Phoenix Group exceeds FY cash generation targets

Insurance services provider Phoenix Group issued a strong trading update on Thursday, revealing the group had exceeded 2019 cash generation targets ahead of its Capital Markets Day.

Phoenix said that it generated £707.0m in cash over the last twelve months, which was well and truly ahead of the £664.0m generated during the previous year and exceeded the upper end of its target range of £600-700m.

The FTSE 100-listed group said £440.0m of incremental long-term cash generation came from new business - including £205.0m from new open business and £235.0m from the £1.1bn of bulk purchase annuity liabilities contracted year-to-date.

Phoenix revealed it has also sourced £1.1bn of illiquid assets with an average credit rating of A+ so far this year, delivering a £116.0m Solvency II benefit.

The company said it remained on track to deliver upon its £1.2bn total synergy target for its Standard Life Assurance businesses transition, which it stated was "progressing to plan".

Chief executive Clive Bannister said: "This trading update further reinforces Phoenix's conviction in its business model and its capacity to generate cash, deliver resilience and exploit multiple avenues of growth to deliver long-term sustainable cash generation, not just today but in the years ahead."

As of 0900 GMT, Phoenix shares had ticked up 0.55% to 737.40p.