TOP NEWS: Aviva Quarterly Trading "Resilient" But Future Uncertain

(Alliance News) - Aviva PLC on Thursday hailed a resilient performance for the three quarters ...

Alliance News 26 November, 2020 | 9:12AM
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(Alliance News) - Aviva PLC on Thursday hailed a resilient performance for the three quarters ended September 30 as it announced a new dividend policy with future payouts expected to grow by low to mid-single digits.

The FTSE 100-listed general insurer said its trading performance so far in 2020 has been robust, adding its financial position is strong with a capital surplus of GBP11.8 billion. It noted the first nine months of the year has demonstrated its ability to grow in core markets where it has long-term growth prospects.

Bulk purchase annuities sales increased to a record GBP5 billion and commercial insurance premiums are up 9% across the UK, Canada and Ireland.

Turning to dividends, Aviva declared a 7.0 pence interim payout. Furthermore, it said it expects to recommend a final 2020 dividend of 14 pence per share, subject to a decision to be taken in March 2021. The expected 2020 total dividend of 21.0 pence per share is then expected to grow by low to mid-single digits, it said, noting the level of dividend is covered by the capital and cash generated from its core markets of the UK, Ireland and Canada.

The London-based company added it is making progress on its simplification strategy. Aviva said that as its portfolio simplifies it will deliver further value to shareholders by returning excess capital above 180% solvency cover ratio, once the debt leverage target ratio has been reached. It noted it is "exploring options across our manage-for-value portfolio", meaning non-core, including in France, Poland, the remainder of Italy and other joint ventures.

Looking ahead, Aviva said trading from fourth-quarter lockdowns remains uncertain but expects no significant increase in net business interruption claims.

The stock was trading 0.9% lower at 324.60p each on Thursday morning in London.

By Ife Taiwo; ifetaiwo@alliancenews.com

Copyright 2020 Alliance News Limited. All Rights Reserved.

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