Legal & General has announced a £500 million share buyback under aims to return more than £5 billion to shareholders within three years, after posting higher earnings.
The insurance and pensions giant reported a 6% rise in core operating profits, excluding its corporate investments division, to £1.62 billion for 2024.
Pre-tax profits jumped to £542 million from £195 million in 2023.
In a boost for investors, L&G revealed plans to buy back £500 million worth of shares in 2025 and said it will return more than £5 billion – or 40% of its entire stock market valuation – to shareholders within three years via dividends and buybacks.
Chief executive Antonio Simoes has been leading an overhaul of the company after taking over as group chief executive from Sir Nigel Wilson last year.
L&G has sold the group’s housebuilding division, Cala, for £1.35 billion and its US protection arm for £1.8 billion, while also forming strategic tie-ups.
The group is now focusing on its three core businesses – institutional retirement, asset management, and UK retail pensions and protection.
It has also created a corporate investments division which houses parts of the business earmarked for sale or offloading.
“We now have a plan in place for the disposal of each of the remaining assets in our corporate investments portfolio as we continue to simplify our business and unlock value to redeploy into our strategic businesses,” the group said.
As part of Mr Simoes’ new strategy, the company has also merged LGIM, its under-performing asset management arm, with L&G Capital, which is focused on infrastructure investment.
Mr Simoes said: “We are seeing positive commercial momentum as we execute our strategy with rigour and pace.”
He added: “We stated at our Capital Markets Event that we intended to return more to shareholders and that is exactly what we are doing.
“Our clear capital allocation framework supports our plan to return over £5 billion over the next three years, through dividends and buybacks.”
