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M&G plc to acquire Continuum (Financial Services)
M&G plc announces today an agreement to acquire Continuum (Financial Services), a fast-growing provider of independent financial advice.
M&G is taking an initial 49.9% stake in the business this year with a scheduled agreement in place to acquire the remainder over the following 2 years. The purchase price is undisclosed.
M&G plc half year 2022 results
Improved fund flows underpin a resilient operational and financial performance
Solid start to new £2.5bn operating capital generation target by 2024
John Foley, Chief Executive, said:
"This is an encouraging set of results and provides evidence that M&G is continuing to build momentum. Improved client flows underpinned a resilient operational and financial performance despite a period of volatility when many investors reduced their exposure to markets.
"The turnaround in flows builds on the progress we made in 2021. In only 12 months, we have reversed our position from being £2 billion in net client outflows, to achieving £1.2 billion in net client inflows excluding Heritage.
"Importantly, Wholesale Asset Management achieved net client inflows for the first time since 2018 totaling £0.8 billion.
"Our continued investment in M&G Wealth positions it to become a major player in the UK wealth market. In addition to recently announcing an agreement to acquire Continuum Financial Services, M&G Wealth has also launched PruFund Planet on its digital platform, the first time that PruFund has been offered as a choice on any investment platform in the UK.
"The current macro-economic environment is creating uncertainty in the markets in which we operate. However, our diversified sources of earnings and strong shareholder Solvency II coverage ratio protects our ability to invest in the business and, as today's interim dividend of 6.2 pence per share shows, deliver attractive shareholder returns."
H1 financial highlights
- Operating capital generation of £433 million, up 40% on the same period last year, representing a solid start to the achievement of our new operating capital generation target of £2.5 billion by the end of 2024
- Shareholder Solvency II coverage ratio remains very strong at 214% despite total capital generation falling to £24 million (30 June 2021: £869 million) as a result of increasing yields and falling equity markets
- Adjusted operating profit before tax decreased to £182 million, impacted by current market conditions
- IFRS loss after tax of £1,045 million; impacted by short-term fluctuation losses in the fair value of the surplus assets in our annuity portfolio and derivatives used to hedge the Solvency II balance sheet caused by increasing yields
- Assets under management and administration decreased by £21.1 billion to £348.9 billion, driven mainly by adverse market movements, with net client inflows (excluding Heritage) of £1.2 billion
- We are well on track with our buy-back programme having deployed almost £150 million to date
- Interim dividend of 6.2 pence per share, in line with our policy of paying one-third of the previous year's total dividend, with the dividend per share up 2% as a result of the share buy-back programme
H1 operational highlights
- Wholesale Asset Management returned to net client inflows for the first time in four years with a total of £0.8 billion, compared to £3.4 billion of net client outflows in the same period last year reflecting the measures taken to improve investment performance and offer better value to customers and clients
- Improved performance in Wholesale Asset Management, with 62% of funds in upper two performance quartiles over one year (31 December 2021: 45%) and 61% over three years (31 December 2021: 36%) 1
1 Source M&G plc and Morningstar Inc.
- Continued growth in our Institutional Asset Management business with net client inflows of £0.3 billion
- Improved net client flows for M&G Wealth, with gross inflows into PruFund increasing to £2.5 billion (30 June 2021: £1.9 billion) following strong investment performance, digitisation, with PruFund Planet being launched on the M&G Wealth platform, and better service levels
- Roll out of PruFund-type products in Europe progressing with the launch of Future+ in Italy in February, and in Ireland later this year
- Further strengthened M&G Wealth with the recently announced agreement to acquire Continuum Financial Services which broadens our independent advice footprint
- Completed the acquisition of Swiss impact investor responsAbility and published our position on thermal coal, which included our intention to phase out investment in thermal coal by 2030 for OECD and EU countries and 2040 for developing countries
Outlook
- Cautiously optimistic about the turnaround in Wholesale Asset Management in light of continued action on investment performance and net inflows into our new generation of thematic funds but remain mindful of the challenging external environment
- Institutional Asset Management well-placed given consistent strong performance with £4.4 billion of committed client capital for private assets and further client wins yet to be funded
- Following recent acquisitions and partnerships, we believe M&G Wealth now has all the building blocks required to progress on its journey to become a major player in the UK wealth market
- On-going macro economic uncertainty has the potential to disrupt markets further and impact our results
- Strong Solvency II ratio of 214% underpins dividend policy
M&G plc ("M&G"), the leading international savings and investment business, announces the appointment of Andrea Rossi as its next Chief Executive and Executive Director.
Andrea will take up his new position on 10 October 2022, succeeding John Foley who, in April 2022, announced his intention to retire after seven years in the role. John will step down as CEO and Executive Director on 10 October 2022, but will remain at M&G in an advisory capacity until 31 December 2022 in order to ensure an orderly transition.
Andrea has a 22 year track record in the global insurance and asset management sectors, mainly through his time at AXA Group. He was CEO of AXA Investment Managers and a member of the Group Executive Committee of AXA Group for six years. Andrea also held senior roles at AXA's insurance business across Europe and internationally. Under his leadership of AXA Investment Managers, assets under management increased by 55% to €800bn and AUM from external clients more than doubled. This growth was driven by a clear focus on systematically identifying and addressing client needs and through a transformation of underlying systems and processes.
M&G plc (the "Company") confirms that the £500,000,000 share buyback programme (the "Programme") announced on 24 March 2022 in order to reduce the share capital of the Company has now completed. In total under the Programme, the Company repurchased 252,062,653 ordinary shares of £0.05 each in the Company.
In accordance with the requirement of Provision 4 of the UK Corporate Governance Code, the Company is providing an update in response to the voting outcome on Resolution 15 (Say on Climate), approved at its Annual General Meeting on 25 May 2022.
The Board stated in March 2021 our belief that sustainably-run businesses deliver stronger and more resilient long term returns for investors.
Prior to our 2022 AGM we engaged with major shareholders on Resolution 15 (Say on Climate), which asked shareholders to vote to approve our Climate Transition Plan and our climate related financial disclosures for 2021.
We were encouraged that 79.57% of the votes cast were in favour of the resolution, and even where shareholders abstained or dissented, the majority indicated that they appreciated the opportunity to vote. We thank our shareholders for voting and their feedback.
Following the 2022 AGM, we engaged with our major dissenting shareholders on our climate plans, gaining comments in relation to the nature of our interim net zero targets for our investment portfolios, and on target-setting and monitoring.
On these topics, since the AGM, our internal asset owner has published its first formal set of interim targets towards achieving net zero by 2050. These cover £99 billion in retail customers' assets that are managed on our behalf by our asset manager, M&G Investments, and a number of external asset managers. Our asset manager has also published an update on its progress against its initial interim targets set in 2021, and has said it intends to increase these interim targets early in 2023.
M&G plc ("M&G") has today released an update on its approach to IFRS 17; a global insurance accounting standard due to be implemented on 1 January 2023. The material is available on M&G's website at the following link (Results, reports and presentations - M&G plc (mandgplc.com)) and a summary of key points is set out below.
The implementation of IFRS 17 will not change M&G's strategy, solvency position, capital management framework, or dividend policy. M&G remains committed to achieving its core financial target of generating £2.5 billion Operating Capital over the 2022-2024 three-year period.
On transitioning to IFRS 17, M&G expects its IFRS Shareholder Equity to increase due to the notional attribution to shareholders of c. 10% of the With-Profits fund IFRS surplus. This positive impact on Shareholder Equity is expected to more than offset the negative one driven by the creation of the Contractual Service Margin (CSM) in the annuity business.
The increase in IFRS Shareholder Equity is expected to proportionately reduce the IFRS leverage ratio, while the Solvency II leverage ratio will not be affected by the change.
IFRS 17 will change the profit signature of the With-Profits business (including PruFund), as earnings will no longer be back-end loaded, but spread through the life of the product.
IFRS 17 will also remove the volatility related to assumption changes (e.g. longevity) from the Annuities Adjusted Operating Profit (AOP) result. These assumption changes will be absorbed by the CSM and gradually fed through to AOP over time.
M&G will provide a further update on IFRS 17 to the market in June 2023, ahead of publishing its first set of IFRS 17 financial statements at its 2023 Half Year Results.
M&G plc, the leading international saving and investment business, announces the appointment of Joseph Pinto as its next Chief Executive Officer of M&G Asset Management.
Joseph will have accountability for all investment capabilities including the equity, fixed income, multi asset, private and alternative asset strategies alongside distribution, operations and proposition management across the Asset Management business.
With 30 years of experience in asset management, financial services, and consulting, Joseph joins from Natixis Investment Managers where he has served as a Head of Distribution and Investment Solutions for EMEA, APAC and LATAM and Global Chief Operating Officer. Previously at AXA Investment Managers for 13 years, Joseph held senior positions, including Global Chief Operating Officer, Global Head of Markets & Investment Strategy and Head of Business Development for South Europe and the Middle East.
Positive net client flows in Asset Management and Wealth in a year of significant market uncertainty
Returned nearly £1 billion to shareholders through dividends and share buy-back
On track to achieve £2.5 billion operating capital generation target by 2024
Launched transformation programme to drive simplification, unlock growth and deliver £200 million cost savings.
And later;
Subsequent to 31 December 2022, the Board has declared a second interim dividend for 2022 of 13.4 pence per ordinary share and, an estimated £310m in total. The dividend is expected to be paid on 27 April 2023 and will be recorded as an appropriation of retained earnings in the financial statements at the time that it is paid. The final dividend amount per ordinary share for the year ended 31 December 2022 is impacted by the share buy-back programme, see Note 10 for further details.
M&G plc has today submitted its single group Solvency and Financial Condition Report ("SFCR") for the year ended 31 December 2022 to the Prudential Regulation Authority.
A copy of the SFCR is now available on the M&G plc website.
M&G plc (the 'Company') today announces that its Notice of Annual General Meeting 2023 (the 'Notice') is available to view on the Company's website at mandg.com.
The Company's Annual General Meeting will be held on Wednesday 24 May 2023 at 10:00 at 10 Fenchurch Avenue, London EC3M 5AG (with facilities for in person and virtual attendance and participation).
A copy of the Notice, Proxy Form and Voting Instruction Cards will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism in due course. Printed copies of the Notice will today be posted to those shareholders who have requested to receive a hard copy.
The Company announces that this year it will publish its Half-Year Financial Results on 20 September 2023. This is due to the implementation of the new insurance accounting standard, IFRS17.
In light of the fact that there has been an adjustment to the reporting date, the Company will release a Q1 Trading Statement on 8 June 2023.
Information on these and other key reporting dates can be found on our website http://mandg.com
idpickering wrote:Financial Reporting Calendar.The Company announces that this year it will publish its Half-Year Financial Results on 20 September 2023. This is due to the implementation of the new insurance accounting standard, IFRS17.
In light of the fact that there has been an adjustment to the reporting date, the Company will release a Q1 Trading Statement on 8 June 2023.
Information on these and other key reporting dates can be found on our website http://mandg.com
https://www.investegate.co.uk/announcement/7531828
Ian (I hold).
BullDog wrote:Thanks. I have a chunk of MNG too. I remain rather nervous about the dividend sustainability.
Continued positive momentum across all three Group priorities: Financial strength, Simplification and Growth
Delivered positive net flows and strong investment performance across both the Asset Management and Wealth businesses
Completed the first phase of the Transformation programme, and maintained a strong and conservatively positioned balance sheet
Andrea Rossi, Group Chief Executive Officer, said:
"M&G started the year building on our strong momentum from 2022. At Full-Year Results we identified three priorities for the Group: maintain financial strength through capital discipline, simplify the business, and deliver profitable growth focusing on Asset Management and Wealth. I am pleased to say we have made good progress on each of those fronts and are on track to deliver on our ambitious targets.
"I am particularly encouraged by the £1.0 billion net client inflows achieved in Wholesale Asset Management in just three months. Thanks to this success, we more than offset the expected redemptions from institutional clients and drove inflows into high-margin propositions. Much of this growth has come from our home market, the UK, where we were amongst the 'top five' managers by net flows in the period1, ending a long period of subdued performance.
1 Source: The Pridham report
"In Institutional Asset Management, despite known headwinds in the UK, we have continued to expand our presence in Europe, winning large mandates in the Netherlands and Switzerland, where we secured £0.8 billion in funding from the Swiss Investment Fund for Emerging Markets.
"Turning to M&G Wealth, we continue to see good momentum, with PruFund sales growing to £1.6 billion in Q1. In May we launched PruFund Growth, PruFund Cautious and PruFund Risk Managed versions on our digital platform, further expanding the reach of this unique proposition. Making the wider PruFund range more accessible to financial intermediaries will support flows in the second half of the year and beyond.
"Looking ahead, I'm both confident and excited about the prospects for M&G, as we execute on the strategy outlined at Full-Year Results. I am enthused by the progress to date and remain focused on delivering operational efficiencies to benefit both clients and shareholders. Notwithstanding an uncertain external environment, we are building on the inherent strengths of our differentiated business model, delivering profitable growth alongside attractive shareholders returns."
And later;
Financial strength
Despite continued volatility in financial markets, Shareholder Solvency II coverage ratio improved to 200% (2022: 199%) even after factoring in the £310 million 2022 final dividend announced in March (corresponding to a seven percentage points reduction)
Our shareholder annuity portfolio continues to perform resiliently and remains conservatively positioned, with a clear focus on high credit quality. 98% of the assets are investment grade, with no defaults experienced in Q1 and a very low level of downgrades
We remain committed to our disciplined capital management framework and policy of stable or increasing dividends per share
M&G plc ("M&G") has today released a presentation to provide an update on its transition to IFRS 17, the global insurance accounting standard implemented on 1 January 2023. The update reflects M&G's current expectations and assessment of the impact of the IFRS 9 and IFRS 17 implementation, providing a restatement of M&G's financial results for the year ended 31 December 2022 and the six months ended 30 June 2022 on an unaudited IFRS 17 basis.
The material is available on M&G's website at the following link https://www.mandg.com/investors/results ... sentations and a summary of key points is set out below.
The implementation of IFRS 17 will not change M&G's strategy, solvency position, capital management framework, or dividend policy. M&G remains committed to achieving its financial target of generating £2.5 billion Operating Capital over the 2022-2024 period. It also remains committed to the financial targets set out on 9 March 2023 and to be achieved by end of 2025, namely:
Deliver > 50% of the Group's earnings from the Asset Management and Wealth operations1
Deliver cost savings of £200m across the Group's managed cost base
Reduce the Asset Management CIR to < 70% (excluding performance fees)
Reduce the Solvency II leverage ratio to < 30%
M&G's restated 2022 closing position for IFRS Shareholder Equity increases by over 50% to £4.3bn, mainly due to the attribution to shareholders of c. 10% of the With-Profits fund IFRS surplus. Adjusted Equity is £8.3bn, calculated as the sum of Shareholder Equity and the Contractual Service Margin (CSM) attributable to Shareholder net of tax.
The increase in IFRS Shareholder Equity and creation of the CSM reduce the IFRS leverage ratio to 28%. The ratio is calculated as the nominal value of subordinated debt over the sum of Adjusted Equity and the nominal value of subordinated debt.
The restated 2022 Full-Year Adjusted Operating Profit (AOP) increases by 4% to £552m, driven by the change in profit signature of the Annuities and With-Profits business (including PruFund) and the revised AOP methodology.
The CSM attributable to Shareholder at the end of 2022 is £5.1bn (£4.1bn net of tax), demonstrating the sizeable discounted future value from M&G insurance operations, as well as their long-term and resilient nature.
M&G expects to publish its 2023 Half-Year Results on 20 September 2023.
yieldhog wrote:I see the upcoming interim dividend date is expected to be payable November 3rd.
X/d date is September 28th.
Last year it was September 29th with an x/d of18/8
Y
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