Phoenix Group discontinues Sunlife sale as firm reports profit boost

FTSE 100 pensions giant Phoenix Group said that it had “discontinued” the Sunlife sale process as the firm reported a solid increase in profit in the first half.

The firm said it had stopped the sale due to “current uncertainty in the protection market” and would instead seek to “focus on enhancing the value it generates within the group”.

Sunlife is a major provider of financial protection products, including life insurance, directly to Britons aged over 50.

Phoenix bought Sunlife and the rest of French firm Axa’s UK investment, pensions and insurance businesses for £375m back in 2016. The business was put up for sale back in June after a strategic review concluded it was “no longer core” to Phoenix’s strategy.

The announcement came alongside Phoenix’s financial results for the first half of the year.

Adjusted operating profit increased 15 per cent to £360m, up from £313m last year. The firm said this was driven by “profitable growth” in its pensions & savings arm as well as its retirement solutions business.

Operating cash generation rose 19 per cent to £647m, which Phoenix put down to “strong delivery of recurring management targets”.

Its total cash generation in the period hit £950m with the firm expressing confidence that it would deliver at the “top-end” of its £1.4-£1.5bn target for the 2024 financial year.

Boss Andy Briggs said he was “pleased with the initial progress” against Phoenix’s three year plan.

The firm has set an operating cash generation target of £1.4bn for 2026 alongside an adjusted operating profit target of £900m.

“I am confident that as we continue to execute on our strategy we are building a growing business that is on track to deliver our financial targets and create shareholder value,” he said.

Phoenix announced an interim dividend of 26.65p per share, a 2.5 per cent increase compared to last year.