In response to pressure from activist investor Cevian to increase returns, Aviva (AV.L) increased its dividends to investors on Thursday, including a projected 300 million pound ($355 million) share purchase. Indeed, this was done despite a tumultuous year in its major markets.
A final dividend of 20.7 pence per share for 2022 was among the more than 5 billion pounds in payments to investors made by the British insurer and asset management since 2021.
Due to claims inflation and the effects of more extreme weather, the insurance industry as a whole has been under pressure the last year.
Following an increase in general insurance premiums, Aviva’s 2022 earnings exceeded expert expectations.
The FTSE 100 firm reported an increase in operating profit from continuing operations of 35%, from 1.6 billion pounds in 2021 to 2.2 billion pounds in 2022.
In fact, one of the greatest levels of total capital return in the industry is now offered by Aviva, according to JPMorgan analysts in a note.
Nevertheless, at 09:20 GMT, Aviva shares were up 2.9%.
Since taking over three years ago, Aviva CEO Amanda Blanc has aggressively trimmed expenses while raising billions through the sale of company divisions all around the world.
The company reported an accounting loss of 1.1 billion pounds, down from a profit of 2 billion pounds the year before, which it attributed to unfavorable market changes in 2022.
The solvency ratio for Aviva, a crucial indicator of capital strength, was 212%, down from 244% the year before. This decreased to an estimated 196% after a pension scheme contribution and investor distributions, the business claimed.
While the company’s investment arm Aviva Investing reported external net flows of 1.3 billion pounds, down from 3.3 billion the previous year, general insurance gross written premiums grew 8% to 9.7 billion pounds.
