Image source: © 2025 Krish Capital Pty. Ltd.

Highlights

  • IFRS adjusted operating profit increased 25% year-on-year, with pensions, savings, and retirement solutions businesses contributing.

  • Assets under administration rose to £187.9 billion, supported by net inflows and customer engagement initiatives.

  • £2.6 billion of cash generated so far against the £5.1 billion three-year target for 2024–2026.

Phoenix Group Holdings plc (LSE:PHNX) has announced its interim results for the first half of 2025, reporting year-on-year growth in profit and assets while progressing on its strategic priorities of growth, optimisation, and operational transformation.

For the six months ended June 2025, the Group delivered a 20% increase in IFRS adjusted operating profit from its pensions and savings business to £179 million, supported by cost efficiencies and margin improvements. Assets under administration grew 5% to £187.9 billion, with workplace inflows of £2.8 billion and retail net outflows improving to £4.4 billion.

In retirement solutions, IFRS adjusted operating profit rose 36% to £286 million, reflecting portfolio management actions and cost discipline. Bulk purchase annuity (BPA) volumes for the half stood at £0.3 billion, with £3.2 billion written or exclusive year-to-date, including the Group’s largest ever deal worth £1.9 billion completed in July. Individual annuity premiums reached £0.6 billion compared with £0.5 billion in the same period last year. The Group continues to expect to deploy up to £200 million of capital into annuities in 2025.

Across its strategic priorities, Phoenix recorded progress in customer engagement and product expansion. Regulatory approval was obtained for an in-house retail advice proposition, and the Standard Life Annuity Desk was launched to enhance digital experience. The portfolio of retirement income solutions was completed with the launch of a Guaranteed Lifetime Income plan.

On optimisation, the Group advanced the management of annuity-backing assets, with £5 billion now managed in-house and preparations underway to in-house a further £20 billion. Recurring management actions generated £294 million in the half, up from £264 million in the prior year. Debt reduction also continued, with USD 250 million repaid in February.

Operating model transformation remained on track, with cumulative cost savings reaching £100 million and full-year 2025 savings now expected at £160 million. Key milestones included migrating 0.8 million policies to the TCS BaNCS platform and a strategic partnership with Wipro to manage 1.9 million policies.

On financial targets, the Group delivered 9% growth in operating cash generation year-on-year, contributing to £2.6 billion of cash achieved to date against a three-year goal of £5.1 billion for 2024–2026. The Shareholder Capital Coverage Ratio stood at 175% at the end of the period, within the operating range of 140–180%, while the leverage ratio improved to 34%.

Looking ahead, Phoenix confirmed it is on track to meet all its 2026 financial targets, including delivery of around £1.1 billion of IFRS adjusted operating profit and £250 million in annual cost savings. Planned priorities for the second half include the launch of the retail advice proposition, further progress in annuity asset in-housing, migration of an additional 1.1 million policies, and the introduction of the Smooth Managed Fund on the Quilter platform.