Chesnara (CSN) H1 2025 earnings summary

Executive summary

• Achieved strong H1 2025 financial and operational delivery, with £37m cash generation, a 207% solvency ratio, and a 3% interim dividend increase to 7.70p per share.

• Announced the £260m acquisition of HSBC Life (UK), the largest deal in group history, expected to add £4bn AuA and over 450,000 policies, with completion targeted for early 2026.

• Raised £140m via rights issue and £150m through first RT1 bond to support the HSBC Life (UK) acquisition and future growth.

• Admitted to the FTSE 250 Index in August 2025, improving share liquidity and marking a significant milestone since listing.

• Legal merger of Dutch businesses completed, with ongoing integration and migration of acquired Canada Life protection book.

Financial highlights

• Cash generation rose 26% year-over-year to £37m for H1 2025, with divisional contributions of £55m offset by £18m in central costs and one-offs.

• Solvency Coverage Ratio increased by 4 percentage points to 207% (FY24: 203%), well above the 140%-160% operating range.

• Interim dividend increased by 3% to 7.70p per share, with dividend cover at 1.42x.

• Group-owned funds closed at £632m after dividends and tax; IFRS Capital Base at £441m.

• Leverage ratio steady at 31%, expected to reduce to 25% post-acquisition and bond issue.

Outlook and guidance

• HSBC Life (UK) acquisition expected to add over £800m in lifetime cash generation, with £140m in the first five years.

• Pro forma owned funds to increase by 60% to over £1bn; solvency ratio to remain near 200%.

• Dividend growth expected to accelerate to 6% for FY 2025 and interim 2026, post-acquisition.

• Majority of future growth expected from M&A, with a strong pipeline in existing and adjacent geographies.

• First Climate Transition Plan to be published in September, targeting net zero by 2050.