Growth drivers • Ageing INVESTING • demographics & • ANNUITIES • Globalisation of • asset markets • • Creating real assets • INVESTMENT • MANAGEMENT • Welfare reforms • INVESTING & INSURANCE • Technological innovation ANNUITIES • • Today’s capital • •
Legal & General • UK pension risk transfer market leadership Retirement: • Growing US business Institutional L&G’s Strategic • INVESTING & Legal & General Delivering Retirement Income: UK individual Purpose ANNUITIES Retirement: Retail annuities and lifetime mortgages Improve the lives • Future Cities: direct investment in real estate and Legal & General infrastructure / clean energy of our customers Capital • UK multi-tenure housing franchise • Legal & General Global institutional asset management Build a better INVESTMENT • Investment $183bn US business, growing in Asia and EMEA MANAGEMENT society • Management Focused on Index, Fixed Income, Solutions, Real Assets • Legal & General US and UK term life insurance Create value for • Insurance FinTech investing our shareholders INSURANCE • General Insurance UK household and pet insurance
Annuities Investing HY18 Annuity Assets £56.4bn £13.5bn Lifetime mortgages 2.7 Direct investments c.21% Private credit 1.8 Infrastructure 2.8 1.1 Property Residual c.57% Credit assets Notes 5.1 Real Estate Debt and Sale & leaseback c.19% Sovereign-like assets Liabilities Assets
Institutional new business update 2018 YTD 1 H1 H2 TD LGRI Completed Transactions >£8.4bn £0.7bn c.£7.7bn UK PRT £7.7bn £0.5bn c.£7.2bn International PRT £0.4bn 1 £0.2bn £0.2bn 1 Longevity Insurance £0.3bn 1 £0.0bn £0.3bn 1 UK PRT Pipeline >£20bn UK PRT Actively Quoting as at HY Results – >£8bn UK PRT Transactions completed with L&G since HY Results – <£1bn UK PRT Transactions lost since HY Results New UK PRT deals added to Actively Quoting since HY Results £14bn c.£25bn Current PRT Actively Quoting Pipeline • H2: completed a £2.4 billion buyout for the Nortel Networks UK Pension Plan covering around 15,500 pensioner members and around 7,200 deferred members. • H2: includes a £4.4bn buy- in with British Airways PLC’s pension scheme, covering c.22,000 pensioners. This is the largest ever b ulk annuity policy arranged with a UK pension scheme • IFRS and Solvency II impacts of YTD new business in line with previous levels reported by L&G • Actively quoting on c.£25bn. Expect further transactions to be announced in coming months
Book value 1 Year of Counterparty Sector investment (£m) •
Investing £8.1bn £2.0bn £2.0bn 0.6 Future Cities £2.0bn UK Housing 1.1 0.4 VC & SME £4.1bn H1 2018
Future Cities UK Housing VC & SME Urban Regeneration VC Build to Sell • Real estate developments in UK • CALA has increased units by 2.5x • Invested in 240 start-ups in the UK cities, e.g. Cardiff EBIT by 5x since L&G ownership • Accelerated Digital Ventures (ADV) • Newcastle Science Central creating • L&G Homes is building more than funds UK digital businesses to 4,000 jobs 2.5k new homes across 3 sites become global category leaders • Examples: SalaryFinance, Care • The UK’s largest science & tech Sourcer, Smartr365 Build to Rent property business: £240m JV with • 3k homes pipeline across 9 schemes Bruntwood Clean Energy Later Living SME • Investment in NTR with 9 of 12 on- • Inspired Villages has 6 sites in • 40% investment in Pemberton AM, shore wind sites operational development pan-European private debt and direct • Invested in the most efficient solar lending provider Affordable Housing panel through Oxford PV • 3k homes per year by 2022 • Developing limitless energy through • LP investments across a number of tokamak energy nuclear fusion Modular Housing funds • First homes on site in Crowthorne
HY18 AUM: £985bn 25 Real assets Europe c.19% International 166 Revenue by Product (FY17) c.16% Gulf £805m c.4% Asia Solutions 474 US c.61% 625 UK DB 160 Active Strategies 64 UK DC & 326 Workplace 96 Internal Index Interest & Other 31 98 UK Retail & DC & Retail (UK) Personal Investing Capability Client Type
£2,531m GWP £369m GWP 973 US Term Household 337 1,232 UK Individual 326 17 UK Group ASU 15 Pet 2017 2017
Operating Profit (£m) H2 2018 Growth Drivers FY 2017 H1 2018 H1 2017 Var % • Legal & General Actively quoting over £25bn UK PRT business, Retirement: 906 361 333 8 >£8bn UK PRT Transactions completed since HY • Institutional $25bn US PRT market opportunity Legal & General • INVESTING & LTM £600m H2 target Retirement: 341 119 107 11 • ANNUITIES Individual Annuities premiums up 16% in Q2 Retail • CALA and L&G Homes build-to-sell Legal & General • 272 172 142 21 Further investment in urban regeneration and Capital clean energy Legal & General • INVESTMENT US LDI / Fixed income positive trends continuing Investment 203 194 5 400 • MANAGEMENT Several UK & US DC mandate wins Management • Legal & General UK & US premium growth both up 3% 303 154 147 5 • Insurance GP turnaround on track INSURANCE • General Double digit growth in direct premium 37 (6) 15 - • Insurance Strong distribution pipeline 7 Total 2,366 1,003 938
100% LGRI LGRR LGC “GROWN UPS” LGIM LGI GI Mature Savings Sale agreed 20% - 49% 100% “SCALE UPS” - CALA Homes - NTR (Energy) - BTR - ETF - Pemberton - Salary Finance - LGIMA - DC / Retail - ADV - Smartr365 - LGRA - Future Cities Sale agreed - India First 3% - 20% 100% “START UPS” - LGIM Asia - Smart Survey - SmartQuote - SmartClaim Caresourcer – increased holding to 27.22% CALA Homes: Purchased 52% and now own 100% India First: 26% owned – Sale agreed £79m (Direct 20%, Indirect 7.22%) Theidol.com: 100% purchased and within LGI Mature Savings – Sale agreed £650m
Accessibl ble tools for a new gene nerat ation n Workp kplace ace communi unicati tions ns • of personal nal investo tors Personalised videos replacing • 59% increase in conversion standard mailings • • Digital B2B mortgage broking 100% increase in new customer Increased engagement: 14% platform acquisition made changes • • Reduces 10 hours of work Cost saving of 14p per member to 1 • £3m investment Digital DC auto-enrolment workplace platform for small businesses • Secure ure: HTTPS website and 2 step Online insurance comparison security verification tool • • Easy: Only provider that offers an Largest provider of travel app and Alexa and Google Home insurance in UK • compatibility Co-developing digital • L&G has a 17% stake and offers retirement solutions LGIM funds on the platform • >500k employees on platform Salary financing platform for SmartQuo te & SmartC tClai aim • workplace Supports other L&G for Home Insurance • A new fully digital Survey workplace offerings, such as • 5 questions to customers • Improves upon the existing DC and Personal Investing • > 400 data points used to • paper based Homebuyers Better rates because create a quote Survey, which is used on a repayment comes directly • Claim processing time cut in nationwide basis from employer half: 34m processing
Operating profit from divisions (£m) Earnings per share (p) Dividend per share (p) Consensus
Recommend
More recommend
