M&G reports jump in outflows as it slumps to loss in 2024

M&G has disclosed notable increases in fund withdrawals for 2024, with outflows surging to £9.5 billion from last year’s £4.7 billion, according to the company's annual results.

All sectors of the business experienced these outflows, with its conventional Life division suffering the most significant hit, facing outflows totalling £4.8 billion over the course of the year, as reported by City AM.

Despite this, the insurer and asset manager's adjusted operating profit saw a five per cent elevation to £837 million, propelled by an impressive 19 per cent rise in profits from its asset management segment.

Attributing to M&G's ongoing strategy to expand and streamline operations, the enhanced profits in asset management were bolstered by cost-cutting measures that successfully counteracted the effects of inflation, as evidenced by the dip in cost-to-income ratio from 79 per cent the previous year to 76 per cent.

Nonetheless, the group acknowledged a significant statutory loss after tax of £347 million, a downturn from a £309 million profit in the preceding year, reflecting unrealised fair value losses on surplus assets in its annuity portfolio alongside hedging-related fair value losses.

M&G’s chief executive, Andrea Rossi, stated today that the firm has established a fresh target for the forthcoming three years: To increase adjusted operating profit annually by an average of at least five per cent.

"As we look ahead, the strong foundations we have built position us well to continue to deliver long-term value to our customers and clients and diversified profitable growth to shareholders," he expressed.

The group's total assets under management and administration saw an increase from £343.5bn to £345.9bn, partially attributed to the acquisition of Baumont Real Estate Capital and an increased stake in Continuum.

In September, M&G announced it would raise its three-year cumulative operating capital generation target to £2.7bn for 2022 to 2024, and confirmed today that it had achieved this goal while also reducing its debt by £461m.