LV almost trebles profits before tax

Michael Lloyd

August 7, 2019

LV= has almost trebled its profit before tax in H1 compared to H1 2018.

Its profit before tax from continuing operations was £35m in H1, up from £12m from the same period last year. LV= saw protection sales of £150m in H1, down slightly from £152m year-on-year.

Richard Rowney, LV= group chief executive, said: “Protection sales have been driven by strong performance in our market leading income protection proposition.

“We continue to invest in developing our offering in this area and in the first six months have extended our Dr Services benefit to include access to physiotherapy and psychological experts and have chosen Square Health to undertake all new nurse screenings, medical exams and laboratory tests.

“Profit before tax from continuing operations of £35m reflects improving investment markets partially offset by subordinated debt interest and costs associated with the planned conversion to a company limited by guarantee.

“2019 is an important year in the evolution of LV= as we establish the foundations from which to build a better mutual for the future.”

LV= Group’s share of the discontinued general insurance post-tax results was £29m in H1, up from £5m from 2018.

LV= agreed a deal to sell the remaining shareholding in LV=GI to Allianz on 31 December 2019.

Rowney added: “In the first six months we successfully negotiated an improved sale price for our remaining shareholding in our general insurance business to Allianz, representing a good deal for our members.

“Following the announcement of the sale of our remaining stake in LV= General Insurance to Allianz, we now treat this business as discontinued in line with IFRS reporting standards. The group’s share of the GI result is in line with expectations.

“We also achieved member support for our important plans to convert to a company limited by guarantee.

“One of the foundations of our success over the years has been the strength of the LV= brand and this remains in good health. Our ambition is to be best loved by advisers and our net promoter scores among IFAs in the first half of the year placed us in the top quartile for both protection and retirement.

“We remain on track to separate the business by the end of 2019, well ahead of the original plan, and the value of this transaction will be reflected in our 2019 full year results.

“Trading conditions for life and pensions remain tough and while the protection market is growing steadily, investment and pensions markets are down sharply driven by investor uncertainty and the continued decline in defined benefit to defined contribution transfers.

“We look to the future with confidence as we build momentum across savings and retirement and protection while continuing to provide a good service to our heritage customers.”

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