Press release

H1 2021 Results: Strong financial performance – 14% growth in operating profit and 22% ROE

4 Aug 2021

Nigel Wilson, Group Chief Executive: "Thanks to the hard work and dedication of my colleagues across Legal & General, we have delivered a strong set of financial results, with EPS up 21% since H1 2019. And we expect to deliver double digit growth in operating profit at the full year.

We’re continuing to make investments that are economically, environmentally and socially valuable, in line with our longterm commitment to delivering Inclusive Capitalism and supporting the Building Back Better and Levelling Up agenda.

We are already a leading asset manager and we remain focused on continuing to scale-up our asset origination capabilities which are a unique and important component of our synergistic business model which has driven our 22% ROE."

Strong financial performance¹, now well above pre-COVID 2019 levels

Operating profit of £1,079m, up 14% (H1 2020: £946m), with double-digit growth or higher in LGC, LGI and LGRR
Earnings per share of 17.78p, up 21% on H1 2019 (14.74p) and up significantly on H1 2020 (4.89p)
Profit after tax² of £1,065m (H1 2020: £290m) and Return on equity of 22.0% (H1 2020: 6.3%)
Solvency II coverage ratio³ of 183% (H1 2020: 173%)
Interim dividend of 5.18p, up 5% (H1 2020: 4.93p), consistent with our stated ambition

Growing contribution to our five-year (2020-2024) ambitions⁴

Cash generation of £0.9bn, up 14% year on year. Capital generation of £0.8bn, up 9% year on year
Cumulative cash and capital generation of £2.4bn and £2.3bn respectively, against our ambition of £8.0-9.0bn by 2024
Cumulative dividends declared £1.4bn (H1 2021: £309m, 2020: £1,048m) against our ambition of £5.6-5.9bn by 2024

Good PRT new business volumes and strong net flows

Global PRT new business premiums of £3.1bn (H1 2020: £3.4bn) with £2bn already won/in exclusive negotiations for H2
LGIM external net flows of £27.4bn (H1 2020: £6.2bn), with AUM up 7% to £1.3tn
Individual annuity premiums up 15% and LGI new business annual premiums up 6

Unique and growing alternative asset origination capabilities

Legal & General Capital (LGC) operating profit doubled to £250m (H1 2020: £123m)
ESG-aligned asset origination expertise in clean energy, residential property, digital infrastructure and SME finance
Third party capital AUM of £6.8bn against our ambition of £14bn by 2025

Long-term, growth-oriented and highly synergistic business model

An established track record: HY11 to HY21 CAGR of 11% in EPS, 12% in DPS and 7% in book value per share
Highly synergistic: five focused divisions that create a virtuous circle of internal demand and supply, supporting c20% ROE
Long-term and predictable value creation: 40+ year duration business with earnings driven by a growing stock of assets
Attractive global growth markets: retirement solutions ($53tn), asset management ($136tn), climate change ($20tn)⁵
A longstanding commitment to Inclusive Capitalism and a leader in ESG: rated #1 Life & Health insurer by ShareAction

Further information

Ed Houghton

Group Strategy & Investor Relations Director

Email Ed Houghton

Sujee Rajah

Director

Investor Relations

Email Sujee Rajah

John Godfrey

Director of Levelling Up

Group Communications

T: 020 3124 2090Email John Godfrey

Notes to editors

Established in 1836, L&G is one of the UK's leading financial services groups and a major global investor, with £1.1 trillion in total assets under management (as at FY24) of which c. 44% (c. £0.5 trillion) is international.

We have a highly synergistic business model, which continues to drive strong returns. We are a leading player in Institutional Retirement, in Retail Savings and Protection, and in Asset Management through both public and private markets. Across the Group, we are committed to responsible investing and dedicated to serving the long-term savings and investment needs of customers and society.