024 we set out our 3-year strategy, to realise our vision to be the UK's leading retirement savings and income business. Progress towards fulfilling our vision is delivered through executing against our strategic priorities of Grow, Optimise and Enhance. Our strategy fully embeds our environmental, social and governance ('ESG') themes of People and Planet.
In February 2026 we changed our name from Phoenix Group Holdings plc to Standard Life plc. This move brought our most trusted brand to the forefront and demonstrates our commitment to helping customers secure a better retirement.
+2.6%
2025 Final dividend increase
(2024: +2.6%)
Achieving our vision to be the UK's leading retirement savings and income business
To achieve our vision, our 2024-26 strategy is designed to build on the strong foundations we had already developed, leveraging our scale and strong positions in the attractive markets we operate in and completing our full-service customer offering.
To Grow we need to have a full suite of products which meet the needs of our customers, and build out our ability to engage with them. Having broadened our range of products in the market over recent years, including the launch of the Standard Life Guaranteed Lifetime Income plan, we now have a full product suite to support customers across all stages of their retirement journey.
There is always more to do as we continue to innovate and adapt to changing customer needs, behaviours and market trends, but this phase is now largely complete and sets us up well for the future.
We have also been working to unlock access to products and engagement opportunities. The launch of our advice proposition in 2025, and our wide range of digital offerings, from our Family Finance Hub, to our Mixed Income Builder tool, are all helping customers navigate their retirement journey, by supporting households with engaging planning and budgeting options.
We're focused on scaling our products, and deepening our intermediary partnerships, to widen our access to potential customers. In January 2026 we expanded the distribution of our smoothed managed fund onto the Quilter platform.
To Optimise our scale in-force business and our balance sheet, we have been further enhancing our unique in-house asset management expertise, including evolving our annuity-backing assets. For example, in September we announced we were preparing to in-house c.£20 billion of annuity-backing assets. Our asset management expertise will deliver enhanced returns, drive better customer outcomes, create cost savings and it underpins our ability to deliver recurring management actions. Together these contribute to the excess cash generation we are consistently achieving and in turn enabled us to repay £0.4 billion of debt to support our deleveraging programme, which will continue in 2026.
Under Enhance, our priority is to transform our operating model and culture, which in turn helps us to deliver better customer outcomes. A large aspect of this is completing the migration of customer administration to modern, technology-enabled platforms. In total, 75% of our policies are now on their end-state platforms, up from 45% in 2024, enabled by our strategic partnerships, including with Diligenta and Wipro.
Through leveraging technology and streamlining the organisation, we have made good progress on our cost savings programme with run-rate savings of £180 million achieved at the end of 2025. This underpins our confidence in achieving our end-2026 £250 million run-rate savings cost target.
Our remaining area of focus, which presents a significant opportunity as we continue to help our customers navigate their retirement journey, is the digital customer interface. Whilst we already have an award winning app, the next step is to enhance our technology and customer engagement capabilities by leveraging our digital infrastructure to create digitally enabled and personalised customer journeys - focused on data, guidance and advice. We're also focused on deepening our intermediary partnerships, widening our access to potential customers. While for Workplace and Annuities it's about continuing to deliver excellent performance.
See pages 28 to 37 for more detail on how we are delivering our strategy and pages 48 to 77 for our Sustainability review in the Annual Report and Accounts.
70%
Expected growth in long-term savings and retirement market over the next decade8
An attractive market with structural growth drivers and further tailwinds
The UK long-term savings and retirement market is already large, with c.£3.6 trillion8 of assets managed on behalf of customers, but it is also structurally growing across our key markets of Workplace, Retail and Annuities, and set to grow by c.70% over the next decade8.
This growth is driven by the current demographic and socio-economic trends, which have seen increasing responsibility for retirement falling on individuals rather than employers as was previously the case, including the shift from defined benefit ('DB') to defined contribution ('DC') schemes.
We continue to advocate for the changes that will make the biggest difference to our customers, and in this regard I am really encouraged by recent regulatory and political proposals that will support better retirement outcomes across all our key markets. These will also act as further tailwinds to the industry that will accelerate the existing structural growth opportunities beyond the c.70% expected growth.
As the only scale UK player solely focused on the full savings and retirement lifecycle, Standard Life is uniquely positioned to benefit from this market growth. Our ambition is to grow faster than the market.
See pages 22 to 23 for more on Our growth drivers in the Annual Report and Accounts.
Taking share in our chosen markets
Workplace is typically the foundation of a customer's retirement savings journey and it acts as a key acquisition tool for us. We're a scaled player, with AUA of £70.6 billion and three million members, both of which are growing.
Our ambition here is to consolidate our top-3 market position as this market grows rapidly; concentrates down to fewer players; and will be supported by expected contribution increases. This acceleration and concentration will be driven by proposals outlined in the Pension Schemes Bill which includes a requirement for minimum thresholds for default funds. We will achieve our strategy through deep customer engagement which will drive retention and support new scheme wins.
Winning in Workplace requires three things: a leading employer proposition, excellent customer service, and scale driven cost efficiency. We are strong on all three, as demonstrated across a collection of metrics.
We achieved an excellent Net Promoter Score ('NPS') of +60 in 20252. We welcomed 247k new Workplace members in 2025, up from 216k in 2024 and we won over 200 schemes in 2025. Lastly, Workplace AUA is up almost 40% in three years, importantly driven by strong positive net fund flows. With £10 billion of gross inflows reached this year, our market share grew to over 10%.
Our Retail strategy is to engage customers with innovative products to join, stay and consolidate with us. Delivering on this strategy will enable us to move from our current top-10 position to top-5.
Success in this market is driven by three things: customer engagement, offering products that meet customers' evolving needs and leveraging digital infrastructure to do all this proactively.
With 1-in-5 UK adults being customers of Standard Life plc, this provides us with a unique opportunity to win market share in the retail market - both via advisers and direct to customers. Our ability to win is further evidenced by our expanded product range now meeting more of our customers' evolving needs.
The positive outcomes of our efforts include high customer satisfaction scores, with 93% of customers rating us "good" or "excellent". This is translating to more digital customer engagement, with total logins up c.50% in two years.
While our Retail business remains in net outflow, we're seeing positive customer outcomes reflected in gross retail inflows of £7.1 billion in 2025, up by nearly £3 billion over the last three years.
Alongside our newly launched advice proposition, Targeted Support will enhance our ability to offer timely services to our customers and is very much aligned to our belief that everyone's journey to and through retirement can be better.
We have a significant opportunity to leverage our digital infrastructure, but we are not there yet. One area we're focusing on is building out our Salesforce customer relationship management ('CRM') integration. This gives us deeper insight to support customers so we can gather insights and proactively help by 'nudging' them to make the right choices at the right life stages, as they journey to and through retirement.
Within Annuities, which includes PRT and individual annuities, winning is all about having a leading employer proposition, excellent member experience, and competitive pricing. Our strength in all three is why we are winning in these markets today. Our comprehensive buy-in and buy-out capabilities, and a full product suite, mean that we can serve customers, however complex their needs may be.
We currently have a top-5 position and our ambition is to maintain this. We will achieve this by continuing to have a disciplined capital deployment approach of c.£200 million per annum, and through providing a holistic suite of de-risking solutions.
Having re-entered the individual annuity market in 2023 we have nearly doubled our market share to 15%, from 8% only two years ago, driven by our ability to launch a product that is both competitively priced and delivered via a leading digital customer experience.
In PRT we wrote our largest-ever deal of £1.9 billion in 2025, owing to our expertise and ability to provide member certainty in complex transactions. Our disciplined approach, reflected in our focus on value rather than volume in this market, means we are achieving attractive returns, with lifetime internal rates of returns ('IRRs') on our annuity business of more than 20%.
+93%
Customer satisfaction - digital
(2024: 94%) REM
+60
Workplace Net Promoter Score13
(2024: +60)
Whether it is saving for retirement through our Workplace business, or staying and consolidating in Retail, or securing income through our Annuities business, we're well positioned to serve customers and their evolving needs.
See pages 18 to 21 for Our business model and pages 24 to 27 on Our key divisions in the Annual Report and Accounts.
Strengthening our competitive advantages
Standard Life is clearly already winning today and is well-positioned to win share in our growing markets, underpinned by our three competitive advantages of customer engagement, capital efficiency and cost efficiency.
With 1-in-5 UK adults being customers of Standard Life plc we have an exceptional level of customer access which enables our customer engagement. This gives us insights into what customers - both corporate and consumers - really need, which in turn supports how we develop and design propositions. Our recent name change has brought our strongest brand to the forefront.
We also benefit from capital efficiency from our diversified long-term savings and retirement businesses, comprising both capital-light fee-based and capital-utilising spread-based products. Our unique asset management capabilities are already delivering superior returns, reflected in the sustainable delivery of recurring management actions at c.£500 million per annum, all whilst remaining cash flow matched.
£1,474m
2025 Operating Cash Generation
(2024: £1,403m) REM APM
Our existing cost efficiency, underpinned by our 12 million customer base, has been achieved by leveraging technology across our business, as reflected in our sector-leading Pensions and Savings margin. This margin expansion will continue as we deliver further cost savings. And, technology advancements will drive operating leverage higher as we scale.
Looking ahead, we will continue to strengthen those competitive advantages, which will support our growth.
See pages 16 to 17 for Our investment case in the Annual Report and Accounts.
Firmly on track for all our 2026 financial targets
Consistently executing on each of our strategic priorities is translating directly into the delivery of attractive financial outcomes. Our 2025 performance has been strong across our financial framework of cash, capital and earnings and we are firmly on track to deliver all of our 2026 financial targets.
See the Business review on pages 38 to 47 for more detail in the Annual Report and Accounts.
Operating Cash Generation ('OCG') continues to be the metric which best demonstrates the long-term underlying value generation from our business. OCG grew by 5% in the period to £1,474 million (2024: £1,403 million).
For 2025 the Board has recommended a 2.6% increase in the Final dividend of 28.05 pence per share, bringing our Total dividend to 55.40 pence per share, extending our strong track record of dividend growth.
We delivered £1 billion free cash flow in 2025, which has doubled from when we started this journey in 2023. At this level we are comfortably covering our dividend of £548 million and delivering £423 million of excess cash.
We continue to expect mid-single digit percentage growth per annum in OCG. This means dividends and excess cash will both grow, as OCG grows, particularly as recurring uses are reducing.
2026 is our final year of prioritising this excess cash to reduce debt. So excess cash generated after the end of this year, will be available to be deployed to the highest returning opportunities, in line with our capital allocation framework.
Summary
We operate in one of the most attractive retirement and savings markets in the world, and Standard Life has an important role to play in shaping the industry and providing better outcomes for pensioners.
When we set out our 3-year strategy in 2024, we were clear on the scale of the opportunity in front of us. Two years on, I'm delighted with the progress we've made and looking ahead, I continue to be optimistic.
Our execution positions us exceptionally well to meet the needs of our customers, and is strengthening our competitive advantages. This is translating into strong and attractive financial performance and returns to shareholders.
As we continue to serve our customers, colleagues and other key stakeholders, this will support us in achieving our vision of becoming the UK's leading retirement savings and income business.
Thank you
Our performance is only achieved through the continued hard work and dedication of our outstanding people so I would like to thank each and every one of my colleagues across the Group for their contributions. With our move to Standard Life plc, I am even more energised about our future and the progress we will make together in the years ahead.
Andy Briggs
Group Chief Executive Officer
Business review
Delivering cash, capital and earnings
We are successfully executing on our 3-year strategic priorities, which is driving improved performance and creating strong operating momentum across the key Group financial framework metrics of cash, capital and earnings.
Nicolaos Nicandrou
Group Chief Financial Officer
Our 2025 results reflect another year of strong, meaningful progress towards our 2026 financial targets. We are firmly on track to achieve these goals as we work towards our vision to be the UK's leading retirement savings and income business.
Operating momentum underpins our financial progress
In March 2024 we set 3-year targets under our financial framework of cash, capital and earnings, and we were able to upgrade a number of those targets in March 2025. Two years into our 3‑year strategic plan, the Group has delivered clear operational and financial improvement across our Grow, Optimise and Enhance priorities. Strong operating performance and sustainable cash generation continue to increase financial flexibility and support delivery of our 2026 financial framework.
In 2025, Operating Cash Generation increased 5% and IFRS adjusted operating profit rose 15%, driven by profitable growth in both our capital‑light, fee‑based Pensions and Savings business and our capital‑utilising Retirement Solutions business. Growing levels of assets under management and improved margins supported this outcome, alongside further cost reductions as we progress towards our £250 million net cost savings target by 2026.
We also strengthened our balance sheet, improving Solvency II leverage to 33%, with a clear line of sight to reaching c.30% by 2026, while maintaining our Shareholder Capital Coverage Ratio ('SCCR') at the upper half of our 140-180% operating range.
2025 financial summary
|
Financial performance metrics |
2025 |
2024 |
YOY change |
|
|
Cash |
Operating Cash Generation1 |
£1,474m |
£1,403m |
+5% |
|
Total cash generation1 |
£1,711m |
£1,779m |
-4% |
|
|
Solvency II capital |
Group Solvency II surplus |
£3.6bn |
£3.5bn |
+2% |
|
Group Shareholder Capital Coverage Ratio1 |
176% |
172% |
+4%pts |
|
|
Solvency II leverage ratio1 |
33% |
36% |
-3%pts |
|
|
IFRS |
Adjusted operating profit1 |
£945m |
£825m |
+15% |
|
Loss after tax attributable to owners |
£(394)m |
£(1,078)m |
+63% |
|
|
Shareholders' equity |
£244m |
£1,213m |
-80% |
|
|
Contractual Service Margin (gross of tax) |
£3,806m |
£3,257m |
+17% |
|
|
Adjusted shareholders' equity1 |
£3,098m |
£3,656m |
-15% |
|
|
Assets |
Assets under administration1 |
£317bn |
£292bn |
+8% |
|
Dividend |
Final dividend per share |
28.05p |
27.35p |
+2.6% |
|
Total dividend per share |
55.40p |
54.00p |
+2.6% |
|
1. Denotes metrics that are alternative performance measures ('APMs') - further information can be found on pages 340 to 345 in the Annual Report and Accounts.
Delivering successfully on our financial framework metrics
In 2025, we delivered total cash generation of £1,711 million, taking our 2024-25 total cash generation to £3.5 billion and remain on track to achieve our 2024-26 cumulative £5.1 billion target. Underpinning this is strong growth in OCG to £1,474 million, up 5% year-on-year in line with our annual mid-single digit percentage growth guidance. Our strong operating momentum, supported by the continued contribution of recurring management actions delivered by our in-house asset management team, has led to increased OCG contributions from our two main operating businesses: Pensions and Savings (up 13% year-on-year) and Retirement Solutions (up 3% year-on-year).
Importantly, OCG more than covered our recurring cash uses and dividend, totalling £1,051 million in the period, and generated £423 million of excess cash to deploy in line with our capital allocation framework, which we directed to reducing our debt leverage. Once this deleveraging programme is completed in 2026, future excess cash will be deployed towards the most attractive return opportunities across growth investments, targeted M&A, and increased returns to shareholders.
Our SII capital position remains strong with improvements in the SII surplus to £3.6 billion and in the SCCR to 176%. This reflected positive net recurring solvency capital generation of £0.4 billion, equivalent to a 9%pts increase in SCCR. Other SII capital actions more than covered our continued investment across our strategic priorities to grow, optimise and enhance, while our hedging programme eliminated the impact of market effects.
Growing momentum in the Group's operating performance is also evident in the 15% increase in our IFRS adjusted operating profit to £945 million. Improved performance in Pensions and Savings and in Retirement Solutions has delivered higher IFRS adjusted operating profit for these businesses, up 23% and 19% year-on-year respectively.
We reported an IFRS statutory loss after tax of £394 million in the period primarily due to adverse economic variances of £604 million pre-tax, reflecting the known consequence of the Group's hedging programme under this reporting basis. This statutory loss has impacted our IFRS shareholders' equity position, which has reduced to £244 million. This decline is not economically meaningful as the strength of our underlying economic financial position measured on a Solvency basis remains unchanged, with no consequential effect on cash generation, liquidity or strategic flexibility. As a reminder, our hedging programme aims to protect cash and SII capital from volatility in equities and interest rates, thereby safeguarding the Group's ability to deliver a progressive and sustainable dividend. The hedging covers components of the Solvency balance sheet which are not present under IFRS, giving rise to accounting volatility. We continue to prioritise stable SII surplus capital and predictable dividends and accept the hedge-related volatility in the IFRS result.
Notably, our Contractual Service Margin ('CSM') (gross of tax) grew 17% in 2025, which represents a sizeable stock of value that will be released into IFRS adjusted operating profit in future years. The growth in our CSM partially offset the decline in our shareholders' equity, with adjusted shareholders' equity of £3,098 million at end-2025.
As a result of our improved operating performance, the Board is recommending a 2.6% increase in the 2025 Final dividend to 28.05 pence per share, taking the Total dividend for the year to 55.40 pence per share.
Alternative performance measures
With our financial framework designed to deliver cash, capital and earnings, we recognise the need to use a broad range of metrics to measure and report the performance of the Group, some of which are not defined or specified in accordance with Generally Accepted Accounting Principles ('GAAP') or the statutory reporting framework.
We use a range of alternative performance measures ('APMs') to evaluate our business, which are summarised on pages 340 to 345 in the Annual Report and Accounts.
Business segment review
Strong business momentum supports our strong operating performance
Our diversified business model is a core source of strength for our Group and provides a robust foundation for sustainable and predictable earnings performance.
Pensions and Savings, covering new and in‑force life insurance and unit‑linked investment products, remains a key source of capital‑light fee‑based income. Retirement Solutions includes individual annuities and Pension Risk Transfer ('PRT') business, which add capital utilising spread-based margin to our results, diversifying our earnings sources. Europe and Other, which includes Ireland, Germany and SunLife protection, bring further diversification through premiums, fees and investment margins across distinct markets. With‑Profits continues to generate low‑volatility earnings via shareholder transfers from the Group's With‑Profits funds.
Together, these segments have underpinned the Group's strong 2025 performance, enhancing OCG and IFRS adjusted operating profit and reinforcing our trajectory towards the delivery of our 2026 targets.
This is our first year of providing a full segmental breakdown of OCG. The largest contributor to OCG is our Retirement Solutions business which represents over half of the total. In 2025, Retirement Solutions OCG grew by 3% to £879 million (2024: £850 million), supported by yield re-optimisation actions.
Our Pensions and Savings business is the fastest growing contributor to OCG, up 13% to £396 million in 2025 (2024: £350 million). This growth was supported by business growth and actions to reduce operating costs and simplify fund structures.
Europe and Other and With-Profits broadly maintained their combined £199 million OCG contribution, of £123 million (2024: £129 million) and £76 million (2024: £74 million) respectively.
In 2025 Pensions and Savings' IFRS adjusted operating profit grew by 23% to £389 million (2024: £316 million) reflecting the benefit of growing assets and improved cost efficiencies.
Retirement Solutions' IFRS adjusted operating profit increased 19% to £563 million (2024: £474 million), supported by a higher CSM release reflecting ongoing growth of the annuity book, higher portfolio optimisation actions and improved cost efficiencies.
Europe and Other IFRS adjusted operating profit decreased to £83 million (2024: £96 million), primarily due to a lower insurance result, while With-Profits reported a lower IFRS adjusted operating profit result of £24 million (2024: £41 million) as the 2024 results included one-off adjustments that did not repeat in 2025.
The Group's Corporate Centre operating loss of £114 million (2024: £102 million) includes lower interest income of £38 million (2024: £54 million) from reduced cash balances owing to debt repayments made.
+5%
Group OCG growth REM APM
+15%
Group IFRS adjusted operating profit growth REM APM
Pensions and Savings
Pensions and Savings performance driving higher profitability
Our Pensions and Savings business reported 11% growth in gross inflows to £17.1 billion2 (2024: £15.4 billion1) as our leading propositions and brand support our strong momentum here, and we continue to strengthen our capabilities across both our Workplace and Retail segments.
Workplace saw £10 billion of inflows in 2025, £1.5 billion of which were from new scheme wins. Excluding new schemes, gross inflows were £8.5 billion, highlighting the strong flywheel effect of this business. In Retail, gross inflows continue to improve, up 16% to £7.1 billion in 2025, benefiting from a greater take up of our drawdown product, and higher international bond sales.
Gross outflows totalled £19.6 billion2 (2024: £18.7 billion1), and reflect our higher asset base and actions taken by our customers to access their retirement savings in the form of annuity income, drawdown payments or withdrawing tax-free lump sumps, as they journey to and through retirement.
Scheme retention in Workplace remains high, and outflows reflect the higher asset base, and the natural attrition from those taking their pensions. Retail outflows include fulfilling our primary purpose of customers accessing their retirements savings, estimated at £5 billion in 2025. While the remaining retail outflows remain sizeable, we expect them to improve as a percentage of AUA as we increase our focus on retention.
The overall net outflow position was more than offset by £24.6 billion of positive market effects, driving AUA 8% higher to £211.7 billion at 31 December 2025.
The capital-light fee-based nature of this business means that we consider IFRS adjusted operating profit as the best measure to assess its performance. The increasing scale of this business and actions to reduce costs and simplify our funds range drove a 2bps improvement in operating profit margin to 19bps (2024: 17bps). Combined with an average AUA growth of 7%, this led to strong growth in IFRS adjusted operating profit of 23% to £389 million (2024: £316 million). OCG similarly increased to £396 million (2024: £350 million).
19bps
IFRS adjusted operating profit margin APM
+7%
Average AUA growth APM
+23%
IFRS adjusted operating profit growth APM
1. 2024 AUA, flows and average AUA have been restated to reflect the reallocation of the Retail International Bond from Europe and Other to Pensions and Savings.
2. Retail International Bond AUA and flows reallocated from Europe and Other to Pensions and Savings for 2023, 2024 and 2025. 2025 also reflects the reclassification of Corporate Trustee Investment Plan Held for Transfer assets from Workplace to Europe and Other at end-2025.
Retirement Solutions
Retirement Solutions driving resilient capital-efficient growth
We have two main product lines here, being individual annuities and PRT. We run £42 billion of annuity assets, and it is the management of this large book, that drives most of our profitability. New volumes are not the primary driver of current year profits but are a source of future value.
Our Retirement Solutions business reported 20% growth in individual annuities new business to £1.2 billion (2024: £1.0 billion) and we maintained our discipline in PRT in a narrow credit spread environment and competitive market, writing £3.9 billion of new business (2024: £5.1 billion). Due to our proactive approach in managing capital allocation and pricing discipline to secure attractive returns, we took the strategic decision to forgo volumes to protect the economics, investing 21% less capital this year. Our aim remains to direct up to £200 million capital to annuities this year, provided we secure sufficiently attractive returns. We expect continuation of the competitive landscape in 2026, and we remain confident in our abilities to win in this market, with £1.6 billion of PRT transactions completed or at an exclusive stage in 2026 to date. We remain focused on disciplined capital deployment in a competitive market.
The capital-utilising spread-based nature of this business means that we consider OCG as the most meaningful measure to assess performance. In-force business management has a greater bearing on profitability and cash generation than new business flows. Our proactive management of the in-force book combined with our scale and efficiency, our effective risk management, and our expertise in delivering asset portfolio optimisation actions, enabled us to sustain a spread-based margin of 219 bps (2024: 218bps), dynamics which we consider to be enduring. Around half of this margin reflects the steady release of capital and spread margins as our liabilities run-off, with the other half relating to the benefit from both yield re-optimisation and capital improvement actions.
Applied to our growing average AUA, which was up 3% at £40.2 billion (2024: £39.0 billion), resulted in OCG growth of 3% to £879 million (2024: £850 million). This growth accounts for over half of the Group's OCG.
IFRS adjusted operating profit also increased to £563 million (2024: £474 million) driven by disciplined pricing, investment optimisation, cost efficiencies and growth.
219bps
OCG spread APM
+3%
Average AUA growth APM
+3%
OCG growth APM
Cash
Consistent OCG delivery
In 2025, OCG increased 5% to £1,474 million (2024: £1,403 million), in line with our guidance to grow OCG at a mid-single digit percentage rate per annum. This was driven by higher surplus emergence of £914 million (2024: £866 million), supported by new business written and the benefit of our ongoing cost savings programme, which have offset the natural run-off of our in-force business.
The remaining £560 million of OCG was generated through recurring management actions (2024: £537 million), reflecting another strong performance driven by our developed in-house asset management capabilities, and in line with our guidance of delivering sustainable recurring management actions of around £0.5 billion per annum. The majority of these actions were portfolio optimisation actions contributing £363 million (2024: £323 million), with a further £93 million from fund simplification actions (2024: £122 million) and £104 million from capital improvement actions (2024: £92 million).
Total cash generation supports deleveraging and investment
Total cash generation during the period was £1,711 million (2024: £1,779 million). In addition to the OCG generated this year, we also contributed £237 million (2024: £376 million) of non-operating cash generation from the delivery of non-recurring management actions. Over 2024-25 we have delivered £3.5 billion total cash generation and are on track to achieve our 3-year target of £5.1 billion.
Standard Life plc holding companies' sources and uses of cash
|
£m |
2025 |
2024 |
|
Holding companies' cash at 1 January2 |
1,117 |
1,012 |
|
Operating Cash Generation |
1,474 |
1,403 |
|
Of which Pensions and Savings |
396 |
350 |
|
Of which Retirement Solutions |
879 |
850 |
|
Of which Europe and Other |
123 |
129 |
|
Of which With-Profits |
76 |
74 |
|
Non-operating cash generation |
237 |
376 |
|
Total cash generation1 |
1,711 |
1,779 |
|
Recurring uses of cash |
(1,051) |
(1,107) |
|
Non-operating cash outflows |
(533) |
(314) |
|
Holding companies' cash, pre-debt movements |
1,244 |
1,370 |
|
Debt repayments |
(398) |
(643) |
|
Debt issuance |
- |
390 |
|
Holding companies' cash at 31 December2 |
846 |
1,117 |
|
Operating Cash Generation comprises: |
|
|
|
Recurring management actions |
560 |
537 |
|
Surplus emergence |
914 |
866 |
1. Total cash generation includes £123 million received by the holding companies in respect of tax losses surrendered (2024: £156 million).
2. Holding companies' cash is an APM - further information can be found on pages 340 to 345 in the Annual Report and Accounts.
The £5.1 billion total cash generation target is expected to exceed both our expected recurring uses and the planned investment in our business over the 2024-26 period, which together are expected to total £3.9 billion. As a result, we will generate £1.2 billion of excess cash. In line with our capital allocation framework, the financial headroom created by this excess cash is being directed to deleveraging in order to meet our c.30% SII leverage ratio target by the end of 2026, with £651 million of debt already retired across 2024 and 2025.
Recurring uses of cash
Our recurring uses of cash comprise of central operating expenses, debt interest, capital invested in annuities and shareholder dividends. Operating expenses decreased to £112 million (2024: £132 million) reflecting cost reductions. Debt interest fell to £229 million (2024: £236 million) as we reduce the level of debt on our balance sheet.
We invested £162 million of capital into our annuities business (2024: £206 million) to support £5.1 billion of new business annuity premiums in the year (2024: £6.1 billion).
Combined, these recurring uses excluding the shareholder dividend reduced to £503 million1 (2024: £574 million) as we took steps to improve both operating and capital efficiency.
Importantly, OCG of £1,474 million more than covered the recurring uses of cash including dividend in the period of £1,051 million. The excess cash generated of £423 million was principally deployed to retire debt in support of our deleveraging programme.
Non-recurring uses of cash
Non-operating net cash outflows increased to £533 million (2024: £314 million), partly driven by cash collateral outflows on currency derivatives used to hedge non-sterling debt instruments of £105 million, following depreciation of the US Dollar in the period. Non-operating costs also include our planned investment across our strategic priorities of £275 million (2024: £354 million) to grow, optimise and enhance our business, as well as other payments relating to provision of capital support to new ventures, subsidiary closure, costs and other one-off items funded centrally.
Debt repayments
Net debt repayments were higher at £398 million (2024: £253 million net repayment) and represent the redemption of $250 million of Restricted Tier 1 notes (£200 million) and £198 million Tier 2 notes in February and December 2025, respectively.
£1,474m
Operating Cash Generation REM APM
£1,711m
Total cash generation REM APM
1. Comprises central operation expenses, debt interest and capital invested in annuities.
Capital
Resilient Solvency II position
Our SII capital position remains resilient, with an estimated surplus of £3.6 billion (2024: £3.5 billion) and is stated after the accrual for the 2025 Final dividend. Our surplus was £0.1 billion higher than 2024 despite retiring £398 million of debt this year, demonstrating the improved operating capital generation capabilities of our business. Our SCCR increased 4%pts to 176% (2024: 172%) and remains in the upper half of our target operating range of 140-180%.
Recurring capital generation
In 2025, recurring SII capital generation pre-dividend totalled £0.9 billion, with £0.4 billion generated post-dividend which increased the SCCR by 9%pts.
Surplus emergence from in-force business, together with the release of capital requirements, contributed £0.9 billion to the SII surplus and 21%pts to the SCCR. In addition, we delivered £0.5 billion of recurring management actions, predominantly Own Funds accretive as a result of portfolio optimisation actions, increasing the SCCR by 13%pts.
Operating costs, dividends and debt interest totalled £0.9 billion, reducing the SCCR by 20%pts, while our new business strain was lower this year at £0.1 billion, reflective of lower capital allocation to protect economics in a highly competitive market, and reduced the SCCR by 5%pts.
Solvency II economic sensitivity analysis1
|
|
Surplus (£bn) |
SCCR (%) |
|
Solvency II base |
3.6 |
176 |
|
Equities: 20% fall in markets |
- |
7 |
|
Long-term rates: 100bps rise in interest rates |
- |
4 |
|
Long-term rates: 100bps fall in interest rates |
- |
(4) |
|
Long-term inflation: 50bps rise in inflation |
- |
(1) |
|
Property: 12% fall in values |
(0.2) |
(4) |
|
Credit spreads: 145bps widening with no allowance for downgrades |
0.1 |
4 |
|
Credit downgrade: immediate full letter downgrade on 20% of portfolio2 |
(0.3) |
(7) |
|
Lapse: 10% increase/decrease in rates |
(0.2) |
(2) |
|
Longevity: 6 months increase |
(0.4) |
(8) |
1. Illustrative impacts assume changing one assumption on 1 January 2026, while keeping others unchanged, and that there is no market recovery. They should not be used to predict the impact of future events as this will not fully capture the impact of economic or business changes. Given recent volatile markets, we caution against extrapolating results as exposures are not all linear.
2. Impact of an immediate full letter downgrade across 20% of the shareholder exposure to the bond portfolio (e.g. from AAA to AA, AA to A, etc.). This sensitivity assumes management actions are taken to rebalance the annuity portfolio back to the original average credit rating and makes no allowance for the spread widening which would be associated with a downgrade.
Non-recurring capital generation
Non-recurring SII capital generation, excluding the debt repayments, added £0.1 billion to surplus, as £0.4 billion of surplus generated from other management actions more than offset our other non-recurring uses in the period, including £0.3 billion of investment spend and other items. These uses primarily reflect our planned investment to grow, optimise and enhance our business over 2024-26 and include the Day 1 benefit from appointing Wipro as our new strategic partner to assume management of the existing ReAssure platform, ALPHA, earlier than previously planned. Other management actions include the benefits achieved from transitioning to the in-house management of our annuity-backing assets, which has improved cost efficiency and strengthened our ability to deliver long-term value to shareholders. They also include the benefits from selling the shareholders' share of future income from our with-profits funds to the estate of these funds. We continue to be well hedged on an economic basis under SII and experienced a positive impact of £0.1 billion this year driven by a steepened yield curve, lower inflation and higher equity markets. This impact was offset by £0.1 billion losses on currency hedge instruments relating to our debt instruments.
Strong progress on leverage
Our SII leverage ratio improved by 3%pts to 33% at 31 December 2025 (2024: 36%), as a result of the £398 million debt repayments completed in February and December 2025. We remain on track to achieve our c.30% SII leverage ratio target by the end of 2026, although the path will not be linear.
£3.6bn
Group Solvency II surplus (estimated) REM
176%
Group Shareholder Capital Coverage Ratio (estimated) APM
33%
Solvency II leverage ratio REM APM
Movement in Group Solvency II capital during 2025
|
|
|
Recurring capital generation of +£0.4bn surplus and +9%pts SCCR |
|
Non-recurring capital utilisation of +£0.1bn surplus and +3%pts SCCR |
|
|
|
|
|
|||||
|
£m |
2024 |
Surplus emergence and release of SCR |
Recurring management actions |
Operating costs, debt interest and dividend |
New business strain |
|
Other management actions |
Economics and temporary strain |
Investment spend and other |
|
2025 (pre-debt repayment) |
|
Debt repayment |
2025 |
|
Own Funds |
8.4 |
0.7 |
0.5 |
(0.9) |
0.1 |
|
0.3 |
0.0 |
(0.4) |
|
8.7 |
|
(0.4) |
8.3 |
|
SCR |
(4.9) |
0.2 |
0.0 |
- |
(0.2) |
|
0.1 |
0.0 |
0.1 |
|
(4.7) |
|
- |
(4.7) |
|
SII surplus |
3.5 |
0.9 |
0.5 |
(0.9) |
(0.1) |
|
0.4 |
0.0 |
(0.3) |
|
4.0 |
|
(0.4) |
3.6 |
|
SCCR1 |
172% |
21% |
13% |
(20)% |
(5)% |
|
9% |
1% |
(7)% |
|
184% |
|
(8)% |
176% |
1. The SCCR excludes SII Own Funds and Solvency Capital Requirements ('SCR') of unsupported With-Profit funds and unsupported pension schemes.
Earnings
IFRS adjusted operating profit momentum continues
We generated a 15% year-on-year increase in IFRS adjusted operating profit to £945 million (2024: £825 million) driven by uplifts in both of our two main operating business units, Pensions and Savings (23% growth year-on-year) and Retirement Solutions (19% growth year-on-year).
Looking ahead, our continued IFRS adjusted operating profit momentum in 2025 provides us with confidence in meeting our 2026 IFRS adjusted operating profit target of c.£1.1 billion.
Accelerated delivery of cost savings
The Group's cost savings programme remains firmly on track to deliver the end-2026 targeted £250 million of annual run-rate cost savings, net of inflation, relative to the Group's 2023 cost levels, as we continue to enhance our business and progress towards a more efficient Group-wide operating model.
In 2025, £117 million of run-rate savings were delivered, which combined with the savings achieved in 2024, brings the cumulative run-rate cost savings total to £180 million across 2024-25, £55 million ahead of our original delivery profile by 2025.
Of these run-rate savings, £110 million were earned in the year (2024: £28 million), with £55 million of the £82 million year-on-year increase emerging IFRS adjusted operating profit, with the balance accounted through the CSM.
IFRS income statement
|
£m |
2025 |
2024 |
|
Pensions and Savings |
389 |
316 |
|
Retirement Solutions |
563 |
474 |
|
Europe and Other |
83 |
96 |
|
With-Profits |
24 |
41 |
|
Corporate Centre |
(114) |
(102) |
|
Adjusted operating profit |
945 |
825 |
|
Amortisation and impairment of intangibles |
(233) |
(270) |
|
Finance costs attributable to owners |
(193) |
(204) |
|
Other non-operating items |
(396) |
(520) |
|
Profit/(loss) before economics, tax and NCI |
123 |
(169) |
|
Economic variances |
(604) |
(1,297) |
|
Loss before tax and NCI |
(481) |
(1,466) |
|
Profit before tax attributable to non-controlling interest |
49 |
12 |
|
Loss before tax attributable to owners |
(432) |
(1,454) |
|
Tax credit attributable to owners |
38 |
376 |
|
Loss after tax attributable to owners |
(394) |
(1,078) |
Amortisation and impairment of intangibles
The previously acquired in-force business, relating to IFRS 9 capital-light fee-based business, is being amortised in line with the expected run-off profile of the investment contract profits to which it relates. Amortisation and impairment during the period reduced to £233 million (2024: £270 million) reflecting the run-off of this acquired business.
Finance costs and other non-operating items
Other non-operating losses in the period totalled £396 million (2024: £520 million loss), the majority of which reflects £264 million (2024: £372 million) of planned investment spend across our strategic priorities, with £132 million (2024: £148 million) of other one-off items.
Finance costs of £193 million (2024: £204 million) reflected interest borne on the Group's debt.
IFRS loss after tax shaped by economic variances
The Group generated an IFRS loss after tax attributable to owners of £394 million (2024: loss of £1,078 million). The loss is driven by £604 million of adverse hedging-related economic variances (2024: £1,297 million adverse), primarily from rising equity markets in the year (FTSE 100 +21.5%, S&P 500 +16.4% and Eurostoxx 50 +18.3%), and reflects the result of the Group's hedging programme which aims to protect cash and SII capital from volatility in equities and interest rates. This gives rise to accounting movements, as several of the SII capital components covered by hedging are not recognised on the IFRS balance sheet, with the IFRS market sensitivities shown on pages 242 to 248.
£945m
IFRS adjusted operating profit REM APM
£3,806m
Contractual Service Margin (gross of tax)
£3,098m
IFRS adjusted shareholders' equity APM
Adjusted shareholders' equity highlights strong underlying value
We have built on our progress made in 2024 in increasing the level of pre-tax IFRS adjusted operating profitability to cover our recurring uses. In 2025 only £29 million (pre-tax) remained uncovered, an improvement on the equivalent amount of £182 million in 2024.
We continue to expect that our target of c.£1.1 billion IFRS adjusted operating profit in 2026 will be sufficient to fully cover our recurring uses and create excess to fund non-recurring uses.
The level of non-operating items are elevated at present, largely driven by our planned 3-year non-recurring investment spend. The level of non-operating items is expected to moderate once our current spend on migrations and transformation is completed. From 2027 we expect adjusted operating profit to cover all uses, excluding economic variances.
The resulting IFRS loss after tax in the period drove shareholders' equity lower at the end of 2025 to £244 million (2024: £1,213 million). As described above, this is owing to economic variances and has no impact on operating performance, cash, or capital strength, so the movement does not change the financial viability of our business, which is best measured by reference to Solvency capital, which includes the store of future value on annuities, with-profits and investment contract business. The Board continues to prioritise stable SII surplus capital and predictable dividends and accepts the hedge-related volatility in the IFRS result.
Adjusted shareholders' equity provides a better, albeit still partial, view of the value of the business under IFRS. It comprises IFRS shareholders' equity and the CSM (net of tax) and stood at £3,098 million at 31 December 2025 (2024: £3,656 million).
IFRS shareholders' equity and adjusted shareholders' equity
|
£m |
2025 |
2024 |
|
Adjusted operating profit |
945 |
825 |
|
Recurring uses: |
|
|
|
Amortisation of intangibles |
(233) |
(270) |
|
Finance costs attributable to owners |
(193) |
(204) |
|
Dividend |
(548) |
(533) |
|
Adjusted operating profit before tax, less recurring uses |
(29) |
(182) |
|
Non-recurring uses, economics and tax: |
|
|
|
Other non-operating items |
(396) |
(520) |
|
Economic variances |
(604) |
(1,297) |
|
Tax and other items recognised in equity |
60 |
470 |
|
Movement in shareholders' equity |
(969) |
(1,529) |
|
|
|
|
|
Opening shareholders' equity |
1,213 |
2,742 |
|
Movement in shareholders' equity |
(969) |
(1,529) |
|
Closing shareholders' equity |
244 |
1,213 |
|
CSM (net of tax) |
2,854 |
2,443 |
|
Adjusted shareholders' equity |
3,098 |
3,656 |
CSM momentum drives value
The Group's CSM (gross of tax) rose by 17% to £3,806 million at 31 December 2025 (2024: £3,257 million) and represents a sizeable stock of value that will unwind into IFRS adjusted operating profit in future years.
The increase in the period was driven by a £296 million contribution from strategic project initiatives, which comprised the impact of the lower cost of managing our annuity-backing assets which will be in-housed and the impact from the net expense benefits related to the Wipro strategic partnership. An additional £150 million contribution was generated from new business, principally from annuities written in Retirement Solutions (2024: £248 million), with a further £308 million from assumption changes, experience profits, positive market effects and other (2024: £370 million). Both periods benefited from lower expense maintenance loadings reflecting our cost savings initiatives and from positive market effects.
The 2025 CSM release into the income statement of 7% is broadly in line with the prior year (2024: 8%), contributing £274 million to pre-tax IFRS adjusted operating profit (2024: £281 million). With in-year net CSM generation more than exceeding amortisation, the net of tax value of the CSM increased to £2,854 million at 31 December 2025 (2024: £2,443 million).
Other stores of value not captured in IFRS balance sheet
In addition to the store of future value of £2.9 billion (post-tax) captured in the CSM for insurance contracts, there is a further store of future value which is included in Solvency II Own Funds, relating to the value-in-force for investment contracts. This increased to £4.4 billion post-tax in 2025 (2024: £3.4 billion post-tax), reflecting new business flows, cost savings, improved in-force business management and equity market rises. These stores of value will emerge through IFRS adjusted operating profit in future years, providing a strong underpin to the Group performance trajectory for many years to come.
Movement in Group Contractual Service Margin during 2025, including segmental split
|
£m |
Opening CSM (gross) |
New business |
Interest accretion |
Assumption changes, experience economics and other |
Strategic project initiatives |
Closing CSM, pre-release (gross) |
CSM release |
Closing CSM (gross) |
Tax |
Closing CSM (net) |
|
Pensions and Savings |
263 |
- |
- |
56 |
10 |
329 |
(33) |
296 |
(74) |
222 |
|
Retirement Solutions |
2,306 |
128 |
61 |
223 |
271 |
2,989 |
(189) |
2,800 |
(700) |
2,100 |
|
Europe and Other |
196 |
22 |
2 |
(5) |
5 |
220 |
(24) |
196 |
(49) |
147 |
|
With-Profits |
492 |
- |
6 |
34 |
10 |
542 |
(28) |
514 |
(129) |
385 |
|
2025 Total Group CSM |
3,257 |
150 |
69 |
308 |
296 |
4,080 |
(274) |
3,806 |
(952) |
2,854 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Total Group CSM |
2,853 |
248 |
67 |
370 |
- |
3,538 |
(281) |
3,257 |
(814) |
2,443 |
Dividend
28.05p
2025 Total dividend per share
+2.6%
2025 Final dividend increase
+3%
10-year Total dividend CAGR
In March 2024, the Board outlined a 3-year strategy for 2024-26, to support the creation of a business which delivers sustainable and growing cash, capital and earnings and adopted a progressive and sustainable ordinary dividend policy, reflecting its confidence in the Group's strategy.
In operating this dividend policy, the Board will announce any potential annual dividend increase alongside the Group's Full Year results and expects the Interim dividend to be in line with the previous year's Final dividend. The Board continues to prioritise the sustainability of our dividend over the long term. Future dividends and annual increases will be subject to the discretion of the Board, following assessment of longer-term affordability.
In operating the policy and assessing longer-term affordability, the Board considers the quantum and trajectory of the Group's OCG, SII surplus, SCCR and the distributable reserves at the Group's holding company.
At 31 December 2025, distributable reserves at Standard Life plc, the Group's holding company that pays dividends to shareholders, stood at £5,800 million (2024: £5,571 million), supported by distributions from its main operating companies which continue to report under UK GAAP and carry sizeable distributable reserves. In 2025 the Group's main operating subsidiaries generated strong UK GAAP net profits after hedging impacts, which supported the cash remittances to Group.
In the consolidated IFRS financial statements, the Group is targeting a positive pre-hedge post-dividend IFRS net profit contribution to the IFRS shareholders' equity from 2027. The Group accepts the hedge-related volatility that impacts IFRS shareholders' equity, which is a known consequence of our Solvency II hedging strategy that is designed to protect our cash, capital and dividend.
In this overall context and consistent with previous guidance, the Board considers that the Group's consolidated IFRS shareholders' equity is not a constraint to the payment of our dividends.
As a result of our improved operating performance in 2025 and our ongoing confidence in the Group's strategy, the Board is recommending a 2.6% increase in the 2025 Final dividend to 28.05 pence per share, taking the 2025 Total dividend to 55.40 pence per share.
Looking ahead
The Group continues to operate in an environment with increased global geopolitical and macroeconomic uncertainty, including the escalation of conflict in the Middle East in recent weeks. Despite this backdrop, the UK consumer retirement needs we serve are long term in nature and enduring.
Two years into this 3-year period, we have made demonstrable progress across our strategic priorities and our improved operating performance puts us firmly on track to meet our 2026 financial framework targets.
At the end of 2026, our business will have a higher OCG and IFRS adjusted operating profit base and a higher quality Solvency balance sheet. Importantly, it will generate a healthy and growing level of excess cash, improving both our financial and strategic flexibility.
2026 financial targets
|
|
Financial target |
Status |
Performance in 2025 and 2024 |
|
Cash |
Mid-single digit percentage growth p.a. in Operating Cash Generation |
On track |
£1,474m, +5% vs FY2024 (£1,403m) |
|
Total cash generation of £5.1bn across 2024-26 |
On track |
£3.5bn across 2024-25 (FY2025: £1.7bn, FY2024: £1.8bn) |
|
|
Capital |
Operate within our 140-180% Shareholder Capital Coverage Ratio operating range |
On track |
176%, within operating range (FY2024: 172%) |
|
Solvency II leverage ratio of c.30% by the end of 2026 |
On track |
33%, -3%pts vs FY2024 (36%) |
|
|
Earnings |
c.£1.1bn of IFRS adjusted operating profit in 2026 |
On track |
£945m, +15% vs FY2024 (£825m) |
|
£250m of annual run-rate cost savings by the end of 2026 |
On track |
£180m across 2024-25 (FY2025: £117m, FY2024: £63m) |
Information required under the Disclosure Guidance & Transparency Rules ('DTR')
Information required to be communicated in unedited full text, in accordance with DTR 6.3.5R(1A), is included in the Annual Report and Accounts, available at http://www.rns-pdf.londonstockexchange.com/rns/7523W_1-2026-3-15.pdf
In accordance with UK Listing Rule 6.4.1, a copy of the Annual Report and Accounts has been submitted to the National Storage Mechanism and will shortly be available for inspection at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism
The document may also shortly be accessed via the Standard Life website at: https://www.standardlifeplc.com/investors/results-reports-and-presentations/
Enquiries
Investors/analysts:
Claire Hawkins, Director of Corporate Affairs & Brand, Standard Life
+44 (0)20 4559 3161
Joanne Roberts, Investor Relations Director, Standard Life
+44 (0)20 4559 4673
Media:
Tom Blackwell, FTI Consulting
+44 (0)203 727 1051
Shellie Wells, Corporate Communications Director, Standard Life
+44 (0)20 4559 3031
Presentation and webcast details
There will be a live virtual presentation for analysts and investors today starting at 09:30 (GMT). You can register for the live webcast at: Standard Life FY 2025 results
A copy of the presentation and a detailed financial supplement will be available at:
https://www.standardlifeplc.com/investors/results-reports-and-presentations/
A replay of the presentation and transcript will also be available on our website following the event.
There will also be an additional Q&A event aimed at retail investors, hosted by Andy Briggs, Group CEO, and Nicolaos Nicandrou, Group CFO, following a replay of the Group's Investor Presentation, via Investor Meet Company on 20 March 2026, starting at 12:30 (GMT).
The Investor Meet Company presentation and Q&A is open to all existing and potential shareholders. Questions can be submitted pre-event via your Investor Meet Company dashboard up until 19 March 2026, 09:00 (GMT), or at any time during the event.
Investors can sign up to Investor Meet Company for free and add to meet Standard Life plc via:
https://www.investormeetcompany.com/standard-life-plc/register
Dividend details
The recommended Final 2025 dividend of 28.05 pence per share is expected to be paid on 20 May 2026. The ordinary shares will be quoted ex-dividend on the London Stock Exchange as of 9 April 2026.
The record date for eligibility for payment will be 10 April 2026.
Footnotes
|
1. |
Operating Cash Generation ('OCG') represents the sustainable level of ongoing cash generation from our underlying business operations, that is remitted from our Life Companies to the Group. |
|
2. |
Total cash generation represents the total cash remitted from the operating entities to the Group, comprising OCG, non-recurring management actions and the release of free surplus above capital requirements in the Life Companies. |
|
3. |
The Shareholder Capital Coverage Ratio excludes Solvency II Own Funds and Solvency Capital Requirements of unsupported With-Profit funds and unsupported pension schemes. |
|
4. |
31 December 2025 Solvency II capital position is an estimated position. |
|
5. |
Solvency II leverage ratio calculation = debt (all debt including RT1) / SII regulatory Own Funds. Ratio allows for currency hedges over foreign currency denominated debt. |
|
6. |
Includes reallocation of flows and AUA for International Bonds to Retail from Europe, and held for transfer Corporate Trustee Investment Plan ('CTIP') mandate to Other from Workplace. |
|
7. |
The Board will continue to prioritise the sustainability of our dividend over the long term. Future dividends and annual increases will be subject to the discretion of the Board, following assessment of longer-term affordability. At 31 December 2025, distributable reserves at Standard Life plc, the Group's holding company that pays dividends to shareholders, stood at £5,800 million (FY 2024: £5,571 million), supported by distributions from its main operating companies which continue to report under UK GAAP and carry sizeable distributable reserves. In 2025 the Group's main operating subsidiaries generated strong UK GAAP net profits after hedging impacts, which supported the cash remittances to Group. In the consolidated IFRS financial statements, the Group is targeting a positive pre-hedge post-dividend IFRS net profit contribution to the IFRS shareholders' equity. The Group accepts the hedge-related volatility that impacts IFRS shareholders' equity, which is a known consequence of our Solvency II hedging strategy that is designed to protect our cash, capital and dividend. In this overall context and consistent with previous guidance, the Board considers that the Group's consolidated IFRS shareholders' equity is not a constraint to the payment of our dividends. |
|
8. |
Company analysis of market data and industry forecasts including 2024 LCP Pension Risk Transfer report, NMG, The 2024 Purple Book and publicly available FY 2024 and HY 2025 financial disclosures. |
|
9. |
Company estimate based on NMG market model (2024). |
|
10. |
NMG market model (2024) data. |
|
11. |
Company estimate based on 2025 LCP Pension Risk Transfer report. |
|
12. |
Company estimate based on publicly available information. |
|
13. |
Customer satisfaction score converted to NPS equivalent metric. |
Disclaimers
On 24 February 2026 we changed our name from Phoenix Group Holdings plc to Standard Life plc. References to performance to 31 December 2025 were under Phoenix Group Holdings plc.
This announcement in relation to Standard Life plc and its subsidiaries (the 'Group') contains, and the Group may make other statements (verbal or otherwise) containing, forward-looking statements and other financial and/or statistical data about the Group's current plans, goals, targets, ambitions, outlook, guidance and expectations relating to future financial condition, performance, results, strategy and/or objectives.
Statements containing the words: 'believes', 'intends', 'will', 'may', 'should', 'expects', 'plans', 'aims', 'seeks', 'targets', 'continues' and 'anticipates' or other words of similar meaning are forward looking. Such forward-looking statements and other financial and/or statistical data involve known and unknown risks and uncertainty because they relate to future events and circumstances that are beyond the Group's control. For example, certain insurance risk disclosures are dependent on the Group's choices about assumptions and models, which by their nature are estimates. As such, actual future gains and losses could differ materially from those that the Group has estimated.
Other factors which could cause actual results to differ materially from those estimated by forward-looking statements include, but are not limited to: domestic and global economic, political, social, environmental and business conditions; asset prices; market-related risks such as fluctuations in investment yields, interest rates and exchange rates, the potential for a sustained low-interest rate or high-interest rate environment, and the performance of financial or credit markets generally; the regulations, policies and actions of governmental and/or regulatory authorities including, for example, climate change and the effect of the UK's version of the 'Solvency II' regulations on the Group's capital maintenance requirements; developments in the UK's relationship with the European Union; the direct and indirect consequences of the conflicts in Ukraine and the Middle East for European and global macroeconomic conditions and related or other geopolitical conflicts; political uncertainty and instability including the rise in protectionist measures; the impact of changing inflation rates (including high inflation) and/or deflation; information technology (including developments and use of Artificial Intelligence) or data security breaches (including the Group being subject to cyber-attacks); the development of standards and interpretations including evolving practices in sustainability and climate reporting with regard to the interpretation and application of accounting; the limitation of climate scenario analysis and the models that analyse them; lack of transparency and comparability of climate-related forward-looking methodologies; climate change and a transition to a low-carbon economy (including the risk that the Group may not achieve its targets); the Group's ability along with governments and other stakeholders to measure, manage and mitigate the impacts of climate change effectively; the implementation of rules, regulations or other actions with an opposing stance to sustainability matters or policies; market competition; changes in assumptions in pricing and reserving for insurance business (particularly with regard to mortality and morbidity trends, gender pricing and lapse rates); the timing, impact and other uncertainties of any acquisitions, joint ventures, disposals or other strategic transactions (including any associated integration); risks associated with arrangements with third parties; inability of reinsurers to meet obligations or unavailability of reinsurance coverage; and the impact of changes in capital and implementing changes in IFRS 17 or any other regulatory, solvency and/or accounting standards, and tax laws and practices and other legislation and regulations in the jurisdictions in which members of the Group operate.
As a result, the Group's actual future financial condition, performance and results may differ materially from the plans, goals, targets, ambitions, outlook, guidance and expectations set out in the forward-looking statements and other financial and/or statistical data within this announcement. The information in this announcement does not constitute an offer to sell or an invitation to buy securities in Standard Life plc or an invitation or inducement to engage in any other investment activities. The Group undertakes no obligation to update any of the forward-looking statements or data contained within this announcement or any other forward-looking statements or data it may make or publish. Nothing in this announcement constitutes, nor should it be construed as, a profit forecast or estimate. No representation is made that any of these statements will come to pass or that any future results will be achieved. As a result, you are cautioned not to place undue reliance on such forward-looking statements contained in this announcement.
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