Aviva returns another £3.75bn to investors despite annual profits falling

Insurance giant Aviva has announced plans to hand back another £3.75 billion to shareholders, despite posting a drop in annual earnings.

The group saw underlying operating profits fall 28% to £2.3 billion as it sold off a raft of businesses.

It said with these stripped out, earnings from continuing operations were 10% lower at £1.6 billion, as a strong performance in its general insurance arm was offset by lower operating profit in the UK and Ireland life business.

Aviva announced the new tranche of share buybacks on top of a £1 billion existing programme, meaning it will return £4.75 billion to investors.

In further cheer for shareholders, it also said it would pay out a 14.7p a share final dividend for 2021 and disclosed aims to pay dividends of about £870 million in 2022 and £915 million in 2023.

It has come under pressure from activist investor Cevian, which has been pushing for £5 billion in cash returns by the end of 2022.

Aviva also announced a deal on Wednesday to buy Succession Wealth for £385 million to boost its presence in the fast-growing UK wealth market and expand its ability to offer financial advice to its six million pensions and savings customers.

Amanda Blanc, group chief executive of Aviva, said: “2021 was a year of significant strategic progress, right across Aviva.

“We successfully completed the sale of eight non-core businesses, generating excellent value for our shareholders.”

She said the firm was “delivering on our promise to shareholders” by returning more than £4 billion.