Last checked at 2 Mar 2022 08:00
INFORMATION FOR GENERAL ACCIDENT PLC PREFERENCE SHAREHOLDERS
GENERAL ACCIDENT PLC
Preliminary Announcement of results for the year ended 31 December 2021
These results are published for the benefit of preference shareholders of General Accident plc ("the Company") for the year ended 31 December 2021. The preference shares have remained listed on the London Stock Exchange following the merger of the Company with Commercial Union plc, in June 1998 to form CGU plc ("CGU"), and the subsequent merger of CGU with Norwich Union plc in May 2000 to form Aviva plc (formerly CGNU plc).
The Company transferred its interest in its subsidiaries to its parent company, Aviva plc, in 2005, in return for an inter-company loan. The income of the Company for the year ended 31 December 2021 consists of interest received on this loan.
The principal risks and uncertainties facing the Company are:
- Credit risk: The net asset value of the Company's financial resources is exposed to the potential default on the loan and short-term receivables due from its parent, Aviva plc. The external issuer credit rating of Aviva plc (representing an issuer's ability to meet its overall financial commitments as they fall due) is A, and as such the risk of counterparty default is considered remote. In addition, the loan amounting to £9,484 million (2020: £9,529 million) is secured by a legal charge against the ordinary share capital of Aviva Group Holdings Limited mitigating the risk of loss in the event of Aviva plc defaulting. Due to the nature of the loan, and the fact that it is intended to be held until settled by Aviva plc (on maturity or earlier if redeemed before maturity) and not traded, the Company is not exposed to the risk of changes to the market value caused by changing perceptions of the credit worthiness of Aviva plc. There were no financial assets that were past due or impaired at either 31 December 2021 or 31 December 2020.
- Interest rate risk: From January 2021 the loan has been set at a fixed rate due to LIBOR being abolished, and going forwards the interest rate risk will be mitigated.
Exposure to credit risk and interest rate risk is managed through the monitoring of several risk measures.
The Company is part of the Aviva group ("Group") and Aviva plc owns 100% of the Company's ordinary issued share capital.
Summarised income statement | Audited | Audited | |
| results | results | |
| 12 months to | 12 months to | |
| 31 December | 31 December | |
Statutory results | 2021 | 2020 | |
| £m | £m | |
|
|
| |
Investment income
| 66 | 120
| |
|
| ||
Total income | 66 | 120 | |
|
|
| |
Profit on ordinary activities before tax | 66 | 120 | |
Tax on profit on ordinary activities | - | - | |
Profit for the period | 66 | 120 | |
Basic earnings per share (pence) | 0.24 | 0.52 |
Summarised statement of financial position |
Audited |
Audited | |
31 December | 31 December | ||
2021 | 2020 | ||
£m | £m | ||
|
|
| |
Total assets | 13,932 | 13,932 | |
|
|
| |
Equity attributable to ordinary shareholders | 13,682 | 13,682 | |
Preference share capital | 250 | 250 | |
|
|
| |
Total equity | 13,932 | 13,932 | |
|
|
| |
Liabilities | - | - | |
Total equity and liabilities | 13,932 | 13,932 | |
|
| ||
| |||
Statement of changes in equity | Audited | Audited | |
results | results | ||
12 months to | 12 months to | ||
31 December | 31 December | ||
2021 | 2020 | ||
£m | £m | ||
| |||
Total equity at 1 January | 13,932 | 13,934 | |
|
|
| |
Profit for the period | 66 | 120 | |
Total comprehensive income for the period |
66 |
120 | |
|
|
| |
Dividends | (66) | (122) | |
|
|
| |
Total equity at 31 December | 13,932 | 13,932 | |
|
Summarised statement of cash flows | Audited | Audited |
results | results | |
12 months to | 12 months to | |
31 December | 31 December | |
2021 | 2020 | |
£m | £m | |
| ||
Cash flows from financing activities | - | - |
Net cash from financing activities | - | - |
Total net increase/(decrease) in cash and cash equivalents | - | - |
Cash and cash equivalents at 1 January | - | - |
Cash and cash equivalents at 31 December1 | - | - |
|
|
|
¹The closing balance as at 31 December 2021 is £195 (2020: £475). The majority of the Company's cash requirements are met by fellow Group companies.
Basis of preparation
The preliminary announcement for the year ended 31 December 2021 was approved by the Board of Directors on 1 March 2022. The preliminary announcement for the year ended 31 December 2021 is prepared on the basis of the accounting policies set out in the annual accounts. Audited statutory accounts, together with the auditor's report thereon, will be filed with the Registrar of Companies when approved and published.
The Company's Annual Report and Accounts for 2021 will be filed with the Registrar of Companies. The results for the year ended 31 December 2021 and 2020 were audited by PricewaterhouseCoopers LLP. The auditor's report was unqualified and did not contain a statement under section 498(2) or section 498(3) of the Companies Act 2006.
The audited annual reports and accounts of both the Company and of Aviva plc for the year ended 31 December 2021, once published, will be available on application to the Group General Counsel and Company Secretary, Aviva plc, St Helen's, 1 Undershaft, London, EC3P 3DQ. Copies will be made available on the Aviva plc website once published at http://www.aviva.com/investor-relations/reports/.
Enquiries: Rupert Taylor Rea, Investor Relations Director, Aviva plc, rupert.taylorrea@aviva.com, +44 (0)7385 494 440