European Embedded Value Supplementary Information
for the six months ended 30 June 2006
1 Summary income statement on a European embedded value basis
|
£m
|
|||
|
6 months ended
30 June 2006 |
6 months ended
30 June 2005 |
Year ended
31 December 2005 |
|
|
South Africa |
|||
|
Covered business |
266
|
262
|
579
|
|
Asset management |
55
|
37
|
85
|
|
Banking |
274
|
176
|
421
|
|
General insurance |
42
|
49
|
102
|
|
|
637
|
524
|
1,187
|
|
United States |
|||
|
Covered business |
67
|
83
|
122
|
|
Asset management |
59
|
50
|
118
|
|
|
126
|
133
|
240
|
|
Europe |
|||
|
Covered business |
183
|
-
|
-
|
|
Asset management |
3
|
(2)
|
(4)
|
|
Banking |
6
|
-
|
-
|
|
|
192
|
(2)
|
(4)
|
|
Other |
9
|
10
|
20
|
|
|
9
|
10
|
20
|
|
Finance costs |
(63)
|
(19)
|
(37)
|
|
Other shareholders' income / (expenses) |
(16)
|
(8)
|
(19)
|
|
Adjusted operating profit* |
885
|
638
|
1,387
|
|
Adjusting items |
87
|
276
|
636
|
|
Profit before tax (net of income tax attributable to policyholder returns) |
972
|
914
|
2,023
|
|
Income tax attributable to shareholders |
(241)
|
(218)
|
(485)
|
|
Profit for the financial period |
731
|
696
|
1,538
|
|
Profit for the financial period attributable to: |
|||
|
Equity holders of the parent |
561
|
590
|
1,281
|
|
Minority interests |
|||
|
Ordinary shares |
144
|
78
|
205
|
|
Preferred securities |
26
|
28
|
52
|
|
Profit for the financial period |
731
|
696
|
1,538
|
* For long-term and general insurance business, European Embedded Value (EEV) adjusted operating profit is based on the expected investment return, includes investment returns on life funds' investments in Group equity and debt instruments and is stated net of income tax attributable to policyholder returns. For all businesses, EEV adjusted operating profit excludes goodwill impairment, the impact of acquisition accounting, initial costs of Black Economic Empowerment schemes, profit / (loss) on disposal of subsidiaries, associated undertakings and strategic investments and dividends declared to holders of perpetual preferred callable securities.
Adjusting items comprise:
|
£m
|
|||
|
6 months ended
30 June 2006 |
6 months ended
30 June 2005 |
Year ended
31 December 2005 |
|
|
Income / (expense) |
|
||
|
Goodwill impairment and amortisation of non-covered business acquired intangible assets |
(6)
|
(2)
|
(5)
|
|
Profit / (loss) on disposal of subsidiaries, associated undertakings and strategic investments |
97
|
(4)
|
58
|
|
Short-term fluctuations in investment returns (including economic assumption changes) |
|
||
|
Covered business |
(50)
|
210
|
524
|
|
Other |
24
|
23
|
80
|
|
Cost of capital changes |
-
|
49
|
51
|
|
Initial costs of Black Economic Empowerment schemes |
-
|
-
|
(72)
|
|
Dividends declared to holders of perpetual preferred callable securities |
22
|
-
|
-
|
|
Adjusting items |
87
|
276
|
636
|
Adjusted operating profit after tax attributable to ordinary equity holders is determined as follows:
|
£m
|
|||
|
6 months ended
30 June 2006 |
6 months ended
30 June 2005 |
Year ended
31 December 2005 |
|
|
Adjusted operating profit |
885
|
638
|
1,387
|
|
Tax on adjusted operating profit |
(238)
|
(154)
|
(352)
|
|
|
647
|
484
|
1,035
|
|
Minority interests |
|
||
|
Ordinary shares |
(122)
|
(76)
|
(187)
|
|
Preferred securities |
(26)
|
(28)
|
(52)
|
|
Adjusted operating profit after tax attributable to ordinary equity holders |
499
|
380
|
796
|
|
Pence
|
|||
| Embedded value earnings per share attributable to ordinary equity holders of the parent |
6 months ended
30 June 2006 |
6 months ended
30 June 2005 |
Year ended
31 December 2005 |
|
Adjusted operating earnings per share* |
9.8
|
10.1
|
20.7
|
|
Basic earnings per share |
12.0
|
17.0
|
37.1
|
|
Adjusted weighted average number of shares - millions |
5,063
|
3,753
|
3,840
|
|
Weighted average number of shares - millions |
4,547
|
3,467
|
3,456
|
* EEV adjusted operating earnings per share is calculated on the same basis as EEV adjusted operating profit, stated after tax, and minority interests. It excludes income attributable to Black Economic Empowerment trusts of listed subsidiaries. The calculation of the adjusted weighted average number of shares includes own shares held in policyholders' funds and Black Economic Empowerment trusts.
|
£m
|
|||
|
6 months ended
30 June 2006 |
6 months ended
30 June 2005 |
Year ended
31 December 2005 |
|
|
Adjusted operating profit for the covered business |
516
|
345
|
701
|
|
South Africa |
266
|
262
|
579
|
|
United States |
67
|
83
|
122
|
|
Europe |
183
|
-
|
-
|
|
|
|||
|
Tax on adjusted operating profit for the covered business |
140
|
99
|
191
|
|
South Africa |
72
|
75
|
150
|
|
United States |
22
|
24
|
41
|
|
Europe |
46
|
-
|
-
|
|
|
|||
|
Adjusted operating profit after tax for the covered business |
376
|
246
|
510
|
|
South Africa |
194
|
187
|
429
|
|
United States |
45
|
59
|
81
|
|
Europe |
137
|
-
|
-
|
|
|
|||
|
Reconciliation of tax on adjusted operating profit |
|||
|
Tax on adjusted operating profit for the covered business |
140
|
99
|
191
|
|
Tax on adjusted operating profit for other business |
98
|
55
|
161
|
|
Tax on adjusted operating profit |
238
|
154
|
352
|
