PHOENIX Group upgraded its near-term cash generation target after completing the merger of its Standard Life and Phoenix Life Assurance into a single business, Phoenix Life.

The insurer reported that this was one of the largest UK insurance Part VII transfers ever completed, bringing together four legal entities, 8mn policies and £200bn of assets.

This has led to a material one-off upgrade to the group's 2023 cash generation target to £1.8bn from £1.3bn to £1.4bn.

In turn, the group's three-year cash generation target increases to £4.5bn from £4.1bn across 2023 and 2025.

Thanks to this, Phoenix expects to have significant surplus cash at its holding company at the end of the year.

Chief Executive Andy Briggs said the merger reaffirmed the company's position as leader at delivering cost.

"This reaffirms Phoenix Group's position as the UK's leader at delivering cost and capital synergies and generating value for customers and shareholders."

Back in September, the pensions giant beat analysts' estimates as it more than doubled its long-term cash generation in the first six months of the year despite a "challenging market environment".

In its half-year report, Phoenix said its new business long-term cash generation more than doubled to £885m from £430m.

The total amount of cash generation in the six months has dipped down to £898m from £950m.

Analysts had been pricing in longterm new business cash generation of just £519m for the period, according to a company-compiled consensus.

Phoenix shares closed up 5.67 per cent.


(c) 2023 City A.M., source Newspaper