Phoenix Group, the insurance consolidation company which has attracted the interest of private equity, reckons it is doing just fine as an independent company after a year of 'considerable progress' in 2011, though the group's finance costs remain a concern.
Net income in 2011 declined to £6,490m from £7,543m in 2010, while profit before finance costs and tax dipped to £247m from £280m the year before. Those finance costs are not inconsiderable, however, clocking in at £251m in 2011 and £269m in 2010.
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Operating earnings before tax on a Market Consistent Embedded Value (MCEV) eased to £535m in 2011 from £754m the year before. MCEV operating earnings after tax were lower at £394m (2010: £543 million) primarily due to a decrease in the long-term risk-free rate and the non-recurrence of significant positive experience variances in 2010.
On an international financial reporting standards (IFRS) basis, operating profit before tax grew to £387m in 2011 from £373m in 2010.
Chairman Ron Sandler announced his intention to resign this year once an appropriate replacement has been found.
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