Earnings call transcript: Chesnara H1 2026 profit and capital generation jump

In the first half of 2026, Chesnara's operating capital generation rose by 79% to £96 million, thanks to the first full consolidation of Chesnara Life following the acquisition of HSBC Life UK. Cash remittances increased by 31% to £73 million, with Scildon in the Netherlands delivering a record £30 million. The interim dividend was raised by 6% to 8.16 pence per share, extending Chesnara's long history of dividend growth.

The Solvency II coverage ratio stood at 185%, well above the group's operating range of 140% to 160%. The company's assets under administration grew to £21 billion, and own funds increased by 14% to £976 million. Adjusted operating profit jumped by 46% to £31 million, while contractual service margin rose to £327 million, up from £131 million at the end of 2025.

Management highlighted that the increase in contractual service margin reflected the addition of Chesnara Life and a higher-than-expected cost of service margin on the acquisition. The company also benefited from cost control and merger synergies in the Netherlands. However, it faced some pressure from adverse mortality in the Netherlands during the first quarter and weaker persistency in Sweden.