REG - Phoenix Group Hldgs - 2023 Trading Statement

Phoenix groupAnnouncement

01/02/2024 07:00

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RNS Number : 6004B  Phoenix Group Holdings PLC  01 February 2024

 

LEI: 2138001P49OLAEU33T68

 

Phoenix Group delivers another year of strong organic new business growth in
2023 and achieves its 2025 growth target two years early

 

·   2023 new business net fund flows of c.£7bn, a c.80% year-on-year
increase

·   Workplace net fund flows of c.£4.5bn have nearly doubled year-on-year
with c.£2bn of new scheme assets transferred in 2023, including the transfer
of one of the largest workplace schemes tendered in the UK market in recent
years

·   BPA premiums of c.£6bn written in 2023 (FY22: £4.8bn), with a reduced
capital strain of <5%

·   The Group has therefore delivered c.£1.5bn of new business long-term
cash generation in 2023, achieving its 2025 target two years early

Commenting on the trading update, Phoenix Group CEO, Andy Briggs said:

"I am delighted that Phoenix Group has delivered another year of strong
organic growth in 2023, with increased new business net fund flows supporting
us in delivering £1.5bn of new business long-term cash. This means we have
achieved our 2025 new business long-term cash target two years early,
reflecting the focus and investment we have put into our growth strategy. Our
capital-light fee-based Workplace business continues to go from strength to
strength, nearly doubling its net fund flows year-on-year, including the
transfer of one of the largest workplace schemes tendered in the UK market in
recent years. Our BPA business also performed well in a buoyant market, with
c.£6bn of premiums contracted at a reduced capital strain of less than 5%."

Phoenix Group Holdings plc ("Phoenix Group" or "the Group") today announces
that it has delivered strong organic growth in 2023, with new business net
fund flows of c.£7 billion (FY22: £3.9 billion). This was underpinned by
improved performance in the Standard Life branded Pension & Savings and
Retirement Solutions businesses, and is in line with the Group's strategy to
deliver a balanced business mix through leveraging its scale in the
capital-light fee-based businesses and maintaining a disciplined level of
growth in annuities.

Within Pensions & Savings, the Workplace business delivered net fund flows
of c.£4.5 billion in 2023, nearly double the prior year (FY22: £2.4
billion), supported by c.£2 billion of new scheme assets transferred in the
period. This included the transfer of the Siemens workplace scheme, one of the
largest workplace scheme transfers to have been tendered in the UK market in
recent years, which demonstrates the strength of our proposition.

Growth in the Retirement Solutions business has been driven by our Bulk
Purchase Annuities ("BPA") business, which completed an additional 7 BPA
transactions during the second half of 2023 covering c.£2.8 billion of
premiums. The Group has therefore contracted c.£6 billion of premiums during
the year (FY22: £4.8 billion). The capital invested for 2023 is expected to
be slightly less than £300 million, equating to a reduced capital strain of
<5% (FY22: 5.8%).

As a result of this strong performance, the Group has delivered c.£1.5
billion of total new business long-term cash generation in 2023, achieving its
2025 target two years early. This outperformance reflects the Group's clear
strategic focus and investment into growth, which has been further accelerated
by a supportive economic environment.

Total Group net outflows, including the legacy Heritage business, have nearly
halved in 2023 to c.£(3) billion (FY22: £(5.7) billion).

In line with the guidance provided at our 2023 Half Year results, the Group
continues to expect its Solvency II Surplus to be slightly below the 30 June
position of £3.9 billion. This reflects the continued investment we are
making into our business, which is supporting the strong growth we have
reported today.

Phoenix Group will announce its Full Year 2023 results on 22 March 2024.

Enquiries

Investors/analysts:

Claire Hawkins, Director of Corporate Affairs and Investor Relations, Phoenix
Group

+44 (0)20 4559 3161

Andrew Downey, Investor Relations Director, Phoenix Group

+44 (0)20 4559 3145

Media:

Douglas Campbell, Teneo

+44 (0)7753 136 628

Shellie Wells, Corporate Communications Director, Phoenix Group

+44 (0)20 4559 3031

Legal Disclaimers

This announcement in relation to Phoenix Group Holdings plc and its
subsidiaries (the 'Group') contains, and the Group may make other statements
(verbal or otherwise) containing, forward-looking statements and other
financial and/or statistical data about the Group's current plans, goals,
ambitions, outlook, guidance and expectations relating to future financial
condition, performance, results, strategy and/or objectives.

Statements containing the words: 'believes', 'intends', 'will', 'may',
'should', 'expects', 'plans', 'aims', 'seeks', 'targets', 'continues' and
'anticipates' or other words of similar meaning are forward looking.  Such
forward-looking statements and other financial and/or statistical data involve
risk and uncertainty because they relate to future events and circumstances
that are beyond the Group's control. For example, certain insurance risk
disclosures are dependent on the Group's choices about assumptions and models,
which by their nature are estimates. As such, actual future gains and losses
could differ materially from those that the Group has estimated.

Other factors which could cause actual results to differ materially from those
estimated by forward-looking statements include, but are not limited to:
domestic and global economic, political, social, environmental and business
conditions; asset prices; market related risks such as fluctuations in
investment yields, interest rates and exchange rates, the potential for a
sustained low-interest rate or high-interest rate, environment, and the
performance of financial or credit markets generally; the policies and actions
of governmental and/or regulatory authorities, including, for example,
initiatives related to the financial crisis, the COVID-19 pandemic, climate
change and the effect of the UK's version of the "Solvency II" regulations on
the Group's capital maintenance requirements; the impact of changing inflation
rates (including high inflation) and/or deflation; the medium and long-term
political, legal, social and economic effects of the COVID-19 pandemic and the
UK's exit from the European Union; the direct and indirect consequences of the
European and global macroeconomic conditions of the Russia-Ukraine War and
related or other geopolitical conflicts; information technology or data
security breaches (including the Group being subject to cyberattacks); the
development of standards and interpretations including evolving practices in
ESG and climate reporting with regard to the interpretation and application of
accounting; the limitation of climate scenario analysis and the models that
analyse them; lack of transparency and comparability of climate-related
forward-looking methodologies; climate change and a transition to a low-carbon
economy (including the risk that the Group may not achieve its targets);
market competition; changes in assumptions in pricing and reserving for
insurance business (particularly with regard to mortality and morbidity
trends, gender pricing and lapse rates); the timing, impact and other
uncertainties of proposed or future acquisitions, disposals or combinations
within relevant industries; risks associated with arrangements with third
parties; inability of reinsurers to meet obligations or unavailability of
reinsurance coverage; the impact of changes in capital, and implementing
changes in IFRS 17 or any other regulatory solvency and/or accounting
standards, and tax and other legislation and regulations in the jurisdictions
in which members of the Group operate.

As a result, the Group's actual future financial condition, performance and
results may differ materially from the plans, goals, ambitions, outlook,
guidance and expectations set out in the forward-looking statements and other
financial and/or statistical data within this announcement. The Group
undertakes no obligation to update any of the forward-looking statements or
data contained within this announcement or any other forward-looking
statements or data it may make or publish.  Nothing in this announcement
constitutes, nor should it be construed as, a profit forecast or estimate.

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