Aviva share price: Full-year results out

Aviva Plc (LON:AV) has this morning released its full-year results. Here are the highlights from Aviva’s statement with more to follow:

Mark Wilson, Group Chief Executive Officer, said:
“These results show tangible progress, with all key metrics moving in the right direction. Cash is up 65%, operating earnings per share is up 10%1, value of new business is up 15%2 and book value is 26% higher. Operating expenses are £571 million lower than our 2011 base-line, debt ratios are down and our full year combined ratio of 95.7% is the best in eight years.

“We have increased our final dividend by 30% to reflect the progress made during the year and our improved financial position. We have entered 2015 in a position of strength.
“Nevertheless, it would be wrong to assume that our turnaround is nearing completion as we have further to travel than the distance we have come.”
Operating profit has increased 6% to £2,173 million (FY13: £2,049 million). Expense reductions and an improved result in UK Life, more than offset the negative impact of currency, lower individual annuity sales and disposals of some of our non-core businesses which, together, depressed operating profit by c.£200 million. The UK Life operating profit benefited from £282 million (FY13: £116 million) of back book actions relating to longevity and expense reserve releases, partially offset by a DAC writedown.

In general insurance and health, the operating profit of £808 million was broadly flat (FY13: £797 million). A higher underwriting result was offset by lower investment returns, primarily due to the reduced intercompany loan.
Aviva Investors‘ fund management operating profit increased 16% to £79 million (FY13: £68 million) although this remains inadequate relative to assets under management of £246 billion.
Lower interest costs and corporate centre spend have also improved Group profitability and there remains opportunity for further reductions in this area.
**Outlook**
A successful integration of Friends Life is a significant focus and it is important to demonstrate our ability to execute on our plans and achieve our external objectives. This is a bare minimum.
While the proposed integration of Friends Life is a major exercise, there are large parts of the business that are not involved and we will continue to focus on better capital allocation and efficiency across the entire group, driving digital throughout the organisation and building out our true customer composite model.
Aviva has travelled a long way in the past two years. But it would be wrong to assume that our turnaround is nearing completion. On the contrary, we have further to travel than the distance we have come.
As of 07:06 GMT, Thursday, 05 March, Aviva plc share price is 532.00p.