Aberdeen Group Plc · LSE:ABDN
Aberdeen — Standard Life — FY2004 Earnings Presentation
47 slides from Aberdeen's earnings presentation, Mar 17, 2005
Slide 1: Preliminary Results 2004 Presentation
Preliminary Results 2004 Presentation
Slide 2: Preliminary Results 2004 Presentation
Preliminary Results 2004 Presentation 17 March 2005 Sir Brian Stewart Chairman 2 Full Year Results 2004 17 March 2005
Slide 3: Agenda
Agenda • Overview • Operating and Financial Review • Business Review • Summary • Questions & Answers
Slide 4: Overview - Results Highlights
Overview - Results Highlights • Worldwide insurance APE sales £1.42bn • Worldwide gross investment sales £2.35bn • SLI third party FUM increase to £18.3bn • Total group funds under management a record £108bn • Standard Life Bank mortgages under management £10.2bn • Capital resources of £5.5bn (statu
Slide 5: Standard Life's Strengths
Standard Life’s Strengths • Clear vision of the future • Leading brand • Innovative range of quality products • Market leading standards of customer service • Strong long term fund performance • Opportunities for synergies across business operation • Determination to deliver excellent results for st
Slide 6: Operating and Financial Review
Full Year Results 2004 Operating and Financial Review John Hylands Group Finance Director
Slide 7: Worldwide APE £1.6bn
Worldwide APE £1.6bn £bn 2.00 1.80 1.60 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00 2000 2001 2002 2003 2004 2000-2003 12 months to 15 November Life and pensions APE + 10% of investment sales 2004 13.5 months to 31 December 7 Full Year Results 20 17 March 2005
Slide 8: Geographic Breakdown APE
Geographic Breakdown APE Europe 16% (10%) Canada 12% (12%) Asia UK 1% 71% (2%) (76%) Insurance APE + 10% of investment sales 2004 31 December year end ( ) 2003 15 November year end 8 Full Year Results 20 17 March 2005
Slide 9: Group Funds Under Management £108bn
Group Funds Under Management £108bn £ bn 120 100 80 60 40 20 0 2000 2001 2002 2003 2004 2003 includes £2bn securitisation and 15 November year end 2004 includes £3bn securitisation and 31 December year end 9 Full Year Results 20 17 March 2005
Slide 10: Financial Position as at 31 December 2004
Financial Position as at 31 December 2004 Companies Act 31 December 15 November 2004 (£m) 2003 (£m) Restated Assets 99,322 88,565 Technical provisions 84,030 74,830 Other liabilities 10,836 9,455 Fund for future appropriations 4,456 4,280 1 Full Year Results 20 17 March 2005
Slide 11: Statutory and Realistic Solvency (unaudited)
Statutory and Realistic Solvency (unaudited) 2004 £m Capital Resources 5,468 Capital Resources Requirement (CRR) 2,513 Realistic Assets of the Fund 40,495 Realistic Liabilities of the Fund 37,207 Realistic assets exceed realistic liabilities 3,288 1 Full Year Results 20 17 March 2005
Slide 12: Capital position
Capital position 2004 £m Fund for future appropriations 4,456 Adjustment on to regulatory basis (1,007) Other Qualifying Capital Subordinated members’ accounts (MACS) 548 Subordinated loans 971 Implicit item 500 2,019 _____ Total capital to meet regulatory requirements 5,468 Regulatory capital resou
Slide 13: Credit Ratings
Credit Ratings S&P Moody’s Rating Outlook Rating Outlook Financial Strength A+ Negative A1 Negative SL Finance A- A3 Negative SL MACS A- Baa1 Negative 1 Full Year Results 20 17 March 2005
Slide 14: Business Review
Full Year Results 2004 Business Review Sandy Crombie Group Chief Executive
Slide 15: Overview – A year of Progress
Overview – A year of Progress Management Actions – Strategic Review – Established numerous projects to set course for demutualisation and flotation – Repositioned for profitability and growth – Cost reductions – Changed commission structures to improve profitability – Variety of actions taken to str
Slide 16: Overview – A year of Progress
Overview – A year of Progress Achievements Delivered – Sales maintained but mix changed towards improved profitability – Successful product launches – Maintained leading brand – Customer service awards – Strong investment performance – Secure financial position 1 Full Year Results 20 17 March 2005
Slide 17: Business Unit Review
Business Unit Review • UK Life and Pensions • Bank • Healthcare • Investments • Canada • International
Slide 18: UK Life and Pensions
Full Year Results 2004 UK Life and Pensions
Slide 19: UK Life and Pensions New Business APE
UK Life and Pensions New Business APE • Total APE sales £939m (£957m) • Focus on profitable market share • Total APE market share Q4 8% (Q3:8.4%) • Deliberately stood back from chasing sales for improved profitability and to guard capital – Protection down 57% yoy – Annuities drove Retirement Income
Slide 20: UK Life and Pensions Repositioning
UK Life and Pensions Repositioning • Focus on profitable growth • With profit fund pre-tax investment return of 10.4% • Exciting product launches – SIPPS – Secured Capital Plan – Individual Buy-Out Plan – New protection proposition – sigma • Strong service levels and innovative products to drive pro
Slide 21: UK Life and Pension Depolarisation
UK Life and Pension Depolarisation • IFA’s remain key • Attractions to having multi-tie agreements • Our strengths – Product range and quality – Product performance – Service standards – Information technology and supporting systems • Recent multi-tie announcements to date – Barclays – Thinc-Destini
Slide 22: Investments
Full Year Results 2004 Investments
Slide 23: Investment Highlights
Investment Highlights • Performance strong across main asset classes • Money weighted average well above median for 1 year and upper quartile over three years 13.5 months to 31 December 2004 Past performance is not necessarily a guide to future performance 2 Full Year Results 20 17 March 2005
Slide 24: Active Investment Performance – by Product
Active Investment Performance – by Product at 31 December 2004 % Rank 0 3 mths 1 year 3 years 5 years 25 10 years 50 75 100 Weighted Par Non Par Mutual SLIF SLIF Corporate SLPF Irish & SICAVS Average Funds Funds Funds Net Gross German Ex Group Life Funds 2 Full Year Results 20 17 March 2005
Slide 25: Standard Life Investment Sales
Standard Life Investment Sales • Achieved record institutional sales of £1.8bn and won major segregated institutional mandates • Third party FUM Gross inflows of £3.7bn • Strong start to 2005 2 Full Year Results 20 17 March 2005
Slide 26: Standard Life Investments Third Party FUM £18.3bn
Standard Life Investments Third Party FUM £18.3bn £ bn 18 16 14 12 10 8 6 4 2 0 2000 2001 2002 2003 2004 2000-2003 12 months to 15 November 2004 13.5 months to 31 December 2 Full Year Results 20 17 March 2005
Slide 27: Third Party Gross Inflow £3.7bn
Third Party Gross Inflow £3.7bn £ bn 4 3 2 1 0 2000 2001 2002 2003 2004 2000-2003 12 months to 15 November 2004 13.5 months to 31 December 2 Full Year Results 20 17 March 2005
Slide 28: Bank
Full Year Results 2004 Bank
Slide 29: Standard Life Bank
Standard Life Bank • £9.1m profit (£4.6m) • Mortgages under management increased by 17% to £10.2bn (£8.7bn) • Gross mortgage lending increased by 24% to £4.6bn (£3.7bn) • Mortgage business quality remains outstanding – Average indexed loan-to-value ratio of the mortgage book fell from 46.3% to 44.7%
Slide 30: Standard Life Bank
Standard Life Bank • Substantial improvements in efficiency – Mortgages under management double over 4 years – Staff numbers have reduced by 18% in the same period • Customer engagement strong – 64% of customers use flexible features of the mortgage – Increasing usage as a financial planning tool •
Slide 31: Standard Life Bank Mortgages Under Management £10.2bn
Standard Life Bank Mortgages Under Management £10.2bn £ bn 12 10 8 6 4 2 0 1999 2000 2001 2002 2003 2004 2000-2003 12 months to 15 November Year end 2004 13.5 months to 31 December Year end 3 Full Year Results 20 17 March 2005
Slide 32: Healthcare
Full Year Results 2004 Healthcare
Slide 33: Standard Life Healthcare
Standard Life Healthcare • Inforce premiums increased by 12% • Customer retention continues to build • Customer satisfaction 98% Q3 04 • Premiums increased in response to claims experience • Cost issues addressed • Moving towards break even (H1 £4m loss H2 £2.1m loss) % relate to 13.5 months to Dece
Slide 34: Standard Life Healthcare In-force Premium Income £217m
Standard Life Healthcare In-force Premium Income £217m £m 250 200 150 100 50 0 2000 2001 2002 2003 2004 2000-2003 12 months to 15 November Year end 2004 13.5 months to 31 December Year end 3 Full Year Results 20 17 March 2005
Slide 35: Canada
Full Year Results 2004 Canada
Slide 36: Canada
Canada • Group Savings and Retirement leader in Canadian market, with highest market share increase from 2003 and 2nd overall in 2004 as measured by EAP (from 15% to 26%) • Market share of 2004 new sales: – Group Savings and Retirement 26% – Group Insurance 4% – Individual Life 6% – Individual Savin
Slide 37: Canada
Canada • Domestication achieved, offering greater capital flexibility • New chief executive appointed 1 January 2005 • Growth in 2005 will be generated from all product lines – Expanded product offering for Group Savings and Retirement with the objective to increase our share of the Defined Benefit
Slide 38: International
Full Year Results 2004 International
Slide 39: Overseas Operations Highlights
Overseas Operations Highlights • Germany/Austria – Exceptional growth of new business up 164% – Expect 2005 APE sales to revert to more normal levels • India – HDFC Standard Life insurance market share around 8% – Expanding our geographic footprint • China – Sales ahead of target – Developing produc
Slide 40: Summary
Summary • Year of change, success and solid performance • Repositioning and restructuring to improve profitability and maximise value for members • Strong products, performance, service and brand • Secure financial position • Standard Life on a new track 4 Full Year Results 20 17 March 2005
Slide 41: Questions & Answers
Full Year Results 2004 Questions & Answers
Slide 42: Preliminary Results 2004 Presentation
Preliminary Results 2004 Presentation
Slide 43: Appendix
Full Year Results 2004 Appendix
Slide 44: Overview – Award winning Performance
Overview – Award winning Performance • IFA Company of the Year award (7th consecutive year) • MMFS award for Best Pension Provider • MMFS award for Best Healthcare Provider • FAS Award for the ‘Investment provider 5-Star Award’ (9th successive year) • 1st place in 2004 Standard & Poor’s Ten year UK
Slide 45: UK With Profits Business £31bn
UK With Profits Business £31bn Cash 9% (10% ) Fixed Equity interest 35.5% 41.1% (58.6% ) (16.3% ) Property 14.4% (15.1% ) Comprises the assets backing the With Profits Fund as at 31 December 2004 (31 December 2003) Value includes corporate assets 4 Full Year Results 20 17 March 2005
Slide 46: Preliminary Results 2004 Presentation
Preliminary Results 2004 Presentation 17 March 2005 46 Full Year Results 2004 17 March 2005
Slide 47: Full Year Results 2004
Full Year Results 2004 The Standard Life Assurance Company* is a mutual company registered in Scotland (No. SZ4) Head Office Standard Life House 30 Lothian Road Edinburgh EH1 2DH. The Standard Life group includes Standard Life Pension Funds Limited* SLTM Limited* Standard Life Investments (Mutual Fu