JRP Group's profit surges following merger

Maryam Cockar Sharecast | 10 Mar, 2017 07:59 - Updated: 08:50 | | |

  • 137.00
  • 0.37%0.50
  • Max: 138.20
  • Min: 132.76
  • Volume: 947,689
  • MM 200 : n/a
17:17 24/03/17
  • 18,980.44
  • -0.11%-21.83
  • Max: 19,025.61
  • Min: 18,912.98
  • Volume: 0
  • MM 200 : n/a
17:18 24/03/17
  • 8,290.86
  • -0.20%-16.67
  • Max: 8,314.33
  • Min: 8,245.76
  • Volume: 0
  • MM 200 : n/a
17:18 24/03/17
  • 4,053.28
  • -0.06%-2.57
  • Max: 4,061.01
  • Min: 4,045.90
  • Volume: 0
  • MM 200 : n/a
17:18 24/03/17
  • 3,995.03
  • -0.05%-2.10
  • Max: 4,002.17
  • Min: 3,987.92
  • Volume: 0
  • MM 200 : n/a
17:20 24/03/17

Following the merger of Just Retirement and Partnership last April, JRP Group’s profit grew last year on the back of new business.

The FTSE 250 financial services firm reported that pro forma adjusted operating profit increased 58% in 2016 to £164m, driven by an 82% growth in new business profit to £124m, while pre-tax profit for the 18 months to December 2016 was £199m

JRP’s new business margin more than doubled to 6.8% from 3.3% as it focused on profit rather than volume last year and driven by price improvements, enhanced risk selection, and unusually high mortgage spreads, although retirement income revenue was down 13%.

The £1.6bn merger delivered run rate savings of £30m by the end of 2016, a year ahead of schedule for £45m by 2018.

The company estimates that its solvency II coverage ratio rose to 151% for the year end from 134% at the end of the second half of 2016, helped by its fourth quarter £250m hybrid debt issue.

This enabled the company to propose a 2.4p final dividend, taking the total for the year to 3.5p, up 6%, with the embedded value at 219p per share.

Chief executive Rodney Cook said that the company’s focus is on growing profits, but this would be helped by market growth and it is clearest in the defined benefit de-risking and lifetime mortgage markets, where growth is already underway.

“Although the guaranteed income for life solutions market growth is more measured, our addressable market is growing as pensions companies put broking services in place to give their retiring customers access to the open market.

“It is easier for us to be selective with respect to the risks we take when markets are growing. The 2016 margins demonstrated this, and we remain selective in relation to new business,” he said.

More news

20:27 Republicans pull healthcare bill before vote

The White House pulled its proposed bill to reform the US healthcare system at the last moment despite what some had assumed to be widespread Republican support to revamp Obamacare.

20:06 Week ahead: Stage set for Parliament to approve Brexit

Great Britain will formally announce its decision to exit the European Union this week, on Wednesday, kick-starting two years of negotiations with the bloc.

19:37 Weekly review

The FTSE 100 retreated by 88.14 points to end the week at 7,336.82.

19:12 Europe close: Stocks head into the weekend on a mixed note

On the eve of the European Union’s 60th anniversary, European stocks ended on a mixed note after a key vote on a US healthcare bill was postponed, but the euro strengthened after data showed the eurozone's recovery had gained momentum.

18:47 FX round-up: Sterling downcast on Friday as US Congress votes on Trump's Healthcare Bill

Sterling turned in a downcast Friday performance as it slipped on most key pairs, with global markets drifting as US President Donald Trump's Healthcare Bill goes to a congressional vote, and ahead of UK formally beginning its EU-exit talks next week.

18:43 US durable goods orders jump in February, but details weaker

Orders for goods meant to last more than three years jumped in February on the back of a large increase in those for civilian aircraft.

18:05 Smiths Group sales improve as new strategy kicks in, further disposals eyed

As it makes early progress with a new strategy, engineer Smiths Group reported improved revenues in the second quarter and an unchanged full year outlook.

18:02 London close: FTSE drifts lower ahead of pivotal US Congress healthcare vote

Equities in London spent most of the session adrift with a slightly negative bias ahead of the US congressional vote on President Donald Trump's Healthcare Bill, with little in the way of domestic corporate or economic news to provide firm direction.

17:29 US open: Stocks edge higher ahead of second healthcare bill vote

Ahead of the second attempt on the Congressional vote on the Republican healthcare bill, US stocks were trading slightly higher on Friday, but were on course for their worst weekly performance in months.

17:02 Small cap news round-up

FastJet has appointed a new chief financial officer along with other appointments to strengthen its board as the African budget airline attempts to turnaround its fortunes.