|
M&G PLC on Thursday reported strong full-year results with assets under management, net flows, adjusted operating profit and operating capital generation are all ahead of expectations. ‘2025 was a year of strong commercial momentum and strategic progress for M&G. We continued to invest in our business, setting it up for long-term growth and expanding our international distribution and investment capabilities,’ said M&G Chief Executive Andrea Rossi. The London-based investment manager said adjusted operating pretax profit edged up to £838 million in 2025 from £837 million the year prior, ahead of £820 million company consensus. This reflected growth in Life and higher fee-based earnings in Asset Management, offset by lower performance fees in Asset Management and lower investment income in both Asset Management and Corporate Centre, M&G said. Life adjusted operating profit increased 2.4% to £764 million from £746 million on-year, but fell 3.1% in Asset Management to £280 million from £289 million. The IFRS result after tax was £314 million, swung from a £347 million loss. This was mainly driven by improved short-term fluctuations in investment returns and reduced ‘mismatches’ arising on application of IFRS 17, M&G explained. Assets under management and administration increased 8.7% to £375.9 billion from £345.9 billion, ahead of £372 billion company compiled consensus. Net flows from open business totalled £7.8 billion compared to outflows of £1.9 billion the year prior, above consensus cited by RBC Capital Markets of £4.6 billion. Total net outflows were £1.9 billion, ahead of £2.1 billion consensus, easing from £9.5 billion in 2024. CEO Rossi said the improvement of nearly £10 billion year-on-year, was driven by a strong performance in Asset Management and a return to growth in Life. In Asset Management, M&G generated £7.0 billion of net inflows from external clients, corresponding to 4.4% of opening assets under management and administration. In Life, M&G said it ‘materially’ increased bulk purchase annuity volumes, and brought PruFund back into sustained net inflows in the second half. Rossi said M&G expects this momentum across the business to continue in 2026. Operating capital generation fell to £765 million from £933 million, but beat £729 million consensus. Total capital generation declined to £833 million from £1.11 billion. The solvency II coverage ratio improved to 242% from 223%, ahead of 233% consensus. M&G said it achieved £250 million cost savings from the transformation programme in 2025, beating the upgraded target. Looking ahead, M&G said it is ‘firmly committed’ to delivering an average annual growth in adjusted operating pretax profit of at least 5% over 2025 to 2027, and expects a ‘meaningful’ acceleration in AOP growth in 2026. The firm has a target cost-to-income ratio of 70% by the end of 2027, ‘which we are confident to meet through sustained net inflows, strong revenue growth and continued cost discipline.’ M&G also said it is ‘on-track’ to achieve the target of £2.7 billion cumulative OCG excluding new business strain over 2025 to 2027. M&G declared a second interim dividend of 13.8 pence per share, up from 13.5p a year ago. This takes the total payout to 20.5p, up 2.0% from 20.1p, in line with consensus. Shares in M&G were 0.8% lower at 298.09p each in London on Thursday morning but have risen 39% in the last 12 months. The wider FTSE 100 was down 0.5%. Copyright 2026 Alliance News Ltd. All Rights Reserved.
|
