REG - Just Group plc - IFRS 17 UPDATE

JustAnnouncement

06/02/2023 07:00

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RNS Number : 9413O  Just Group PLC  06 February 2023

 NEWS RELEASE  www.justgroupplc.co.uk

 

6 February 2023

JUST GROUP plc

IFRS 17 UPDATE

 

Just Group plc ("Just", the "Group") has today made presentation slides
available on the Group's website www.justgroupplc.co.uk, and provides below an
update on its implementation of IFRS 17. IFRS 17 is a new accounting standard
for insurers which was  implemented on 1 January 2023.

 

We remain committed to our ambition to target 15% growth in underlying
operating profit.

Under IFRS 17, we will continue our commitment to deliver 15% growth in
underlying operating profit per annum over the medium term. Our IFRS 17
measure for underlying operating profit is explained further below.

Our target to deliver a greater than 10% return on equity will also continue
under IFRS 17(1).

 

No change in strategy, growth ambition, capital, cash or dividend policy.

IFRS 17 is an accounting change and does not affect the underlying economics
of our business or our strategy.

·      Our commitment and ability to invest in future growth is
unchanged

·      The capital strength of the Group is unchanged

·      Our new and existing business cashflows are unchanged

·      The Group's dividend policy is unchanged

·      The Group's creditworthiness is unchanged

 

Effect of transition to IFRS 17

Under IFRS 17 total profits remain unchanged. IFRS 17 introduces two new
balance sheet concepts - the Contractual Service Margin ("CSM") and Risk
Adjustment ("RA"), which are stocks of discounted future value that will be
released in accounting terms into reported profit over time. These stocks of
future value are added to by future new business, which in turn also release
over time.

·      We expect the Group's shareholder value to be broadly unchanged
as opening IFRS 17 adjusted shareholders equity (IFRS 17 equity and CSM net of
tax) on transition at 1 January 2022 is similar to closing IFRS 4 equity of
£2.1bn on 31/12/21. This approach reflects the shareholder value created from
past business written.

o  IFRS 17 adjusted shareholders equity is expected to be around £2.1-2.2bn
on 1 January 2022 (including CSM net of tax, expected to be c.£0.9-1.1bn).

·      Underlying operating profit. To provide a meaningful measure of
business performance, we will add back the net change in CSM created during
the year to derive underlying operating profit under IFRS 17.  We expect this
new measure of IFRS 17 underlying operating profit to be comparable to IFRS 4
underlying operating profit.

 

Further Information

Please contact the Investor Relations team, details below.

 

 FINANCIAL CALENDAR AND TIMELINES                       DATE            BASIS
 Results for the year ended 31 December 2022            7 March 2023    IFRS 4
 Further updates ahead of interims                      June 2023       Including restated comparatives
 Interim results for the six months ended 30 June 2023  15 August 2023  First financial reporting under IFRS 17

 

Note 1: Return on equity is IFRS 17 underlying operating profit after
attributed tax divided by the average IFRS 17 adjusted shareholders equity
less goodwill

Note 2: Alternative performance measure. In addition to statutory IFRS
performance measures, the Group has presented a number of non-statutory
alternative performance measures within the Annual Report and Accounts. The
Board believes that the APMs used give a more representative view of the
underlying performance of the Group

Note 3: All the figures are unaudited

 

 Enquiries

 Investors / Analysts                 Media

 Alistair Smith, Investor Relations   Stephen Lowe, Group Communications Director

 Telephone: +44 (0) 1737 232 792      Telephone: +44 (0) 1737 827 301

 alistair.smith@wearejust.co.uk       press.office@wearejust.co.uk

 Paul Kelly, Investor Relations       Temple Bar Advisory

 Telephone: +44 (0) 20 7444 8127      Alex Child-Villiers

 paul.kelly@wearejust.co.uk           William Barker

                                      Telephone: +44 (0) 20 7183 1190

 

A copy of this announcement will be available on the Group's website
www.justgroupplc.co.uk

 

JUST GROUP PLC

GROUP COMMUNICATIONS

Enterprise House

Bancroft Road

Reigate

Surrey RH2 7RP

 

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