Phoenix Share Discussion Threads

[jonwig] 13/4/2018 08:48

@ stun12 - thanks for clarification!

[stun12] 13/4/2018 08:41

Hi Jonwig. Phoenix is actually rated at 'A' at Fitch, but these are Tier One securities i.e. quasi-equity and are subordinate to regular issuance.

[jonwig] 13/4/2018 07:13

Timetable:

Further to the announcement of the proposed acquisition of Standard Life Assurance on 23rd February 2018, Phoenix expects to publish a combined circular and prospectus on or around 4th May 2018 and the shareholder vote will follow at a general meeting to be held on 29th May 2018.

The rest of the RNS is about debt issuance. They give a Fitch rating of BBB-: "medium class companies, which are satisfactory at the moment". So BBB- is the lowest investment grate rating.

[edmundshaw] 06/4/2018 10:05

Well, when I was 35 I had never grown food and eaten it (unless you count bean sprouts). First time was when I had a house with a garden in my late 30s.

And bicycle tyres are thicker, car tyre treads are thicker, and at 65 you have probably had more punctures than at 18. Duh!

And boiling an egg is so twentieth century...

[lauders] 06/4/2018 08:03

Hmm... Some worrying stats re: the new generation. One day no doubt many simple chores will be robot replaced/assisted and no human will remember how to perform them:

According to the survey:

Fifteen percent of 18-35 year olds have never boiled an egg compared to 3% of over
65s

A massive 41% have never changed a fuse compared to 13% of over 65s

25% have never sewn or repaired clothes compared to 17% of over 65s

41% of millennials have never eaten food that they’ve grown, compared to 19% of
over 65s

63% haven’t changed a tyre, compared to 47% of the over 65s

11% have never hand-written a letter, compared to 3% of over 65s

[topvest] 31/3/2018 18:05

Phoenix have become the premier closed-end life vehicle in the UK with the AXA and forthcoming Standard Life deal. Quite a transition from the ove- leveraged vehicle that I originally invested in about 5 years ago. Happy to hold.

[lauders] 31/3/2018 01:46

Thank you jonwig! I see your point and believe it is probably more positive than negative. Wind farms have been a no-go area for me as I am cautious on them as investments but the BOD must have done their homework prior to any decisions and are convinced of the investment logic. They don't strike me as risk-takers!

[jonwig] 29/3/2018 15:42

Lauders - good I think. PHNX holds loads of cash as reserves to pay maturing policies. Gilts have yielded so little that they've already said they want to diversify - corporate bonds, etc. This looks pretty safe, and it's secured debt financing not equity.

[lauders] 29/3/2018 15:22

Can't decide whether this is good news or not:

Phoenix invests £27 million in renewable energy project

[skinny] 27/3/2018 16:48

The Company's Annual General Meeting will be held at Stationers' Hall, Ave Maria Lane, London, EC4M 7DD on Wednesday 2 May 2018 at 10.00 a.m (British Summer Time).

[cwa1] 22/3/2018 08:06

XD today, payable 4/5/18.

[lauders] 21/3/2018 15:09

Phoenix Group strengthens Executive Committee with three
appointments

[speedsgh] 16/3/2018 11:03

Phoenix follows Standard Life tie-up with new acquisition -

Phoenix, which crunches together old insurance books, is in talks to buy another business.

The development comes weeks after Phoenix revealed its biggest deal to date, a £3.2 billion transaction to buy the majority of Standard Life Aberdeen’s insurance business and become Europe’s largest manager of books of mature business.

Clive Bannister, Phoenix’s chief executive, said the likely acquisition, over which the company is in exclusive talks, would be much smaller. It is to buy a so-called bulk annuity business, where insurers take over final salary pension schemes from companies which no longer want to manage the risk of meeting their obligations to pay out promised sums to pensioners...

[jonwig] 16/3/2018 06:40

edmundshaw - agree about the dividend policy. 'Strong and stable' ... but without any irony!

Something in the results which has hardly been mentioned - possible purchase of a bulk annuity book. Could this be Equitable Life, or have I got the wrong kind of business?

[edmundshaw] 15/3/2018 13:58

The company gives what it says it will give with dividends. If they generate more cash than expected the policy seems to be to keep it for the next acquisition, or to elongate dividend sustainability. So for me the dividend is exactly as expected. And next year it will be almost exactly 3% higher as epcected. And after that it will probably rise only on further acquisitions.

If you want racy, this is not a good share. If you want dependable good performance I think this is a good bet, and currently rather undervalued (which of course we hope will correct!) given the extended sustainability of cashflow and the tightening central banks.

[stun12] 15/3/2018 09:54

Picked a few more up in the mid 770s. I thought that the divi was much as expected given the higher share count after the last rights issue?

[sogoesit] 15/3/2018 08:58

Disappointed in the dividend declaration so I expect a partial share price retrace.

[speedsgh] 15/3/2018 08:32

For some reason results announcement is not currently showing on Investegate website...

2017 Highlights
· £653 million of cash generation2 (2016: £486 million). The Group now expects to achieve the top end of the £1.0 - 1.2 billion cash generation target range for the two year period between 2017 - 2018.
· Solvency II surplus of £1.8 billion3 as at 31 December 2017 (£1.1 billion as at 31 December 2016).
· Shareholder Capital Coverage Ratio of 164% as at 31 December 20174 (139% as at 31 December 2016).
· Group operating profit of £368 million (2016: £351 million).
· Proposed final dividend of 25.1p per share, a 5% increase on the 2016 final dividend.
· Credit rating upgrade from Fitch Ratings achieved in July 2017, with the rating reaffirmed following the announcement of the proposed Standard Life Assurance acquisition.
· Strong 92% customer satisfaction score.

Integration of acquisitions substantially complete
· Integration of the AXA Wealth and Abbey Life businesses is substantially complete, ahead of plan.
· 2017 cash generation of £165 million from the AXA Wealth business (£282 million of cash generation to date since completion of the AXA Wealth acquisition) and £236 million from Abbey Life.
· Combined cost savings of £27 million per annum delivered against a target of £17 million per annum.

2018 Outlook
· New long-term cash generation target for 2018 - 2022 of £2.5 billion.
· Proposed acquisition of Standard Life Assurance and Strategic Partnership with Standard Life Aberdeen plc due for completion in Q3 2018, subject to regulatory approval.
· In exclusive talks on first Bulk Purchase Annuity transaction.
· Final stage of onshoring project to complete as soon as practicable after Standard Life Assurance transaction.

Commenting on the results, Group CEO, Clive Bannister said:
"Phoenix has enjoyed a highly successful year. The Group continues to deliver strong cash generation and remains on track to achieve its targets, supported by capital and cost synergies from the integration of the AXA and Abbey Life acquisitions which are now substantially complete. Our success with integrating both acquisitions demonstrates our ability to deliver benefits for both investors and policyholders alike.

Our proposed acquisition of Standard Life Assurance and the Strategic Partnership with Standard Life Aberdeen plc announced last month is consistent with our strategy and value accretive. We look forward to welcoming Standard Life Aberdeen as a 19.99% shareholder in the enlarged Group. It will make Phoenix the pre-eminent closed fund consolidator in Europe and deliver increased size in an industry that rewards scale. We remain committed to maintaining a high level of customer service throughout this acquisition and transition process."

[hvs] 15/3/2018 07:17

Very good statement and good opportunities going forward.

[lauders] 10/3/2018 01:35

Would be nice for pensioners if the Government actually address the cold calling matter quickly and DOES bring the ban into play:

Good to see that "Three in four (75%) of our policies are now receiving an annual bonus (up from less than 40% four years ago)" per PHNX's March 1st release here:

[fenners66] 07/3/2018 22:18

So economics has a way of self balancing , supply and demand , here's an idea, life expectancy up, government deficits up, more borrowing to pay for more pensioners, interest rates down to cope with deficits and fix the economies, gilt yields down , pensioners incomes down, pensioners switch of heating (apparently 3000 people a year die because of this) , life expectancy falls , funds release makes up for low gilt yields..... what's next ?

[jonwig] 07/3/2018 14:41

@ boonkoh - yes, it seems evident from the quotes above. Their H1 results were a bit unclear (to me!) in that they gave some indication of solvency benefits but not, I think, cashflow.

It's also the case that life cos suffered from low gilt yields (hold lots of bonds, get lower coupon reinvesting when they mature), so rising yields can help. But equity falls won't be a help at all, if - when.

[boonkoh] 07/3/2018 14:11

Jonwig, so is it fair to say PHNX should also see the benefits from revised life expectancy projections?

[jonwig] 07/3/2018 08:36

FT comment re L&G:

... set to benefit from a slowing, if not a shortening, of our future life expectancy.

Back in August, Legal & General reported a £126m boost to its half-year operating profit simply because the long-term trend of increasing life expectancy had slowed. This allowed it to adjust its reserves to take account of these new assumptions about mortality.

This morning, it updated that figure for the full year: a £332m increase to profit from those mortality changes - exactly in line with forecasts from analysts at RBC Capital Markets.
...

Back in August, Legal & General reported a £126m boost to its half-year operating profit simply because the long-term trend of increasing life expectancy had slowed. This allowed it to adjust its reserves to take account of these new assumptions about mortality.

This morning, it updated that figure for the full year: a £332m increase to profit from those mortality changes - exactly in line with forecasts from analysts at RBC Capital Markets.