M&G (MNG) H1 2024 earnings summary

Executive summary

• Delivered resilient half-year results with adjusted operating profit before tax of £375m, supported by strong capital generation and cost discipline, despite challenging markets and high interest rates.

• Strategic priorities of financial strength, simplification, and growth advanced, with significant progress in transformation and international expansion.

• Operating capital generation reached £486m, supporting an upgraded cumulative target of £2.7bn by end-2024.

• Debt reduced by £461m, improving Solvency II ratio to 210% and leverage ratio to 32%.

• Interim dividend per share increased to 6.6p, with dividend policy under review for sustainable growth.

Financial highlights

• Adjusted operating profit was £375m, down year-on-year, with Asset Management contribution up 9% and Life and Wealth segments down.

• Operating capital generation at £486m, supported by management actions, and cumulative OCG since 2022 at £2.3bn.

• Solvency II coverage ratio improved to 210%, with surplus at £4.6bn after dividends and deleveraging.

• Net client outflows of £1.5bn, mainly from Wealth and Institutional Asset Management; Asset Management delivered neutral to slightly negative flows.

• Assets under management and administration (AUMA) increased to £346.1bn, driven by positive market movements and acquisitions.

Outlook and guidance

• Upgraded operating capital generation target to £2.7bn by end-2024 and cost savings target to £220m by 2025.

• Expect improvement in asset management flows in H2 2024, with strong client demand for fixed income and private markets.

• PruFund flows expected to remain subdued in H2 due to high interest rates, but new product launches and platform expansion targeted for 2025 growth.

• Confident in achieving upgraded capital generation and cost savings targets, with dividend growth under review.

• On track to complete first capital-lite BPA transaction by year-end and to launch a PruFund-like proposition in the Middle East.