Chesnara plc (LON:CSN) has announced its interim 2026 results.
Commenting on the results and outlook, Steve Murray, Group CEO, said:
“Chesnara has delivered a very strong financial performance in the first half of 2026 with Operating Capital Generation up 79% and a 6% increase in the interim dividend. The integration of Chesnara Life UK, our largest acquisition to date, continues at pace with strong capital generation already delivered from our first five months of ownership. The regulatory Change in Control for the proposed acquisition of Scottish Widows Europe SA is anticipated around the end of 2026, and we continue to see attractive opportunities to grow the business, underpinned by a healthy M&A pipeline and disciplined execution across the Group.”
CASH:
o Operating Capital Generation1 (OCG) of £96m, up 79% (HY25: £54m)
o Cash Remittances2 of £73m, up 31% (HY25: £56m)
CAPITAL:
o Solvency Coverage Ratio of 185%, (FY25: 257%) reflecting the completion of the HSBC Life (UK) acquisition; 5 ppts above FY25 proforma estimate of c.180%
o Own Funds of £976m, up 14% (FY25: £859m)
VALUE:
o Adjusted Operating Profit3 (AOP) of £31m, up 46% (HY25: £21m)
o Assets under Administration4 (AuA) of £21bn, up 38% (FY25: £15bn)
STRATEGIC PROGRESS:
o HSBC Life (UK) acquisition was completed in January 2026 and subsequently rebranded as Chesnara Life UK. This represents Chesnara’s largest transaction to date and has significantly increased the scale of the Group.
o Proposed Acquisition of Scottish Widows Europe SA was announced in February 2026 and is expected to add a further €250m of lifetime Cash Generation, ~€1.7bn of AuA and ~46,000 policies. This establishes a presence in Luxembourg to support future European consolidation. The regulatory Change in Control application has been submitted and is expected to complete around the end of 2026.
o Integrations are progressing well. The Group successfully completed the Part VII transfer of the second Canada Life portfolio with the subsequent migration in early August. The migration of HSBC systems data to SS&C remains on track for completion by the end of 2026, with the associated Part VII expected to follow in 2027. Following the merger of Scildon and Waard in 2025, the combined business has been progressing the next stage of integration activity.
o Balance sheet optimisation continues to be a material source of cash and value for the Group. The Group employed further capital management initiatives over H1, including the expansion of existing reinsurance and foreign exchange hedging arrangements.
o New business growth was largely driven by increased demand for our UK onshore bond offerings across Countrywide Assured and Chesnara Life UK. Total New Business Contribution was £12m, up 152% (HY25: £5m).
o Ongoing delivery of our sustainability strategy continues, including the actions we are taking to manage the risks and opportunities presented by a changing world.
INTERIM 2026 DIVIDEND:
The Board is declaring a 6% increase in the interim dividend to 8.16p per share. This is in line with the guidance provided at the time of announcement of the HSBC Life (UK) acquisition and represents a one-off additional step-up of 3% to the interim dividend.
FINANCIAL RESULTS
| HY26 | HY255 | % increase | ||
| CASH | Operating Capital Generation (OCG) | £96m | £54m | 79% |
| Cash Remittances | £73m | £56m | 31% | |
| CAPITAL | Solvency Coverage Ratio | 185% | 257% | (72ppts) |
| Own Funds | £976m | £859m | 14% | |
| VALUE | Adjusted Operating Profit (AOP) | £31m | £21m | 46% |
| Assets under Administration (AuA) | £21bn | £15bn | 38% |
A comprehensive reconciliation of the Group’s Alternative Performance Measures (APMs) to GAAP metrics is provided within the Additional Information section of the 2026 interim report.
· CASH: Material growth in OCG with positive contributions from all business units, and further benefits from capital optimisation activities, including those driven by the acquisition of Chesnara Life UK. Of the £96m total Group OCG: £51m is in respect of acquisition related impacts; £33m is from surplus emergence from our business units; and a further £12m is from capital optimisation activities in Group Centre. Sustained growth in OCG across the Group has also contributed to increased Cash Remittances to Group Centre of 31% compared to HY25.
· CAPITAL: The Solvency Coverage Ratio of 185% remains materially above the upper end of the Group’s operating range of 140% to 160% and is higher than the Group’s proforma estimate of c.180% at FY25. This headroom provides continued capacity to pursue inorganic investment opportunities. The completion of the Chesnara Life UK acquisition and the associated purchase price payment and solvency capital requirement reduced the Solvency Coverage Ratio, partially offset by capital optimisation actions, including mass lapse reinsurance and foreign exchange hedging implemented in the UK and Group Centre respectively. The Group’s Solvency Coverage Ratio is expected to remain above the upper end of the Group’s operating range following completion of the Scottish Widows Europe SA acquisition. Own Funds increased by 14%, driven by robust operating performance, the impact of the acquisition of Chesnara Life UK and favourable market conditions.
· VALUE: Robust operating performance across the business units has supported a 46% increase in AOP. Group AuA also increased by 38%, reflecting £5bn of AuA from the acquisition of Chesnara Life UK and the impact of positive market conditions, largely in Sweden.
DIVIDEND DETAILS
· The interim dividend of 8.16p per share represents a 6% increase on the prior year and is expected to be paid on 16 October 2026. The ordinary shares will be quoted ex-dividend on the London Stock Exchange as of 3 September 2026. The record date for eligibility for payment will be 4 September 2026.
Notes
1Operating Capital Generation (OCG): OCG measures the amount of Solvency II capital the Group generates from operational activities.
2Cash Remittances: Cash paid by our business units to the Group.
3Adjusted Operating Profit (AOP): AOP is IFRS profit before tax adjusted for the impacts of economic volatility, amortisation and impairments of intangibles, finance and restructuring costs and other non-operating items which in the Directors’ view should be excluded by their nature or incidence to enable a full understanding of financial performance.
4Assets under Administration (AuA): AuA reflects the value of the financial assets that the business
administers, as reported in the IFRS Consolidated Balance Sheet. The result includes the pro-forma impact of the second Canada Life portfolio acquisition following the completion of the Part VII transfer and migration by early August 2026.
5Solvency Coverage Ratio, Own Funds and AuA comparators: are stated as at FY25.
