Aviva PLC (LSE:AV.) said it is on track to deliver its cost-reduction plans a year ahead of target as it unveiled better-than-expected half-year profit.
Amanda Blanc, group chief executive officer, said: “We expect to exceed our financial targets and we are making progress each quarter.”
The insurer expects full-year 2023 operating profit to grow between 5% and 7% from £1.35 billion in 2022 and said it is on track to exceed its Solvency II operating own funds generation target of £1.5 billion per annum by 2024 and its cash remittance target of more than £5.4 billion cumulative (2022-24).
It also expects to deliver its target of £750 million gross cost reduction by 2024, one year ahead of schedule.
Group operating profit rose 8% to £715 million in the first half from £661 million in the second half of the prior year, ahead of forecasts of £701 million, while operating EPS jumped 10% to 19.9p from 18.1p in the previous half-year.
The dividend was boosted 8% to 11.1p and Aviva expects to pay a dividend of around 33.4p for 2023, with low-to-mid single digit growth in the cash cost of the dividend thereafter.
Solvency II operating own funds generation (OFG) rose 26% to £648 million and Aviva said it is on track to exceed its target of £1.5 billion OFG per annum by 2024.
General insurance gross written premiums (GWP) grew 12% to £5.27 billion with UK&I General Insurance GWP up 13% to £3.22 billion.
UK personal lines GWP grew 16%, driven by strong rate increases mitigating inflationary pressures as well as new product propositions.