StockMarketWire.com - Phoenix Group said it delivered £664m of cash generation in 2018 (2017: £653m).

In a trading update, the group delivered £1.3bn cash generation in 2017 and 2018, exceeding the upper end of its cash generation target of £1bn - £1.2bn for this period.

HIGHLIGHTS:

- Solvency II surplus of £3.1bn as at 30 September 2018 (£2.5bn pro-forma as at 31 December 2017). Shareholder capital coverage ratio of 164% as at 30 September 20184 (147% pro-forma as at 31 December 2017)

- Already delivered £400m of capital synergies on the acquisition of the Standard Life Assurance business against a total £440m capital synergy target announced for the transaction

- Assets under administration remain stable at £240bn as at 30 September 2018 (31 December 2017 proforma: £240bn) reflecting net business inflows of £3.3bn by end Q3 on Open business in the UK and Europe

- Two further bulk purchase annuity transactions completed during the second half taking total 2018 year to date transactions to £0.8bn

- Phoenix selected Diligenta, the FCA regulated subsidiary of TCS, as its partner to deliver a single, digitally enhanced outsourcer platform that will improve customer outcomes and deliver cost savings for our legacy-Phoenix Life policies which is due to be complete by end 2021

- Fitch Ratings affirmed the group's ratings in July at A+5; "stable" outlook. Leverage ratio currently 22%6, below the Fitch target range of 25-30%

CEO Clive Bannister said: "The trading update we have announced today demonstrates Phoenix's strength in delivering and ability to exceed our targets.

"We have delivered £1.3bn of cash generation in 2017 and 2018, exceeding the upper end of our target range of £1bn-£1.2bn and have significantly strengthened our Solvency II surplus position during the year to a group surplus of £3.1bn as at 30 September 2018.

"We continue to deliver against our strategy with a further two bulk purchase annuity transactions completed in the second half of the year.

"Operationally, Diligenta will become our preferred outsource partner and enable us to deliver a single, digitally enhanced outsourcer platform to circa 5.5m of our customers.

"The acquisition of Standard Life Assurance completed on 31 August 2018 and was transformational for Phoenix.

"I am delighted by the significant progress we have already made with the transition process and the £400m of capital synergies delivered.

"I look forward to explaining how Phoenix has been re-defined by this acquisition at today's Capital Markets Day."




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