More on St James Place
St James’s Place :H1 Results
St James’s Place, the life assurance company reported a 14% increase in operating profits (on an achieved profit basis) and a 15% increase in new business APE for the six months to June 2005. Funds under management rose to £10.5bn, up 22% from a year ago.
Helped by strong investment returns (£22.6m against £3.5m last year) pre-tax profits (on an achieved profits basis) rose 71% to £70.2m.
The company considers that reporting on an achieved profit basis (the traditional reporting basis for UK life assurers, sometimes known as embedded value) more meaningful and much of the commentary is on the achieved profit results although the IFRS figures are also available. On an IFRS basis, the results still look healthy with operating profits up 47% to £13.1m.
Following a somewhat desultory first quarter, new business APE in the second quarter has grown by 29%. Pension products grew by 39%, investment products by 34% while protection products declined by 12% compared to last year.
The outlook for life assurers in general has been improving and the slowing house market should contribute further as investors seek alternative avenues. St James’s, as we have pointed out before, is far more conservative in its management than its peers, the lower risk justifying the premium attached to this share.
The share trades at 227.75p, on a prospective PE of 14.5x (2005 earnings), with a yield of 1.3%.
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