Last checked at 6 Feb 2023 07:00
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NEWS RELEASE | www.justgroupplc.co.uk |
6 February 2023
JUST GROUP plc
IFRS 17 UPDATE
Just Group plc ("Just", the "Group") has today made presentation slides available on the Group's website www.justgroupplc.co.uk, and provides below an update on its implementation of IFRS 17. IFRS 17 is a new accounting standard for insurers which was implemented on 1 January 2023.
We remain committed to our ambition to target 15% growth in underlying operating profit.
Under IFRS 17, we will continue our commitment to deliver 15% growth in underlying operating profit per annum over the medium term. Our IFRS 17 measure for underlying operating profit is explained further below.
Our target to deliver a greater than 10% return on equity will also continue under IFRS 171.
No change in strategy, growth ambition, capital, cash or dividend policy.
IFRS 17 is an accounting change and does not affect the underlying economics of our business or our strategy.
· Our commitment and ability to invest in future growth is unchanged
· The capital strength of the Group is unchanged
· Our new and existing business cashflows are unchanged
· The Group's dividend policy is unchanged
· The Group's creditworthiness is unchanged
Effect of transition to IFRS 17
Under IFRS 17 total profits remain unchanged. IFRS 17 introduces two new balance sheet concepts - the Contractual Service Margin ("CSM") and Risk Adjustment ("RA"), which are stocks of discounted future value that will be released in accounting terms into reported profit over time. These stocks of future value are added to by future new business, which in turn also release over time.
· We expect the Group's shareholder value to be broadly unchanged as opening IFRS 17 adjusted shareholders equity (IFRS 17 equity and CSM net of tax) on transition at 1 January 2022 is similar to closing IFRS 4 equity of £2.1bn on 31/12/21. This approach reflects the shareholder value created from past business written.
o IFRS 17 adjusted shareholders equity is expected to be around £2.1-2.2bn on 1 January 2022 (including CSM net of tax, expected to be c.£0.9-1.1bn).
· Underlying operating profit. To provide a meaningful measure of business performance, we will add back the net change in CSM created during the year to derive underlying operating profit under IFRS 17. We expect this new measure of IFRS 17 underlying operating profit to be comparable to IFRS 4 underlying operating profit.
Further Information
Please contact the Investor Relations team, details below.
FINANCIAL CALENDAR AND TIMELINES | DATE | BASIS |
Results for the year ended 31 December 2022 | 7 March 2023 | IFRS 4 |
Further updates ahead of interims | June 2023 | Including restated comparatives |
Interim results for the six months ended 30 June 2023 | 15 August 2023 | First financial reporting under IFRS 17 |
Note 1: Return on equity is IFRS 17 underlying operating profit after attributed tax divided by the average IFRS 17 adjusted shareholders equity less goodwill
Note 2: Alternative performance measure. In addition to statutory IFRS performance measures, the Group has presented a number of non-statutory alternative performance measures within the Annual Report and Accounts. The Board believes that the APMs used give a more representative view of the underlying performance of the Group
Note 3: All the figures are unaudited
Enquiries
Investors / Analysts
Alistair Smith, Investor Relations Telephone: +44 (0) 1737 232 792 alistair.smith@wearejust.co.uk
Paul Kelly, Investor Relations Telephone: +44 (0) 20 7444 8127 paul.kelly@wearejust.co.uk
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Media
Stephen Lowe, Group Communications Director Telephone: +44 (0) 1737 827 301 press.office@wearejust.co.uk
Temple Bar Advisory Alex Child-Villiers William Barker Telephone: +44 (0) 20 7183 1190 |
A copy of this announcement will be available on the Group's website www.justgroupplc.co.uk
JUST GROUP PLC
GROUP COMMUNICATIONS
Enterprise House
Bancroft Road
Reigate
Surrey RH2 7RP