Phoenix
Group
shares
soared
this
morning
after
the
life
insurance
and
pensions
business
unveiled
“ambitious”
new
targets
and
annual
results
that
met –
and
in
some
areas
surpassed –
City
expectations.
Shares
in
the
company
jumped
8.5%
to
533.4p
in
London
on
Friday
morning,
making
it
the
best-performing
stock
in
the
broader
FTSE
100
index,
which
opened
up
0.3%.
In
its
annual
results,
the
company
reported
total
cash
generation
of
£2.02
billion,
up
35%
from
£1.50
billion
the
year
prior.
This
was
above
its
upgraded
target
of
£1.8
billion,
which
had
been
the
market
consensus.
New
business
long-term
generation
rose
to
£1.51
billion
from
£1.23
billion,
meeting
City
expectations,
and
achieving
its
2025
target
two
years
early.
Phoenix
added
this
included
strong
growth
from
its
pensions
and
savings
business
to
€395
million
from
£249
million
and
an
increase
in
its
retirement
solutions
business
to
£1.07
billion
from
£934
million.
Those
specific
results
follow
its
purchase
of
several
retirement
businesses,
including
the
Standard
Life
brand,
which
it
purchased
from
abrdn
(ABDN)
in
2021.
Phoenix
said
its
solvency
II
surplus
of
£3.9
billion
remained
“resilient,”
and
included
a
well-flagged
£70
million
consumer
duty
provision
following
a
review
of
its
back
book
products
ahead
of
the
July
2024
compliance
deadline.
In
2022,
the
solvency
II
surplus
had
been
£4.4
billion.
IFRS
adjusted
operating
pretax
profit
increased
13%
to
£617
million
from
£544
million,
driven
by
strong
growth
in
its
pension
and
savings
business,
ahead
of
the
£599
million
consensus.
Pretax
losses
have
now
narrowed
to
£164
million
from
£3.51
billion.
Phoenix
npw
plans
to
grow
operating
cash
generation
by
around
25%
to
£1.4
billion
in
2026
from
£1.1
billion
in
2023,
after
which
it
is
expected
to
grow
at
a
mid-single
digit
rate
over
the
long
term.
These
“ambitious”
growth
targets
will
support
a
new
“progressive”
and
sustainable
dividend
policy,
it
said.
Phoenix
increased
its
final
dividend
by
2.5%
to
26.65p
per
share
from
26p
last
year.
This
took
the
total
payout
to
52.65p
from
50.8p,
up
3.6%.
Phoenix
intends
to
repay
at
least
£500
million
of
debt
by
the
end
of
2026,
and
is
aiming
for
£900
million
of
IFRS
adjusted
operating
profit
in
2026.
Around
£250
million
of
annual
cost
savings
are
also
expected
by
the
end
of
2026.
By
Jeremy
Cutler,
Alliance
News
reporter
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