Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

Aviva slips after in-line 2017 profits; to spend £500mln on buy-backs, £600mln on 'bolt-on' acquisitions

The FTSE 100-listed general and iife insurer said its 2017 operating profit rose by 2% to £3.1bn, just above the company-supplied consensus forecasts of £3bn
Aviva logo
Assets under management at Aviva Investors, the firm’s fund arm, increased by 9% to £490bn

Aviva PLC (LON:AV.) shares slipped lower on Thursday as it reported an as-expected 2% rise in 2017 operating profit, helped by a strong performance from its UK division, unveiled plans for a £500mln share buy-back, and said it would spend £600mln on ‘bolt-on- acquisitions.

The FTSE 100-listed general insurer and iife assurer said its 2017 operating profit rose by 2% to £3.1bn, just above the company-supplied consensus forecasts of £3bn.

READ: Aviva bids farewell to Spanish banking units in £178mln sale

The group added that assets under management at Aviva Investors, the firm’s fund arm, increased by 9% to £490bn, with its fund management revenue up 14% to £577mln.

Mark Wilson, Aviva’s group chief executive officer, commented: “Our largest market, the UK, has gone from strength to strength, growing sales, market share and profit. For Aviva, the UK is a dependable and growing business.”

He added: “This year, we expect to deploy £2bn of excess cash, including £900mln in debt reduction, in excess of £500mln of capital returns to shareholders and about £600mln for bolt-on acquisitions.”

The firm said it will pay a total dividend of 27.4p, up 18% on its 23.3p payout in 2016 and slightly above forecasts.

Subdued share price

In early morning trading, Aviva shares were 2.1% lower at 496.6p.

Richard Hunter, head of markets at interactive investor, commented: “The muted share price reaction to the results cannot detract from what is generally a sparkling set of numbers.”

He added: “Disappointments are few and far between, although committed bears may point to a slightly softer General Insurance operating profit, an uptick in operating expenses and a ‘disappointing”’ contribution from Canada.

“Nonetheless, overall Aviva has shown its strength in terms of growth, capital stability and an improved outlook statement.“

 -- Adds share price, analyst comment --

View full AV. profile View Profile

Aviva plc Timeline

Related Articles

Hapi app
October 09 2017
Employee engagement and benefits schemes are the ‘secret sauce’ that makes a business different
money
March 29 2018
Chesnara said it has made good progress on integrating Legal and General Nederland and the benefits were slightly ahead of expectations

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use