FINANCIAL HIGHLIGHTS - 31 december 2011

Continued strong cash generation of £810 million by the Group's operating companies enabled the Group to achieve above the mid-point of its 2011 target range of £750 to £850 million despite challenging market conditions. 

Management actions accelerated £359 million of cash, mainly related to restructuring and de-risking activities.

Group MCEV increased by £14 million in the period reflecting the resilience of the business.  Value enhancing management actions delivered an incremental uplift to MCEV of £165 million against a target of £100 million.

Group IFRS operating profit of £387 million reflects a strong performance from both the Group's operating segments.

Ignis' IFRS operating profit of £46 million remained stable, despite the challenging market conditions.

Total Group assets under management increased by £2.5 billion to £72.1 billion, including net third party sales of £1.7 billion.

The estimated IGD surplus has increased to £1.3 billion with IGD capital generation of £0.6 billion offsetting the payment of dividends, debt interest and debt repayments of £0.3 billion.  The headroom over the Group's IGD capital policy was £0.4 billion at 31 December 2011 (2010: £0.1 billion).

The increase in the IGD Excess Capital from 2010 is consistent with the increase in the IGD surplus.  The IGD Excess Capital coverage percentage was 182% at 31 December 2011 (2010: 170%).

The Group has met its target of reducing gearing to below 50% through strong cash generation and an increase in MCEV.

The Board has recommended a final dividend of 21 pence per share bringing the total dividend for the year to 42 pence.  The final dividend is due to be paid on 8 May 2012, subject to compliance with the processes set out in the Group's main credit facilities and shareholder approval at the Company's AGM.  A scrip dividend option will be available to shareholders.