Insurance company Aviva recently announced its intention to repurchase £300 million of its stocks in response to higher sales and increased operating profit. With the firm’s operating profit rising by 9% to nearly £1.5 billion (€2.2 billion) in 2023, Aviva disclosed that it paid a final dividend of 22.3 pence per share; this raised the total annual dividends to 33.4 pence—a growth of 8% from the previous year.
CEO Amanda Blanc confirmed in a company statement that they experienced significant growth in 2023, stating that sales increased, expenses decreased, and operating profit saw a 9% boost. Over the past three years, the company has given back to shareholders over £9 billion through stock buy-backs and dividends.
In 2021, Swedish activist shareholder Cevian Capital acquired a nearly 5% interest in Aviva with the aim of encouraging substantial cost reductions and increased returns for shareholders. After affirming Aviva’s strong shareholder returns, including sizeable excess capital distributions, Cevian Capital fully withdrew its stake in the company the following year.
In addition to creating capital returns, Aviva has continued to invest, most notably with the purchase of insurance firm Probitas for £242 million. This acquisition marked Aviva’s re-entry into Lloyd’s of London market after an absence of more than 20 years. In a recent conversation with Bloomberg News, Blanc declared that the acquisition filled a market gap they had identified, and offered Aviva a remarkable new opportunity for distribution, further solidifying their position in the insurance sector.
Regarded as an attractive sector, Blanc also mentioned that there has been consistent consolidation in the insurance industry over the past few decades and predicted it will continue. By the morning of 8th January, Aviva shares had surged to a high of 4.5% in early London trading.
Aviva saw a net increase of £8.3 billion in its wealth business, which contributed to a 15% boost to the assets under management, raising the amount to £170 billion.