LGGNF - Legal & General 2022 Results: Operating profit up 12% to £2.5bn EPS up 12% to 38.3p ROE of 21% and Solvency coverage of 236%
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Legal &General ( LGEN:LN ) todayreleased its 2022 year-end earnings report. Below is a briefsynopsis—for a more in-depth view, please access the full reportthrough this link .
Strong financialperformance 1
- Operating profit of £2,523m, up 12% (2021: £2,262m)
- Profit aftertax 2 of £2,291m, up 12% (2021:£2,050m)
- EPS of 38.33p, up 12% (2021: 34.19p)
- Return on equity of 20.7% (2021:20.5%)
- Solvency II coverage ratio of 236% (2021:187%)
- As of 3 March 2023 we estimate the coverage ratio was240% 3
- Full year dividend of 19.37p,up 5% (2021: 18.45p), consistent with our ambition
On track to achieve our five-year(2020-2024) ambitions 4
- Cash generation of £1.9bn, up 14%.Capital generation of £1.8bn, up 10%
-
Cumulativecash and capital generation on track with strong dividend headroom. Todate:
- Cash generation of £5.1bn and capital generation of£4.9bn (£8.0-9.0bn by 2024)
- Dividends of £3.3bn(£5.6-5.9bn by 2024)
- Net surplusgeneration 5 over dividends of £0.7bn
Good new businessvolumes and rapidly increasing international presence
- Global PRT newbusiness premiums of £9.5bn (2021: £7.2bn), of which 23%international
- LGC alternative AUM up 21% to £4.2bn (2021: £3.4bn), of which 12% international
- LGIM AUM of£1.2tn, of which £441bn (37%) international
- LGIMexternal net flows of £49.6bn (2021: £34.6bn), of which 43%international
- Protection gross premiums up 8% to £3.1bn (2021: £2.9bn), of which 39% international
Sir Nigel Wilson,Group Chief Executive: "We have delivered another strongresult in 2022, ahead of market expectations, with operating profit of£2.5bn and EPS of 38.3p, both up 12%, cash generation of £1.9bn up14%, capital generation of £1.8bn up 10%, dividends up 5% to 19.37pand an ROE of 21%. Our diversified and highly synergistic businessmodel continues to deliver significant benefits. Our balance sheet isstrong and highly resilient, with a record solvency ratio of 236% andwe have once again received 100% of cash flows due from our DirectInvestments. At a time when many households are being affected by therising cost of living, our commitment to inclusive capitalism is moreimportant than ever to help improve the lives of our customers, builda better society for the long-term and create value for ourshareholders."
ENDS
Footnotes
1. The Group uses anumber of Alternative Performance Measures (including operatingprofit, net release from operations, return on equity and LGIM AUM) toenhance understanding of the Group’s performance. These are definedin the glossary, on pages 89 to 92 of this report.
2. Profit after taxattributable to equity holders.
3. Coverage ratio before the payment of the 2022final dividend.
4. Cash generation defined as net release from operations andCapital generation defined as Solvency II operational surplusgeneration.
5. Net surplus generation defined as Solvency II operational surplusgeneration less new business strain.
Financial summary
£m |
2022 |
2021 |
Growth % |
Analysis ofoperating profit |
| |
| |
| |
Legal & General Retirement Institutional(LGRI) |
1,257 |
1,154 |
9 |
Legal &General Capital (LGC) |
509 |
461 |
10 |
Legal& General Investment Management (LGIM) |
340 |
422 |
(19) |
Retail 1 |
825 |
620 |
33 |
|
|
|
|
|
|
|
|
Operating profit fromdivisions |
2,931 |
2,657 |
10 |
Group debt costs |
(214) |
(230) |
7 |
Group investment projects andexpenses |
(194) |
(165) |
(18) |
|
|
|
|
|
|
|
|
Operatingprofit 2 |
2,523 |
2,262 |
12 |
Investment and other variances (incl.minority interests) |
136 |
226 |
n/a |
Profitbefore tax attributable to equityholders 3 |
2,659 |
2,488 |
7 |
Profit aftertax attributable to equity holders |
2,291 |
2,050 |
12 |
|
|
|
|
|
|
|
|
Earnings pershare (p) |
38.33 |
34.19 |
12 |
Book valueper share (p) |
194 |
174 |
11 |
Full year dividend per share(p) |
19.37 |
18.45 |
5 |
1. From 1 January 2022,our insurance (LGI) and retail retirement (LGRR) businesses have cometogether to form Retail. The new division will focus on the savings,protection and retirement needs of our c13m retail policyholders andworkplace members.
2. Operating profit is an Alternative Performance Measure andrepresents Adjusted operating profit as defined on page 89.
3. Profit before taxattributable to equity holders is an Alternative Performance Measureand represents Adjusted profit before tax attributable to equityholders as defined on page 89.
About Legal & GeneralGroup
Established in 1836, Legal & General is one ofthe UK's leading financial services groups and a major globalinvestor, with over £1.4 trillion ($1.7 trillion) in total assetsunder management* of which a third is international. We also providepowerful asset origination capabilities. Together, these underpin ourleading retirement and protection solutions: we are a leadinginternational player in pension risk transfer, in UK and US lifeinsurance, and in UK workplace pensions and retirement income. Throughinclusive capitalism, we aim to build a better society by investing inlong-term assets that benefit everyone.
*as of December 31,2021
The information contained in this press release is intendedsolely for journalists and should not be relied upon by privateinvestors or any other persons to make financialdecisions.
Contact Details
Meir Kahtan PublicRelations, LLC (MKPR)
Meir Kahtan
+1917-864-0800
CompanyWebsite
https://www.legalandgeneralgroup.com/
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