Shares in Phoenix Group Holdings PLC (LSE:PHNX) climbed 6.2% to a five-month high after the life insurer impressed with results for 2024 that showed better cash, a solid solvency position and an improved outlook.
The FTSE 100-listed group delivered total cash generation of £1.8 billion, down from £2 billion the year before but better than the top end of previous guidance and well ahead of the £1.5 billion average analyst forecast.
A final dividend of 27.35p per share, up 2.6%, brought the full year to 54p, which was in line with the City consensus.
Phoenix upgraded its cash targets, now expecting operating cash generation grow by a "mid-single digit" percentage per year in coming years., with its three-year target for cumulative total cash generation increased to £5.1 billion from £4.4 billion between 2024 and 2026.
"We therefore expect to generate excess cash of £1.1 billion across 2024-26 and this will be allocated in accordance with our capital allocation framework, with a clear focus on deleveraging."
The solvency ratio was 172%, versus a consensus forecast of 169%.
CEO Andy Briggs said: "Our strong performance in 2024 and the operating momentum we have built will support us in delivering our growth strategy and have led us to upgrade our cash generation and adjusted operating profit targets through to 2026.
"Delivery will give us the financial flexibility to reduce our leverage, while also sustaining our progressive dividend for shareholders. It also brings us closer to realising our vision to be the UK's leading retirement savings and income business."