02 March 2020

LGIM delivers strong performance in uncertain environment

Business highlights:

  • AUM up 20% at £894.2bn (2015: £746.1bn)
  • Total net flows of £31.2bn (2015: £33.3bn)
  • International net flows of £14.5bn (2015: £9.5bn)

Legal & General Investment Management (LGIM) today announced resilient results for 2016, with operating profit up 3% at £366m (2015: £355m) and total net flows of £31.2bn (2015: £33.3bn). Asset management profit, excluding the one-off adjustment for discontinuing box profits, was up 7%.

External net flows were positive across distribution channels and regions at £29.2bn (2015: £37.7bn). In a challenging year for active managers, LGIM’s active funds delivered consistent strong performance, with the majority outperforming their respective benchmarks over the past one, three and five years1.

Net flows into LGIM’s market-leading Solutions business, including liability-driven investment (LDI) and multi-asset solutions, were strong at £34.7bn (2015: £34.7bn), as pension schemes implemented a wider range of risk-management strategies.

LGIM continues to benefit from the rapid growth of the UK defined contribution (DC) market, with a 23% increase in customers on its Workplace platform to more than 2.2m (2015: 1.8m). Net flows were £2.0bn (2015: £2.9bn) and contributed to £20.8bn of assets on the Workplace platform. The number of pension schemes supported by the DC business has grown to over 9,400 (2015: 4,376) and total AUM increased by 24% to £57.1bn (2015: £46.1bn).

The Retail business has performed well despite net industry sales falling to their lowest level since 1995, with net inflows of £1.4bn (2015: £1.2bn). LGIM was ranked third in UK net sales in 2016, up from sixth the previous year (Source: Pridham report).

Total International AUM increased by 45% to £177.4bn (2015: £122.4bn), due to positive flows, rallying equity markets and the devaluation of sterling during the year. The US business delivered a particularly strong performance, with net inflows of £9.4bn (2015: £6.3bn), driven by significant growth in Index and continued strength in Solutions and Fixed Income. Flows were also positive in Europe, the Gulf and Asia.

LGIM Real Assets was adversely impacted by the slowdown in the property market as a result of the EU referendum, but net inflows resumed in Q4, contributing to overall AUM of £19.6bn (2015: £18.3bn). All of LGIM’s unitised property funds remained open in the aftermath of the referendum.

Mark Zinkula, CEO at LGIM, said: “We have delivered robust results in a challenging environment and continue to successfully expand our business. The fact that we once again delivered growth across all distribution channels and regions in 2016 was a significant achievement. We are building on our leading position in the UK defined benefit (DB) market, but our growth is increasingly coming from the DC and retail sectors and our target international markets.”

For further information, please contact:

Stephanie Ramos
Senior Media Relations Manager
T: +44 (0)20 3124 3589
E: stephanie.ramos@lgim.com  

Elisabeth Steyn
Media Relations Executive
T: 0203 124 4353
E: elisabeth.steyn@lgim.com

Notes to editors

Legal & General Investment Management:
Legal & General Investment Management is one of Europe’s largest asset managers and a major global investor, with total assets of £853 billion*. We work with a wide range of global clients, including pension schemes, sovereign wealth funds, fund distributors and retail investors.

Throughout the past 40 years we have built our business through understanding what matters most to our clients and transforming this insight into valuable, accessible investment products and solutions. We provide investment expertise across the full spectrum of asset classes including fixed income, equities, commercial property and cash. Our capabilities range from index-tracking and active strategies to liquidity management and liability-based risk management solutions.

*LGIM internal data as at 30 June 2016. These figures include assets managed by LGIMA, an SEC Registered Investment Advisor.  Data includes derivative positions and advisory assets.