Sales dip but cash generation strong at Legal and General

1st Nov 2011 07:36

Legal and General saw sales drop slightly in the third quarter but the company preferred to focus on its cash generation, which is said remains strong. Operational cash rose to £736m in the three months to the end of September from £628m in the same period a year ago, while net cash generation was up 15% to £631m from £549m."Our strong cash generation means we can fund new business growth whilst increasing our balance sheet strength and at the same time supporting a growing dividend," noted chief executive, Tim Breedon.New business, on an annualised premium equivalent basis, eased 1% to £1,338m from £1,347m the year before. The investment management business's gross new funds fell 4% to £25,103m from £26,065m the year before. On the savings side, savings investment new business rose 14% to £555m from £486m last year, insured savings new business fell 15% to £317m from £372m the year before, while "with-profits" new business dipped 7% to £96m from £103m last year.The shares slipped 3.9p to 106.6p in a falling market following the release of the figures, suggesting the market was mildly disappointed with what Breedon hailed as "another successful quarter from Legal & General."Breedon said: "We remain confident in our growth opportunities despite the continuing uncertainty in the global economic and regulatory environment. This provides challenges for all companies, but Legal & General is well positioned not only to ride out the uncertainty but also to continue to push our businesses forward." NR