TIDMLGEN
RNS Number : 9706Q
Legal & General Group Plc
05 December 2016
Regulatory News Service
05 December 2016
LEGAL & GENERAL GROUP CAPITAL MARKETS EVENT
Legal & General Group Plc ("Legal & General") will host
a conference for investors and analysts on Monday 5 December at 1
Coleman St, London, EC2R 5AA. The event starts at 3.00pm, and will
include presentations on the Group's strategy, balance sheet, risk
management, and its insurance, retirement, capital and investment
management divisions. At the event, Legal & General will
disclose that it expects current full year forecast for net cash
generation will be circa GBP1.4 billion and net surplus generation
of GBP1.1 billion pre market and other movements.
Nigel Wilson, Group CEO, said: "Legal & General's global
growth opportunities within each division, value driven products,
growing loyal customer base and strong balance sheet, underpin our
confidence in delivering sustained growth in net cash generation,
profits and dividend to our shareholders. Our ambition is to repeat
a similar operational performance in 2015-2020 to that achieved in
2010-2015."
Group Strategy and Growth Opportunities
Three of Legal & General's divisions: Legal & General
Retirement (LGR); Legal & General Investment Management (LGIM);
and Legal & General Insurance (LGI) are strongly positioned to
capitalise on significant structural growth opportunities arising
from geopolitical, economic and demographic changes.
Legal & General Capital (LGC) is focused on direct
investments, which over time are expected deliver ROCE of greater
than 10%, where the funding gap in the UK for housing, urban
regeneration and SME finance is over GBP500 billion.
LGIM's assets under management of GBP841.5 billion have
increased 180% since the Global Financial Crisis and we expect its
core strategic markets of Defined Contribution, Defined Benefit,
solutions and index to present significant global growth
opportunities.
LGR has written over 1,500 deals since we began writing bulk
annuity business in 1987. In 2016 we have written a record GBP6.9
billion of new annuity sales as at 2 December. This has been
achieved with a Solvency II new business strain of 2-3% of premium
on which we expect to achieve payback in four years. On an EEV
basis the new business margin is circa 13%. In addition we have
made more than GBP0.5 billion of lifetime mortgage advances. There
remains a huge opportunity in the UK, which has GBP2.1 trillion in
defined benefit liabilities, of which only 5% has transferred to
buy-out to date. In the US, the market opportunity is even
greater.
LGI has over 7 million customers in the UK and US, and has 25%
market share in the UK retail protection market. LGI intends to
leverage its UK insurance expertise to grow its protection
business, scale and technology in the US.
Financial Strength
Legal & General's strong balance sheet underpins our
confidence in driving new business growth and shareholder returns.
As at 30 June 2016, Legal & General had Solvency II own funds
of GBP13.7 billion and surplus of GBP5.3 billion with a solvency
coverage ratio of 163% [1]. Our S&P credit rating is AA-. The
Group has moved to a capital efficient business model for writing
new annuity business. In addition our diversified business model
serves to reduce the Group's overall Solvency II new business
strain. This capital efficiency means we are targeting average
annual growth in Solvency II net surplus generation over the next
five years to be in the mid to high single digit percentage
range.
[1] Shareholders basis, 158% pro forma basis
The presentation will start at 3.00pm and will be webcast live
at http://www.legalandgeneralgroup.com
ends
For further information, please contact:
Investors:
Laura Doyle Head of Investor Relations 020 3124 2088
Sujee Rajah Investor Relations Manager 020 3124 2047
Media:
Richard King Head of Group Corporate Communications 020 3124
2095
Legal & General Group Plc:
1. Established in 1836, Legal & General is a leading
provider of insurance, savings and investment management products
in the UK. The Group has a market capitalisation of GBP14.4bn (as
at 2(nd) December 2016) and is responsible for investing GBP841.5bn
worldwide (as at 30 June 2016) on behalf of investors,
policyholders and shareholders.
2. Legal & General has over seven million customers in the
UK for life assurance, pensions, investments and general insurance
plans and over one million customers in the US who rely on us for
life assurance.
3. In 2015, Legal & General's operating profit (IFRS basis)
was GBP1,455m and adjusted earnings per share were 18.58p for the
period, an increase of 14% and 11% respectively. For H1 2016 Legal
& General's adjusted operating profit was GBP822m, an increase
of 10%, profit before tax attributable to equity holders was
GBP826m, an increase of 23%, adjusted earnings per share were
11.20p for the period, an increase of 14%, and net cash generation
of GBP727m, an increase of 16%.
4. Net surplus generation is defined as the Solvency II expected
release less new business strain.
For more information on Legal & General, please see
http://www.legalandgeneralgroup.com/
Forward-looking statements
This announcement may contain certain forward-looking statements
relating to Legal & General, its plans and its current goals
and expectations relating to future financial condition,
performance and results. By their nature, forward-looking
statements involve uncertainty because they relate to future events
and circumstances which are beyond Legal & General's control,
including, among others, UK domestic and global economic and
business conditions, market related risks such as fluctuations in
interest rates and exchange rates, the policies and actions of
regulatory and Governmental authorities, the impact of competition,
the timing impact of these events and other uncertainties of future
acquisition or combinations within relevant industries. As a
result, Legal & General's actual future condition, performance
and results may differ materially from the plans, goals and
expectations set out in these forward-looking statements and
persons reading this announcement should not place reliance on
forward-looking statements. These forward-looking statements are
made only as at the date on which such statements are made and
Legal & General Group Plc does not undertake to update
forward-looking statements contained in this announcement or any
other forward-looking statement it may make.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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