M&G slumps to loss as outflows accelerate
M&G has reported a jump in outflows for 2024. The insurer and asset manager reported outflows of £9.5bn throughout 2024, compared to £4.7bn in 2023, it revealed in its annual results.
Outflows were recorded from every arm of the firm. Its traditional Life business was hit hardest, with outflows of £4.8bn during the year.
Meanwhile, the firm’s adjusted operating profit jumped five per cent, to £837m, driven by a 19 per cent increase in profit from its asset management arm.
The jump in asset management profit came from M&G’s ongoing plan to grow and simplify the business. Cost reductions more than offset the impact of inflation on the business, with its cost-to-income ratio falling from 79 per cent last year to 76 per cent.
However, the group said it had made a £347m statutory loss after tax, down from a £309m profit last year, thanks to unrealised fair value losses on the surplus assets in its annuity portfolio and fair value losses on interest rate hedging.
M&G boss Andrea Rossi said today that the group had introduced a new target for the next three years: Growing adjusted operating profit on average by five or more per cent per year.
“As we look ahead, the strong foundations we have built position us well to continue to deliver long-term value to our customers and clients and diversified profitable growth to shareholders,” he said.
In total, the group’s assets under management and administration increased from £343.5bn to £345.9bn, due in part to the acquisition of Baumont Real Estate Capital and increasing its stake in Continuum.
In September, M&G said it would upgrade its three-year cumulative operating capital generation target to £2.7bn for 2022 to 2024, and said today it had reached that goal while deleveraging to reduce its debt by £461m.
Now, it has set a new three year cumulative operating capital generation target of £2.7bn, though this excludes new business in its Life arm due to strategic growth plans.