Aviva PLC (LSE:AV.) shares rose 5% after the insurer posted strong first-half results and said its newly acquired Direct Line business is integrating “at pace” following completion last month.
Adjusted operating profit climbed 22% to £1.07 billion, prompting a 10% rise in the interim dividend to 13.1p per share.
General insurance drove much of the improvement, with gross written premiums up 7% to £6.29 billion and the combined operating ratio improving to 94.6% from 95.4%. UK and Ireland operating profit surged 50% to £430 million, while Canada grew 7%.
Chief executive Amanda Blanc called the performance “outstanding” and said Aviva’s strategic shift towards “capital-light” businesses was progressing, with these now representing 66% of operating profit.
Wealth and health segments also delivered, with net flows up 16% to £5.8 billion and health in-force premiums rising 14% to £1 billion. Retirement sales slipped 3% amid a subdued bulk annuity market.
Aviva reaffirmed that Direct Line should add around 10% to run-rate earnings per share and confirmed cash generation and capital returns remain strong, with £2.1 billion in liquidity. Medium-term financial targets were left unchanged.
The shares rose 31.09p to 690.09p.