L&G Full Year Results 2024 Part 1

Risks and Uncertainties	Risk management	Outlook
Investment market performance and conditions in the broader economy may adversely impact earnings, profitability, liquidity, or surplus capital. The performance and liquidity of financial and property markets, interest rate movements and inflation impact the value of investments we hold in both shareholders' funds and to meet the obligations from insurance business; the movement in certain investments directly impacts profitability. Interest rate movements and inflation can also change the value of our obligations and although we seek to match assets and liabilities, losses can still arise. Falls in the risk-free yield curve can also create a greater degree of inherent volatility to be managed in the solvency balance sheet, potentially impacting capital requirements and surplus capital. Rises in risk free rates can lead to reduced liquidity buffers. Falls in investment values can reduce our investment management fee income.	We cannot completely eliminate the downside impacts on our earnings, profitability, liquidity, or surplus capital from investment market volatility and adverse economic conditions, although we seek to position our investment portfolios and wider business plans for a range of plausible economic scenarios and investment market conditions to ensure their resilience across a range of outcomes. This includes setting risk limits on exposures to different asset classes and where hedging instruments exist, we seek to use them to limit our exposures to risks which are not adequately rewarded. We maintain a range of actions to retain liquidity flexibility. Our Own Risk Solvency Assessment ("ORSA") process is integral to our risk management approach, and includes an assessment of the financial impacts of risks associated with investment market volatility and adverse economic scenarios for our solvency balance sheet, capital sufficiency, and liquidity requirements.	The global economic outlook remains uncertain with the potential for external shocks to knock economies and markets off course. Our businesses are primarily exposed to economic conditions in the UK and US. Central bank interest rates were cut during 2024 in UK and US, however, there remains uncertainty around the pace and timing of any further cuts and there is no guarantee of a "soft landing" for either economy. Geo-political risk factors remain elevated - this includes on-going conflicts in Ukraine and the Middle East, and the impact of a resurgence of populist and nationalist politics on domestic and international policy. Asset values, including commercial and residential property prices, remain susceptible to reappraisal should the current economic outlook deteriorate, as well as from a range of geo-political factors. During 2024 we have seen signs of commercial property markets stabilising, albeit transaction volumes remain low and the office sector continues to show pressure. Within our construction businesses supply chain pressure and cost inflation appear to be moderating, albeit we remain vigilant over cost inflation being absorbed by the supply chain. Labour shortages also continue to present risk.
In dealing with issuers of debt and other types of counterparty, the group is exposed to the risk of financial loss. Systemic corporate sector failures, or a major sovereign debt event, could, in extreme scenarios, trigger defaults impacting the value of our bond portfolios. Under Solvency II, a widespread widening of credit spreads and downgrades can also result in a reduction in our balance sheet surplus, despite already having set aside significant capital for credit risk. We are also exposed to default risks in dealing with banking, money market and reinsurance counterparties, as well as settlement, custody, and other bespoke business services. Default risk also arises where we undertake property lending, with exposure to loss if an accrued debt exceeds the value of security taken.	We manage our exposure to downgrade and default risks within our bond portfolios, through setting selection criteria and exposure limits, and using L&G Asset Management's global credit team's capabilities to ensure risks are effectively controlled, where appropriate trading out to improve credit quality. In our property lending businesses, our loan criteria take account of borrower creditworthiness and the potential for movements in the value of security. We manage our reinsurer exposures tightly, with the vast majority of our reinsurers having a minimum A- rating, setting rating-based exposure limits, and where appropriate taking collateral. Similarly, we seek to limit aggregate exposure to banking, money market and service providers. Whilst we manage risks to our balance sheet, we can never eliminate downgrade or default risks, although we seek to hold a strong balance sheet that we believe to be prudent for a range of adverse scenarios.	The risk of credit default increases in periods of low economic growth, and we continue to closely monitor the factors that may lead to a widening of credit spreads including the outlook for the real economy and fiscal and monetary policy. Although real incomes in the UK have risen in 2024, any reversal of this would particularly impact economic activity in sectors reliant on discretionary spending. The recent UK budget announced tax and spending measures that have dampened consumer and business sentiment. Growth forecasts are modest and employers are cautious on the impact of increased labour costs. Economic growth in the United States continues to be strong and there is broad optimism that the new administration will support domestic manufacturing. However, we believe uncertainty over new policies, in particular around tariffs and immigration, pose downside risks. We remain vigilant, closely monitoring all the names/assets in our portfolio in the short term, as well as forming views on the medium to long-term outlook. Our credit portfolio remains overwhelmingly (98%+) investment grade.
We fail to respond to the emerging threats from climate change for our investment portfolios and wider businesses. As a significant investor in financial markets, commercial real estate and housing, we are exposed to climate related transition risks. Abrupt shifts in the political and technological landscape could impact the value of those investment assets associated with higher levels of greenhouse gas emissions. Physical risks, stemming from extreme outcomes, could impact the valuation of at-risk assets, for example floods could impact the value of our property assets; and could also potentially have longer-term effects on mortality rates. We are also exposed to reputation and climate related litigation risks should our responses to the threats from climate change be judged not to align with the expectations of advocacy groups. Our risk management approach is also reliant upon the availability of verifiable consistent and comparable emissions data.	We recognise that our scale brings a responsibility to act decisively in positioning our balance sheet in the context of the threats from climate change. We continue to embed the assessment of climate risks in our investment process, including in the management of real assets. We measure the carbon intensity of our investment portfolios. Along with specific investment exclusions for carbon intensive sectors, we have set overall reduction targets aligned with the 1.5°C Paris objective. This includes science-based targets to support our emission reduction goals in line with our transition plan. We are evolving our approach to the inclusion of nature and biodiversity alongside our climate risk work. Alongside managing physical and transition exposures, we closely monitor the political and regulatory landscape, and as part of our climate strategy we engage with regulators and investee companies in support of climate action. As we change how we invest, the products and services we offer, and how we operate, we are also mindful of the need to ensure that we have the right skills for the future.	Over the next decade, the change necessary to meet global carbon reduction targets will require societal adjustments on an unprecedented scale. Recent events, particularly the increasing frequency of record-breaking heat and extreme weather, have demonstrated the impacts of increased climate volatility can be significant and may emerge rapidly. A failure by governments to ensure an orderly transition to low carbon economies increases the risk for sudden late policy action and large, unanticipated shifts in the asset values of impacted industries. Whilst our transition plans seek to minimise our overall exposure to this risk, their execution is dependent on the delivery of the policy actions and the climate reduction targets of the firms we invest in. The actions governments take will also, to a significant extent, impact on our ability to deliver upon the climate-related targets we have set ourselves, and as the science of climate change evolves, we may need to adapt our approach. Anti ESG sentiment, particularly within countries with a high dependency on fossil fuel related industries, may also constrain global ambition in addressing climate change as well as limiting investment opportunities. Although a broad set of actions to limit global warming are underway, we are moving to a situation where the path to achieving a near-1.5 temperature increase is becoming narrower. Whilst we retain our current ambition, this could also have an impact on our ability to meet the climate-related targets we have set ourselves. We expect a continuing and increased focus on nature and biodiversity risks going forward.
Changes in demographic experience, regulatory changes, increased expenses and taxation levels may require revisions to our pricing and reserving bases. Changes in capital requirements, including UK and Insurance Capital Standards, could impact our reported solvency position and our dividend and capital return policy. The pricing of long-term business requires the setting of assumptions for long-term trends in factors such as mortality, lapse rates, expenses, interest rates and credit defaults. Actual experience may require recalibration of these assumptions, changing the level of liability provisions and impacting reported profitability. Regulation defines the overall framework for the design, marketing, taxation and distribution of our products, and the prudential provisions and capital that we hold. Significant changes in legislation or regulation may increase our cost base, reduce our future revenues, impact profitability or require us to hold more capital. The prominence of this risk increases where change is implemented without prior engagement with the sector. The nature of long-term business can also result in some changes or re- interpretation of regulation over time, having a retrospective effect on in-force books of business, impacting future cash generation. Changes in these areas can affect our reported solvency position and our dividend and capital return policy.	We undertake significant analysis of the variables associated with writing long-term insurance business to ensure that a suitable premium is charged for the risks we take on, and that provisions continue to remain appropriate for factors including mortality, lapse rates, expenses, and credit defaults in the assets backing our insurance liabilities. We seek to have a comprehensive understanding of longevity, mortality, and morbidity risks, and we continue to evaluate wider trends in life expectancy. However, we cannot remove the risk that adjustment to reserves may be required, although the selective use of reinsurance acts to reduce the impact to us of significant variations in life expectancy and mortality. We actively engage with government and regulatory bodies to assist in the evaluation of regulatory and tax change to promote outcomes that meet the needs of all stakeholders. To influence policy, our interactions with the government and policy teams at regulators include face-to-face and virtual meetings, written responses to discussion papers and consultations, ad-hoc communications and attendance at roundtables with industry peers. With our experience in various sectors, we can explain how proposed policy translates into practice and identify potential issues or unintended consequences that might arise. When such regulatory changes move to the implementation stage, we undertake detailed gap analysis work and depending on the scale of the remediation required, establish project management arrangements with first- and second-line teams working together. This is to ensure we deliver regulatory change effectively and efficiently, minimising disruption to our operations and to our customers and clients.	At times, we have seen elevated levels of mortality in both the UK and the US since the Covid 19 pandemic, and there is continued uncertainty in the outlook, albeit this has somewhat reduced with the passage of time. The causes are unclear but may reflect indirect impacts of Covid 19 related illness, and the deferral of diagnostics and medical treatments for other conditions. Cost of living pressures and government spending decisions, particularly relating to health and care, also have the potential to affect mortality outcomes. Along with the emergence of new diseases and changes in immunology impacting mortality and morbidity assumptions, other risk factors that may impact future reserving requirements include significant advances in medical science leading to more effective treatments, beyond that anticipated, requiring adjustment to our longevity assumptions. Whilst at present we do not believe climate change to be material driver for mortality and longevity risk in the medium term, we continue to keep this under review. The UK has experienced elevated levels of inflation in recent years, but this has returned closer to the Bank of England's inflation target. Inflationary pressure impacts the level of our expense base and there is an additional risk that complying with new regulatory requirements increases costs. We have carefully evaluated the impact of expected price and salary inflation in our pricing and reserving assumptions and will continue to pro-actively monitor on an ongoing basis. Changes in capital standards, both in the UK and elsewhere, could impact our reported solvency position and our dividend and capital return policy. Post-Brexit, the UK is reforming its capital regime to move from Solvency II to Solvency UK. The key changes are designed to enable annuity product providers to invest more broadly to diversify risk and support investment in the UK economy. We have developed our risk framework to meet or exceed regulatory expectations on subjects such as funded reinsurance, Matching Adjustment and liquidity risk management and reporting. The Bermuda Monetary Authority ("BMA") revised its capital regime for life insurers during 2023, with changes effective from March 2024 and reflected in our results. The Insurance Capital Standards (ICS), a global minimum standard capital for Internationally Active Insurance Groups ("IAIGs"), was adopted by the International Association of Insurance Supervisor (IAIS) in December 2024. L&G Group, designated an IAIG by the PRA, has actively participated in consultations on the standard. If Solvency UK is considered as strong as the ICS, it may be used for ICS compliance and therefore would result in little impact on L&G Group. We will continue to engage with both the PRA and the IAIS during this period. New UK rules implementing both a global minimum tax regime and a UK domestic minimum tax regime at 15% applied from 1 January 2024 to all of the Group's businesses globally with work underway to ensure compliance and to engage with regulators as implementation and guidance on the new regimes develops. Bermuda has introduced a corporate income tax regime from 1 January 2025 and there is ongoing consultation on the implementation of the new regime.
Failure to effectively implement regulatory or legislative change applying to the financial services sector in a timely manner could lead to regulatory censure, reputational damage, and deteriorating customer and client outcomes. We are exposed to several risks where effective identification and implementation of regulatory changes are particularly important. These include changes relating to our management of operational risk, conduct risk, climate risk and health & safety risk. The magnitude or scope of some regulatory changes can have a bearing on our ability to deliver our overall strategy. Regulatory or legislative changes can have a significant impact on our business. Such changes could limit our ability to operate in certain markets or sectors, potentially leading to a reduction in our customer and client base and revenue. There is a risk that regulatory policies could develop in a manner that is detrimental to our business and/ or customers and clients. Alternatively, it could develop in a way that presents opportunities, but we fail to revise our strategy and adapt quickly enough to benefit. Non-compliance with new regulations or legislation could potentially damage our reputation. This could lead to a loss of customer and client trust and result in regulatory sanctions including potentially significant monetary penalties.	We identify, track and review the impact of regulatory and legislative change through our internal control processes, with material updates being considered at the Executive and Group Risk Committees and the Group Board. Our processes are designed to ensure compliance with all new and developing regulation. We actively engage with regulatory bodies to ensure we maintain high standards of business and deliver for our customers and clients. In 2023 we successfully implemented the Consumer Duty for open products, and our work on legacy products is also now complete. We have also made strong progress on our implementation of the UK's Operational Resilience rules which are due to come into force in March 2025. We seek to influence the direction of travel on various regulatory policy themes at the government and regulator level for the benefit of our customers and other stakeholders.	The volume and burden of regulatory change remains high across the sectors we operate in. We analyse, interpret and implement all relevant financial services legislation and regulation impacting our business units ensuring appropriate levels of governance and assurance. Key forthcoming developments in our risk areas include: Operational risk: Work is underway to comply with the UK's new operational resilience rules by 31 March 2025 and similar rules in other jurisdictions. Conduct risk: The FCA has committed to consulting on rules to better support consumers in retail investments and pensions in H1 2025. The FCA and Government have also committed to developing a new UK retail disclosure regime, the Consumer Composite Investment regime. In early 2025, the FCA will launch a Market Study into the distribution of pure protection products. New rules on diversity and inclusion in financial services are expected, likely leading to increased data collection, disclosure and reporting requirements. We maintain a focus on minimising the risks of financial crime for our customers and clients and on our financial results. Climate risk: there continue to be a variety of moving pieces in the development of climate regulation at the UK, the US and EU level. We anticipate more focus on scenario testing and scrutiny on sustainability claims following the FCA's new anti-greenwashing rule and Sustainability Disclosure Regulations effective from 31 May 2024. We continue to await the outcome of developments on the UK Green Taxonomy and are preparing for the implementation of International Sustainability Standards Board (ISSB) disclosure standards from 2026. Requirements relating to Nature continue to evolve rapidly. Health and Safety: we have enhanced our governance processes and developed a 3-year strategy focusing on culture, quality, consistency, technology, and keeping pace with change. Initial registration requirements for UK's new Buildings Safety Act were met and we are working to ensure we meet all the Act's requirements. Our overall Health & Safety risk exposure is expected to decrease materially following the sale of CALA Group (Cala). Strategic risk: we continue to follow and engage closely with the new UK Government on the reforms being proposed as part of the Pensions Investment Review and related initiatives. We were the first major pension provider to successfully pass integration testing with the Pension Dashboard Programme ahead of connections starting in April 2025.
New entrants and/or new technology may disrupt the markets in which we operate. There is already strong competition in our markets, and although we have had considerable past success at building scale to offer low-cost products, we recognise that markets remain attractive to new entrants. We are also cognisant of competitors who may have lower return on capital requirements or be unconstrained by Solvency II and/or Solvency UK. The continued evolution of AI has the potential to be a significant disrupting force across our businesses, for example by enabling new entrants to compete with potentially lower costs, and more efficient processes. The technology itself could have an impact on asset valuations, and on our liabilities including through its impact on life sciences and health care systems effectiveness.	We continuously monitor the factors that may impact the markets in which we operate. We have responded to the rapid advancement and accessibility of generative AI capabilities from third parties by launching a central AI Accelerator programme. This initiative brings together colleagues across the Group to shape and incubate our generative AI approaches, raise awareness and educate our business, and deliver a secure environment for internal test and learn use cases. Our regulatory developments team keeps a close watch on the AI landscape across all our jurisdictions. We have been actively engaged in numerous consultations in relation to AI and generative AI.	We observe a continued acceleration of a number of trends, including greater consumer engagement in digital business models and on-line servicing tools. In the current operating environment, businesses like ours have transformed working practices, and we anticipate further investment in automation, using robotics and machine learning to enhance business efficiency. We are deepening our understanding of the impacts of generative and traditional AI on our businesses and in the wider sector. Our businesses are also well positioned for changes in the competitive landscape that may arise from pensions-related changes. We welcome innovation in the market, such as the proposed roll out of defined benefit 'superfund' consolidation schemes, as long as the security of members' benefits is prioritised. We may see alternative de-risking offerings coming to the market targeting a similar segment to superfunds, for instance for DB schemes with funding levels of around 90%. The pension dashboards initiative will also be a positive development. We are well positioned for connecting having passed integration testing. On the 'collective' defined contribution reform, while we have seen limited demand for this to date, it may hold the potential to disrupt both the workplace and retirement income market.
A material failure in our business processes or IT security may result in unanticipated financial loss or reputational damage. We have constructed our framework of internal control to minimise the risk of unanticipated financial loss or damage to our reputation. However, no system of internal control can completely eliminate the risk of error, financial loss, fraudulent actions, or reputational damage. We are also inherently exposed to cyber threats including the risks of data theft and fraud and more generally it is imperative that we maintain the privacy of our customers and clients' personal data. There is also strong stakeholder expectation that our core business services are resilient to operational disruption.	Our risk governance model seeks to ensure that business management are actively engaged in maintaining an appropriate control environment, supported by risk functions led by the Chief Risk Officer, with independent assurance from Group Internal Audit. We continue to evolve our risk management approach for change, IT, security, operational resilience and data access and privacy. Whilst we seek to maintain a control environment commensurate with our risk profile, we recognise that residual risk will always remain across the spectrum of our business operations and we aim to develop response plans so that when adverse events occur, appropriate actions are deployed.	We continue to remain alert to evolving operational risks and invest in our system capabilities, including those for the management of cyber risks, to ensure that our important business processes are resilient. We also remain cognisant of the risks as we implement a new global operating model and IT platform for Asset Management and have structured the migration in phases to minimise change risks.
The successful delivery of our strategy is dependent on the ability to attract and retain talent with the right skills and capabilities. The Group aims to recruit, develop and retain high quality individuals. We are inherently exposed to the risk that key personnel or teams and their associated expertise may leave the Group, with an adverse effect on the Group's businesses. As we increasingly focus on the digitalisation of our businesses, we are also competing for technology and digital skill sets with other business sectors as well as our peers.	We seek to ensure that key personnel dependencies do not arise, through employee training and development programmes, remuneration strategies and succession planning. Our processes include the active identification and development of talent within our workforce, and by highlighting our values and social purpose, promoting L&G as a great place to work. As well as investing in our people, we are also transforming how we engage and develop capabilities, with new technologies and tools to support globalisation, increase productivity and provide an exceptional employee experience.	Competition for talent remains strong with skills in areas such as investment management and data particularly sought after across many business sectors, including those in which we operate. We also recognise the risks posed by the outlook for inflation in salary expectations across the wider employment market, and internally we have taken steps to help our employees through direct financial support and by providing advice and resources to help them manage their financial well-being. The recent increase in employer National Insurance contributions and the reduction in contribution threshold may impact operational costs. We remain committed to attracting and retaining top talent by continuously adapting our strategies to the evolving market conditions

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£m	FY 2024	FY 2023²	Growth (%)

Institutional Retirement	1,105	1,028	7
Asset Management	401	448	(10)
Retail¹	504	449	12
Group debt costs	(216)	(212)	(2)
Group investment projects and expenses	(178)	(182)	2

Core Operating profit^3,4	1,616	1,531	6

Corporate Investments unit	95	136	(30)

Operating Profit³	1,711	1,667	3

Investment variance from Core businesses (incl. minority interests)	(991)	(1,228)	19
Investment variance from Corporate Investments unit	(388)	(363)	(7)

Profit before tax attributable to equity holders³	332	76	337

Profit after tax attributable to equity holders⁴	191	457	(58)

Core Operating Earnings per share³ (p)	20.23	19.04	6

Operating ROE³ (%)	34.8	26.6	8
Contractual Service Margin (CSM)³	13,292	12,994
CSM (net of tax) + Book Value	13,310	14,306
CSM (net of tax) + Book Value per share (p)	226	239

Solvency II
Operational surplus generation	1,751	1,821
Coverage ratio (%)	232	224

Dividend per share (p)[6]	21.36	20.34

FINANCIAL HIGHLIGHTS¹ £m	FY 2024	FY 2023
Contractual service margin release	650	591
Risk adjustment release	141	119
Expected investment margin	485	486
Experience variances	(10)	(13)
Non-attributable expenses	(168)	(160)
Other	7	5
Operating profit	1,105	1,028
Investment and other variances	(557)	(555)
Profit before tax attributable to equity holders	548	473

Contractual service margin (CSM)	8,625	8,350
Risk adjustment (RA)²	710	807
Total store of future profit	9,335	9,157

CSM release as a % of closing CSM pre release	7.0%	6.6%

New business CSM	489	865
New business RA	94	161
Total new business future profit	583	1,026

UK PRT	8,412	12,048
International PRT	2,250	1,671
Total new business (Gross Premiums)	10,662	13,719
Funded reinsurance premiums	(557)	(3,189)
Total new business (net of Funded Reinsurance)	10,105	10,530

Institutional annuity assets³ (£bn)	73.8	68.9
Shareholder assets⁴ (£bn)	3.5	3.1

FINANCIAL HIGHLIGHTS¹ £m	FY 2024	FY 2023
Management fee revenue	947	900
Transactional revenue	20	26
Total revenue	967	926
Total costs	(711)	(658)
Operating profit from fee-related earnings	256	268
Operating profit from Balance Sheet investments	145	180
Total Operating Profit	401	448
Investment and other variances	(190)	(123)
Profit before tax	211	325
Asset Management cost: income ratio (%)	74%	71%

NET FLOWS AND ASSETS £bn
External net flows	(47.8)	(38.4)
PRT Transfers	(2.8)	(15.2)
Internal net flows	2.1	1.6
Total net flows	(48.5)	(52.0)
Average assets under management	1,128	1,155
Assets under management ex JV, Associates and other	1,118	1,159
JV, Associates and other AUM²	17	13
Total AUM	1,135	1,172
Of which:
- International assets under management³	488	465
- Private Markets⁴	57	50
- UK DC assets under management	183	163

FINANCIAL HIGHLIGHTS¹ £m	FY 2024	FY 2023
Contractual service margin release	469	446
Risk adjustment release	84	74
Expected investment margin	106	122
Experience variances	16	(44)
Non-attributable expenses	(136)	(121)
Other	(35)	(28)
Operating profit	504	449
- US/UK Insurance²	188	139
- Retail Retirement³	316	310
Investment and other variances	(207)	(171)
Profit before tax attributable to equity holders	297	278

Contractual service margin (CSM)	4,667	4,644
Risk adjustment (RA)	841	891
Total store of future profit	5,508	5,535

New business CSM	351	320
New business RA	45	32
Total new business future profit	396	352

Protection new business annual premiums	422	412
Individual annuities single premium	2,118	1,431
Workplace DC net flows (£bn)⁴	6.0	6.4
Lifetime & Retirement Interest Only mortgage advances	270	299
Retail retirement annuity assets⁵ (£bn)	18.4	17.2
Retail retirement shareholder assets⁵ (£bn)	1.0	0.9

UK Retail protection gross premiums	1,525	1,512
UK Group protection gross premiums	528	479
US protection gross premiums	1,318	1,273
Total protection gross premiums	3,371	3,264

Protection New Business Value	192	165
Annuities New Business Value	132	100
Solvency II New Business Value	324	265

FINANCIAL HIGHLIGHTS £m	FY 2024	FY 2023
Operating profit	95	136
Investment and other variances	(388)	(363)
Loss before tax attributable to equity holders	(293)	(227)

Portfolio Net Asset Value (£bn)
Cala	-	1.1
Legacy Real Estate	0.5	0.4
Legacy Land	0.1	0.1
Fintech and Other	0.2	0.3
Total Corporate Investments	0.8	1.9

Subsidiary remittances¹ (£m)	2024	2023



LGAS	1,193	752
LGIM	80	140
LGA²	-	185
Other³	447	472
Total	1,720	1,549

Equity holders' Effective Tax Rate (%)	FY 2024	FY 2023



Equity holders' total Effective Tax Rate¹	41.3	11.9
Annualised rate of UK corporation tax	25.0	23.5

Capital¹ (£m)	FY 2024	FY 2023
Own Funds	15,860	16,556
Solvency Capital Requirement (SCR)	(6,848)	(7,389)
Solvency II surplus	9,012	9,167
SCR coverage ratio (%)	232%	224%

Analysis of movement from 1 January to 31 December 2024¹ (£m)	Solvency II Own Funds	Solvency II SCR	Solvency II Surplus

Opening Position	16,556	(7,389)	9,167
Operational surplus generation	1,786	(35)	1,751
New business strain	185	(594)	(409)
Net surplus generation	1,971	(629)	1,342
Operating variances			156
Mergers, acquisitions and disposals			9
Market movements			(231)
Share buyback			(201)
Dividends paid			(1,230)
Total surplus movement (after dividends paid in the period)	(696)	541	(155)
Closing Position	15,860	(6,848)	9,012

		Impact on net of tax Solvency II capital surplus FY 2024 £bn		Impact on net of tax Solvency II coverage ratio FY 2024 %
	100bps increase in risk-free rates		(0.0)	11
	100bps decrease in risk-free rates		(0.2)	(14)
	Credit spreads widen by 100bps assuming an escalating addition to ratings		0.2	9
	Credit spreads widen by 100bps assuming a flat addition to ratings		0.2	13
Credit spreads narrow by 100bps assuming a flat deduction from ratings			(0.6)	(18)
	Credit spreads of sub-investment grade assets widen by 100bps assuming a level addition to ratings		(0.1)	(3)
	Credit migration		(0.5)	(8)
	25% fall in equity markets		(0.5)	(5)
	15% fall in property markets		(0.8)	(10)
	50bps increase in future inflation expectations		0.1	(1)
	10% increase in maintenance expenses		(0.3)	(5)


£m	PVNBP	Contribution from new business	Margin %

Institutional Retirement - UK annuity business	7,855	420	5.3
Retail Retirement - UK annuity business	2,118	132	6.2
UK Protection	1,461	57	3.9
US Protection	1,249	135	10.8

			%
Margin for risk			3.7
Risk-free rate
- UK			4.1
- US			4.6

Risk discount rate (net of tax)			7.8
- UK			8.3
- US

Long-term rate of return on non-profit annuities			5.5

Financial Calendar	Date
Ex-dividend date (2024 final dividend)	24 April 2025
Record date	25 April 2025
Annual General meeting	22 May 2025
Dividend payment date	5 June 2025
2025 interim results announcement	6 August 2025
Ex-dividend date (2025 interim dividend)	21 August 2025
Record date	22 August 2025
Dividend payment date	26 September 2025

2024 Full Year Results

Core operating profit up 6%, executing our growth strategy with a sharper focus and enhanced returns, with a £500m buyback

Strong financial performance[1]

Sustainable Growth

Enhanced Returns

Financial summary

Strong 2024 financial performance

Income statement

Balance sheet and asset portfolio

Group Strategy

Our three businesses

Our capital allocation framework

Returning capital to shareholders

Outlook

Institutional Retirement

Strong operating profit, up 7% to £1.1bn

£10.7bn global PRT volumes written and a strong pipeline for 2025

Executing capital-light UK PRT in 2024

A record year for international PRT volumes

Asset Management

Higher average revenue fee rate and underlying operating expenses broadly flat

Supporting clients across key channels and markets

Growing our Private Markets Platform

Investing for the long term

Retail

Operating profit up 12%

Succeeding in a competitive landscape in FY 2024

Corporate Investments

Operating profit down reflecting disposals

Subsidiary remittances to Group

Borrowings

Cash

Taxation

Solvency II

Solvency II new business contribution

Principal risks and uncertainties

Notes

Definitions

Forward-looking statements

Caution about climate information

Going concern statement

Directors' responsibility statement

Enquiries

Investors

Media

Companies

UK 100

Latest directors dealings