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    LGEN   GB0005603997

LEGAL & GENERAL PLC

(LGEN)
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Legal & General : Half year results 2021

08/04/2021 | 05:36am EDT

DocuSign Envelope ID: C85DE488-0F27-4675-9D0E-E6B0EE497E92

Legal & General Finance PLC

Interim report for the six months ended 30 June 2021

HY 2021

Legal & General Finance PLC 02338444

DocuSign Envelope ID: C85DE488-0F27-4675-9D0E-E6B0EE497E92

LEGAL & GENERAL FINANCE PLC CONTENTS

Page

  1. Directors' Report
  2. Income Statement
  3. Balance Sheet
  4. Statement of Changes in Equity
  5. Notes to the Financial Statements

Registered Office

One Coleman Street

London

EC2R 5AA

Registered in England and Wales number 02338444

2

DocuSign Envelope ID: C85DE488-0F27-4675-9D0E-E6B0EE497E92

LEGAL & GENERAL FINANCE PLC

DIRECTORS' REPORT

Principal activities and business review

The principal activity of the Company throughout the period was to operate as a finance company.

The Company's prime objective is to provide funding to Legal & General Group Plc and its global subsidiaries ("the group"). It does this by raising finance from capital markets. In fulfilling this role, the Company issues listed debt through Legal & General Group Plc's £5bn Euro Note Programme and the Company's US $2bn Commercial Paper Programme. All of the Company's issued listed debt under these programmes is guaranteed by Legal & General Group Plc.

The directors review a range of performance indicators to monitor the performance of the Company. Profit before income tax and net assets are regarded as the principal key performance indicators.

The profit before income tax of the Company for the six month period up to 30 June 2021 was £8.8m (H1 20: £5.8m; FY 20 £11.4m) mainly reflecting interest income from loans to other group companies. Net assets as at 30 June 2021 were £24.4m (HY 20: £12.7m; FY 20 £17.3m).

The group and its global subsidiaries recognise that companies have an obligation to ensure that their business and supporting supply chains are slavery free.

Legal & General's full modern slavery statement can be found at www.legalandgeneralgroup.com/csr/modern-slavery-statement/.

Principal risks and uncertainties

The Company's business involves the acceptance and management of risk. The principal risks and uncertainties facing the Company are given below. These uncertainties are unchanged from the year ended 31 December 2020 and are explained in detail in note 18 of the Company's Annual Accounts for the year ended 31 December 2020.

a) Market infrastructure

The Company's investment and fund raising activities are reliant upon the availability of market infrastructure. The loss of a major financial centre may have a significant effect on the Company's operation and profitability.

b) Counterparties

A number of major banks operate as counterparties for the investments of the Company. Whilst the Company ensures that it only transacts with strongly rated counterparties and it regularly reviews its exposures, the financial failure of a significant counterparty could result in disruption and financial loss.

c) Liquidity and cash flow

Liquidity risk is the risk that the Company, though solvent, either does not have sufficient liquid financial resources available to enable it to meet its obligations as they fall due, or can only secure such liquid financial resources at an excessive borrowing cost relative to that achieved in the recent past by a comparably rated borrower or through the sale of illiquid assets at a price significantly below the fair value of such assets in the recent past. This risk can arise from adverse market conditions or an unexpected event that causes liquidity stress in other entities within the group.

Our regulatory and legislative landscape also continues to evolve, including the impact of the UK's exit from the European Union ("EU"). The Company's activity base is in the UK and US. We therefore have limited direct exposure to the EU should the UK's financial services regime not be assessed as equivalent by the EU.

Covid-19 lockdowns have resulted in considerable disruption to the global economy, and whilst vaccines and treatments offer hope for a return to economic growth areas of uncertainty remain including future virus mutations and the long-term efficacy of vaccines. There is also significant short and medium term uncertainty for interest rates, inflation and foreign exchange, and the approaches that central banks may take to stimulate economic growth, including the deployment of negative interest rates.

Statement of Directors' Responsibilities

The directors confirm that these condensed interim financial statements have been prepared in accordance with UK-adopted International Accounting Standard 34, "Interim Financial Reporting", as issued by the IASB and that the Director's Report contains a true and fair review of the assets, liabilities and financial position of the Company. The report also includes a fair review of the information required by DTR 4.2.7, namely an indication of important events that have occurred during the first six months of the year 2021 and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the financial year.

A. Fairhurst

For and on behalf of Legal & General Co Sec Limited

G. O'Neill

Company Secretary

Director

Date: 3 August 2021

Date: 3 August 2021

3

DocuSign Envelope ID: C85DE488-0F27-4675-9D0E-E6B0EE497E92

LEGAL & GENERAL FINANCE PLC

INCOME STATEMENT

For the six month period to 30 June 2021

6 months

6 months

Full year

2021

2020

2020

£m

£m

£m

Finance and similar income

Income from investments in group undertakings

33.2

28.3

59.7

Investment return

0.4

5.1

3.9

33.6

33.4

63.6

Finance and similar costs

Interest paid to group undertakings

(5.3)

(7.3)

(12.5)

Other finance costs

(17.6)

(18.6)

(36.5)

(22.9)

(25.9)

(49.0)

Administrative expenses

(1.9)

(1.7)

(3.2)

Profit before income tax

8.8

5.8

11.4

Income tax expense

(1.7)

(1.2)

(2.2)

Profit for the period

7.1

4.6

9.2

There was no other comprehensive income for the period. The profit for the period attributable to owners of the Company reflects the total comprehensive income of the Company.

4

DocuSign Envelope ID: C85DE488-0F27-4675-9D0E-E6B0EE497E92

LEGAL & GENERAL FINANCE PLC

BALANCE SHEET

As at 30 June 2021

Notes

As at

As at

As at

30 Jun 2021

30 Jun 2020

31 Dec 2020

£m

£m

£m

Non-Current Assets

Financial investments

601.2

601.2

601.2

Receivables

300.0

300.0

300.0

Current Assets

Financial investments

2

1,422.5

1,394.4

1,827.0

Receivables

823.5

580.2

713.9

Cash and cash equivalents

100.7

363.7

102.2

2,346.7

2,338.3

2,643.1

Total Assets

3,247.9

3,239.5

3,544.3

Non-Current Liabilities

Borrowings

3

598.3

598.2

598.2

Other payables and financial liabilities

300.0

300.0

300.0

Current Liabilities

Borrowings

3

58.9

108.9

61.6

Other payables and financial liabilities

2,266.3

2,219.7

2,567.2

2,325.2

2,328.6

2,628.8

Total Liabilities

3,223.5

3,226.8

3,527.0

Net assets

24.4

12.7

17.3

Equity

Share capital

-

-

-

Retained earnings

24.4

12.7

17.3

Total Equity

24.4

12.7

17.3

The notes on pages 7 to 9 form an integral part of these financial statements.

The financial statements on pages 4 to 9 were approved by the Board of directors on 3 August 2021 and were signed on its behalf by:

G. O'Neill

Director

3 August 2021

5

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Legal & General Group plc published this content on 04 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 August 2021 09:35:09 UTC.


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Financials
Sales 2021 59 567 M 81 616 M 81 616 M
Net income 2021 1 982 M 2 716 M 2 716 M
Net Debt 2021 1 114 M 1 526 M 1 526 M
P/E ratio 2021 8,46x
Yield 2021 6,51%
Capitalization 16 724 M 22 927 M 22 914 M
EV / Sales 2021 0,30x
EV / Sales 2022 0,26x
Nbr of Employees 10 099
Free-Float 97,3%
Chart LEGAL & GENERAL PLC
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Technical analysis trends LEGAL & GENERAL PLC
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TrendsNeutralNeutralBullish
Income Statement Evolution
Consensus
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Mean consensus OUTPERFORM
Number of Analysts 19
Last Close Price 2,82 GBX
Average target price 318,81 GBX
Spread / Average Target 11 213%
EPS Revisions
Managers and Directors
Nigel David Wilson Group Chief Executive Officer & Executive Director
Jeff Davies Group Chief Financial Officer & Executive Director
John Kingman Chairman
Lesley Mary Samuel Knox Independent Non-Executive Director
Philip Arthur John Broadley Senior Independent Director
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