Standard Life posts positive first-half results after Aegon purchase

Standard Life on Monday reported stronger-than-expected half-year results and said it remains on track to deliver its 2026 financial targets.

The London-based retirement savings provider said its attributable pretax loss for the six months ended June 30 widened to £272 million from £209 million a year ago, despite total income rising to £21.73 billion from £8.60 billion.

The company's bottom line was hurt by £473 million in adverse hedging-related economic variances, which Standard Life largely attributed to rising equity markets during the period.

Adjusted operating profit rose 25% to £563 million from £451 million, beating company-compiled consensus of £541 million.

Total cash generation increased 15% to £900 million from £781 million, ahead of consensus of £804 million. Operating cash generation rose 6% to £745 million from £705 million.

Standard Life lifted its interim dividend by 2.6% to 28.05 pence per share from 27.35p.

Chief Executive Officer Andy Briggs said: "Standard Life continues to demonstrate exciting momentum against our vision to be the UK's leading retirement savings and income business. Our strong half-year results reflect how we are helping more customers achieve better outcomes, and we remain on track to deliver our end-2026 financial targets, while our profitable growth and strong cash generation is increasing our financial flexibility."

Standard Life said it remains on track to achieve its £5.1 billion total cash generation target for the 2024 to 2026 period. Its £1.1 billion adjusted operating profit target for 2026 is also on track.

The company expects to generate around £500 million of excess cash in 2026, which will be the final year Standard Life uses excess cash to reduce leverage.

"Excess cash generated post-2026 will be available to be deployed to the highest-returning opportunities, in line with our capital allocation framework. We will look to strike the right balance between growth opportunities and shareholder returns," Standard Life explained.

In April, Standard Life announced a £2.0 billion deal to acquire Aegon's UK insurance and pensions operations in a cash-and-shares transaction.

Last month, it announced a partnership to expand its UK pension risk transfer business, backed by an initial capital commitment of up to £2 billion over five years.

Standard Life will contribute £500 million of the £2 billion, with the remainder coming from a consortium of institutional investors including CVC Capital Partners, Prudential Financial, Goldman Sachs and MS&AD Insurance Group Holdings. The consortium is led by CVC and Prudential Financial.

Briggs added: "The £2 billion acquisition of Aegon UK and our recently announced UK PRT partnership will further strengthen our capabilities and customer offering. Standard Life champions the belief that everyone's journey to and through retirement can be better and we look to the future with confidence."

Shares in Standard Life were up 1.4% at 945.05 pence on Monday morning in London.

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