Interim Results Announcement 2013

Published: 08 Aug 2013

Interim Results Announcement 2013

Mark Wilson, Group Chief Executive Officer, said:

“In the first half we have taken a number of steps to deliver our investment thesis of cash flow and growth. These results show satisfactory progress in Aviva’s turnaround.

“We have achieved profit after tax of £776 million, in contrast to the £624 million loss last year. Cash flows to the Group have increased by 30% to £573 million. Our key measure of sales – value of new business – has increased 17%, driven by the UK, France, Poland, Turkey and Asia.

“Although these results continue the positive trends of the first quarter, tackling our legacy issues will take time.

“I am committed to achieving for investors what we set out to do: turning around the company to unlock the considerable value in Aviva.”

Cash flow

  • Cash remittances to Group up 30% at £573 million1 (HY12: £441 million)
  • Operating capital generation £936 million1 (HY12: £906 million)
  • The interim dividend is 5.6 pence per share (HY12: 10.0 pence per share), consistent with guidance given at the full year 2012

Profit

  • Operating profit 5% higher at £1,008 million1 (HY12: £959 million)
  • IFRS profit after tax of £776 million (HY12: loss after tax of £624 million)

Expenses

  • Operating expenses 9% lower at £1,528 million2 (HY12: £1,675 million)
  • Restructuring costs 10% lower at £164 million1 (HY12: £182 million)

Value of new business

  • Value of new business up 17% to £401 million (HY12: £343 million)
  • Increase driven by UK Life, France, Poland, Turkey and Asia

Combined operating ratio

  • Combined operating ratio 96.2% (HY12: 95.5%)

Balance sheet

  • Intercompany loan reduced by £700 million to £5.1 billion
  • IFRS net asset value per share 281p (FY12: 278p)
  • MCEV net asset value per share 441p (FY12: 422p)
  • Pro forma3 economic capital surplus4 within our target range at £7.6 billion, 175% (FY12: £7.1 billion, 172%)
  • Sale of remaining shareholding in Delta Lloyd, disposal of businesses in Russia and Malaysia, and transfer of Aseval completed

Download the full announcement PDF (1.3MB)

  1. On a continuing basis, excluding US Life and Delta Lloyd.
  2. Operating expenses excludes integration and restructuring costs, US Life and Delta Lloyd.
  3. The pro forma economic capital surplus at HY13 includes the impact of the US Life transaction and an increase in pension scheme risk allowance from five to ten years of stressed contributions (FY12: includes the benefit of completing the US Life, Aseval, Delta Lloyd and Malaysia transactions).
  4. The economic capital surplus represents an estimated position. The capital requirement is based on Aviva’s own internal assessment and capital management policies. The term ‘economic capital’ does not imply capital as required by regulators or other third parties.

Contacts

Investor contacts

Colin Simpson
+44 (0)20 7662 8115

David Elliot
+44 (0)20 7662 8048

Media contacts

Nigel Prideaux
+44 (0)20 7662 0215

Andrew Reid
+44 (0)20 7662 3131

Sarah Swailes
+44 (0)20 7662 6700

Timings

Real time media conference call 07:15 hrs BST

Analyst presentation 08:15 hrs BST

Presentation slides www.aviva.com 06.30hrs BST

Live webcast www.avivawebcast.com/interims2013/ 08:15 hrs BST

Download the full announcement PDF (1.3MB)

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