Britain's ageing population and changes to workplace pensions proved lucrative for Resolution during the first half of the year.
The insurance company, which was founded by dealmaker Clive Cowdery in 2006, topped the FTSE 100 leaderboard after the value of new business in its domestic operation, Friends Life, grew by 41% to £89 million in the six months ending June 30.
Chief executive Andy Briggs said he expects the UK annuity market to be worth £40 billion by 2020, helped by trends including the retirement of the “baby boomer” generation. The market has grown as the population ages and both the state and employers pull back support.
“We remain well placed to benefit from the key market trends,” Briggs added. “The corporate benefits market is large and growing as a result of the structural shift from defined-benefit pension schemes towards defined-contribution and from the introduction of auto-enrolment, which will improve the living standards of millions of people as they retire.
“Demographic forces will also bring an increasing number of people and volume of funds to retirement income over the next decade.”
Resolution acquired Friends Provident in 2009 and then bought parts of Axa UK and Bupa. The company has since been overhauled and now also has a heritage unit, made up of closed life funds, an international division and an asset manager, which has £18 billion under management.
“We have continued to deliver cash from our heritage division and made good progress on international strategy implementation. This financial discipline underpins strong growth in cash generation and I remain confident about the future prospects of the group,” said Briggs.
Shares in the company rose 10.9p to 334.5p as it maintained its dividend at 7.05p. Operating profit grew to £191 million, against £163 million last year.