Results round-up: L&G, Admiral, Inmarsat, Restaurant Group

Insurer Legal & General said full year pre-tax profits rose 17% to £1.6bn as it reported a strong rise in operating profits from its retirement division.

Adjusted operating profits rose to £1.6bn from £1.4bn. Earnings per share were up 19% at 22.2p. The full year dividend was up 7% 14.35p a share. Net cash increased 12% to £1.4bn.

Retirement unit operating profits jumped to £811m from £641m as the group picked up big pension deals with Rolls-Royce and ICI.

LGIM, L&G's asset management unit reported a 20% increase in assets under management £894.2bn with net inflows of £31.2bn.

“With further political and economic uncertainty anticipated in 2017 and beyond, we expect further market volatility. The risk of slowing global economic activity remains and no business model can be fully immunised,” L&G said.

“However, we believe the opportunities available to the group, primarily in the UK and US, remain attractive.”

Admiral

Admiral's full year profits fell by a quarter due to the government's recent changes to the 'Ogden' rate at which personal injury claims are calculated, though the non-life insurer's hefty dividend was held steady as underlying profits edged higher.

With customer numbers increasing 16% on the previous year to 5.15m, turnover for calendar-2016 grew 22% to £2.6bn and revenue by 13% to £1.02bn.

Profit fell 25% to £284.3m due to the effect of Ogden, though if that was excluded it would have risen 3% to £389.7m.

Earnings per share were down 27% to 78.7p, but pre-Ogden were up 2% to 109.6p.

The full year dividend was kept flat at 114.4p per share.

Even with the impact of Ogden the return on equity was only reduced from 49% to a still-strong 37%, thanks to the company's extensive use of co- and reinsurance.

In his first full year as chief executive, David Stevens acknowledged that profits being down a quarter after 25 years of almost uninterrupted profit growth under his predecessor was "not exactly a flying start".

"On the other hand our ability to grow our businesses rapidly, both in the UK and overseas, and to absorb the shock of an eccentric government decision on discount rates while delivering a 37% return on equity and again paying a substantial dividend is a tribute to the health of the business and resilience of our model."

Inmarsat

Satellite communications operator Inmarsat said full year earnings rose 9.5% to $795m, boosted by strong performances in its government and aviation units, which were moderately offset by weaker maritime revenues.

Revenues rose 4.3% to $1.3bn and the final dividend was lifted by 5% to 33.37 cents a share.

“We remain confident about the medium to long term outlook for the business,” Inmarsat said.

However it added that future prospects continued to be “difficult to predict” as there was “sustained pressure on customer expenditure, increasing competition and the arrival of new satellite capacity in some of our markets".

“Consequently, there is expected to be an unusually wide range of possible outcomes for the performance of the business in 2017 and 2018.”

Inmarsat forecast revenue of $1.2bn-$1.3bn in 2017 and $1.3bn to $1.5bn in 2018.

Restaurant Group

Frankie & Benny’s and Garfunkel's owner Restaurant Group said 2016 was challenging following poor trading across its leisure brands with like-for-like sales down.

Revenue was up 3.7% to £710.7m but like-for-like sales were down 3.9% compared to to the previous year.

Adjusted pre-tax profit fell 11.2% last year to £77.1m, as expected by analysts, and adjusted earnings per share was down 11.2% to 30p, while the statutory loss before tax was £39.5m and the statutory loss per share was 20.1p.

Earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 5.5% to £121m.

The FTSE 250 company said that in 2016 there was a “consistently disappointing trading performance” which exposed “fundamental issues” across its main leisure brands, which includes Frankie & Benny’s, Chiquito and Coast to Coast, and have taken steps for a review for all of its leisure brands, although it did benefit from a strong performance from the pubs and concessions division.

Restaurant Group incurred an exceptional charge of £116.7m due to site closures, asset value impairments and provision for onerous leases and despite headwinds it maintained its full year dividend at 17.4p per share.

The company said that it is currently trading is in line with expectations with 2017 being a transitional year for the business, given the significant change underway and substantial investment in price and marketing.

It anticipates momentum improving towards the end of the year as initiatives start to take effect and as it opens between 16 to 20 units with associated capital expenditure of between £16m-£20m, as well as refurbishment and maintenance capital expenditure of between £20m-£25m.