Investment manager M&G saw shares fall after today reporting a loss after tax of £248m for the first half of the year.
Before tax the company saw a six per cent improvement in its profits for the half-year, at £327m, but the FTSE 100 company swung to a loss after tax of £248m for the six months ended 30 June – a stark contrast compared to its profit of £826m for the same period last year.
It said this was due to short-term fluctuations in the fair value of surplus assets in its annuity portfolio, and derivatives used to hedge the Solvency II balance sheet caused by increasing yields and rising equity markets.
Shares in M&G fell by 1.8 per cent at the open to 233.80p per share.
Total capital generation was a positive £869m in the period, compared to a negative £202m a year ago, with the company saying it was on track for its target of £2.2bn by the end of 2022.
The M&G board declared an interim dividend of 6.1p per share, totalling around £155m, in line with its policy of paying one-third of the previous year’s total dividend.
Chief executive John Foley said: “Today’s results show good progress on our actions to reposition the business for sustainable growth and continued strong total capital generation.”