LONDON -- Legal & General
L&G, which competes in the insurance market with Aviva and Prudential, also declared an interim dividend up 18% to 1.96 pence per share.
Earnings per share advanced 14% to 6.96 pence and return on equity was 15.9% against 15% in the first half of 2011.
Despite the increase in profits, operational cash generation was down 1.3% to 471 million pounds and net cash generation only up 0.2% to 407 million pounds.
Nigel Wilson, group chief executive, said:
Our financial and strategic discipline creates confidence in complex and chaotic markets. In spite of economic conditions, we continue to grow. LGIM achieved strong net flows of 4 billion pounds, UK protection gross premiums grew by 9% to 672 million pounds, and we also achieved 13% growth in US gross premiums to $456 million.
We have strong businesses, and social and economic challenges bring opportunities which we intend to pursue at a faster pace. We maintain shareholder assets of over 6 billion pounds, and a strong capital surplus of 3.8 billion pounds. Our balance sheet strength and robust financial discipline provides Legal & General with options to accelerate our evolution, delivering further value for customers and shareholders.
The company will be satisfied that its core business, risk, delivered an operating profit of 272 million pounds, up 15%. This benefited from growth in protection and housing gross premiums of 10% to 838 million pounds as a result of a leading market position and a record quarter for group protection sales.
The asset management division did not generate any significant increase in profits despite gaining net new business of 4.0 billion pounds. Savings operating profit of 73 million pounds was up 7%.
The company admitted that the current uncertain macro-economic situation in Europe remained a risk, although pointed to the diversification within their products and distribution channels to mitigate the dangers.
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