M&G reported today (4 September) that it is seeking to expand its 'international footprint' amid the merger of its wealth and life insurance operations and closure of its digital adviser platform.
It was "well positioned to navigate the current uncertain economic climate due to its diversified business model, international footprint, compelling products and services, investment capabilities and expertise". the half year 2024 statement said.
The London-headquartered global asset manager said that "following a strategic review and given our commitment to operational discipline, we have decided to focus and rationalise our Wealth strategy, combining the Life and Wealth operations under the leadership of Clive Bolton. Through this change, we will better focus our efforts to serve the UK retail market, complement PruFund with life insurance solutions, reduce duplication and improve efficiency."
Its competitive position in the wealth market was "not sufficiently strong to ensure profitable growth without committing significant further resources.
"Our future focus will be on continuing to grow the distribution of our own solutions through our restricted advice channel and independent advisers and making our propositions more accessible on third party platforms."
The 2024 half year figures showed adjusted operating profit of £375m (30 June 2023: £390m), with a 9% improvement in asset management contribution, and a 7% reduction in life and wealth "due to lower contractual service margin (CSM) amortisation rates and returns on surplus assets".
An IFRS loss after tax of £56m (30 June 2023: £75m profit) was "impacted by larger losses relating to short-term fluctuations in investment returns and mismatches arising on application of IFRS 17, although benefitted from lower restructuring costs".
AUMA of £346.1bn was £2.6bn higher than at the start of the year, due to positive markets and the consolidation of the Continuum operations offsetting net outflows.
Andrea Rossi (pictured), group chief executive officer, said: “Over the last 18 months, we have made meaningful progress transforming M&G by focusing on our strategic priorities: Financial Strength, Simplification, and Growth. Against the backdrop of a challenging market environment in the first half of the year, we have delivered another resilient financial performance with Adjusted Operating Profit and Capital Generation nearly matching last year’s excellent results.
"We have materially improved the Financial Strength of the business lifting our shareholder Solvency II coverage ratio to 210%, a very strong position. And we tackled our leverage too, reducing debt by £461 million.
“Our Simplification agenda continues at pace, delivering £121 million in cost savings so far. We have made considerable progress across all of our financial targets and, reflecting our track record of delivery and our commitment to strong shareholder outcomes, we are announcing today upgrades to our capital generation and cost savings targets.
“We are continuing to push further on our strategic priorities, combining our Life and Wealth operations to support the acceleration of our growth plan in the UK retail market. We also see growth opportunities in our international footprint and in the broadening of our product offering.
“As we look ahead, the strong foundations we have built give me confidence in the long-term outlook for M&G.”
