Legal & General share price slides as FY profit misses forecasts

Shares in Legal & General Group Plc (LON:LGEN) have lost ground in early trading in London today with the blue-chip insurer’s full-year profits falling short of forecasts. The company, however, posted a surge in its annuity assets and hiked its dividend.

As of 08:19 GMT, Legal & General’s share price has shed 2.41 percent to 271.50p. The shares are underperforming the blue-chip FTSE 100 index which has inched 0.14 percent higher to 6,898.70p.
Legal & General announced in a statement this morning that its operating profit had climbed 10 percent to £1.28 billion last year. Reuters noted that the result was below the £1.31 billion forecast in a company-supplied poll of analysts. The FTSE 100 group reported that its annuity assets had surged 28 percent year-on-year to £44.2 billion lifted by a doubling in sales of bulk annuities. Legal & General Investment Management’s (LGIM) total assets jumped 16 percent to £708.5 billion.

“Our market-leading growth businesses coupled with continuous cost reductions have given us scale and efficiency in our chosen markets,” Legal & General’s chief executive Nigel Wilson said in the statement, adding that the company had produced “another year of double digit growth across our key financial metrics enabling us to reward shareholders with a 21 percent rise in the dividend”. Legal & General announced a full-year dividend of 11.25p per share as compared with 9.30p a year ago.
As of February 28, the consensus forecast amongst 28 polled investment analysts covering Legal & General for the Financial Times has it that the company will outperform the market. The 18 analysts offering 12-month price targets for the stock have a median target of 277.50p, with a high estimate of 305.00p and a low of 180.00p.
As of 09:01 GMT, Wednesday, 04 March, Legal & General Group Plc share price is 270.20p.