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Phoenix Group Holdings PLC on Monday unveiled a new payout policy, following the lifting of its dividend for an ‘outstanding’ 2021.
Shares in Phoenix were up 1.6% at 635.80 pence on Monday in London.
For the year, the London-based insurance services provider posted record cash generation of £1.72 billion, edging upwards from the £1.71 billion generated the year before, and ahead of its target range of £1.5 billion to £16 billion.
Phoenix's pretax loss for 2021 was £688 million, swinging from a profit of £944 million, reflecting £1.13 billion in adverse investment return variances, and £639 million in charges for amortisation and impairments.
However, operating profit increased 2.5% to £1.23 billion from £1.20 billion, due to a full contribution from the group's ReAssure business and increased bulk purchase annuity new business in the period.
Revenue grow 36% year-on-year to £6.38 billion from £4.70 billion, while as at December 31, total assets under administration edged up 1% to £310 billion from £307 billion, restated to reflect the sale of £29 billion of assets from the Wrap SIPP, TIP and Onshore Bond businesses sold.
Phoenix said that 2021 had seen the company ‘prove the wedge’, meaning that organic growth from its Open business had more than offset the run-off from its Heritage business for the first time.
Phoenix declared a final dividend of 24.8 pence per share, bringing the total payout to 48.9p, up 2.9% from 47.5p the prior year.
In addition, the group has introduced a new dividend policy to reflect that it has two potential drivers of future dividend increases: organic and inorganic growth.
‘It has been an outstanding year for Phoenix, with a record set of financial results and significant strategic progress made as we fully embraced our purpose. 2021 marked a pivotal moment for Phoenix, with £1.2 billion of new business from our Open business more than offsetting the run-off of our Heritage business for the first time. This demonstrates that Phoenix is a growing, sustainable business, and enabled the board to recommend our first ever organic dividend increase of 3%. Phoenix has also today announced a new dividend policy which sets out our intention to pay a dividend that is sustainable and grows over time,’ said Chief Executive Officer Andy Briggs.
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