24th September 2023
Half Year highlihts:
-delivering sustainable organic growth
-106% year-on-year increase in H1 incremental new business long-term cash generation to £885m(H1 2022: £430m).
Comprises £665m from Retirement Solutions(H1 2022: £282m) and £220m from capital-light fee-based businesses(H1 2022: £148m).
-72% year-on-year increase in new business net fund flows to £3.1bn(H1 2022: £1.8bn).
-Phoenix is now on track to deliver positive Group net fund flows from 2024, for the first time in its history-continues to deliver high levels of dependable cash generation
-£898m of cash generation(H1 2022: £950m); now confident of delivering at the top-end of our £1.3bn-to-£1.4bn target range for the year.
-£12.5bn of Group in-force long-term free cash increased by c.£0.4bn (FY22: £12.1bn) with strong growth both organically and through M&A, more than offsetting our annual uses of cash.
-resilient balance sheet supports investment in growth
-180% Solvency II Shareholder Capital Coverage Ratio (‘SCCR’)(FY22: 189%) remains at the top-end of our target range of 140-180%, providing capacity to invest in growth opportunities, as Phoenix have done in the first half.
£3.9bn Solvency II Surplus at 30 June 2023 remains resilient (FY22: £4.4bn).
The insurer has the financial flexibility to support our strategy, including the capacity to raise further debt.
Commenting on the results, Phoenix Group CEO, Andy Briggs said: “As the UK’s largest long-term savings and retirement business, Phoenix is executing on its single strategic focus –helping customers journey to and through retirement. We are delivering strong organic growth, with new business long-term cash more than doubling to £885m in the first half. This was supported by a 72% year-on-year increase in our new business net fund flows to £3.1bn in H1, despite a challenging market environment, and we are now confident of delivering positive Group net fund flows from 2024. We also grew inorganically, with the completion of the Sun Life of Canada UK acquisition, with c.20% of the purchase price received in cash generation in just 3 months, and we are confident of executing further M&A over time.
We continue to deliver our dependable cash generation, with £898m in H1, and are on track to deliver at the top-end of our £1.3-£1.4bn target range for 2023.
Our impressive first half performance has enabled the Board to declare an Interim dividend that is a 5% year-on-year increase and executing our strategy will support us in delivering a dividend that is sustainable and grows over time.”
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