Aviva has embraced its turnaround as first half operating profits tops a billion pounds thanks to sales increases in key markets despite weakness in Italy and Spain (release).
Pre-tax operating profits rose to £1.008bn from £959m in the first half of 2013 compared to the same period in 2012. Basic earnings per share was 22.8p – up from a loss of 24.0p. Its key measure of sales growth, the value of new business, increased by 17 per cent to £401m – driven by the UK, France, Poland, Turkey and Asia.
However, there has been some speculation over the figures.
Aviva says value of new business in its Uk life biz up 16% after it "re-priced" the annuities book.. Annuities a huge issue for the country— steve hawkes (@steve_hawkes) August 8, 2013
Chief executive Mark Wilson said:
In the first half we have taken a number of steps to deliver our investment thesis of cash flow and growth. These results show satisfactory progress in Aviva's turnaround.
We have achieved profit after tax of £776 million, in contrast to the £624 million loss last year. Cash flows to the Group have increased by 30% to £573 million….
Although these results continue the positive trends of the first quarter, tackling our legacy issues will take time.
I am committed to achieving for investors what we set out to do: turning around the company to unlock the considerable value in Aviva.
The interim dividend was reported as 5.6p per share, down from 10.0p per share the year before, consistent with guidance given at the full year 2012.