Standard Life sees profits dip in prelim results

David Nish, chief executive at Standard Life, said 2009 had been a "successful year" for the firm, with it building a strong platform for future profitable growth.

The firm reported that UK operating profit on an EEV basis shrank by £152m from £658m in 2008 to £506m in 2009. Yet, it saw total assets under administration grow by 13 per cent to £177.6bn in 2009 from £156.8bn in 2008.

Net flows into its UK life & pensions operations increased by 43 per cent to £1.2bn, compared with £848m in 2008, as assets under administration grew to £105.6bn from £94.8bn. It said individual pensions net inflows had slowed to £328m from £550m in 2008, as self-invested personal pensions (Sipp) net inflows shrank to £1.8bn from £2.5bn in 2008, fuelled by a reduction in transfer values.

Mutual funds saw net inflows of £795m, more than double the previous year's reported £339m., it said driven by growth in customer number of the Wrap and Fundzone platforms.

Standard Life said the number of customers using the Wrap platform increased to 31,600 at 31 December 2009, while the number of IFAs also increased to 583 in 2009 from 409 at the end of 2008. Total funds on the platform more than doubled to £3.6bn compared with £1.7bn at the end of 2008.

Mr Nish said: "Today's [10 March] announcement highlights good profits and healthy cash flow for the year, and the ongoing delivery of efficiency savings in our business despite the difficult and uncertain year for financial markets.

"We continued to grow customer assets generated further value from back book management, and maintained a robust capital positions though our disciplined approach to risk management."

Mr Nish added: "Standard Life starts 2010 in a good position. We will continue to drive shareholder value through being a customer-centric business, focused on long-term savings and investments propositions.

"We are stepping up our investment in our leading corporate and retail propositions during 2010 and are excited by the many opportunities across our markets."

Mr Nish said a greater focus on efficiency would also help to improve margins, helping the firm to increase profits "more strongly".

The sale of Standard Life Bank and its policy on managing mortgage exposure reduced gross lending by 74 per cent to £281m in 2009, compared with £1.1bn in 2008.

The group said it saw realised £47m in annual efficiency savings during 2009, which included the alignment of its UK distribution and marketing operating models with strategic objectives, leading to a headcount reduction of approximately 200 and a reduction in associated overheads.