FINANCIAL HIGHLIGHTS - CONTINUED STRONG PERFORMANCE:
NET CASH GENERATION UP 16% TO £1,002M (2012: £865M) OPERATIONAL CASH GENERATION UP 9% TO £1,042M (2012: £958M) OPERATING PROFIT UP 7% TO £1,158M (2012: £1,087M) PROFIT BEFORE TAX UP 10% TO £1,134M (2012: £1,033M) PROFIT AFTER TAX UP 12% TO £896M (2012: £798M) EARNINGS PER SHARE UP 10% TO 15.20P (2012: 13.84P) RETURN ON EQUITY 16.1% (2012: 15.4%) FULL YEAR DIVIDEND UP 22% TO 9.30P PER SHARE (2012: 7.65P PER SHARE) NET CASH DIVIDEND COVER TOWARDS 1.5 IN TWO YEARS
Nigel Wilson, Group Chief Executive, said:
"Disciplined investment in growth, effective management and rigorous cost control has enabled us to more than triple net cash since the financial crisis: it has grown from £320m in 2008 to £1,002m in 2013. We have grown dividends again by over 20% and due to the strength of the business intend to move dividend cover from 1.8 towards 1.5 times over the next two years.
Legal & General moved up another gear in 2013, delivering record financial results and accelerating growth across all areas. Net inflows were £17bn including £9bn in LGIM and £8bn into Cofunds. LGIM now has £450bn of AUM, and Cofunds, with £64bn of assets is the UK's largest Savings platform. Annuity premiums grew by 78% to over £4bn, protection gross premiums were over £1.3bn, and we intermediated £28bn of mortgages. We successfully completed four acquisitions in 2013 and have announced a further acquisition in 2014.
We have delivered significant outperformance during lean economic times and are building momentum as the economy recovers. We now have over 10 million customers who we provide with good quality, good value products and excellent service, including through the recent floods.
Our business has continued to perform strongly in the first two months of 2014 but external risks to the broader economy and markets remain. There is inherent uncertainty as the 'monetary methadone' of QE is withdrawn, and the possibility of further 'butterfly-wing' effects for emerging markets and the Eurozone. The single largest risk to economic progress remains the persistent backdrop of political and regulatory uncertainty, which could undermine the confidence of businesses to invest for long-term growth in the UK. As the largest institutional investor in the UK we are front and centre in delivering the steady, stable investment in debt, equity and physical infrastructure required for recovery."
