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US investor Silchester reveals 5% stake in ITV this afternoon
“Vote Labour Live Longer”
My grandfather and father both miners voted Labour and were short lived, 59 and 69 respectively so not sure your strapline carries much truth in my household.
UK life expectancy falls to 2010 levels
UK life expectancy fell to the levels of more than a decade ago following a drop during the pandemic and a decade of slow growth, according to new official data.
The Office for National Statistics said on Thursday that UK life expectancy at birth in 2020 to 2022 was 78.6 years for males and 82.6 years for females, down 38 weeks from the 2017 to 2019 level for men and a drop of 23 weeks for women.
The statistics agency added that life expectancy was back to the same level as 2010 to 2012 for females and slightly below the 2010 to 2012 level for males.
ONS’s Pamela Cobb said: “After a decade of slowing life expectancy improvements, we’ve now seen life expectancy fall for both men and women. This decrease has been mainly driven by the coronavirus pandemic, which led to increased mortality in 2020 and 2021.”
Sue Noffke Fund Manager commentary on Assura……..
I'll start with a property company, and that's Assura And you won't know it from walking around in the streets, but it does GP patient practices. So, the facilities for NHS healthcare, the tenant is effectively the government and we know that there is huge demand for healthcare services in the community. They've got round about 600 or so practices in the UK, [they have] got a lot of development opportunities as well.
Now property has come under pressure as interest rates have gone up, but Assura has been fleet of foot in terms of its financing. So, it's got a strong balance sheet and it's not exposed to the rising interest rates. It doesn't have refinancing really until towards the end of this decade and it locked in some of the lower-cost financing that was available in recent years. So, I think that one, which is yielding 8% with good prospects, it's growing its dividends sustainably at 5%. Not super-exciting, but good enough. That is a really good holding to have in our portfolio.
Sue Noffke (fund manager) commentary on LGEN………..
A different stock that would be yielding more than the market would be Legal & General Group
and that is a household name. It also has some fantastic growth opportunities. It also has a strong balance sheet, and you can see the themes here. Their balance sheet comes under solvency too, which is a bit technical, but it's got strong solvency, a strong balance sheet, to cope with the amount of growth the higher interest rate is affording them.
Higher interest rates mean that a lot of companies are looking to outsource their pension liabilities to a third-party provider, and Legal & General has the capability, has heritage, of doing that really well. It's got the balance sheet to do that. It's yielding 9% in today's market. Again, it's growing its dividend by 5% per annum. We think that is sustainable. So, not only do you get the growth, but you can have jam today. So, I think those are two really attractive opportunities in the portfolio today……….the other stock she is referring too is Assura.
As the Tempus column in The Times mentions today, there is NO catalyst for the shares to go up. IMHO only a takeover approach or a stake sale of the production business will allow the shares to re-rate. I don’t envy the management, trying to replace linear advertising revenues with production revenues, it’s gonna be a long haul. The 5p dividend offers a crumb of solace but if the economy worsens from here I’ve no doubt that will be scaled back too. Not selling at these levels so I guess like many here, I’m waiting for better days.
Name
Position/Status
Number of shares purchased
Purchase price per ordinary share
Date of purchase
Sara Thompson
Group HR Director
11,200
454.13 pence
31 October 2023
Berenberg reinitiates Assura with 'buy' - price target 49 pence
Reuters are running with the above story on their website……….
From The Times Market report tonight…….In the FTSE 100, meanwhile, the chatter surrounding Aviva refused to die down. Shares of the insurer followed Wednesday’s 3.2 per cent increase with a rather more modest rise of ½p, or 0.2 per cent, to 388¼p, although City sources insisted that at least two potential suitors were running a sliderule over the business, attracted by its excess capital and strong cashflow.
The talk is that the likes of Allianz of Germany, Intact Financial Corporation of Canada and the Scandinavian group Tryg are considering their options, with at least one mulling a £6 a share proposal. An American insurer is also rumoured to be interested in Aviva, which last weekend revealed it was backing a £1 billion cancer research and treatment campus in London.
From investors Chronicle this afternoon……..There have undoubtedly been few better times to invest in private equity (PE) – valuations are cheap as interest rates have harrowed the sector – but the timing of Phoenix Group’s (PHNX) purchase of a 5 per cent stake in PE firm Hambro Perks, a few days before the Financial Conduct Authority announced a wide-ranging investigation into valuations the sector reports, could hardly have been worse. This follows on from accounting changes under IFRS 17 that could make the kind of expansive closed book buying that the company specialises much harder under a regime that is stricter on solvency levels.
In fact, most of the news away from the half-year results contained an element of unfortunate timing, and not just for Phoenix. For example, the company is part of the so-called Mansion House Compact which also includes L&G (LGEN), Aviva (AV.) and Scottish Widows. The group recently pledged to invest at least 5 per cent of its defined contribution default funds in unlisted assets which would include things such as private equity, although it is worth pointing out that the pledge is non-binding.
These missteps aside, the half saw the balance sheet increase its positive levels of cash generation with £885mn of new business cash rolling in, more than double the total at this point last year, and which comfortably covers the dividend by three times.
Berenberg makes the point that the key for Phoenix is its A+ credit rating from Fitch that allows the company to borrow at reasonable rates. Management has options over whether to deleverage or continue buying, the broker said. With dividend yield now 10 per cent, the market is demanding more surety for risk. Hold.
Berenberg analyst Thomas Bateman describes Phoenix, the UK’s largest consolidator of long-term savings and retirement plans, as ‘a cash machine’.
The current in-force book of policies generates £500 million per year in surplus capital, which the firm ploughs back into the ever-growing UK pension market acquiring back books from other insurers such as 2022’s deal to buy Sun Life UK.
At the end of December 2022, Phoenix reported in-force long-term free cash flow of £12.1 billion, which represents all the cash available to shareholders if the group decided to stop making acquisitions and simply let its existing policies run down.
By discounting all this future cash flow back to today Bateman estimates the net present value of the group is £8.7 billion, which he considers ‘extremely conservative’ but still compares very favourably with the firm’s current market value of around £5.3 billion.
Full year dividend for 2023 is £915 million or 33.4p per share which is 7.7% higher than full year 2022
Https://news.sky.com/story/direct-line-approaches-aviva-executive-winslow-about-ceo-vacancy-12942791
CBAM see value in the prefs……..
On the 3rd August 2023, Close Brothers Asset Management bought 1,021,250 shares in AVIVA PLC 8.75% CUM IRR PREF. This brought our shareholding to 5.43% of the shares in issue. This is based on the shares in issue figure of 100,000,000 as at 3rd August 2023.
This is the required notification that the holding has crossed 5% of the shares in issue.
Hi everyone,
Seems this one slipped under the radar last week……….
https://www.ipe.com/news/british-steel-pension-scheme-completes-2bn-buy-in-with-legal-and-general/10064456.article
Best Wishes
Blackfriars
Surprised no mention on any of the boards re the following…………
https://news.sky.com/story/former-outsourcing-giant-interserve-seals-735m-aviva-pension-deal-12768743
Best wishes
Blackfriars
Hi everyone,
Long term holder but never felt the need to register or post on LSE.
However, thought the following from head of Aviva IR might be helpful……..
“Thank you for your email. Aviva has no direct exposure to the LDI market. We do not provide LDI solutions for external clients (i.e. in the way that the likes of L&G, BlackRock, Insight do).
Similar to the pension funds, ourselves and other life insurers have faced collateral calls in relation to our interest rate hedging programme. However these calls have been entirely manageable within our day-to-day liquidity management”
Hope this helps
Best
Blackfriars 1
Hi everyone
Long term holder here but up until now never felt the need to register or post.
However, you may find interesting reply from head of IR last week .
“ We don’t manage LDI funds for third parties as we don’t have an asset manager, so have no exposure from that perspective. There will of course be some collateral calls on the derivatives used in our own balance sheet hedging, but we have plenty of liquidity available to fund any calls. So in summary, not something we are concerned about”
Hope this helps.
Best
Blackfriars1