Trading Highlights (figures in brackets show movement compared to 2014)
-
New life and pensions business (on a PVNBP basis)2 £6,774m (+40%).
Excellent growth in new business sales reflects the strength of Royal London’s pensions and insurance propositions.
-
Improved overall margin of 2% (+43%) on new life and pensions business has been achieved as operating efficiency initiatives are embedded across the business.
-
EEV Operating profit before tax and exceptional items £244m (+11%).
This increase is driven by the success of our pension and insurance businesses and the record new business figures. New business profits rose to £137m (2014: £85m).
-
Embedded value has exceeded the £3bn mark for the first time - £3.2bn (+6%) following good total profit performance.
-
IFRS transfer to unallocated divisible surplus £175m (+31%)
Our IFRS results also benefit from Royal London’s strong trading performance and improved margins.
-
Group funds under management £84.5bn (+3%).
Increase due to net inflows and good underlying investment performance in difficult markets.
-
Surplus regulatory (Insurance Groups Directive) capital £3,535m (+4%).
Stronger capital position is a consequence of improved new business results and the £350m raised by a subordinated debt issue in November 2015.
-
ProfitShare £70m (+17%)
ProfitShare paid to eligible Policyholders increased by 17% in 2015 as a result of the improved new business results and strong capital position. This brings the cumulative ProfitShare paid to members to £536m since 2007.
Phil Loney, Group Chief Executive of Royal London, said:“Our strategy of focusing on creating the best outcomes and the best experience for our customers reflects our position as the largest customer-owned company across our chosen markets. Our strategy continues to produce pleasing results and over the last four years Royal London has doubled its life and pension sales and has nearly doubled assets under management.
The last year saw a record breaking trading performance which brought with it a healthy increase in operating profit. New business growth was particularly strong, with sales of group pensions and income drawdown products going from strength to strength. The fourth quarter of the year saw pension sales reach new highs, which is particularly satisfying as it follows on from the announcement that we will in future be sharing part of our profits with pension customers through our unique ProfitShare arrangement.
It is also pleasing that following considerable investment in our protection proposition, sales of protection products through intermediaries are now surging ahead. Our direct-to-consumer division is now making significant headway in the market segments where it operates by providing better value for money and fairer products than the market incumbents. The strong growth in revenues has allowed a substantial increase in investment in the business at the same time as growing profits and strengthening the capital position of Royal London.
The main Royal London With-Profits fund again benefited from a positive investment return in 2015 and is ahead of its benchmark over one, three and five years. The total bonuses paid to policyholders have increased by 144% from those in 2014. In addition, the asset shares of qualifying With-Profits policyholders benefit from a ProfitShare; the asset shares have been uplifted by 1.4% (up from 1.15% in 2014) this year. Over the last decade our profit sharing approach has boosted the value of policies held by qualifying customers to the tune of £536m.
Royal London remains well capitalised, with surplus regulatory capital increasing to £3,535m (£3,390m in 2014).”
|
