Legal & General Group Plc

Good morning, and a warm welcome to those of you in the room and to those joining online. Just a few housekeeping points to start. Firstly, to those in the room, please make sure you've turned your devices to silent. In the event that the firearm sounds, colleagues will guide you towards the nearest exit. The normal forward-looking statements apply. Our running order will be as follows. Antonio will open with a summary of our H1 results. and an update on the progress we are making in delivering against our strategy. Jeff will cover the financial results in more detail, and then Antonio will make closing statements before opening to Q&A. Antonio, over to you.

Thank you, Ed, and good morning, everybody. It's great to see you here. So we've made a good start to the year. Headline half-year numbers show core operating profit slightly up compared to last year. We have grown our store of future profit by 7%, and our solvency ratio remains strong at 223%. So to reiterate what we said eight weeks ago at our capital markets event, we expect the full year core operating profit to grow by mid-single digits year on year, reflecting the strength of our business. So at the capital markets event on the 12th of June, we set out a clear and compelling vision for the group. That vision is for a simpler, better connected LNG with three businesses, institutional retirement, asset management, and retail. And with the ambition to become more capital light over time. We are now focusing on executing against that strategy. That execution is delivering three things basically, sustainable growth, sharper focus, and enhanced returns. So first, in terms of sustainable growth, our three divisions have strong growth prospects. In institutional retirement, we have written or are exclusive on five billion pounds of PRT deals in the year to date and have our strongest ever pipeline. We're taking positive steps in asset management, particularly in private markets. And in retail, we have seen continued strong new business performance. We are delivering with sharper focus on execution. We're making good progress on creating a combined single global asset manager. And we are transforming our operating model, technology, and our culture. And in the newly created corporate investments unit, we're going on with plans for assets disposals. So let me start with institutional retirement. As we highlighted in June, we expect sort of the new normal for the market to be around 45 billion pounds of volumes in the UK. You can see it there. And as mentioned, year-to-date it is really important. We have written or are exclusive on five billion of global PRT deals. That includes $525 million in the US. And many of these deals have come from our long-term asset management Our pipeline for the second half of the year is the strongest that it has ever been, as I said before. We are currently quoting, you can see it there, on 15 deals over one billion pounds, with more than 24 billion of U.K. market deals in the pipeline, most of which are expected to transact in 2024. So our long-term relationships with DB schemes, our asset origination capabilities, and our ability to serve the whole market give us competitive advantage and give me the confidence in our delivery for the rest of the year at attractive margins. Turning to asset management, asset management revenues are up 6% year on year, despite lower AUM, so this is important, as we shift to higher margin business with positive growth in DC and in wholesale channels, and also in active fixed income and multi-asset strategies. Importantly, our investment returns for clients continue to outperform across our active strategies. The new combined asset management division is really well positioned, as I said, on the 12th of June, through our scale, performance track record, and our asset origination capabilities. And the integration of our businesses, what used to be LGIM and LGC, is progressing well, with a number of client wins showcasing the value of our combined business. You can see here on the slide we have transferred $1.1 billion of balance sheet assets from LGC, comprising of basically two things, equity stakes in origination platforms-so think about affordable housing or Scitec-and seed assets for future fund launches to catalyze effectively the growth in private market fee earnings. We've made good progress in the search for a new CEO for the asset management division, and we have a strong field of candidates. I hope to make an announcement about this later in the year. So as signaled at the capital markets event, we are investing to grow the asset management business. In the first half of the year, we have invested an additional $23 million. You can see that that's 7% of the division's cost base to drive growth and operational scalability. This is consistent with our stated annual investment of 50 to 100 million. If you remember, we had this debate on the 12th of June. Kind of that's the number for the year. In the first half, that's 23 million. We are invest-where are we investing? We're investing to build out our European and Asian wholesale capabilities, so distribution channels, and to enhance private markets investment and distribution capabilities. We will direct our investment to where we are delivering growth, and importantly, we will moderate it if we are not achieving that growth. underlying cost growth, you can see there, was 3 percent lower than the U.K. wage inflation. So we will continue to show strong discipline on underlying operating costs to be able to then reinvest in the business. And as a result, you can see that our cost to income has increased by three percentage points to 73 percent. And as mentioned in June, we expect this to stabilize and then decline as revenues increase. Also, as I said in June, we have an ambition to grow our private markets AUM to $85 billion by 2028. And the three exciting client wins in private markets over the last month, all of this was done in July, shown here on the slide, demonstrate the synergies of our business model and the credibility of that strategy that we announced. Let me just go through the three. Our Private Markets Access Fund, which was launched on the first of July, provides our 5.3 million workplace DC customers with diversified private markets exposure. We anticipate the investment in this fund to reach 12 billion by 2028. On the middle, our affordable housing fund was launched on the 15th of July and has two cornerstone local government pension schemes, Access, which is a pool of 11 local government pension schemes, and the Greater Manchester Pension Fund. This fund puts pension capital to work to address the underinvestment in U.K. affordable housing. We expect this portfolio to be $4 billion by 2028. And finally, we are expanding our bill-to-rent platform with another cornerstone investor to increase U.K. rental supply and expect to create another $4 billion portfolio by 2028. So taken together, we expect these three platforms to generate the $12 billion, the $4 billion, and the $4 billion, $20 billion of assets at an average revenue margin of 50 to 90 basis points, which is well above the average revenue margin of asset management. Turning to retail, in retail we expect material growth in the coming decades as UK personal accumulation and accumulation assets grow and they continue to compound. In the first half of the year, our workplace D.C. assets under administration continue to grow strongly with 3.2 billion of net flows. Our other retail businesses performed well, too, with individual annuity sales doubling versus last year, which was already a strong year. And our protection businesses are also showing strong growth, both here in the U.K. and in the U.S. So those are the businesses. We are executing, as you can see, our strategy at pace and with rigor. We're making progress in IT migrations, payments processing, and procurement. You can see it here on the left. We are simplifying our operating model, doing things once and well, and breaking down divisional silos to improve collaboration and to improve efficiency. We have detailed plans in place and our transformation office created earlier in the year is driving strategy execution across 20 thematic work streams. And finally, our strategy is delivering enhanced returns to shareholders. Today, we have announced a 5% growth in the interim dividend. And we will be returning more to shareholders over the period of 2024 to 2027 than the equivalent of maintaining a 5 percent dividend growth. We started our 200 million buyback program the day just a day after the capital markets event. It's now almost 50 percent complete. It's 46 percent as of yesterday. And we are confident we will undertake further similar buybacks over the subsequent period. I'll now hand over to Jeff, who will take you through the financial highlights before returning to summarize and then open for questions. Jeff.

Thank you, Antonio. And good morning, everyone. Welcome, those I haven't already met. I'm just going to grab a water. Our results today are in line with the guidance we gave at our capital markets event in June, and we continue to expect to achieve mid-single-digit growth in core operating profit for 2024 as a whole. Core operating profit was slightly up at £849 million, driven by the predictable and ongoing releases of the contractual service margin and risk adjustment from our growing insurance businesses, reflecting the record volumes written last year. Investment variance mostly reflects the impact on our annuity portfolio of the increase in interest rates of 64 basis points and movements in inflation expectations, both of these in line with our published sensitivities. Our balance sheet remains strong, with a solvency two coverage ratio of 223%, which is net of the 200 million pound buyback. And capital generation is in line with expectations at 0.9 billion pounds. We continue to grow our store of future profit by writing profitable new business. In the last two years, we have added over one billion pounds to our CSM and risk adjustment, and this is net of 2.5 billion pounds that has been released into operating profit over that time. This store of future profit will continue to deliver steady and reliable earnings for shareholders into the future. We have added 303 million pounds to this from new business written in the first half of this year. So now, moving on to divisions. Operating profit from institutional retirement was up 6% to 560 million pounds. This strong performance was driven by the growing scale of CSM being released into earnings, up 18% year on year, as a result of the record volumes written in 23. The expected investment margin is underpinned by the reliable performance of our well-managed and geographically diverse annuity assets. And profit before tax primarily reflects the impact of the interest rates and inflation that I mentioned earlier. As Antonio covered, we have now written or are exclusive on £5 billion of global PRT premium, and our UK PRT pipeline is the strongest it has ever been. Our guidance on UK PRT volumes remains unchanged, and we are well positioned to capitalise on the market opportunity. In the US, we have more than doubled volumes in the first six months of this year versus the first half of last year, and we continue to see the US as an attractive and growing market opportunity. Whilst UK new business continues to meet our internal return hurdles, the IFRS and solvency metrics for the first half are lower. In simple terms, the lower duration of the business written means we capture the investment margins for a shorter period. In particular, the £900 million buy-in with the ICI pension fund had a duration of less than eight years, nearly 40% lower than the average duration of new business written over the last three years. The asset management result reflects the profits generated from fee-earning AUM, as well as from our balance sheet investments, which include asset origination platforms and seed assets for future funds. Operating profit from fee-related earnings is down 4%, reflecting the increased investment in the division. Fee revenue is up 6% despite a 4% fall in average AUM. This reflects our conscious shift towards higher margin business, illustrated by our DC and wholesale channels, which have seen increases in revenue of 20% and 7% respectively. Operating profit from balance sheet investments was lower at £81 million. We again increased the valuation of Pemberton as it continues to successfully deploy and raise new capital, although the increase is lower than last year. Antonio has already covered our investment in this division and how we will be disciplined on underlying operating costs. And external net flows continue to be dominated by UK defined benefit, with schemes adjusting their portfolios in response to improved funding positions. As we have said, PRT is a beneficiary of this trend. And excluding DB flows, ANR was flat. We continue to see growth in higher margin areas, with workplace DC and wholesale generating five million of ANR from 4.9 billion of net flows. Private Markets AUM was up 8%, with 4 million of ANR at an average free margin of 30 basis points. And we are making strong progress, having recently launched three new funds, as Antonio covered earlier. Our leading position in the UK DC market, with 176 billion pounds of AUM, makes us strongly positioned for growth in this market. In addition, international AUM now represents 41% of the total as we continue to diversify and extend our global reach. So in retail, total operating profit was up 6% to 268 million pounds. This strong performance was driven by the predictable and ongoing profit releases from our growing CSM balance and positive claims experience in the UK. This was partially offset by increased non-attributable expenses, which are, however, in line with the second half run rate for 2023. Workplace net flows were 3.2 billion pounds. We have now reached 5.3 million customers and expect continued growth. Individual annuities benefit from the higher interest rate environment with volumes having doubled year on year for the first six months of 2024. And our US protection platform adopts market leading technology to drive continued growth. Annual new business premiums were up 18% to $103 million. As a result, SomnC2 new business value increased by 48% to 176 million pounds. We remain focused on leveraging technology and scaling efficiencies across all our retail businesses to deliver great customer outcomes and business growth. Moving on to our Corporate Investments Unit. In June, we announced the creation of this new unit, which is comprised of non-strategic assets such as Carla, Legacy Real Estate and Land, and FinTech. We are assessing our options across the portfolio and moving forward with plans for asset disposal. Operating profit is predominantly driven by the trading performance of Carla, which delivered £42 million of profit in the first six months of the year. This is down on the prior year, reflecting a combination of the higher rates environment and some planning delays, but slightly ahead of the second half run rate. Investment variance of 187 million was primarily driven by a write down of salary finance as we consider options to manage the business outcome in the best interest of customers and shareholders. Total carrying value of the assets in the unit is flat at two billion pounds. And finally, onto our balance sheet. As we said, our solvency coverage ratio remains strong at 223% and we continue to see the benefits of the diversification and synergies of our business model we remain well positioned to capitalize on the opportunities in front of us as we move into what we expect to be a busy second half. We have made a positive start and as we have already said, we remain on track to deliver mid single digit growth in core operating profit in 2024. So with that, I will hand back to Antonio.