Friends Provident owner eyes greater consolidation in sector
The new owner of Friends Provident announced a sharp rise in profits at the life assurer but said tough trading conditions in the UK reinforced the case for more deals in the sector.
Buy-out firm Resolution acquired Friends Provident at the end of last year and is on the verge of completing a £2.75bn takeover of Axa's UK life and pensions arm.
It hopes to unveil another deal by next summer as it looks to increase scale and build market leading positions in the areas of protection, workplace savings and annuities. Announcing Friends Provident's results for the six months to June 30, Resolution said strong growth overseas and greater investor confidence at its Lombard wealth management business offset difficult conditions in the UK.
Total sales of £458m on an annualised premium basis - representing new regular premiums plus 10% of single premiums - were up 42% on a year earlier.
In the UK, sales were 6% higher at £203m.
Operating profits for the Friends business jumped to £157m from £29m a year earlier.
Resolution said: "These results reflect strong performances at Friends Provident International and Lombard while the UK continued to face difficulties, notably in the UK individual protection market. The UK results serve to reinforce the case for consolidation."