News
Aviva plc: Aviva announces restatement of interim 2008 and full year 2007 results on an MCEV basis
04 February, 2009
MCEV is the next step in evolving embedded value reporting
- Greater transparency and comparability
- A shareholder's perspective on value
- A market consistent approach to financial risk
- A greater focus on disclosure of cash being generated by the business
- Explicit allowances for non-hedgeable risk
MCEV does not change the economics of our business, just the timing of profit recognition
- General insurance, IFRS and solvency reporting is unchanged
- The dividend paying capacity remains unchanged
- Long term savings IRRs remain broadly unchanged
- Restatement impact on equity shareholders funds: 1% decrease for 2007 and 7% decrease for mid 2008, due to volatile markets
Aviva is a well-diversified group with a strong balance sheet on any measure
Aviva plc ("Aviva") announces the restatement of its supplementary financial information on a Market Consistent Embedded Value basis (MCEV). A presentation for investors and analysts will take place today covering the group's 2008 long-term savings new business sales and the restatement of the full year 2007 and the half year 2008 results on an MCEV basis. This presentation takes place ahead of the group's full year results, which will be announced on 5 March.
Philip Scott, chief financial officer said, "Embedded value remains key to measuring the performance of long-term business. MCEV is an important step forward in increasing the transparency of our business and we have provided significantly more information and improved our disclosures.
"The adoption of MCEV does not change the economics of our business, but it does change the timing of when we report the profit that we earn from writing long-term savings business. MCEV does not affect our statutory results, our regulatory capital position or our dividend paying capacity."
Worldwide Highlights
| MCEV Restated 6 months 2008 | EEV Reported 6 months 2008 | MCEV Restated Full year 2007 | EEV Reported Full year 2007 | |
|---|---|---|---|---|
| Reviewed | Reviewed | Audited | Audited | |
| Equity shareholders' funds | £17,389m | £18,672m | £19,998m | £20,253m |
| Net asset value per share | 654p | 702p | 763p | 772p |
| Operating profit before tax | £1,509m | £1,719m | £3,065m | £3,286m |
| (Loss)/profit after tax | £(2,361)m | £(1,275)m | £1,946m | £2,134m |
| Life and pensions PVNBP | £18,214m | £17,283m | £32,722m | £31,600m |
| Value of new business gross of tax and minority interests | £352m | £488m | £897m | £912m |
| New business margin1 | 1.9% | 2.8% | 2.7% | 2.9% |
- New business margin is based on the value of new business gross of tax and minorities over PVNBP.
Enquiries:
| Analysts | ||
| Charles Barrows | Investor relations director | +44 (0)20 7662 8115 |
| Jessie Burrows | Head of investor relations | +44 (0)20 7662 2111 |
| Susie Yeoh | Senior investor relations manager | +44 (0)20 7662 2117 |
| Media: | ||
| Hayley Stimpson | External affairs director | +44 (0)20 7662 7544 |
| Sue Winston | Head of group media relations | +44 (0)20 7662 8221 |
| Danielle Anthony | Senior group media relations manager | +44 (0)20 7662 9511 |
| Vanessa Rhodes | Senior group media relations manager | +44 (0)20 7662 2482 |
| James Murgatroyd / Ed Simpkins | Finsbury | +44 (0)20 7251 3801 |
Analysts:
A presentation to investors and analysts, covering both the long-term savings new business announcement and the restatement of 2007 results onto an MCEV basis, will take place at 1000 hrs (GMT) at St Helen’s, 1 Undershaft, London, EC3P 3DQ. The investor and analyst presentation is being filmed for live webcast and can be viewed on the group’s website or on www.cantos.com. In addition, a replay will be available on these websites later today. There will also be a live teleconference link to the investor and analyst meeting on +44(0)20 7138 0818. A replay facility will be available until 17 February 2009 on +44 (0)20 7806 1970. The pass code for the whole presentation, including the question and answer session, is 5463049# and for the question and answer session only the pass code is 4478829#.
The presentation slides will be available on the group's website from 0930 hrs (GMT).
The Aviva media centre includes images, company information and news release archive. Photographs are available on the Aviva media centre at www.aviva.com/media.
Download full announcement PDF (1.58Mb)
Notes to editors
- Aviva is a leading provider of life and pensions to Europe with substantial positions in other markets around the world, making it the world’s fifth largest insurance group based on gross worldwide premiums at 31 December 2007.
- Aviva’s principal business activities are long-term savings, fund management and general insurance, with worldwide total sales* of £49.2 billion at 31 December 2007 and total funds under management of £359 billion at 30 June 2008.
*Based on 2007 published life and pensions PVNBP on an EEV basis, total investment sales and general insurance and health net written premiums including share of associates' premiums. - Embedded value is a method of reporting the economic value of life insurance business. This information helps investors to value life insurance companies.
