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Cinven Partners LLP
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Tel: +44 (0)20 7661 3325
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Email: Vanessa Maydon

Press releases

Just Group plc
13 November 2013

Interim Management Statement for the quarter ended 30 September 2013

Strong performance in a challenging market remain on track to meet full year operating profit expectations

New Business Sales (1) 3 months to
30 Sep 2013
£'m
3 months to
30 Sep 2012
£'m
Change
%
Retirement 282.8 268.6 +5
Care 16.8 23.4 -28
Protection 0.8 0.5 +38
Total 300.3 292.5 +3
  9 months to
30 Sep 2013
£'m
9 months to
30 Sep 2012
£'m
Change
%
Retirement 884.3 786.7 +12
Care 44.9 68.6 -35
Protection 2.6 2.3 +13
Total 931.7 857.6 +9
  • Q3 Retirement New Business sales up 5% to £283m, versus overall NSA market decline
    in excess of 15% for the same period (2)
  • Total Q3 New Business sales up 3 % to £300m
  • New business m argins improving , as pricing discipline is maintained
  • Continue to develop the Defined Benefit de-risking proposition, with 3 further transact ions si nce the half year, and a strong pipeline
  • Remain on track to meet full year 2013 Total Operating Profit expectations

Commenting on these results, Steve Groves, Chief Executive Officer, said:

“I am pleased to report another quarter of growth which has been achieved in a market that continues to adapt to the changes brought about by the introduction of RDR. Partnership’s core Retirement sales grew by 5% over the period, which represents a strong performance against the backdrop of a total NSA market decline in excess of 15 %. The fundamental drivers expected to deliver market growth over the medium and long term remain intact, and we therefore continue to be confident that the market disruption is a temporary phenomenon.

Looking ahead, we do not expect to see growth in our year-on-year retirement sales in Q4 given that sales in the final quarter of 2012 benefitted materially from regulatory change, in particular the introduction of gender neutral pricing.

Despite the challenging sales environment we have maintained our focus on new business margins which, as expected, have improved against those reported in H1. This, together with a continuing strong performance from the in-force book, gives us confidence in our ability to deliver total operating profit in line with expectations for the full year."

Operating profit remains on track to meet expectations.

  • Partnership’s Intellectual Property continues to support pricing discipline, despite a falling yield environment and increasingly competitive pricing in the lifestyle segment of the market
  • Completion of a material Equity Release bulk trans action in the quarter delivered anticipated yield improvements
  • New Business profit margin improving as expected
  • In-force business continues to perform strongly

Retirement new business sales outperform a challenging market.

  • NSA market fell in excess of 15 % in Q3 against same period in 2012
  • As noted at the half year, market activity continued to be negatively impacted into Q3 as a result of the changes introduced by RDR
  • Quote activity in the market continues to improve
  • Partnership’s outperformance against the market was enhanced by completion of three DB de-risking transactions in the quarter, emphasising Partnership ’s lead ing position in medically underwritten buy-in and buy-out transactions
  • Pipeline of further DB de-risking deals remains strong

Care new business sales gradually recovering.

  • Recovery expected to remain slow, with volumes gradually increasing into 2014

Operational updates

  • Recognised as Best Enhanced Annuity Provider (Investment Life & Pensions MoneyFacts awards) and awarded 5 Stars in the FT Adviser Online Service awards

No material change to the financial position of the Group

New Business Sales by quarter (1)

  3 months to:
  30/9/13 30/6/13 31/3/13 31/12/12 30/09/12 30/6/12 31/3/12
  £'m £'m £'m £'m £'m £'m £'m
Retirement 282.8 242.9 358.6 380.8 268.6 219.5 307.6
Care 16.8 13.3 14.8 25.8 23.4 19.5 25.7
Protection 0.8 1.1 0.7 0.4 0.5 0.8 1.0
Total 300.3 257.3 374.1 407.0 292.5 230.8 334.3

Notes:
(1) Single Premium Equivalent sales completed in the period. Figures are unaudited.
(2) Based on Towers Watson enhanced annuity survey results for Q3 2013.