-Increased confidence – dividends up, targets up, substantial capital return
-£4.75bn total capital return, meeting its commitment
-Estimated c.40% increase in 2022 dividend per share to c.31.5p (based on illustrative share consolidation)
-Increased cumulative cash remittances target to >£5.4bn (2022-24)
-Upgraded cost savings target of £750m gross of inflation (2018-24)
|Cash remittances5,‡||Total 2021 dividend||Adjusted operating profit5,6,‡||General Insurance GWP5||Life new business sales5,7|
|2020: £1.37bn||2020: 21.00p||2020: £1,806m||2020: £8.3bn||2020: £29.9bn|
Amanda Blanc, Group Chief Executive Officer, said:
“2021 was a year of significant strategic progress, right across Aviva. We successfully completed the sale of eight non-core businesses, generating excellent value for our shareholders. Our financial position is strengthened and Aviva is now a much simpler, leaner business, focused on our core markets in the UK, Ireland and Canada.
“Today we are announcing a total capital return to shareholders of £4.75bn1, including the existing £1bn share buyback, delivering on our promise to shareholders by returning more than £4bn. We are confident in the future and are setting out plans for further investment to enhance our capabilities and accelerate growth, starting with the acquisition of Succession Wealth, a leading national financial advice firm, which we have announced today.
“Our people are central to our success, and it’s only right that they share in the value they’ve helped create. So we are giving each of our 22,000 employees £1,000 in Aviva shares, to say thank you.
“The Focus and Strengthen parts of our strategy are complete and we are now wholly focused on accelerating performance. Our trading in 2021 was strong, reinforcing our confidence that Aviva can grow sustainably. Our general insurance volumes are the highest in over a decade, life insurance sales7 grew by 23%, and we are on track to reduce controllable costs4,‡ by £300m by the end of 2022.
“The progress we’ve made in the last year shows Aviva has what it takes to produce attractive and sustainable returns for shareholders. Our performance and progress give us the confidence to announce today an update to our dividend policy, with estimated dividend per share growth of c.40% in 20222,3 to 31.5p, based on the illustrative consolidation ratio.
“Aviva has the foundations in place to deliver its promise. We’ve achieved a lot in the last year but we’re only just getting started. There is so much more Aviva can and will deliver for our customers and our shareholders.”
Delivering on the promise to shareholders – capital returns and updated dividend policy
- Total shareholder returns of £4.75bn comprising £3.75bn via B Share Scheme announced today on top of existing £1bn share buyback
- Final dividend per share for 2021 of 14.7p (2020: 14.00p), with total dividend per share for the year up 5% to 22.05p (2020: 21.00p)
- In light of the significant progress we have made, and our confidence in the outlook for Aviva, we are announcing clear guidance on dividends for the next two financial years2,3:
- For 2022 we estimate we will be able to pay a dividend of approximately £870m. Following the proposed B Share Scheme and share consolidation announced today, this would be equivalent to an illustrative per share amount of c.31.5p, an increase of c.40% on 20212,3
- For 2023 we estimate we will be able to pay a dividend of approximately £915m, growth of 5% giving an illustrative 33p per share2,3
- Thereafter we expect low-to-mid single digit growth in dividend per share. These cash dividends represent an attractive payout level from long-term, sustainable cash and capital, underpinned by our upgraded cash remittance target5
- Surplus capital above target levels is available for investment in the business or return to shareholders over time