LONDON May 2 British life insurer Legal &
General outpaced expectations on sales and cash
generation in the first quarter of 2012 as its products were
snapped up investors and ageing savers putting more aside for
The firm said in a trading statement on Thursday total sales
for the group were up nearly a third from a year earlier to 555
million pounds during the three months to March 31, well ahead
of market forecasts of 499 million pounds.
Net cash generation rose by a fifth to 249 million pounds,
also ahead of a 244 million pounds forecast, as L&G's businesses
gained scale globally.
Management said the firm wants to invest in more expansion
in foreign markets, seeking to harness trends such as ageing
populations, the retreat of governments from pension provision
and a more internationalised investment industry.
The quarter saw L&G make two merger deals: buying out the 75
percent of investment fund supermarket Cofunds it did not
already own, and the acquisition of a 46.5 percent stake in UK
housebuilder Cala Group from Lloyds Banking Group.
The firm is on the look out for more such transactions,
Chief Executive Nigel Wilson said in a conference call with
journalists, though he stressed any deals will be bolt on,
rather than transformational.
"We have successfully executed two M&A deals and we have the
capital, the capability and the appetite to do more to enhance
growth," he said.
Wilson said the company is also looking to make direct
infrastructure investments in the UK, providing capital at a
time when banks are retrenching in the wake of the financial
Infrastructure has become popular with institutional and
individual investors because it can provide steady income
streams from sources such as road tolls and inflation-indexed
Investing in infrastructure is also increasingly encouraged
by governments seeking to boost private sector financing as they
struggle to cut spending and limit public debt.
Wilson said the company was "engaging positively" with
authorities over its interest in putting money directly into
areas such as housebuilding, urban regeneration, and energy.
"There's a lot of required infrastructure assets in the UK
we'd be delighted to increase our investment in," Wilson said.
Among its strongest performing units, the savings business
saw a 20 percent jump in sales to 366 million pounds with assets
under administration reaching 74 billion pounds, the company
The firm's investment management arm saw net inflows of new
money more than double from a year earlier to 5.5 billion pounds
during the quarter, taking assets under management to 441
Much of the new money came from international clients in the
United States, Gulf and Europe, the company said.