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Key facts

Legal & General is a leading UK-based financial services business, with over 10 million customers across the world.
We deliver financial solutions and services that help people to plan for their future. Our businesses help people achieve financial security by building retirement income, protecting their homes and families and enabling them to save for the future. We aim to be socially and economically useful in society, working closely with government, industry bodies and charities to help people have good housing, live healthy lives and enjoy good levels of income in retirement.

This is our social purpose: we understand people’s financial needs, pool risk and help society by reducing the pressure on public finances.

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Legal & General's Fundamentals (LGEN)

Full Year Results 2016 Part 1

EPS1 UP 19% TO 22.2P, PROFIT BEFORE TAX2 UP 17% TO £1.6BN

FINANCIAL HIGHLIGHTS3:
· NET RELEASE FROM OPERATIONS (NET CASH)4 UP 12% TO £1,411M (2015: £1,256M)
· ADJUSTED OPERATING PROFIT5 UP 11% TO £1,628M (2015: £1,463M)
· PROFIT AFTER TAX UP 16% TO £1,265M (2015: £1,094M)
· EARNINGS PER SHARE UP 17% TO 21.22P (2015: 18.16P)
· ADJUSTED EARNINGS PER SHARE1 UP 19% TO 22.20P (2015: 18.58P)
· FULL YEAR DIVIDEND UP 7% TO 14.35P PER SHARE (2015: 13.40P)
· ADJUSTED RETURN ON EQUITY6 19.6% (2015: 17.7%)
· SOLVENCY II SURPLUS OF £5.7BN (2015: £5.5BN)
· SOLVENCY II COVERAGE RATIO OF 171% (2015: 176%), SHAREHOLDER BASIS7

BUSINESS HIGHLIGHTS:
· LGR NEW BUSINESS OF £8.5BN (2015: £2.9BN)
· LGR ANNUITY ASSETS UP 25% AT £54.4BN (2015: £43.4BN)
· GROUP-WIDE DIRECT INVESTMENT UP 39% AT £10.0BN (2015: £7.2BN)
· LGIM AUM UP 20% AT £894.2BN (2015: £746.1BN)

Nigel Wilson, Group Chief Executive, said:

"Our long term approach to strategy and investment coupled with outstanding execution has again delivered terrific financial performance in 2016. Profit before tax up 17% to £1.6 billion, net release from operations up 12% to £1.4 billion, EPS up 19% at 22.2p and a return on equity of nearly 20%.
We believe the UK remains a great place for us to help fill the huge funding gaps and under-provision of key financial products. We are playing our part to regenerate the UK's cities, delivering economic growth and jobs, capitalise on its world-leading universities and improve commercialisation of its scientific discoveries. Additionally, we are accelerating the evolution of our US businesses.
We look forward to the future with confidence as our core markets are growing, our market share is increasing, our balance sheet is strong and we have positive cash and earnings momentum. Through a combination of selective hiring and internal promotions we have significantly strengthened our management team and technology capability".
Sir John Kingman, Chairman, said:
"Legal & General has a strong management team and formidable further potential. Against that backdrop, the Board has considered the best trajectory of dividend growth, taking into account sustainability across a wide range of economic scenarios and the Group's anticipated financial performance. Accordingly, the Board has recommended an increase in the full year 2016 dividend of 7%".

1. Adjusted earnings per share is calculated by dividing profit after tax attributable to equity holders of the Company, by the weighted average number of ordinary shares in issue during the period. This excludes a £60m net loss on disposals being a £64m impairment loss in relation to the disposal of Cofunds and a £4m profit in relation to the disposal of Suffolk Life (2015: £25m net loss in relation to the disposals of Legal & General France, Legal & General Gulf, Legal & General Egypt and Legal & General International (Ireland)).
2. Represents profit before tax attributable to equity holders.
3. The metrics within the Group's financial highlights are defined in the glossary, which includes Alternative Performance Measures, on pages 89 to 92 to this report.
4. Net release from operations has replaced the term Net cash generation. There is no change in how it is determined.
5. Adjusted operating profit is calculated as operating profit of £1,562m (2015: £1,455m) before taking account of the provision in respect of the closure of our Kingswood office of £66m (2015: £8m).
6. Adjusted return on equity is calculated by taking profit after tax attributable to equity holders of the Company, excluding the £60m net loss on disposals (2015: £25m net loss) described in note 1, divided by the average shareholders' equity during the period.
7. Solvency II coverage ratio on a shareholder basis is adjusted for the Own Funds and SCR of the With-profits fund and the final salary pension schemes.


more.....

"Terrific" results again from this lot.

Yep, all good and encouraging. Staying in for the div as well as the potential sp strength.

And yet the SP has dropped today!

No more then a case of sell on the news queen1.

RBC Capital Markets Outperform 247.75 310.00 310.00 Reiterates

Credit Suisse Underperform 247.75 - 215.00 Initiates/Starts

Took profits before going ex div this year for a change.

Solvency update http://www.moneyam.com/action/news/showArticle?id=5552030

HSBC Buy 260.10 290.00 290.00 Retains

Barclays Capital Overweight 259.05 280.00 280.00 Reiterates

JP Morgan Cazenove Underweight 259.05 197.00 197.00 Reiterates

Deutsche Bank Hold 259.05 255.00 255.00 Reiterates

Results on the 9th, ex-dividend on the 17th.

Div payment date likely to be 21st Sept. my est about 4.6p.

I'm about 30% up on my initial outlay from a year ago of a £10k so all looking good

L&G Half-year Report 2017 Part 1

STRONG FINANCIAL PERFORMANCE IN H1 2017: PROFIT BEFORE TAX1 UP 41% TO £1.2BN

FINANCIAL HIGHLIGHTS2:
· OPERATING PROFIT UP 27% TO £988M (H1 2016: £777M)
· PROFIT AFTER TAX UP 43% TO £952M (H1 2016: £667M)
· EARNINGS PER SHARE UP 41% TO 15.94P (H1 2016: 11.27P)
· INTERIM DIVIDEND3 OF 4.30P PER SHARE (H1 2016: 4.00P)
· NET RELEASE FROM OPERATIONS FOR RETAINED BUSINESS4 UP 6% TO £724M (H1 2016:


£681M)
· RETURN ON EQUITY5 OF 26.7% (H1 2016: 20.6%)
· SOLVENCY II SURPLUS6 INCREASED BY £1.0BN TO £6.7BN (FY 2016: £5.7BN)
· SOLVENCY II COVERAGE RATIO6 OF 186% (FY 2016: 171%)
· H1 2017 RESULTS INCLUDE BASE MORTALITY RELEASE7 OF £126M
BUSINESS HIGHLIGHTS:
· LGR PRT8 NEW ANNUITY BUSINESS OF £1.6BN (H1 2016: £0.7BN)
· LGR RETAIL9 TOTAL SALES UP 98% TO £769M (H1 2016: £389M)
· LGIM AUM UP 13% AT £951.1BN (H1 2016: £841.5BN)
· LGIM EXTERNAL NET INFLOWS OF £21.7BN (H1 2016: £9.6BN)
· GROUP-WIDE DIRECT INVESTMENT UP 48% AT £11.8BN (H1 2016: £8.0BN)
· LGI GROSS PREMIUMS UP 6% TO £1,338M (H1 2016: £1,260M)

Nigel Wilson, Group Chief Executive, said:
"L&G delivered 41% growth in EPS to 15.9p, 41% growth in profit before tax to £1.2 billion and a 26.7% Return on Equity. This includes a base mortality release of £126m as part of our review of longevity assumptions. Our consistently improving financial performance is due to: investing for the long term in our market leading businesses, excellent execution by my colleagues and delivering value for customers.
Our strategy, based around six long term macro and demographic growth drivers, not only allows us to grow L&G's business, but also the scale of our long term capital enables us to support inclusive growth across the UK. We are replicating our successful UK model with measured expansion in the US, where we are experiencing increasing customer acceptance and an ever improving financial performance.
Our business model has proven to be resilient to political, economic and regulatory uncertainties. We are not being complacent as we recognise that there are currently some structural weaknesses in the UK economy. Notwithstanding this we have tremendous momentum across our business, a strong AA- rated balance sheet and increasing access to global growth opportunities, therefore we remain confident in our ability to deliver growth."

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Excellent news today and topped yesterday and again today for the div and also the sp growth likely.. all looking good imvho!

And yet the SP is down today. You'd have thought that with these results and the increase in the dividend they'd have bucked the general market trend.

The whole sector is under preforming today.

Legal & General's first half profits supported by slowing life expectancy but shares fall

Macquarie Underperform 274.35 201.00 218.00 Reiterates

Societe Generale Hold 274.35 250.00 250.00 Reiterates

Barclays Capital Overweight 274.35 - - Reiterates

Legal & General on track for a record year in 2017

Legal & General Group Plc ("L&G") today updates on its trading performance.

L&G continues to see great momentum in all its businesses in the year to date and has experienced particularly strong growth in recent weeks. We remain strategically well placed to deliver strong, attractive growth and returns in our core markets.

Legal & General Retirement ("LGR") has delivered total sales for 2017 to date1 of £6.2bn, with the business showing strong momentum in the UK and US institutional pension risk transfer markets, as well as in individual annuities and lifetime mortgages.

Annuity sales generated £4.5bn of annuity premium, consisting of: £3.3bn of UK institutional pension risk transfer business, $0.7bn of US institutional pension risk transfer business and £0.6bn of UK retail annuities. We have doubled our institutional pension risk transfer business in the US versus 2016 and have now written over $1.6bn of US business since entering the market. LGR sales for 2017 to date also include £0.8bn of longevity insurance.

We have significantly outperformed the market in the retail space, with UK individual annuity premiums up 93%, equivalent to a 14% market share. We have written over £0.9bn of lifetime mortgage advances, an increase of 71%, and our innovative, digital lifetime mortgage business now has a leading 35% market share.

Our UK and US pipeline for pension risk transfer is the largest it has ever been. Additionally we expect the UK's ageing demographic and extensive use of cash drawdowns to make the lifetime mortgage market increasingly attractive.

Legal & General Investment Management ("LGIM") achieved total external net inflows of £38.1bn to the end of October. Inflows were well-diversified by product line and geography. Our liability driven investments ("LDI"), active fixed and property funds delivered strong performances, and LGIM continues to be the market leader in defined benefit and defined contribution solutions in the UK, and a global market leader in LDI.

By the end of October, International net inflows were £26.1bn, with £11.3bn from the US and, encouragingly, a further £10.9bn from Europe. Our US asset management business continues to deliver with over 330 institutional clients and over $170bn of assets. We have established our regional office in Tokyo to complement our capabilities in Hong Kong, and LGIM's recently-announced entry into the European ETF market will provide access to one of the fastest growing segments in asset management.

Legal & General Capital ("LGC") has generated £256m of gross proceeds from transactions with a gross value of £821m to the end of October and has committed and invested £319m to new investments as it continues to recycle investments into new strategic UK real asset opportunities. Our investment programme in housing, urban regeneration, clean energy and scale-ups continues to make good progress. Since October, LGC has also announced the acquisition of its second later living business, Renaissance Villages, for a net purchase price of £51m, and the acquisition of a second major housing site, Arborfield in Berkshire, with capacity and planning consent for 1,500 units.

Legal & General Insurance ("LGI") continued to benefit from our strong market shares in UK retail protection and US term assurance with total gross written premiums to the end of October up 6%2 to £2.1bn. The management actions taken to address the adverse claims experience reported in our Group Protection business in H1 2017 are becoming evident and experience is improving in line with management expectation, and the first half losses have been completely reversed in H2.

General Insurance ("GI") gross written premiums are up 13% to £305m by the end of October. We continue to increase our direct to consumer sales, have launched our market leading digitally innovative SmartQuote proposition and we have been successful in winning further distribution agreements for our household products. In October we agreed to acquire Buddies, a pet insurance provider, which will enable us to further diversify our product range in GI. Following our adverse claims experience in the first quarter of the year, we took management action which has mitigated the ongoing impact of claims on the GI result.

Our business growth is supported by a strong balance sheet with a Solvency II surplus of c.£6.9bn and a shareholder coverage ratio of 190%3.


Nigel Wilson, CEO, commented:

"L&G is on track for a record year for earnings and profits. Our core business divisions are generating formidable momentum. With yesterday's announcement of the sale of our closed book, in run-off Mature Savings business for £650m, our business is now well-positioned and focused on the products and geographies where we see optimum growth and cultural alignment. Our market leading positions and strong balance sheet, coupled with our management capability is allowing us to benefit from global growth opportunities."




1. At 6 Dec 2017

2. Increase versus 31 October 2016. LGI comparison excludes disposed business (L&G Netherlands).

3. At the end of October, the Group's estimated Solvency II surplus was c.£6.9bn with Eligible Own Funds of c.£14.6bn, a Solvency Capital Requirement ("SCR") of c.£7.7bn and a shareholder basis coverage ratio of 190%. In line with our practice, this assumes that Transitional Measures for Technical Provisions are recalculated to current market conditions, as we believe this provides the most up to date and meaningful view of our Solvency II position. The shareholder basis adjusts for the Own Funds and SCR attributable to our With-profits fund and the final salary pension scheme. Legal & General Group's core subsidiaries are rated AA- by Standard & Poors

ends

Shore Capital Buy 263.30 - - Reiterates

JP Morgan Cazenove Underweight 263.30 218.00 218.00 Reiterates

HL's take.