Legal & General announces £500m buyback as annual profits rise

(Sharecast News) - Financial services group Legal & General has announced plans to buy back £500m of shares this year after a strong financial performance in 2024, as part of plans to return more than £5bn to shareholders within three years. "We stated at our Capital Markets Event that we intended to return more to shareholders and that is exactly what we are doing," said chief executive António Simões. "Our clear capital allocation framework supports our plan to return over £5 billion over the next three years, through dividends and buybacks," he said.

The share repurchase follows a £200m buyback in 2024 and an already announced £1bn buyback which will commence after the sale of its US protection business. In total, the £5bn, three-year distribution will equal to around 40% of L&G's market capitalisation.

The company also declared a final dividend of 15.36p, taking the full-year payout to 21.36p, up 5% over 2023. L&G intends to scale back dividend-per-share growth to 2% per annum between 2025 and 2027.

Core operating profits were up 6% last year at £1.62bn - in line with recent guidance - with a decline in asset management profits outweighed by growth in the retail and institutional retirement divisions.

For 2025, the asset management division is said to have had a "positive start" to the year with flows into higher margin products. L&G also expects strong volumes in institutional retirement and a "thriving" retail annuities market.

"Looking ahead, our momentum demonstrates why we are confident in our ability to deliver on our ambitious targets, directing our capital and expertise where they can create lasting value, and making a meaningful impact for customers, shareholders and communities," Simões said.