Just Group plc | Annual Report and Accounts 2024
34
business review continued
The Group has approval to apply the matching adjustment and TMTP in its calculation of technical provisions and uses an internal model to calculate its Group Solvency Capital Requirement (“SCR”). In July 2024, the Group received approval to expand the scope of its revised internal model, and applied it to include the Partnership business from 30 September 2024, which previously had its capital requirement calculated using Standard Formula. The application of a full internal model from this date has led to increased diversification benefits between the Group’s two life companies, which has resulted in a reduction in SCR. This one-off effect accounted for 6% of the increase in the capital coverage ratio, and is included in the management actions and other items line in the Movement in Excess Own Funds analysis below. MOVEMENT IN EXCESS OWN FUNDS 1 The business is delivering sufficient cash generation, which augmented with management actions, supports the deployment of capital to capture the significant growth opportunity available in our chosen markets, provide returns to our capital providers and further investment in the strategic growth of the business. The table below analyses the movement in excess own funds, in the year to 31 December 2024.
UNDERLYING EARNINGS PER SHARE Underlying EPS (based on underlying operating profit after attributed tax) has increased to 36.3 pence (2023: 27.9 pence).
Year ended 31 December 2024
Year ended 31 December 2023
Underlying operating profit (£m)
504
377
Attributable tax (£m)
(126)
(89)
Underlying operating profit after attributable tax (£m) Weighted average number of shares (million)
378
288
1,040
1,032
Underlying EPS 1 (pence)
36.3
27.9
1 Alternative performance measure, see glossary for definition.
EARNINGS PER SHARE Earnings per share (based on net profit after tax, see note 10) has decreased to 6.5 pence (2023: 11.3 pence). This includes any operating experience and assumption changes, the non-operating items and deferral of profit to the CSM reserve, and reflects the IFRS 17 statutory profit.
Year ended 31 December 2024 (Proforma) £m
Year ended 31 December 2023 £m
Year ended 31 December 2024
Year ended 31 December 2023
Unaudited
1,527
Opening excess own funds at 1 January Operating In-force surplus net of TMTP amortisation
1,370
Profit before tax (£m)
113
172
Tax (£m)
(33)
(43)
178
168
Profit attributable to equity holders of Just Group Plc (£m) Coupon payments in respect of Tier 1 notes (net of tax) (£m)
Financing costs
(48) (11)
(49)
80
129
Group and other costs Cash generation 2 New business strain 3
(8)
(12)
(12)
119
111
Earnings (£m)
68
117
(71) (25)
(35) (19)
Weighted average number of shares (million)
Development costs and other
1,040
1,032
23 58 81
57 69
Underlying organic capital generation 2 Management actions and other items Total organic capital generation 2
EPS (pence)
6.5
11.3
126
CAPITAL MANAGEMENT The Group’s proforma capital coverage ratio was 204% at 31 December 2024, including a recalculation of transitional measures on technical provisions (“TMTP”) (31 December 2023: 197% including a recalculation of TMTP). The Solvency capital coverage ratio is a key metric and is one of the Group’s KPIs.
Non-operating Strategic expenditure
(17) (23)
(13) (19) (22)
Dividends
Economic movements Regulatory changes
49
Proforma 31 December 2024 1 £m
(42) (14)
109
31 December 2023 1,2 £m
(24)
Capital actions 4
Unaudited
Proforma closing excess own funds 1,527 1 All figures are net of tax and include a formal recalculation of TMTP where applicable. 2 Alternative performance measure, see glossary for definition. Definition of cash generation has been revised in the year and development costs and other are now stated outside of this measure. 2023 cash generation has been restated. 3 New business strain calculated based on pricing assumptions. 1,561 4 Capital actions are the effect of Tier 2 buyback (2023 and 2024) together with the proforma impact of the February 2025 Tier 3 repayment) and includes the positive effect (if any) from release of Solvency tiering restrictions.
Own funds
3,055
3,104
Solvency Capital Requirement
(1,494) 1,561 204%
(1,577)
Excess own funds
1,527 197%
Proforma Solvency capital coverage ratio 3
1 Includes a recalculation of TMTP. 2 2023 capital position is the reported regulatory position as included in the Group’s Solvency and Financial Condition Report as at 31 December 2023. 3 2024 capital position is presented on a proforma basis after the impact of the February 2025 repayment of Tier 3 subordinated debt. As reported in Note 30 the capital ratio at 31 December 2024 was 211% prior to this repayment. The 2024 capital position is estimated.
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