REG - Standard Life plc - 2025 Annual Financial Report
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RNS Number : 7523W Standard Life plc 16 March 2026
16 March
2026
Standard Life plc: 2025 Full Year
Results
Strong operating momentum and excellent progress against 3-year strategy
Uniquely positioned in attractive markets
Strong execution of strategic priorities
Profitable growth driving balance sheet strengthening
"Our results demonstrate strong progress delivering on our strategic
priorities. Further profitable growth and a strengthened Solvency balance
sheet have supported increased shareholder returns and greater financial
flexibility for the future, underpinned by the significant and growing levels
of excess cash our business generates. We are firmly on track to deliver our
2026 financial targets, building momentum by continuing to sharpen our
competitive position in one of the world's most attractive savings and
retirement markets. Operating as Standard Life plc brings our most trusted
brand to the forefront, demonstrating our commitment to helping our customers
achieve better outcomes and greater financial security in later life. We look
to the future with confidence."
Andy Briggs, Group Chief Executive Officer
Strong FY 2025 financial performance across all key metrics:
31 December 2025 31 December 2024 Change
Operating Cash Generation(1) £1,474m £1,403m +5%
Total cash generation(2) £1,711m £1,779m -4%
Shareholder Capital Coverage Ratio(3,4) 176% 172% +4%pts
Solvency II surplus(4) £3.6bn £3.5bn +2%
Solvency II leverage ratio(5) 33% 36% -3%pts
IFRS adjusted operating profit £945m £825m +15%
Cumulative annual run-rate cost savings delivered £180m £63m +286%
IFRS loss after tax £(394)m £(1,078)m +63%
IFRS adjusted shareholders' equity £3,098m £3,656m -15%
2025 Final dividend 28.05pps 27.35pps +2.6%
2025 Total dividend 55.40pps 54.00pps +2.6%
5% growth in Operating Cash Generation(1) and 15% growth in IFRS adjusted
operating profit driven by continued operating momentum in core businesses
Pensions and Savings (Workplace and Retail): momentum in flows and improving
margins driving strong growth
· 23% IFRS adjusted operating profit growth in our capital-light
fee-based business to £389m driven by 7% growth in average assets under
administration ('AUA') to £204.6bn (FY 2024: £191.5bn) and cost efficiencies
driving a 2bps margin improvement to 19bps (FY 2024: 17bps)
· 13% Operating Cash Generation(1) ('OCG') growth to £396m (FY 2024:
£350m)
· Workplace net inflows of £5.3bn (FY 2024: £5.3bn) comprised £10.0bn
gross inflows (FY 2024: £9.3bn); new Workplace members up 14% in 2025 to
247k, total Workplace customers 3 million
· Retail net outflows(6) improved to £7.8bn (FY 2024: £8.6bn)
reflecting retail strategy green shoots
Retirement Solutions (Annuities): increased contribution to operating cash
benefiting from new business and in-force management actions
· 3% OCG(1) growth in our capital-utilising spread-based business to
£879m driven by growth in average AUA to £40.2bn (FY 2024: £39.0bn) and OCG
margin improvement to 219bps (FY 2024: 218bps), supported by our capital
efficiency, scale and recurring management actions
· 19% IFRS adjusted operating profit growth to £563m (FY 2024: £474m)
· Group Contractual Service Margin ('CSM') (gross of tax) grew 17% to
£3,806m (FY 2024: £3,257m)
· £1.2bn individual annuity premiums written in 2025 (FY 2024: £1.0bn)
and market share increased to 15%
· £3.9bn Pension Risk Transfer ('PRT') volumes written in 2025 (FY 2024:
£5.1bn) included our largest ever deal at £1.9bn
· Disciplined capital deployment maintained through total annuities
strain £162m (FY 2024: £206m) and the generation of lifetime IRRs of more
than 20% in PRT
Strong execution across all strategic priorities
· Continued execution across all our strategic priorities, with an
emphasis on customer engagement, distribution and continued strong trading in
our Workplace and Annuities businesses
Grow: meeting more of our existing customer needs and acquiring new ones
· Deepened customer engagement
o Launched our in-house Retail advice proposition to help those who wouldn't
usually consider paid advice gain access to the support they need
o Widened distribution of our products via adviser partnerships; our
smoothed managed fund is now available on the Quilter platform
o Launched Annuity Desk for Standard Life customers to support a digital
customer experience
o Broadened our wide range of digital tools including our Family Finance Hub
and Mixed Income Builder to support households with engaging planning and
budgeting options
· Expanded product build-out
o Completed our portfolio of innovative retirement income solution products
with the launch of the Guaranteed Lifetime Income plan
o Innovated PRT solutions through longevity insurance novations and gender
equalising benefits, making our PRT proposition more attractive to customers
Optimise: optimising our scale in-force business and balance sheet
· Unique in-house expertise delivering better customer outcomes and
enhancing returns
o £560m recurring management actions delivered in 2025 (FY 2024: £537m)
o £7bn of £41.8bn annuity-backing assets managed in-house, with planning
progressing to in-house a further £20bn
· Excess cash generation has enabled further deleveraging
o $250m debt repaid in February 2025 and £197m repaid in December 2025
o Solvency II leverage ratio(5) 33% (FY 2024: 36%)
Enhance: transforming our operating model and culture
· Cumulative run-rate cost savings increased to £180m (FY 2024: £63m),
£55 million ahead of our original delivery profile by 2025.
· Progressing our migrations
o 1.9m policies migrated to TCS BaNCS in 2025
o Entered into a strategic partnership with Wipro; ALPHA platform covering
1.9m policies now transferred and serviced by Wipro
o 75% policies are now on their end-state technology, up from 45% in 2024
A progressive and sustainable ordinary dividend policy(7)
· The Board is recommending a 2.6% increase in the Final 2025 dividend to
28.05p per share; Total dividend 55.40p per share (FY 2024: 54.00p per share)
· At 31 December 2025, distributable reserves at Standard Life plc, the
Group's holding company that pays the dividends to shareholders, stood at
£5,800m (FY 2024: £5,571m)
· Alongside distributable reserves, when assessing dividend affordability
the Board considers the quantum and trajectory of the Group's OCG(1) and
Shareholder Capital Coverage Ratio(3)
Uniquely positioned in attractive, growing markets and strengthening our
competitive advantages
· The UK long-term savings and retirement market is set to grow by c.70%
over the next decade(8)
· Positioned to win as our competitive advantages of customer engagement,
capital and cost efficiencies strengthen
· Workplace:
o Expectations of c.£80bn(9) annual market flows with ambitions to
consolidate our top-3 position with potential for accelerated growth from
market consolidation and expected contribution increases
o £1.0bn of wins secured for 2026 to date with a medium term opportunity
pipeline of more than £10bn
· Retail:
o Expectations of c.£150bn(10) annual market flows with ambitions to move
from a top-10 position to top-5
o Focus on realising the significant opportunity still available to leverage
digital infrastructure across our 12m strong customer base
· Annuities:
o Expectations of c.£35-55bn(11) annual market flows in PRT and £8-9bn(12)
in individual annuities, with ambitions to maintain our top-5 position across
annuities
o Continued disciplined capital deployment in annuities consistent with our
diversified business mix and focus on value over volume. Expectation to deploy
up to c.£200m of capital across PRT and individual annuities in 2026
o £1.6bn of PRT transactions completed or at an exclusive stage in 2026 to
date
Outlook
Firmly on track across all 2026 financial targets
· Firmly on track to deliver all 2026 financial targets which support our
progressive and sustainable dividend policy(7) and creates financial
flexibility
· We expect to deliver c.£500m of excess cash in 2026
Financial target Progress to date
Cash · Mid-single digit percentage growth p.a. in Operating Cash · 5% growth year-on-year in FY 2025
Generation(1)
· Total cash generation(2) 3-year target of £5.1bn across 2024-26 · £3.5bn achieved cumulatively across 2024-25
Capital · Operate within our 140-180% Shareholder Capital Coverage Ratio(3) · 176% at the end of FY 2025
operating range
· SII leverage ratio(5) of c.30% by the end of 2026 · 3% point improvement to 33% in FY 2025
Earnings · c.£1.1bn of IFRS adjusted operating profit in 2026 · 15% growth year-on-year in FY 2025 to £945m
· £250m of annual run-rate cost savings by the end of 2026 · £180m run-rate savings achieved by the end of FY 2025
· Mid‑single digit OCG growth going forwards supports the generation of
at least £1bn Free Cash Flow per annum and over £400m in excess cash
· 2026 is our final year of using excess cash to de-lever. Excess cash
generated post-2026 will be available to be deployed to the highest returning
opportunities, in line with our capital allocation framework
· In 2027, our aim is for IFRS shareholders' equity to grow, excluding
economics
· We anticipate announcing our post-2026 plan in Q4 2026
FY 2025 financial summary:
Financial performance metrics: 31 December 31 December YoY
2025 2024 change
Cash Operating Cash Generation(1) £1,474m £1,403m +5%
Of which Pensions and Savings £396m £350m +13%
Of which Retirement Solutions £879m £850m +3%
Of which Europe and Other £123m £129m -(5)%
Of which With-Profits £76m £74m +3%
Recurring management actions £560m £537m +4%
Operating Cash Generation margin (annualised)
Pensions and Savings 19bps 18bps +1bps
Retirement Solutions 219bps 218bps +1bps
Total cash generation(2) £1,711m £1,779m -4%
IFRS Adjusted operating profit £945m £825m +15%
Of which Pensions and Savings £389m £316m +23%
Of which Retirement Solutions £563m £474m +19%
Of which Europe and Other £83m £96m -14%
Of which With-Profits £24m £41m -41%
Of which Corporate Centre £(114)m £(102)m -12%
Adjusted operating profit margin (annualised)
Pensions and Savings 19bps 17bps +2bps
Retirement Solutions 140bps 122bps +18bps
Loss after tax £(394)m £(1,078)m +63%
Dividend Final dividend per share 28.05p 27.35p +2.6%
Total dividend per share 55.40p 54.00p +2.6%
Balance sheet metrics: 31 December 31 December YoY
2025 2024 change
Solvency II capital Shareholder Capital Coverage Ratio(3,4) 176% 172% +4%pts
Solvency II surplus(4) £3.6bn £3.5bn +2%
Leverage Solvency II leverage ratio(5) 33% 36% -3%pts
IFRS Shareholders' equity £244m £1,213m -80%
Gross Contractual Service Margin £3,806m £3,257m +17%
Adjusted shareholders' equity £3,098m £3,656m -15%
Assets Assets under administration £317bn £292bn +8%
Group Chief Executive Officer's report
Successful delivery against our strategy
2025 highlights
• Full product suite now available for all customers' life stages;
launched the Standard Life Guaranteed Lifetime Income plan
• Progressed customer engagement including the launch of our
Retail advice proposition
• Strong trading performance with Workplace gross inflows
of £10 billion; signed our largest-ever Pension Risk Transfer deal; Retail
gross inflows continuing to improve
• Firmly on track to deliver all our 2026 financial targets
• Generating c.£1 billion free cash flow, comfortably covering
our dividend and creating further financial flexibility
Standard Life has an exciting opportunity to shape our industry. Our 2025
results show our commitment to better customer outcomes while increasing
shareholder returns and strengthening our financial flexibility.
Standard Life is a retirement specialist focused entirely on retirement
savings and income, and is proud to manage £317 billion of assets under
administration ('AUA') on behalf of our 12 million customers. Our purpose of
'helping people secure a life of possibilities' is embedded in everything that
we do as we help customers journey to and through retirement.
Around two-thirds of our business by assets is Pensions and Savings, our
capital-light fee-based business, which comprises our Workplace and Retail
offerings. 13% of our business by assets is Retirement Solutions, our
capital-utilising spread-based business, comprising our annuities offering
across Pension Risk Transfer ('PRT') and individual annuities.
In March 2024 we set out our 3-year strategy, to realise our vision to be the
UK's leading retirement savings and income business. Progress towards
fulfilling our vision is delivered through executing against our strategic
priorities of Grow, Optimise and Enhance. Our strategy fully embeds our
environmental, social and governance ('ESG') themes of People and Planet.
In February 2026 we changed our name from Phoenix Group Holdings plc to
Standard Life plc. This move brought our most trusted brand to the forefront
and demonstrates our commitment to helping customers secure a better
retirement.
+2.6%
2025 Final dividend increase
(2024: +2.6%)
Achieving our vision to be the UK's leading retirement savings and income business
To achieve our vision, our 2024-26 strategy is designed to build on the strong
foundations we had already developed, leveraging our scale and strong
positions in the attractive markets we operate in and completing our
full-service customer offering.
To Grow we need to have a full suite of products which meet the needs of our
customers, and build out our ability to engage with them. Having broadened our
range of products in the market over recent years, including the launch of the
Standard Life Guaranteed Lifetime Income plan, we now have a full product
suite to support customers across all stages of their retirement journey.
There is always more to do as we continue to innovate and adapt to changing
customer needs, behaviours and market trends, but this phase is now largely
complete and sets us up well for the future.
We have also been working to unlock access to products and engagement
opportunities. The launch of our advice proposition in 2025, and our wide
range of digital offerings, from our Family Finance Hub, to our Mixed Income
Builder tool, are all helping customers navigate their retirement journey, by
supporting households with engaging planning and budgeting options.
We're focused on scaling our products, and deepening our intermediary
partnerships, to widen our access to potential customers. In January 2026 we
expanded the distribution of our smoothed managed fund onto the Quilter
platform.
To Optimise our scale in-force business and our balance sheet, we have been
further enhancing our unique in-house asset management expertise, including
evolving our annuity-backing assets. For example, in September we announced we
were preparing to in-house c.£20 billion of annuity-backing assets. Our asset
management expertise will deliver enhanced returns, drive better customer
outcomes, create cost savings and it underpins our ability to deliver
recurring management actions. Together these contribute to the excess cash
generation we are consistently achieving and in turn enabled us to repay £0.4
billion of debt to support our deleveraging programme, which will continue in
2026.
Under Enhance, our priority is to transform our operating model and culture,
which in turn helps us to deliver better customer outcomes. A large aspect of
this is completing the migration of customer administration to modern,
technology-enabled platforms. In total, 75% of our policies are now on their
end-state platforms, up from 45% in 2024, enabled by our strategic
partnerships, including with Diligenta and Wipro.
Through leveraging technology and streamlining the organisation, we have made
good progress on our cost savings programme with run-rate savings of £180
million achieved at the end of 2025. This underpins our confidence in
achieving our end-2026 £250 million run-rate savings cost target.
Our remaining area of focus, which presents a significant opportunity as we
continue to help our customers navigate their retirement journey, is the
digital customer interface. Whilst we already have an award winning app, the
next step is to enhance our technology and customer engagement capabilities by
leveraging our digital infrastructure to create digitally enabled and
personalised customer journeys - focused on data, guidance and advice. We're
also focused on deepening our intermediary partnerships, widening our access
to potential customers. While for Workplace and Annuities it's about
continuing to deliver excellent performance.
See pages 28 to 37 for more detail on how we are delivering our strategy and
pages 48 to 77 for our Sustainability review in the Annual Report and
Accounts.
70%
Expected growth in long-term savings and retirement market over the next
decade8
An attractive market with structural growth drivers and further tailwinds
The UK long-term savings and retirement market is already large, with c.£3.6
trillion8 of assets managed on behalf of customers, but it is also
structurally growing across our key markets of Workplace, Retail and
Annuities, and set to grow by c.70% over the next decade8.
This growth is driven by the current demographic and socio-economic trends,
which have seen increasing responsibility for retirement falling on
individuals rather than employers as was previously the case, including the
shift from defined benefit ('DB') to defined contribution ('DC') schemes.
We continue to advocate for the changes that will make the biggest difference
to our customers, and in this regard I am really encouraged by recent
regulatory and political proposals that will support better retirement
outcomes across all our key markets. These will also act as further tailwinds
to the industry that will accelerate the existing structural growth
opportunities beyond the c.70% expected growth.
As the only scale UK player solely focused on the full savings and retirement
lifecycle, Standard Life is uniquely positioned to benefit from this market
growth. Our ambition is to grow faster than the market.
See pages 22 to 23 for more on Our growth drivers in the Annual Report and
Accounts.
Taking share in our chosen markets
Workplace is typically the foundation of a customer's retirement savings
journey and it acts as a key acquisition tool for us. We're a scaled player,
with AUA of £70.6 billion and three million members, both of which are
growing.
Our ambition here is to consolidate our top-3 market position as this market
grows rapidly; concentrates down to fewer players; and will be supported by
expected contribution increases. This acceleration and concentration will be
driven by proposals outlined in the Pension Schemes Bill which includes a
requirement for minimum thresholds for default funds. We will achieve our
strategy through deep customer engagement which will drive retention and
support new scheme wins.
Winning in Workplace requires three things: a leading employer proposition,
excellent customer service, and scale driven cost efficiency. We are strong on
all three, as demonstrated across a collection of metrics.
We achieved an excellent Net Promoter Score ('NPS') of +60 in 20252. We
welcomed 247k new Workplace members in 2025, up from 216k in 2024 and we won
over 200 schemes in 2025. Lastly, Workplace AUA is up almost 40% in three
years, importantly driven by strong positive net fund flows. With £10 billion
of gross inflows reached this year, our market share grew to over 10%.
Our Retail strategy is to engage customers with innovative products to join,
stay and consolidate with us. Delivering on this strategy will enable us to
move from our current top-10 position to top-5.
Success in this market is driven by three things: customer engagement,
offering products that meet customers' evolving needs and leveraging digital
infrastructure to do all this proactively.
With 1-in-5 UK adults being customers of Standard Life plc, this provides us
with a unique opportunity to win market share in the retail market - both via
advisers and direct to customers. Our ability to win is further evidenced by
our expanded product range now meeting more of our customers' evolving needs.
The positive outcomes of our efforts include high customer satisfaction
scores, with 93% of customers rating us "good" or "excellent". This is
translating to more digital customer engagement, with total logins up c.50% in
two years.
While our Retail business remains in net outflow, we're seeing positive
customer outcomes reflected in gross retail inflows of £7.1 billion in 2025,
up by nearly £3 billion over the last three years.
Alongside our newly launched advice proposition, Targeted Support will enhance
our ability to offer timely services to our customers and is very much aligned
to our belief that everyone's journey to and through retirement can be better.
We have a significant opportunity to leverage our digital infrastructure, but
we are not there yet. One area we're focusing on is building out our
Salesforce customer relationship management ('CRM') integration. This gives us
deeper insight to support customers so we can gather insights and proactively
help by 'nudging' them to make the right choices at the right life stages, as
they journey to and through retirement.
Within Annuities, which includes PRT and individual annuities, winning is all
about having a leading employer proposition, excellent member experience, and
competitive pricing. Our strength in all three is why we are winning in these
markets today. Our comprehensive buy-in and buy-out capabilities, and a full
product suite, mean that we can serve customers, however complex their needs
may be.
We currently have a top-5 position and our ambition is to maintain this. We
will achieve this by continuing to have a disciplined capital deployment
approach of c.£200 million per annum, and through providing a holistic suite
of de-risking solutions.
Having re-entered the individual annuity market in 2023 we have nearly doubled
our market share to 15%, from 8% only two years ago, driven by our ability to
launch a product that is both competitively priced and delivered via a leading
digital customer experience.
In PRT we wrote our largest-ever deal of £1.9 billion in 2025, owing to our
expertise and ability to provide member certainty in complex transactions. Our
disciplined approach, reflected in our focus on value rather than volume in
this market, means we are achieving attractive returns, with lifetime internal
rates of returns ('IRRs') on our annuity business of more than 20%.
+93%
Customer satisfaction - digital
(2024: 94%) REM
+60
Workplace Net Promoter Score13
(2024: +60)
Whether it is saving for retirement through our Workplace business, or staying
and consolidating in Retail, or securing income through our Annuities
business, we're well positioned to serve customers and their evolving needs.
See pages 18 to 21 for Our business model and pages 24 to 27 on Our key
divisions in the Annual Report and Accounts.
Strengthening our competitive advantages
Standard Life is clearly already winning today and is well-positioned to win
share in our growing markets, underpinned by our three competitive advantages
of customer engagement, capital efficiency and cost efficiency.
With 1-in-5 UK adults being customers of Standard Life plc we have an
exceptional level of customer access which enables our customer engagement.
This gives us insights into what customers - both corporate and consumers -
really need, which in turn supports how we develop and design propositions.
Our recent name change has brought our strongest brand to the forefront.
We also benefit from capital efficiency from our diversified long-term savings
and retirement businesses, comprising both capital-light fee-based and
capital-utilising spread-based products. Our unique asset management
capabilities are already delivering superior returns, reflected in the
sustainable delivery of recurring management actions at c.£500 million per
annum, all whilst remaining cash flow matched.
£1,474m
2025 Operating Cash Generation
(2024: £1,403m) REM APM
Our existing cost efficiency, underpinned by our 12 million customer base, has
been achieved by leveraging technology across our business, as reflected in
our sector-leading Pensions and Savings margin. This margin expansion will
continue as we deliver further cost savings. And, technology advancements will
drive operating leverage higher as we scale.
Looking ahead, we will continue to strengthen those competitive advantages,
which will support our growth.
See pages 16 to 17 for Our investment case in the Annual Report and Accounts.
Firmly on track for all our 2026 financial targets
Consistently executing on each of our strategic priorities is translating
directly into the delivery of attractive financial outcomes. Our 2025
performance has been strong across our financial framework of cash, capital
and earnings and we are firmly on track to deliver all of our 2026 financial
targets.
See the Business review on pages 38 to 47 for more detail in the Annual Report
and Accounts.
Operating Cash Generation ('OCG') continues to be the metric which best
demonstrates the long-term underlying value generation from our business. OCG
grew by 5% in the period to £1,474 million (2024: £1,403 million).
For 2025 the Board has recommended a 2.6% increase in the Final dividend of
28.05 pence per share, bringing our Total dividend to 55.40 pence per share,
extending our strong track record of dividend growth.
We delivered £1 billion free cash flow in 2025, which has doubled from when
we started this journey in 2023. At this level we are comfortably covering our
dividend of £548 million and delivering £423 million of excess cash.
We continue to expect mid-single digit percentage growth per annum in OCG.
This means dividends and excess cash will both grow, as OCG grows,
particularly as recurring uses are reducing.
2026 is our final year of prioritising this excess cash to reduce debt. So
excess cash generated after the end of this year, will be available to be
deployed to the highest returning opportunities, in line with our capital
allocation framework.
Summary
We operate in one of the most attractive retirement and savings markets in the
world, and Standard Life has an important role to play in shaping the industry
and providing better outcomes for pensioners.
When we set out our 3-year strategy in 2024, we were clear on the scale of the
opportunity in front of us. Two years on, I'm delighted with the progress
we've made and looking ahead, I continue to be optimistic.
Our execution positions us exceptionally well to meet the needs of our
customers, and is strengthening our competitive advantages. This is
translating into strong and attractive financial performance and returns to
shareholders.
As we continue to serve our customers, colleagues and other key stakeholders,
this will support us in achieving our vision of becoming the UK's leading
retirement savings and income business.
Thank you
Our performance is only achieved through the continued hard work and
dedication of our outstanding people so I would like to thank each and every
one of my colleagues across the Group for their contributions. With our move
to Standard Life plc, I am even more energised about our future and the
progress we will make together in the years ahead.
Andy Briggs
Group Chief Executive Officer
Business review
Delivering cash, capital and earnings
We are successfully executing on our 3-year strategic priorities, which is
driving improved performance and creating strong operating momentum across the
key Group financial framework metrics of cash, capital and earnings.
Nicolaos Nicandrou
Group Chief Financial Officer
Our 2025 results reflect another year of strong, meaningful progress towards
our 2026 financial targets. We are firmly on track to achieve these goals as
we work towards our vision to be the UK's leading retirement savings and
income business.
Operating momentum underpins our financial progress
In March 2024 we set 3-year targets under our financial framework of cash,
capital and earnings, and we were able to upgrade a number of those targets in
March 2025. Two years into our 3‑year strategic plan, the Group has
delivered clear operational and financial improvement across our Grow,
Optimise and Enhance priorities. Strong operating performance and sustainable
cash generation continue to increase financial flexibility and support
delivery of our 2026 financial framework.
In 2025, Operating Cash Generation increased 5% and IFRS adjusted operating
profit rose 15%, driven by profitable growth in both our capital‑light,
fee‑based Pensions and Savings business and our capital‑utilising
Retirement Solutions business. Growing levels of assets under management and
improved margins supported this outcome, alongside further cost reductions as
we progress towards our £250 million net cost savings target by 2026.
We also strengthened our balance sheet, improving Solvency II leverage to 33%,
with a clear line of sight to reaching c.30% by 2026, while maintaining our
Shareholder Capital Coverage Ratio ('SCCR') at the upper half of our 140-180%
operating range.
2025 financial summary
Financial performance metrics 2025 2024 YOY change
Cash Operating Cash Generation1 £1,474m £1,403m +5%
Total cash generation1 £1,711m £1,779m -4%
Solvency II capital Group Solvency II surplus £3.6bn £3.5bn +2%
Group Shareholder Capital Coverage Ratio1 176% 172% +4%pts
Solvency II leverage ratio1 33% 36% -3%pts
IFRS Adjusted operating profit1 £945m £825m +15%
Loss after tax attributable to owners £(394)m £(1,078)m +63%
Shareholders' equity £244m £1,213m -80%
Contractual Service Margin (gross of tax) £3,806m £3,257m +17%
Adjusted shareholders' equity1 £3,098m £3,656m -15%
Assets Assets under administration1 £317bn £292bn +8%
Dividend Final dividend per share 28.05p 27.35p +2.6%
Total dividend per share 55.40p 54.00p +2.6%
1. Denotes metrics that are alternative performance measures ('APMs') -
further information can be found on pages 340 to 345 in the Annual Report and
Accounts.
Delivering successfully on our financial framework metrics
In 2025, we delivered total cash generation of £1,711 million, taking our
2024-25 total cash generation to £3.5 billion and remain on track to achieve
our 2024-26 cumulative £5.1 billion target. Underpinning this is strong
growth in OCG to £1,474 million, up 5% year-on-year in line with our annual
mid-single digit percentage growth guidance. Our strong operating momentum,
supported by the continued contribution of recurring management actions
delivered by our in-house asset management team, has led to increased OCG
contributions from our two main operating businesses: Pensions and Savings (up
13% year-on-year) and Retirement Solutions (up 3% year-on-year).
Importantly, OCG more than covered our recurring cash uses and dividend,
totalling £1,051 million in the period, and generated £423 million of excess
cash to deploy in line with our capital allocation framework, which we
directed to reducing our debt leverage. Once this deleveraging programme is
completed in 2026, future excess cash will be deployed towards the most
attractive return opportunities across growth investments, targeted M&A,
and increased returns to shareholders.
Our SII capital position remains strong with improvements in the SII surplus
to £3.6 billion and in the SCCR to 176%. This reflected positive net
recurring solvency capital generation of £0.4 billion, equivalent to a 9%pts
increase in SCCR. Other SII capital actions more than covered our continued
investment across our strategic priorities to grow, optimise and enhance,
while our hedging programme eliminated the impact of market effects.
Growing momentum in the Group's operating performance is also evident in the
15% increase in our IFRS adjusted operating profit to £945 million. Improved
performance in Pensions and Savings and in Retirement Solutions has delivered
higher IFRS adjusted operating profit for these businesses, up 23% and 19%
year-on-year respectively.
We reported an IFRS statutory loss after tax of £394 million in the period
primarily due to adverse economic variances of £604 million pre-tax,
reflecting the known consequence of the Group's hedging programme under this
reporting basis. This statutory loss has impacted our IFRS shareholders'
equity position, which has reduced to £244 million. This decline is not
economically meaningful as the strength of our underlying economic financial
position measured on a Solvency basis remains unchanged, with no consequential
effect on cash generation, liquidity or strategic flexibility. As a reminder,
our hedging programme aims to protect cash and SII capital from volatility in
equities and interest rates, thereby safeguarding the Group's ability to
deliver a progressive and sustainable dividend. The hedging covers components
of the Solvency balance sheet which are not present under IFRS, giving rise to
accounting volatility. We continue to prioritise stable SII surplus capital
and predictable dividends and accept the hedge-related volatility in the IFRS
result.
Notably, our Contractual Service Margin ('CSM') (gross of tax) grew 17% in
2025, which represents a sizeable stock of value that will be released into
IFRS adjusted operating profit in future years. The growth in our CSM
partially offset the decline in our shareholders' equity, with adjusted
shareholders' equity of £3,098 million at end-2025.
As a result of our improved operating performance, the Board is recommending a
2.6% increase in the 2025 Final dividend to 28.05 pence per share, taking the
Total dividend for the year to 55.40 pence per share.
Alternative performance measures
With our financial framework designed to deliver cash, capital and earnings,
we recognise the need to use a broad range of metrics to measure and report
the performance of the Group, some of which are not defined or specified in
accordance with Generally Accepted Accounting Principles ('GAAP') or the
statutory reporting framework.
We use a range of alternative performance measures ('APMs') to evaluate our
business, which are summarised on pages 340 to 345 in the Annual Report and
Accounts.
Business segment review
Strong business momentum supports our strong operating performance
Our diversified business model is a core source of strength for our Group and
provides a robust foundation for sustainable and predictable earnings
performance.
Pensions and Savings, covering new and in‑force life insurance and
unit‑linked investment products, remains a key source of capital‑light
fee‑based income. Retirement Solutions includes individual annuities and
Pension Risk Transfer ('PRT') business, which add capital utilising
spread-based margin to our results, diversifying our earnings sources. Europe
and Other, which includes Ireland, Germany and SunLife protection, bring
further diversification through premiums, fees and investment margins across
distinct markets. With‑Profits continues to generate low‑volatility
earnings via shareholder transfers from the Group's With‑Profits funds.
Together, these segments have underpinned the Group's strong 2025 performance,
enhancing OCG and IFRS adjusted operating profit and reinforcing our
trajectory towards the delivery of our 2026 targets.
This is our first year of providing a full segmental breakdown of OCG. The
largest contributor to OCG is our Retirement Solutions business which
represents over half of the total. In 2025, Retirement Solutions OCG grew by
3% to £879 million (2024: £850 million), supported by yield re-optimisation
actions.
Our Pensions and Savings business is the fastest growing contributor to OCG,
up 13% to £396 million in 2025 (2024: £350 million). This growth was
supported by business growth and actions to reduce operating costs and
simplify fund structures.
Europe and Other and With-Profits broadly maintained their combined £199
million OCG contribution, of £123 million (2024: £129 million) and £76
million (2024: £74 million) respectively.
In 2025 Pensions and Savings' IFRS adjusted operating profit grew by 23% to
£389 million (2024: £316 million) reflecting the benefit of growing assets
and improved cost efficiencies.
Retirement Solutions' IFRS adjusted operating profit increased 19% to £563
million (2024: £474 million), supported by a higher CSM release reflecting
ongoing growth of the annuity book, higher portfolio optimisation actions and
improved cost efficiencies.
Europe and Other IFRS adjusted operating profit decreased to £83 million
(2024: £96 million), primarily due to a lower insurance result, while
With-Profits reported a lower IFRS adjusted operating profit result of £24
million (2024: £41 million) as the 2024 results included one-off adjustments
that did not repeat in 2025.
The Group's Corporate Centre operating loss of £114 million (2024: £102
million) includes lower interest income of £38 million (2024: £54 million)
from reduced cash balances owing to debt repayments made.
+5%
Group OCG growth REM APM
+15%
Group IFRS adjusted operating profit growth REM APM
Pensions and Savings
Pensions and Savings performance driving higher profitability
Our Pensions and Savings business reported 11% growth in gross inflows to
£17.1 billion2 (2024: £15.4 billion1) as our leading propositions and brand
support our strong momentum here, and we continue to strengthen our
capabilities across both our Workplace and Retail segments.
Workplace saw £10 billion of inflows in 2025, £1.5 billion of which were
from new scheme wins. Excluding new schemes, gross inflows were £8.5 billion,
highlighting the strong flywheel effect of this business. In Retail, gross
inflows continue to improve, up 16% to £7.1 billion in 2025, benefiting from
a greater take up of our drawdown product, and higher international bond
sales.
Gross outflows totalled £19.6 billion2 (2024: £18.7 billion1), and reflect
our higher asset base and actions taken by our customers to access their
retirement savings in the form of annuity income, drawdown payments or
withdrawing tax-free lump sumps, as they journey to and through retirement.
Scheme retention in Workplace remains high, and outflows reflect the higher
asset base, and the natural attrition from those taking their pensions. Retail
outflows include fulfilling our primary purpose of customers accessing their
retirements savings, estimated at £5 billion in 2025. While the remaining
retail outflows remain sizeable, we expect them to improve as a percentage of
AUA as we increase our focus on retention.
The overall net outflow position was more than offset by £24.6 billion of
positive market effects, driving AUA 8% higher to £211.7 billion at 31
December 2025.
The capital-light fee-based nature of this business means that we consider
IFRS adjusted operating profit as the best measure to assess its performance.
The increasing scale of this business and actions to reduce costs and simplify
our funds range drove a 2bps improvement in operating profit margin to 19bps
(2024: 17bps). Combined with an average AUA growth of 7%, this led to strong
growth in IFRS adjusted operating profit of 23% to £389 million (2024: £316
million). OCG similarly increased to £396 million (2024: £350 million).
19bps
IFRS adjusted operating profit margin APM
+7%
Average AUA growth APM
+23%
IFRS adjusted operating profit growth APM
1. 2024 AUA, flows and average AUA have been restated to reflect the
reallocation of the Retail International Bond from Europe and Other to
Pensions and Savings.
2. Retail International Bond AUA and flows reallocated from Europe and Other
to Pensions and Savings for 2023, 2024 and 2025. 2025 also reflects the
reclassification of Corporate Trustee Investment Plan Held for Transfer assets
from Workplace to Europe and Other at end-2025.
Retirement Solutions
Retirement Solutions driving resilient capital-efficient growth
We have two main product lines here, being individual annuities and PRT. We
run £42 billion of annuity assets, and it is the management of this large
book, that drives most of our profitability. New volumes are not the primary
driver of current year profits but are a source of future value.
Our Retirement Solutions business reported 20% growth in individual annuities
new business to £1.2 billion (2024: £1.0 billion) and we maintained our
discipline in PRT in a narrow credit spread environment and competitive
market, writing £3.9 billion of new business (2024: £5.1 billion). Due to
our proactive approach in managing capital allocation and pricing discipline
to secure attractive returns, we took the strategic decision to forgo volumes
to protect the economics, investing 21% less capital this year. Our aim
remains to direct up to £200 million capital to annuities this year, provided
we secure sufficiently attractive returns. We expect continuation of the
competitive landscape in 2026, and we remain confident in our abilities to win
in this market, with £1.6 billion of PRT transactions completed or at an
exclusive stage in 2026 to date. We remain focused on disciplined capital
deployment in a competitive market.
The capital-utilising spread-based nature of this business means that we
consider OCG as the most meaningful measure to assess performance. In-force
business management has a greater bearing on profitability and cash generation
than new business flows. Our proactive management of the in-force book
combined with our scale and efficiency, our effective risk management, and our
expertise in delivering asset portfolio optimisation actions, enabled us to
sustain a spread-based margin of 219 bps (2024: 218bps), dynamics which we
consider to be enduring. Around half of this margin reflects the steady
release of capital and spread margins as our liabilities run-off, with the
other half relating to the benefit from both yield re-optimisation and capital
improvement actions.
Applied to our growing average AUA, which was up 3% at £40.2 billion (2024:
£39.0 billion), resulted in OCG growth of 3% to £879 million (2024: £850
million). This growth accounts for over half of the Group's OCG.
IFRS adjusted operating profit also increased to £563 million (2024: £474
million) driven by disciplined pricing, investment optimisation, cost
efficiencies and growth.
219bps
OCG spread APM
+3%
Average AUA growth APM
+3%
OCG growth APM
Cash
Consistent OCG delivery
In 2025, OCG increased 5% to £1,474 million (2024: £1,403 million), in line
with our guidance to grow OCG at a mid-single digit percentage rate per annum.
This was driven by higher surplus emergence of £914 million (2024: £866
million), supported by new business written and the benefit of our ongoing
cost savings programme, which have offset the natural run-off of our in-force
business.
The remaining £560 million of OCG was generated through recurring management
actions (2024: £537 million), reflecting another strong performance driven by
our developed in-house asset management capabilities, and in line with our
guidance of delivering sustainable recurring management actions of around
£0.5 billion per annum. The majority of these actions were portfolio
optimisation actions contributing £363 million (2024: £323 million), with a
further £93 million from fund simplification actions (2024: £122 million)
and £104 million from capital improvement actions (2024: £92 million).
Total cash generation supports deleveraging and investment
Total cash generation during the period was £1,711 million (2024: £1,779
million). In addition to the OCG generated this year, we also contributed
£237 million (2024: £376 million) of non-operating cash generation from the
delivery of non-recurring management actions. Over 2024-25 we have delivered
£3.5 billion total cash generation and are on track to achieve our 3-year
target of £5.1 billion.
Standard Life plc holding companies' sources and uses of cash
2025 2024
£m
Holding companies' cash at 1 January2 1,117 1,012
Operating Cash Generation 1,474 1,403
Of which Pensions and Savings 396 350
Of which Retirement Solutions 879 850
Of which Europe and Other 123 129
Of which With-Profits 76 74
Non-operating cash generation 237 376
Total cash generation1 1,711 1,779
Recurring uses of cash (1,051) (1,107)
Non-operating cash outflows (533) (314)
Holding companies' cash, pre-debt movements 1,244 1,370
Debt repayments (398) (643)
Debt issuance - 390
Holding companies' cash at 31 December2 846 1,117
Operating Cash Generation comprises:
Recurring management actions 560 537
Surplus emergence 914 866
1. Total cash generation includes £123 million received by the holding
companies in respect of tax losses surrendered (2024: £156 million).
2. Holding companies' cash is an APM - further information can be found on
pages 340 to 345 in the Annual Report and Accounts.
The £5.1 billion total cash generation target is expected to exceed both our
expected recurring uses and the planned investment in our business over the
2024-26 period, which together are expected to total £3.9 billion. As a
result, we will generate £1.2 billion of excess cash. In line with our
capital allocation framework, the financial headroom created by this excess
cash is being directed to deleveraging in order to meet our c.30% SII leverage
ratio target by the end of 2026, with £651 million of debt already retired
across 2024 and 2025.
Recurring uses of cash
Our recurring uses of cash comprise of central operating expenses, debt
interest, capital invested in annuities and shareholder dividends. Operating
expenses decreased to £112 million (2024: £132 million) reflecting cost
reductions. Debt interest fell to £229 million (2024: £236 million) as we
reduce the level of debt on our balance sheet.
We invested £162 million of capital into our annuities business (2024: £206
million) to support £5.1 billion of new business annuity premiums in the year
(2024: £6.1 billion).
Combined, these recurring uses excluding the shareholder dividend reduced to
£503 million(1) (2024: £574 million) as we took steps to improve both
operating and capital efficiency.
Importantly, OCG of £1,474 million more than covered the recurring uses of
cash including dividend in the period of £1,051 million. The excess cash
generated of £423 million was principally deployed to retire debt in support
of our deleveraging programme.
Non-recurring uses of cash
Non-operating net cash outflows increased to £533 million (2024: £314
million), partly driven by cash collateral outflows on currency derivatives
used to hedge non-sterling debt instruments of £105 million, following
depreciation of the US Dollar in the period. Non-operating costs also include
our planned investment across our strategic priorities of £275 million (2024:
£354 million) to grow, optimise and enhance our business, as well as other
payments relating to provision of capital support to new ventures, subsidiary
closure, costs and other one-off items funded centrally.
Debt repayments
Net debt repayments were higher at £398 million (2024: £253 million net
repayment) and represent the redemption of $250 million of Restricted Tier 1
notes (£200 million) and £198 million Tier 2 notes in February and December
2025, respectively.
£1,474m
Operating Cash Generation REM APM
£1,711m
Total cash generation REM APM
1. Comprises central operation expenses, debt interest and capital invested
in annuities.
Capital
Resilient Solvency II position
Our SII capital position remains resilient, with an estimated surplus of £3.6
billion (2024: £3.5 billion) and is stated after the accrual for the 2025
Final dividend. Our surplus was £0.1 billion higher than 2024 despite
retiring £398 million of debt this year, demonstrating the improved operating
capital generation capabilities of our business. Our SCCR increased 4%pts to
176% (2024: 172%) and remains in the upper half of our target operating range
of 140-180%.
Recurring capital generation
In 2025, recurring SII capital generation pre-dividend totalled £0.9 billion,
with £0.4 billion generated post-dividend which increased the SCCR by 9%pts.
Surplus emergence from in-force business, together with the release of capital
requirements, contributed £0.9 billion to the SII surplus and 21%pts to the
SCCR. In addition, we delivered £0.5 billion of recurring management actions,
predominantly Own Funds accretive as a result of portfolio optimisation
actions, increasing the SCCR by 13%pts.
Operating costs, dividends and debt interest totalled £0.9 billion, reducing
the SCCR by 20%pts, while our new business strain was lower this year at £0.1
billion, reflective of lower capital allocation to protect economics in a
highly competitive market, and reduced the SCCR by 5%pts.
Solvency II economic sensitivity analysis1
Surplus SCCR
(£bn) (%)
Solvency II base 3.6 176
Equities: 20% fall in markets - 7
Long-term rates: 100bps rise in interest rates - 4
Long-term rates: 100bps fall in interest rates - (4)
Long-term inflation: 50bps rise in inflation - (1)
Property: 12% fall in values (0.2) (4)
Credit spreads: 145bps widening with no allowance for downgrades 0.1 4
Credit downgrade: immediate full letter downgrade on 20% of portfolio2 (0.3) (7)
Lapse: 10% increase/decrease in rates (0.2) (2)
Longevity: 6 months increase (0.4) (8)
1. Illustrative impacts assume changing one assumption on 1 January 2026,
while keeping others unchanged, and that there is no market recovery. They
should not be used to predict the impact of future events as this will not
fully capture the impact of economic or business changes. Given recent
volatile markets, we caution against extrapolating results as exposures are
not all linear.
2. Impact of an immediate full letter downgrade across 20% of the
shareholder exposure to the bond portfolio (e.g. from AAA to AA, AA to A,
etc.). This sensitivity assumes management actions are taken to rebalance the
annuity portfolio back to the original average credit rating and makes no
allowance for the spread widening which would be associated with a downgrade.
Non-recurring capital generation
Non-recurring SII capital generation, excluding the debt repayments, added
£0.1 billion to surplus, as £0.4 billion of surplus generated from other
management actions more than offset our other non-recurring uses in the
period, including £0.3 billion of investment spend and other items. These
uses primarily reflect our planned investment to grow, optimise and enhance
our business over 2024-26 and include the Day 1 benefit from appointing Wipro
as our new strategic partner to assume management of the existing ReAssure
platform, ALPHA, earlier than previously planned. Other management actions
include the benefits achieved from transitioning to the in-house management of
our annuity-backing assets, which has improved cost efficiency and
strengthened our ability to deliver long-term value to shareholders. They also
include the benefits from selling the shareholders' share of future income
from our with-profits funds to the estate of these funds. We continue to be
well hedged on an economic basis under SII and experienced a positive impact
of £0.1 billion this year driven by a steepened yield curve, lower inflation
and higher equity markets. This impact was offset by £0.1 billion losses on
currency hedge instruments relating to our debt instruments.
Strong progress on leverage
Our SII leverage ratio improved by 3%pts to 33% at 31 December 2025 (2024:
36%), as a result of the £398 million debt repayments completed in February
and December 2025. We remain on track to achieve our c.30% SII leverage ratio
target by the end of 2026, although the path will not be linear.
£3.6bn
Group Solvency II surplus (estimated) REM
176%
Group Shareholder Capital Coverage Ratio (estimated) APM
33%
Solvency II leverage ratio REM APM
Movement in Group Solvency II capital during 2025
Recurring capital generation of +£0.4bn surplus and +9%pts SCCR Non-recurring capital utilisation of +£0.1bn surplus and +3%pts SCCR
£m 2024 Surplus emergence and release Recurring management actions Operating costs, debt interest and dividend New business strain Other management actions Economics and temporary strain Investment spend 2025 Debt repayment 2025
of SCR and other (pre-debt repayment)
Own Funds 8.4 0.7 0.5 (0.9) 0.1 0.3 0.0 (0.4) 8.7 (0.4) 8.3
SCR (4.9) 0.2 0.0 - (0.2) 0.1 0.0 0.1 (4.7) - (4.7)
SII surplus 3.5 0.9 0.5 (0.9) (0.1) 0.4 0.0 (0.3) 4.0 (0.4) 3.6
SCCR1 172% 21% 13% (20)% (5)% 9% 1% (7)% 184% (8)% 176%
1. The SCCR excludes SII Own Funds and Solvency Capital Requirements ('SCR')
of unsupported With-Profit funds and unsupported pension schemes.
Earnings
IFRS adjusted operating profit momentum continues
We generated a 15% year-on-year increase in IFRS adjusted operating profit to
£945 million (2024: £825 million) driven by uplifts in both of our two main
operating business units, Pensions and Savings (23% growth year-on-year) and
Retirement Solutions (19% growth year-on-year).
Looking ahead, our continued IFRS adjusted operating profit momentum in 2025
provides us with confidence in meeting our 2026 IFRS adjusted operating profit
target of c.£1.1 billion.
Accelerated delivery of cost savings
The Group's cost savings programme remains firmly on track to deliver the
end-2026 targeted £250 million of annual run-rate cost savings, net of
inflation, relative to the Group's 2023 cost levels, as we continue to enhance
our business and progress towards a more efficient Group-wide operating model.
In 2025, £117 million of run-rate savings were delivered, which combined with
the savings achieved in 2024, brings the cumulative run-rate cost savings
total to £180 million across 2024-25, £55 million ahead of our original
delivery profile by 2025.
Of these run-rate savings, £110 million were earned in the year (2024: £28
million), with £55 million of the £82 million year-on-year increase emerging
IFRS adjusted operating profit, with the balance accounted through the CSM.
IFRS income statement
2025 2024
£m
Pensions and Savings 389 316
Retirement Solutions 563 474
Europe and Other 83 96
With-Profits 24 41
Corporate Centre (114) (102)
Adjusted operating profit 945 825
Amortisation and impairment of intangibles (233) (270)
Finance costs attributable to owners (193) (204)
Other non-operating items (396) (520)
Profit/(loss) before economics, tax and NCI 123 (169)
Economic variances (604) (1,297)
Loss before tax and NCI (481) (1,466)
Profit before tax attributable to non-controlling interest 49 12
Loss before tax attributable to owners (432) (1,454)
Tax credit attributable to owners 38 376
Loss after tax attributable to owners (394) (1,078)
Amortisation and impairment of intangibles
The previously acquired in-force business, relating to IFRS 9 capital-light
fee-based business, is being amortised in line with the expected run-off
profile of the investment contract profits to which it relates. Amortisation
and impairment during the period reduced to £233 million (2024: £270
million) reflecting the run-off of this acquired business.
Finance costs and other non-operating items
Other non-operating losses in the period totalled £396 million (2024: £520
million loss), the majority of which reflects £264 million (2024: £372
million) of planned investment spend across our strategic priorities, with
£132 million (2024: £148 million) of other one-off items.
Finance costs of £193 million (2024: £204 million) reflected interest borne
on the Group's debt.
IFRS loss after tax shaped by economic variances
The Group generated an IFRS loss after tax attributable to owners of £394
million (2024: loss of £1,078 million). The loss is driven by £604 million
of adverse hedging-related economic variances (2024: £1,297 million adverse),
primarily from rising equity markets in the year (FTSE 100 +21.5%, S&P 500
+16.4% and Eurostoxx 50 +18.3%), and reflects the result of the Group's
hedging programme which aims to protect cash and SII capital from volatility
in equities and interest rates. This gives rise to accounting movements, as
several of the SII capital components covered by hedging are not recognised on
the IFRS balance sheet, with the IFRS market sensitivities shown on pages 242
to 248.
£945m
IFRS adjusted operating profit REM APM
£3,806m
Contractual Service Margin (gross of tax)
£3,098m
IFRS adjusted shareholders' equity APM
Adjusted shareholders' equity highlights strong underlying value
We have built on our progress made in 2024 in increasing the level of pre-tax
IFRS adjusted operating profitability to cover our recurring uses. In 2025
only £29 million (pre-tax) remained uncovered, an improvement on the
equivalent amount of £182 million in 2024.
We continue to expect that our target of c.£1.1 billion IFRS adjusted
operating profit in 2026 will be sufficient to fully cover our recurring uses
and create excess to fund non-recurring uses.
The level of non-operating items are elevated at present, largely driven by
our planned 3-year non-recurring investment spend. The level of non-operating
items is expected to moderate once our current spend on migrations and
transformation is completed. From 2027 we expect adjusted operating profit to
cover all uses, excluding economic variances.
The resulting IFRS loss after tax in the period drove shareholders' equity
lower at the end of 2025 to £244 million (2024: £1,213 million). As
described above, this is owing to economic variances and has no impact on
operating performance, cash, or capital strength, so the movement does not
change the financial viability of our business, which is best measured by
reference to Solvency capital, which includes the store of future value on
annuities, with-profits and investment contract business. The Board continues
to prioritise stable SII surplus capital and predictable dividends and accepts
the hedge-related volatility in the IFRS result.
Adjusted shareholders' equity provides a better, albeit still partial, view of
the value of the business under IFRS. It comprises IFRS shareholders' equity
and the CSM (net of tax) and stood at £3,098 million at 31 December 2025
(2024: £3,656 million).
IFRS shareholders' equity and adjusted shareholders' equity
2025 2024
£m
Adjusted operating profit 945 825
Recurring uses:
Amortisation of intangibles (233) (270)
Finance costs attributable to owners (193) (204)
Dividend (548) (533)
Adjusted operating profit before tax, less recurring uses (29) (182)
Non-recurring uses, economics and tax:
Other non-operating items (396) (520)
Economic variances (604) (1,297)
Tax and other items recognised in equity 60 470
Movement in shareholders' equity (969) (1,529)
Opening shareholders' equity 1,213 2,742
Movement in shareholders' equity (969) (1,529)
Closing shareholders' equity 244 1,213
CSM (net of tax) 2,854 2,443
Adjusted shareholders' equity 3,098 3,656
CSM momentum drives value
The Group's CSM (gross of tax) rose by 17% to £3,806 million at 31 December
2025 (2024: £3,257 million) and represents a sizeable stock of value that
will unwind into IFRS adjusted operating profit in future years.
The increase in the period was driven by a £296 million contribution from
strategic project initiatives, which comprised the impact of the lower cost of
managing our annuity-backing assets which will be in-housed and the impact
from the net expense benefits related to the Wipro strategic partnership. An
additional £150 million contribution was generated from new business,
principally from annuities written in Retirement Solutions (2024: £248
million), with a further £308 million from assumption changes, experience
profits, positive market effects and other (2024: £370 million). Both periods
benefited from lower expense maintenance loadings reflecting our cost savings
initiatives and from positive market effects.
The 2025 CSM release into the income statement of 7% is broadly in line with
the prior year (2024: 8%), contributing £274 million to pre-tax IFRS adjusted
operating profit (2024: £281 million). With in-year net CSM generation more
than exceeding amortisation, the net of tax value of the CSM increased to
£2,854 million at 31 December 2025 (2024: £2,443 million).
Other stores of value not captured in IFRS balance sheet
In addition to the store of future value of £2.9 billion (post-tax) captured
in the CSM for insurance contracts, there is a further store of future value
which is included in Solvency II Own Funds, relating to the value-in-force for
investment contracts. This increased to £4.4 billion post-tax in 2025 (2024:
£3.4 billion post-tax), reflecting new business flows, cost savings, improved
in-force business management and equity market rises. These stores of value
will emerge through IFRS adjusted operating profit in future years, providing
a strong underpin to the Group performance trajectory for many years to come.
Movement in Group Contractual Service Margin during 2025, including segmental split
Opening New Interest accretion Assumption changes, experience economics and other Strategic project initiatives Closing CSM, pre-release (gross) CSM Closing Tax Closing
£m CSM business release CSM CSM
(gross) (gross) (net)
Pensions and Savings 263 - - 56 10 329 (33) 296 (74) 222
Retirement Solutions 2,306 128 61 223 271 2,989 (189) 2,800 (700) 2,100
Europe and Other 196 22 2 (5) 5 220 (24) 196 (49) 147
With-Profits 492 - 6 34 10 542 (28) 514 (129) 385
2025 Total Group CSM 3,257 150 69 308 296 4,080 (274) 3,806 (952) 2,854
2024 Total Group CSM 2,853 248 67 370 - 3,538 (281) 3,257 (814) 2,443
Dividend
28.05p
2025 Total dividend per share
+2.6%
2025 Final dividend increase
+3%
10-year Total dividend CAGR
In March 2024, the Board outlined a 3-year strategy for 2024-26, to support
the creation of a business which delivers sustainable and growing cash,
capital and earnings and adopted a progressive and sustainable ordinary
dividend policy, reflecting its confidence in the Group's strategy.
In operating this dividend policy, the Board will announce any potential
annual dividend increase alongside the Group's Full Year results and expects
the Interim dividend to be in line with the previous year's Final dividend.
The Board continues to prioritise the sustainability of our dividend over the
long term. Future dividends and annual increases will be subject to the
discretion of the Board, following assessment of longer-term affordability.
In operating the policy and assessing longer-term affordability, the Board
considers the quantum and trajectory of the Group's OCG, SII surplus, SCCR and
the distributable reserves at the Group's holding company.
At 31 December 2025, distributable reserves at Standard Life plc, the Group's
holding company that pays dividends to shareholders, stood at £5,800 million
(2024: £5,571 million), supported by distributions from its main operating
companies which continue to report under UK GAAP and carry sizeable
distributable reserves. In 2025 the Group's main operating subsidiaries
generated strong UK GAAP net profits after hedging impacts, which supported
the cash remittances to Group.
In the consolidated IFRS financial statements, the Group is targeting a
positive pre-hedge post-dividend IFRS net profit contribution to the IFRS
shareholders' equity from 2027. The Group accepts the hedge-related volatility
that impacts IFRS shareholders' equity, which is a known consequence of our
Solvency II hedging strategy that is designed to protect our cash, capital and
dividend.
In this overall context and consistent with previous guidance, the Board
considers that the Group's consolidated IFRS shareholders' equity is not a
constraint to the payment of our dividends.
As a result of our improved operating performance in 2025 and our ongoing
confidence in the Group's strategy, the Board is recommending a 2.6% increase
in the 2025 Final dividend to 28.05 pence per share, taking the 2025 Total
dividend to 55.40 pence per share.
Looking ahead
The Group continues to operate in an environment with increased global
geopolitical and macroeconomic uncertainty, including the escalation of
conflict in the Middle East in recent weeks. Despite this backdrop, the UK
consumer retirement needs we serve are long term in nature and enduring.
Two years into this 3-year period, we have made demonstrable progress across
our strategic priorities and our improved operating performance puts us firmly
on track to meet our 2026 financial framework targets.
At the end of 2026, our business will have a higher OCG and IFRS adjusted
operating profit base and a higher quality Solvency balance sheet.
Importantly, it will generate a healthy and growing level of excess cash,
improving both our financial and strategic flexibility.
2026 financial targets
Financial target Status Performance in 2025 and 2024
Cash Mid-single digit percentage growth p.a. in Operating Cash Generation On track £1,474m, +5% vs FY2024 (£1,403m)
Total cash generation of £5.1bn across 2024-26 On track £3.5bn across 2024-25 (FY2025: £1.7bn, FY2024: £1.8bn)
Capital Operate within our 140-180% Shareholder Capital Coverage Ratio operating range On track 176%, within operating range (FY2024: 172%)
Solvency II leverage ratio of c.30% by the end of 2026 On track 33%, -3%pts vs FY2024 (36%)
Earnings c.£1.1bn of IFRS adjusted operating profit in 2026 On track £945m, +15% vs FY2024 (£825m)
£250m of annual run-rate cost savings by the end of 2026 On track £180m across 2024-25 (FY2025: £117m, FY2024: £63m)
Information required under the Disclosure Guidance & Transparency Rules
('DTR')
Information required to be communicated in unedited full text, in accordance
with DTR 6.3.5R(1A), is included in the Annual Report and Accounts, available
at http://www.rns-pdf.londonstockexchange.com/rns/7523W_1-2026-3-15.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/7523W_1-2026-3-15.pdf)
In accordance with UK Listing Rule 6.4.1, a copy of the Annual Report and
Accounts has been submitted to the National Storage Mechanism and will shortly
be available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/index.html#/nsm/nationalstoragemechanism)
The document may also shortly be accessed via the Standard Life website at:
https://www.standardlifeplc.com/investors/results-reports-and-presentations/
(https://www.standardlifeplc.com/investors/results-reports-and-presentations/)
Enquiries
Investors/analysts:
Claire Hawkins, Director of Corporate Affairs & Brand, Standard Life
+44 (0)20 4559 3161
Joanne Roberts, Investor Relations Director, Standard Life
+44 (0)20 4559 4673
Media:
Tom Blackwell, FTI Consulting
+44 (0)203 727 1051
Shellie Wells, Corporate Communications Director, Standard Life
+44 (0)20 4559 3031
Presentation and webcast details
There will be a live virtual presentation for analysts and investors today
starting at 09:30 (GMT). You can register for the live webcast at: Standard
Life FY 2025 results
(https://storm-virtual-uk.zoom.us/webinar/register/WN_xuRO-s0iTm27dOa2AhukhQ#/registration)
A copy of the presentation and a detailed financial supplement will be
available at:
https://www.standardlifeplc.com/investors/results-reports-and-presentations/
(https://www.standardlifeplc.com/investors/results-reports-and-presentations/)
A replay of the presentation and transcript will also be available on our
website following the event.
There will also be an additional Q&A event aimed at retail investors,
hosted by Andy Briggs, Group CEO, and Nicolaos Nicandrou, Group CFO, following
a replay of the Group's Investor Presentation, via Investor Meet Company on 20
March 2026, starting at 12:30 (GMT).
The Investor Meet Company presentation and Q&A is open to all existing and
potential shareholders. Questions can be submitted pre-event via your Investor
Meet Company dashboard up until 19 March 2026, 09:00 (GMT), or at any time
during the event.
Investors can sign up to Investor Meet Company for free and add to meet
Standard Life plc via:
https://www.investormeetcompany.com/standard-life-plc/register
(https://url.uk.m.mimecastprotect.com/s/YOGzCoYKxf7mr5lT1fzSpIepI?domain=investormeetcompany.com)
Dividend details
The recommended Final 2025 dividend of 28.05 pence per share is expected to be
paid on 20 May 2026. The ordinary shares will be quoted ex-dividend on the
London Stock Exchange as of 9 April 2026.
The record date for eligibility for payment will be 10 April 2026.
Footnotes
1. Operating Cash Generation ('OCG') represents the sustainable level of ongoing
cash generation from our underlying business operations, that is remitted from
our Life Companies to the Group.
2. Total cash generation represents the total cash remitted from the operating
entities to the Group, comprising OCG, non-recurring management actions and
the release of free surplus above capital requirements in the Life Companies.
3. The Shareholder Capital Coverage Ratio excludes Solvency II Own Funds and
Solvency Capital Requirements of unsupported With-Profit funds and unsupported
pension schemes.
4. 31 December 2025 Solvency II capital position is an estimated position.
5. Solvency II leverage ratio calculation = debt (all debt including RT1) / SII
regulatory Own Funds. Ratio allows for currency hedges over foreign currency
denominated debt.
6. Includes reallocation of flows and AUA for International Bonds to Retail from
Europe, and held for transfer Corporate Trustee Investment Plan ('CTIP')
mandate to Other from Workplace.
7. The Board will continue to prioritise the sustainability of our dividend over
the long term. Future dividends and annual increases will be subject to the
discretion of the Board, following assessment of longer-term affordability. At
31 December 2025, distributable reserves at Standard Life plc, the Group's
holding company that pays dividends to shareholders, stood at £5,800 million
(FY 2024: £5,571 million), supported by distributions from its main operating
companies which continue to report under UK GAAP and carry sizeable
distributable reserves. In 2025 the Group's main operating subsidiaries
generated strong UK GAAP net profits after hedging impacts, which supported
the cash remittances to Group. In the consolidated IFRS financial statements,
the Group is targeting a positive pre-hedge post-dividend IFRS net profit
contribution to the IFRS shareholders' equity. The Group accepts the
hedge-related volatility that impacts IFRS shareholders' equity, which is a
known consequence of our Solvency II hedging strategy that is designed to
protect our cash, capital and dividend. In this overall context and consistent
with previous guidance, the Board considers that the Group's consolidated IFRS
shareholders' equity is not a constraint to the payment of our dividends.
8. Company analysis of market data and industry forecasts including 2024 LCP
Pension Risk Transfer report, NMG, The 2024 Purple Book and publicly available
FY 2024 and HY 2025 financial disclosures.
9. Company estimate based on NMG market model (2024).
10. NMG market model (2024) data.
11. Company estimate based on 2025 LCP Pension Risk Transfer report.
12. Company estimate based on publicly available information.
13. Customer satisfaction score converted to NPS equivalent metric.
Disclaimers
On 24 February 2026 we changed our name from Phoenix Group Holdings plc to
Standard Life plc. References to performance to 31 December 2025 were under
Phoenix Group Holdings plc.
This announcement in relation to Standard Life 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, targets, 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
known and unknown risks 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 regulations,
policies and actions of governmental and/or regulatory authorities including,
for example, climate change and the effect of the UK's version of the
'Solvency II' regulations on the Group's capital maintenance requirements;
developments in the UK's relationship with the European Union; the direct and
indirect consequences of the conflicts in Ukraine and the Middle East for
European and global macroeconomic conditions and related or other geopolitical
conflicts; political uncertainty and instability including the rise in
protectionist measures; the impact of changing inflation rates (including high
inflation) and/or deflation; information technology (including developments
and use of Artificial Intelligence) or data security breaches (including the
Group being subject to cyber-attacks); the development of standards and
interpretations including evolving practices in sustainability 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); the Group's
ability along with governments and other stakeholders to measure, manage and
mitigate the impacts of climate change effectively; the implementation of
rules, regulations or other actions with an opposing stance to sustainability
matters or policies; 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 any acquisitions, joint ventures, disposals or other
strategic transactions (including any associated integration); risks
associated with arrangements with third parties; inability of reinsurers to
meet obligations or unavailability of reinsurance coverage; and the impact of
changes in capital and implementing changes in IFRS 17 or any other
regulatory, solvency and/or accounting standards, and tax laws and practices
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, targets, ambitions,
outlook, guidance and expectations set out in the forward-looking statements
and other financial and/or statistical data within this announcement. The
information in this announcement does not constitute an offer to sell or an
invitation to buy securities in Standard Life plc or an invitation or
inducement to engage in any other investment activities. 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. No representation is
made that any of these statements will come to pass or that any future results
will be achieved. As a result, you are cautioned not to place undue reliance
on such forward-looking statements contained in this announcement.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
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. END FR XELLFQXLBBBE
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