LONDON (Reuters) – British insurer Aviva (AV.L) expects to spend three billion kilos in excess cash over the next two years, the majority of it in 2018, the insurer mentioned on Thursday.
It expects to deploy 2 billion kilos next yr, through spending 900 million kilos on repaying debt, making “bolt-on” acquisitions and returning cash to shareholders, it mentioned in a commentary forward of an investor day in Warsaw.
“After a few years of restructuring, our businesses are now high quality and we expect good, sustainable growth from each of them,” leader government Mark Wilson mentioned.
Insurers and reinsurers were giving cash again to shareholders as robust pageant cuts alternatives for enlargement.
Aviva has mentioned it’s only searching for small acquisitions following its five.6 billion pound acquire of Friends Life in 2015.
Aviva mentioned it was once elevating its expectancies for income expansion to greater than five % yearly from 2019 onwards, from a prior goal of mid-single digit expansion.
It additionally mentioned it will build up its dividend pay-out ratio to 55-60 % of income according to percentage through 2020, from a prior 50 %.
The new objectives have been “achievable”, JP Morgan analysts mentioned in a notice, reiterating their “overweight” score at the inventory.
Reporting through Carolyn Cohn