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Insurance giant Legal & General has hiked its shareholder dividend payout as it saw half-year earnings rebound back above £1 billion and forecast strong growth ahead.
The pensions and savings group said it would hand out £309 million to investors after upping its interim dividend by 5% to 5.18p.
The investor cheer came after it delivered a 14% increase in operating profits to £1.1 billion for the first six months of 2021, which followed a pandemic-hit 2020.
L&G saw earnings fall 3% to £2.2 billion last year after it was knocked by the slowdown in housebuilding and lower life insurance demand during the Covid-19 crisis.
But it has regained its poise swiftly in 2021 and is forecasting further robust growth in operating profits for the full-year.
Nigel Wilson chief executive of L&G, cheered a “strong set of financial results” for the first half.
“We expect to deliver double digit growth in operating profit at the full year,” he added.
“We’re continuing to make investments that are economically, environmentally and socially valuable, in line with our long-term commitment.”
Its half-year figures showed the group paid out £79 million for Covid-related claims, which came within the £110 million already set aside in 2020.
The group’s fund management division, L&G Investment Management, saw earnings rise 4% to £204 million as assets swelled 7% to £1.33 trillion thanks to strong inflows of cash.
Shares rose 2% after the results.
Nicholas Hyett, equity analyst at Hargreaves Lansdown said: “With the disruption caused by the pandemic fading into the rear-view mirror, Legal & General is back to making the most of what we think is the most formidable operating model in the UK life insurance sector.”