Phoenix Group Holdings share price up as insurance company reveals cash generation largely in-line with targets for year ended December 2015
Share price in Phoenix Group Holdings rose today after the company announced that its cash generation had met its targets, although profits slumped slightly for the year ended December 2015.
The insurance company, which handles closed life funds, reported cash generation of £225m, safely in line with its target range of £200m – £250m, although down on last year's £567m.
The company also announced operating profit of £324m, down from £483m for the year ended 2014, and proposed a final dividend of 26.7 pence per share.
Shares in the company closed up 1.9 per cent at 935.5p.
"Phoenix has come a long way in recent years and is now a simpler and more focused business," said Clive Bannister, group chief executive of Phoenix. "I believe the impact of regulatory developments will change the landscape of the UK life insurance industry, providing Phoenix with a number of opportunities to grow our business."
Speaking with City PM, Jim McConville, group finance director at Phoenix, added: "We have obviously the Brexit vote coming along which just gives us uncertainty in the short term but we're well-placed to deal with that uncertainty, given the resilience [in our] Solvency II position."
Phoenix also revealed new cash generation targets of £400m – £450m for its 2016 financial year, and a long-term target of £2bn for 2016-2020.
McConville explained that 2015's cash generation target was lower thanks in part to the firm having to make adjustments for Solvency II, and that 2016's target represented "effectively a return to business as usual".
Towards the end of last year, Phoenix had its internal model for Solvency II approved by the Prudential Regulation Authority.