Consolidated income statement

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Year ended 31 December Note 2013 £m 2012* £m
Gross premiums earned   30,502 29,113
Outward reinsurance premiums   (658) (491)
Earned premiums, net of reinsurance B1.5 29,844 28,622
Investment return B1.5 20,347 23,931
Other income B1.5 2,184 1,885
Total revenue, net of reinsurance B1.4 52,375 54,438
Benefits and claims   (42,227) (44,116)
Outward reinsurers’ share of benefit and claims   622 259
Movement in unallocated surplus of with-profits funds   (1,549) (1,287)
Benefits and claims and movement in unallocated surplus of with-profits funds, net of reinsurance   (43,154) (45,144)
Acquisition costs and other expenditure B3 (6,861) (6,032)
Finance costs: interest on core structural borrowings of shareholder-financed operations   (305) (280)
Remeasurement of carrying value of Japan life business classified as held for sale D1 (120)
Total charges, net of reinsurance B1.4 (50,440) (51,456)
Share of profits from joint ventures and associates, net of related tax A2,D5 147 135
Profit before tax (being tax attributable to shareholders’ and policyholders’ returns)   2,082 3,117
Less tax charge attributable to policyholders’ returns   (447) (370)
Profit before tax attributable to shareholders B1.1 1,635 2,747
Total tax charge attributable to policyholders and shareholders B5 (736) (954)
Adjustment to remove tax charge attributable to policyholders’ returns   447 370
Tax charge attributable to shareholders’ returns B5 (289) (584)
Profit for the year attributable to equity holders of the Company   1,346 2,163

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Earnings per share (in pence)   2013 2012*

* The Group has adopted new accounting standards on consolidated financial statements and joint arrangements, and amendments to the employee benefits accounting standard, from 1 January 2013 as described in note A2. Accordingly, the 2012 comparative results and related notes have been adjusted retrospectively from those previously published.

This measure is the formal profit before tax measure under IFRS but it is not the result attributable to shareholders.

This is principally because the corporate taxes of the Group include those on the income of consolidated with-profits and unit-linked funds that, through adjustments to benefits, are borne by policyholders. These amounts are required to be included in the tax charge of the Company under IAS 12. Consequently, the profit before all taxes measure (which is determined after deducting the cost of policyholder benefits and movements in the liability for unallocated surplus of the PAC with-profits fund after adjusting for taxes borne by policyholders) is not representative of pre-tax profits attributable to shareholders.

Based on profit attributable to the equity holders of the Company: B6    
Basic   52.8p 85.1p
Diluted   52.7p 85.0p
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