M&G (MNG) H2 2025 earnings summary

Executive summary

• Achieved £7.8bn net inflows from open business, a £10bn improvement year-over-year, driven by Asset Management and Life segment growth, with record international expansion and a strategic partnership with Dai-ichi Life HD, now the largest shareholder.

• Adjusted Operating Profit remained stable at £838m, with 73% from capital-light sources and strong With-Profits contributions.

• Solvency II coverage ratio increased to 242%, reflecting robust capital generation and balance sheet strength.

• Increased dividend per share by 2% to 20.5p, maintaining a progressive dividend policy.

• Delivered £250m cost savings, exceeding transformation programme targets.

Financial highlights

• Asset Management fee-related earnings grew 12% year-over-year to £261m, despite a 3% decline in total AOP due to lower performance fees.

• Life segment AOP rose 2% to £764m, driven by 17% growth in PruFund profits and 16% in Traditional With-Profits.

• Shareholder Annuities AOP declined 8% year-over-year, mainly due to lower expected returns on surplus assets.

• Operating capital generation before new business strain was £928m, on track for the £2.7bn cumulative target over 2025-2027.

• IFRS profit after tax rose to £314m from a £347m loss in 2024, mainly due to improved investment returns and reduced mismatches under IFRS 17.

Outlook and guidance

• Committed to delivering at least 5% average annual AOP growth over 2025-2027, with meaningful acceleration expected in 2026.

• Targeting a cost-to-income ratio of 70% by end-2027 and £2.7bn cumulative OCG (excluding new business strain) over 2025-2027.

• BPA annual sales targeted at £3-4bn by 2027, leveraging the With-Profits fund.

• Expecting continued positive net inflows in PruFund and strong partnership flows from Dai-ichi Life.

• Up to £150m investment in new business in 2026, primarily supporting BPAs and PruFund sales.