Legal & General, the prominent insurance and pensions giant, reported impressive financial results for the year 2024, boasting significant growth and indicating a strong commitment to returning value to its shareholders. On March 12, 2025, the company announced their core operating profit climbed by 6%, reaching £1.6 billion, alongside pre-tax profits of £542 million, under International Financial Reporting Standards (IFRS).
Accompanying these results, Legal & General revealed plans for a substantial £500 million share buyback slated for 2025. This formation of capital allocation is part of their broader strategy to return over £5 billion to shareholders over the next three years—a significant goal representing approximately 40% of the company’s entire market capitalization.
CEO António Simões emphasized the company’s achievements during 2024, stating, "2024 has been a year of significant strategic progress and strong financial performance. We delivered 6% growth... alongside excellent new business volumes, all the time investing for the future.” Simões's comments reflect the company's intention to not only solidify its financial standing but to also look for innovative opportunities moving forward.
Legal & General’s Solvency II capital generation reached £1.8 billion, and its coverage ratio stood impressively at 232%. These figures underpin the company’s strong risk management framework and ability to absorb potential financial impacts, setting the stage for stable future operations. The reported figure of £14.8 billion as the store of future profit showcases the health of their balance sheet and commitment to long-term profitability.
Throughout the year, the company executed substantial strategic repositioning, including the sale of its homebuilding unit, Cala, for £1.35 billion, and its US Protection business for £1.8 billion. This move signifies Legal & General’s sharpened focus on its core business sectors—grouping its business interests around Institutional Retirement, Asset Management, and UK Retail.
Reflecting on these changes, Simões noted the importance of simplifying the organization’s focus, stating, "By sharpening our focus and simplifying our portfolio – through the sale of Cala and US Protection – alongside our strategic partnership with Meiji Yasuda and our investment in Taurus..." This strategic partnership with Japanese life insurance company Meiji Yasuda aims to bolster growth potential, particularly within the pension risk transfer (PRT) sector.
On the operational side, Legal & General’s Institutional Retirement division achieved £10.7 billion in global pension risk transfer deals, of which £8.4 billion was secured from the UK market. Meanwhile, their Asset Management segment boasted total global assets under management (AUM) of £1.1 trillion, reflecting profitability driven by higher fee margin products and strategic investments, including £1.2 billion from external committed capital.
Retail Annuities also flourished with record sales, amounting to £2.1 billion, as the company saw continued expansion within its Workplace Defined Contribution pensions initiative. The dividend per share increased by 5%, reaching 21.36p, signifying Legal & General's commitment to offering enduring value to its investors.
Market analysts have taken note of the positive trend within Legal & General's operations. Richard Hunter, head of markets at Interactive Investor, commented on the company's position, stating, "Legal & General is in the midst of a new chapter and is transforming. There is little doubt as to the longer-term potential for the savings and investment market, especially considering ageing demographics and potential welfare reform.”
Legal & General’s underlying strength lies not only within its financial metrics but also its strategic realignment and proactive market repositioning. Despite the challenging economic environment, the company appears poised for sustained growth and engagement across multiple fronts, particularly within its reinsurances and annuity sectors.
Yet, there is recognition from analysts of the challenges ahead. The effects of current global economic conditions and demographic shifts could influence market demand and investment opportunities. Legal & General’s ability to adapt within such confines will be pivotal to achieving its ambitious financial goals.
Looking forward, António Simões expressed confidence, stating, "Looking ahead, our momentum demonstrates why we are confident in our ability to deliver on our ambitious targets... making a meaningful impact for customers, shareholders, and communities.” This assurance highlights both the company's strategic direction and commitment to sustainable operations.
Overall, Legal & General’s considerable accomplishments for 2024 and its aggressive plans for securing shareholder returns set the stage for optimistic growth. With strong core performance indicators and decisive, strategic moves, the company is ready to face future challenges whilst ensuring its investors reap the benefits of its policies.