Slides
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Legal & General 2026 Half Year Results L & G
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Forward looking statements This document may contain certain forward-looking statements relating to L&G, its plans and its current goals and expectations relating to future financial condition, performance and results. By their nature, forward-looking statements involve uncertainty because they relate to future events and circumstances which are beyond L&G’s control, including, among others, UK domestic and global economic and business conditions, market related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory and Governmental authorities, the impact of competition, the timing impact of these events and other uncertainties of future acquisitions or combinations within relevant industries. As a result L&G’s actual future condition, performance and results may differ materially from the plans, goals and expectations set out in these forward-looking statements and persons reading this document should not place reliance on forward-looking statements. These forward-looking statements are made only as at the date on which such statements are made and Legal & General Group Plc does not undertake to update forward- looking statements contained in this document or any other forward-looking statement it may make.
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Agenda 3 1. H1 26 Highlights António Simões, Group CEO 2. Financial Performance Andrew Kail, Group CFO 4. Q&A António Simões Group CEO Andrew Kail Group CFO 3. Outlook António Simões, Group CEO
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The best company to invest and retire with 4 £1.2trn Asset Manager with the UK’s largest DC platform UK’s largest provider of retirement incomes Trusted by 13 million customers Income Investment Trust UK savers trusted us to invest £236bn of DC pension savings We paid over £3.7bn this year to provide individuals income in retirement In the first half of 2026 we paid £674m to support families through bereavement and illness #1
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Delivering reliably strong financial results 5 Increased returns 12.15p Core operating EPS up 11% H1 25: 10.94p 201% Solvency II coverage ratio FY25: 203% 6.24p Interim dividend per share up 2% H1 25: 6.12p Growing earnings Strong capital £1.2bn Share Buyback in progress c.£450m completed YTD £13.0bn Store of Future Profit FY25: £13.3bn 14.16p OSG1 per share up 7% H1 25: 13.24p 1Operational Surplus Generation
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Realising our potential with double-digit growth £6.2bn1 Workplace net flows July YTD £6.2bn £4.6bn +35% Jul 25 Jul 26 £23m Annualised net new revenue (ANNR) growing our run-rate £6.9bn Total annuity volumes written and exclusive July YTD £5.0bn £0.2bn £0.3bn£0.9bn £1.2bn Jul 25 Jul 26 UK PRT International PRT Individual £5.4bn £15m £23m H1 26H1 25 1 Estimated end-July position Includes £0.8bn of fully pre-funded assets on schemes already won. 22021-2025, based on publicly available data UK’s #1 Annuity Provider UK’s Largest Asset Manager Fastest growing UK Workplace provider2 £6.9bn £6.1bn £5.7bn Global PRT +53%+15% 6
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Institutional Retirement: Strong volumes and growing asset optimisation We are a global market leader £5.7bn Jul-25: £5.2bn £2.1bn Written + £3.6bn Written and Exclusive YTD L&G typically has 20-25% UK market share Lower headline margins but long-term value remains highly attractive 4.2% IFRS Margin Day one margins reflect tight credit spreads and competitive market environment >14% IRR Long-term value remains as we continue to exceed our 14% hurdle 3.4% New Business Strain UK PRT strain of 3.1% expected to reduce in H2. 2028 TRAJECTORY On track to meet Operating profit growth target 5-7% £288m Asset Optimisation1 Reliable source of ongoing profits; upgraded guidance of >£400m p.a. 7 1 Total asset optimisation of £288m, of which £227m in Institutional Retirement and £61m in Retail On £2.1bn written business
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Asset Management: Growing momentum and profitability step change Cost-income ratio reduces 71% FY25 75% Cost-income ratio First YoY reduction in a decade Ahead of schedule for CIR<70% by 2028 Growing momentum in Asset Management +37% Fee Related Earnings Compounding effect of strong ANNR, cost control and positive markets across 2025/26 £23m ANNR generated in H1 2026 Strong flows in Europe and Private Credit 9.6bps FY25 9.2bps Revenue Margin We are ahead of plan to deliver a margin over 10bps by 2028, with upside as momentum continues 2028 TRAJECTORY On track for operating profit target £500-600m £79bn Private Markets AUM Nearing our £85bn+ target for 2028 8
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1End-July, including £0.8bn of fully pre-funded assets on schemes already won. Retail: Double-digit successes in all businesses Retail momentum 12.3 FY25 12.1 Million Customers Trusted provider in structurally growing markets Capturing opportunities across our key growth markets +35% Workplace Net Flows July YTD1 Almost £1bn of regular monthly inflows £7bn of wins not yet onboarded +36% Individual Annuity Premiums Structural growth market Leading player across the market with strong intermediary presence +22% Protection APE Strong volume growth and improving margins in competitive markets 2028 TRAJECTORY On track to meet Operating Profit growth target 4-6% +140% Workplace end-to- end profit doubled On track to treble end-to-end profits by 2028 to £180m End-to-end profit of £48m at H1 26 9
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Our scale and synergies are competitive advantages 10 1 Average Jun23 – Jun26. Asset Management RetailInstitutional Retirement >95% of Workplace DC assets managed in-house Private Markets Access Fund AUM now over £3bn Shared operations and investment teams across Retail and Institutional Retirement Faster business growth underpinned by cost efficiencies and power of AI 90% of Annuity Assets are managed internally 80% of UK PRT transacted volumes are Asset Management clients1
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11 Dividend cover is now improving 1All 2026E and 2027E figures on this slide are indicative only. Graphs are not to scale 10.94p 12.15p 9.99p 2025 2026E 2027E 20.93p Over 100% Core EPS coverage expected in 2026 6.12p 6.24p 15.67p 2025 2026E 2027E 21.79p We have maintained progressive dividend per share £1.9bn of buybacks since 2023 have rebased distributions and improved coverage +2% +11% 2023 2024 2025 2026E Our payout ratio is improving 107% 106% 104% <100% + =H2 H1 H2 H1 DPSCore EPS +6-9% CAGR +2% p.a.
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Andrew Kail, Group CFO Financial Performance
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13 IFRS Performance at a glance H1 25 H1 26 Institutional Retirement £618 £646m +5% Asset Management £202m £222m +10% Retail £237m £248m +5% Group expenses and debt costs £(198)m £(198)m – Core Operating Profit £859m £918m +7% Total Operating Profit £905m £920m +2% Investment Variance £(456)m £(240)m -47% M&A and restructuring £(57)m £1,322m Minority interests £14m £(5)m Profit before tax attributable to equity holders £406m £1,997m +392%
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14 Building momentum across the Group 1 Written and exclusive July YTD. 2 UK PRT Strain was 3.1% in H1 26 and 1.1% in H1 25. 3 End-July, including £0.8bn of fully pre-funded assets on schemes already won. . Institutional Retirement PRT volumes1 PRT strain2 Asset Optimisation £5.7bn Jul’25: £5.2bn 3.4% H1 25: 1.3% £227m H1 25: £165m Asset Management Annualised Net New Revenue Private Markets AUM Average Fee Margin £23m H1 25: £15m £79bn H1 25: £65bn 9.6bps H1 25: 9.1bps Retail Workplace DC net flows YTD3 Individual Annuities volumes1 Protection APE £6.2bn Jul’25: £4.6bn £1.2bn Jul’25: £0.9bn £168m H1 25: £138m
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Institutional Retirement 15 Financial Highlights (£m) H1 2025 H1 2026 Change (%) CSM Release 334 331 (1)% RA Release 67 58 (13)% Expected Investment Margin 303 346 14% o/w Asset Optimisation 165 227 38% Expenses and other variances1 (86) (89) 3% Core Operating Profit 618 646 5% Investment Variance (218) (222) 2% M&A and restructuring - - n/a Profit Before Tax 400 424 6% PRT Annuities Portfolio £68bn £73bn 7% PRT Volumes2 £5.2bn £5.7bn 10% IFRS Margin3 7.1% 4.2% SII new business strain3 1.3% 3.4% Key takeaways 1 Includes non-attributable expenses and experience variances. 2 Includes written & exclusive to end-July 3 IFRS margin and strain metrics are only for written business at H1 25. Exclusive business and deals in exclusivity since end June are excluded. Significant growth in asset optimisation, providing a recurring source of profit Flat CSM release as sovereign-based investment strategy makes asset optimisation a key growth driver Adverse investment variance driven by accounting, inflation, and model revisions.
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£646m £906m £807m 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £4.7bn £9.5bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £5.7bn £2.1bn 8.3% 9.0% 7.2% 6.5% 4.2% 2022 2023 2024 2025 H1 26 Institutional Retirement 16 Global PRT AssetsGlobal PRT volumes (£) PRT New business margins Institutional Retirement Operating Profit (£) IFRS 4 £93bn of PRT written or exclusive in the last decade PRT AUM has grown every year ex markets Profit deferred from NB margin under sovereign strategies IFRS 17 Predictable profit growth H1 H2 H1 H2 PRT NB margin not comparable under IFRS4 vs IFRS17 Note: The above slide represents data disclosed at the time or restated in the following period where relevant. Over the period, various organisation restructures have occurred (such as the Workplace Administration function moving into our Retail division and the formation of our Asset Management division & Corporate Investments Unit). These have not been retrospectively adjusted for. £41.8bn £57.3bn £73.0bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26
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1Splits into credit, sovereign and direct investments do not include net derivatives, non-financial assets and cash, which are included in the total annuity value figures. 4.2% IFRS New business Margin Assessing the full value of new business Tight credit spreads Driven by: Sovereign-based asset strategy Market competition Does not reflect: Return on capital >14% Increased asset optimisation capacity Significant upside potential Traded Credit Sovereigns Direct Investments 2022 H1 26 55% 35% 10% 38% 33% 29% £73.1bn1 £90.9bn1 Growing allocation to sovereigns: significant upside potential Increasing IFRS Asset Optimisation guidance to >£400m p.a. 17
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Asset Management 18 Financial Highlights (£m) H1 2025 H1 2026 Change (%) Fee Revenue 508 574 13% Expenses (385) (405) 5% Fee Earnings 123 169 37% Balance Sheet Earnings 79 53 (33)% Core Operating Profit 202 222 10% Investment Variance (103) (19) (82)% M&A and restructuring (21) (40) 90 Profit Before Tax 78 163 109% Annualised Net New Revenue 15 23 53% Total AUM (£bn) 1,136 1,242 9% Cost-Income Ratio (%) 76% 71% (5)ppt Average Revenue Margin (bps) 9.1 9.6 5.5% Revenue growth outpacing costs as strategic success converts into profitable growth High-quality fee-based earnings becoming a higher proportion of asset management profits. Less noise from investment variance Strong ANNR shows continued momentum in shift to higher margin products Key takeaways
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£400m £340m £222m 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £983bn £1,196bn £1,242bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 Asset Management 19 Total Assets Under Management Cost-Income Ratio Asset Management Operating Profit 1 2016-2022 cost-income ratio predates the creation of L&G Asset Management and represents L&G Investment Management only. LGIM ex LGC Annualised Net New Revenue 50% 65% 75% 71% 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 Continued momentum with another period of record ANNR UK’s largest asset manager with £1.2trn AUM Cost income ratio now on a reducing trajectory Operating profit returns to growth - - 0 0 £34m £23m 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £15m 2024 H1 H2 Note: The above slide represents data disclosed at the time, or restated in the following period where relevant. Over the period, various organisation restructures have occurred (such as the Workplace Administration function moving into our Retail division and the formation of our Asset Management division & Corporate Investments Unit). These have not been retrospectively adjusted for. LGIM ex LGC N/A
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20 Shift to higher revenue margin products despite industry-wide fee compression Positive ANNR growth across both public and private markets despite net outflows Net Flows ANNR Accelerating ANNR with a shift to higher margins 7 8.8 9.2 9.6 25 24 23 2023 2024 2025 H1 2026 +2.6 bps (2) bps Global market revenue margin bps L&G average revenue margin bps £(28)bn £3bn Public Private Managed £4m £19m 1 1 As disclosed at time of reporting
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£16m £30m £123m £169m HY25 FRE operating profit Markets and other Business driven performance HY26 FRE operating profit Market driven performance 35% Business driven performance 65% 21 Declining cost-income ratio as revenue and cost jaws widen -3% 6% 4% 13% 7% 10% 5% 5% 72% 74% 75% 71% FY23 FY24 FY25 H1 26 Revenue growth Cost growth Cost-income ratio Cost income ratio improving as investments take effect We have managed underlying costs down year on year and generated ANNR to drive business performance H1 25 FRE operating profit H1 26 FRE operating profit Markets and other Business driven performance +37%
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Retail 22 Financial Highlights (£m) H1 2025 H1 2026 Change (%) CSM Release 182 189 4% RA Release 37 36 (3)% Expected Investment Margin 85 92 8% o/w Asset Optimisation 47 61 Expenses and other variances1 (44) (55) 25% Workplace administration2 (23) (14) Operating Profit 237 248 5% Investment Variance (74) (50) (32)% M&A and restructuring 0 0 Profit Before Tax 163 198 21% Annuities new business margin 4.6% 5.4% +0.8%pts Protection new business margin 8.0% 10.9% +2.9%pts Workplace DC AUA (£bn) 101 128 27% Growth in release from CSM reflecting strong underlying growth and increase in asset optimisation profits, managed jointly with PRT Increased new business margins on Protection and Retail annuities Strong growth in Workplace AUA Workplace administration losses reduced despite increased investment (£25m) in H1 Key takeaways 1 Includes non-attributable expenses, experience variances and other smaller items related to non-insurance businesses. 2 Includes allocated investment spend and supporting wider Retail lifetime value (as we retain workplace members into retirement).
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£644m £415m £248m 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £27.7bn £66.6bn £128.0bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 Retail 23 Workplace Assets UK Protection Gross Written Premiums Retail Operating Profit1 1 2017-2023 Operating Profit includes US Protection Annuity Assets IFRS 4 IFRS 17 Workplace Net Flows Annuity Premiums Workplace flows drive 20% AUA CAGR over the last decade Market leader in the structurally growing individual annuity market Steady growth in protection GWP supports steady earnings £1.6bn £1.9bn £1.2bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £4.5bn £7.3bn £3.5bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £0.7bn £1.0bn £1.0bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 H1 H2 H1 H2 H1 H2 H1 H2 Note: The above slide represents data disclosed at the time, or restated in the following period where relevant. Over the period, various organisation restructures have occurred (such as the Workplace Administration function moving into our Retail division and the formation of our Asset Management division & Corporate Investments Unit). These have not been retrospectively adjusted for. All YTD figures are as of end-July. £11.6bn £16.5bn £17.9bn 2017 2018 2019 2020 2021 2022 2023 2024 2025 H1 26 £6.2bn YTD £1.2bn YTD
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£52m £55m £48m 2024 2025 H1 26 Driving scale to treble our end-to-end Workplace profits 24 2028 £180m Major long-term growth driver for L&G >10% YoY Revenue growth Leveraging scale to open jaws as revenue growth > cost growth H1 2026: +140% year on year Note: End-to-end Workplace profits covers Retail Workplace DC and associated Asset Management performance, excluding Retail wide investment spend. +36%CAGR Implied 2026 run-rate: £96m Combined Asset Management and Retail profits from DC to triple to £180m by 2028
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25 1 Reinsurance mismatches reflects the adjustment to reported CSM amortisation within operating profit and the reversal of past onerous contract losses. 2 Other investment variances includes one-off below the line costs and investment variance associated with discontinued operations. Drivers of Investment Variance Modelling & assumption changes Market impacts on Assets and Liabilities In-year vs long-term expected returns Asset revaluations Investment Variance Insurance Business (£m) Shareholder and CIU assets (£m) Other Investment Variance2 Reinsurance mismatches1 FY24 FY25 (214) (362) (224) (322) (1,196) (285) 105 (240) (304) (771) (57) (75) (17) 28 Largely driven by IFRS17 accounting using locked-in discount rate when business written Market moves, including bond yields, inflation, mark to market on property assets, etc. Substantially smaller after reset at FY25 63 (344) 29 (240) H1 26 16 9 (13)
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Change in store of future profit: H1 26 Jan-2026 New business CSM Interest accretion & expected return Non-economic variances1 & FX CSM release into P&L RA release into P&L June-2026 £12,983m £167m £13,314m £(110)m£204m New business RA £31m Jun-2026 before release £13,606m £(529)m £(94)m PRT 9,286 29 9 147 (78) 9,393 (331) (58) 9,004 Retail Annuities 2,954 28 11 39 (15) 3,017 (113) (30) 2,874 Protection 1,074 110 11 18 (17) 1,196 (85) (6) 1,105 26 Analysis of change in store of future profit Note: CSM = Contractual Service Margin and RA = Risk Adjustment. 1Non-economic variances include the impact of changes in non-financial assumptions and experience variances in relation to the future. The amounts presented are calculated at the locked in discount rate in accordance with the IFRS 17. Underlying -1% CSM down -2% Store of profit remains significant, delivering reliable future earnings Future profit shifts towards asset optimisation under sovereign-based investment strategy
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203% 14% (4)% 29% (19)% (14)% (5)% (3)% 201% 8% 209% 27 Own Funds 13,814 647 87 640 (1,206) (886) 3 (196) 12,903 495 13,398 SCR 6,807 (143) 164 (547) - - 141 - 6,422 0 6,422 Surplus 7,007 790 (77) 1,187 (1,206) (886) (138) (196) 6,481 495 6,976 £m FY25 Dividends paid Other Variances HY26 (post- eligibility restriction) Solvency II: H1 26 movements 13.4 6.4 7.0 HY26 Own Funds Capital Requirement Surplus Note: Rounding on ratio impacts can cause sum of rounded numbers to be out by +1/-1ppts. 205% temporary restriction OSG NBS MYL Transaction Share Buyback Debt & Eligibility Debt refinancing impact HY26 Proforma (post RT1 debt raise) Target operating range: 160-190%
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36% 21% 28% 11% 4% Total bond portfolio: £92.9bn² Private credit £22.9bn Infrastructure Utilities Consumer services & goods Sovereign-like assets Traded credit £39.4bn Property- related Cash & Other £110bn1 Rating Geography Sector AAA 4% AA 40% A 30% BBB 25% BB or below <1% UK 49% USA 34% Europe 10% RoW 7% Sovereign 33% Infra 16% Utilities 10% Consumer 8% Real Estate 5% Tech 4% Other 24% 28 Sovereign £30.6bn Only 3% of bond portfolio are BBB- Total global portfolio High-quality, well managed, diversified annuity portfolio 1 Annuity Assets of £90.9bn include £(19.0)bn of net derivatives and non-financial assets. .2 Total bond portfolio represents traded credit, private credit and sovereigns.
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Cash stock as a core strength metric Stock of Holdco cash1,2 £1.4bn cash available at Group holding-company at 31st December 2025 Cash at Holdco has remained stable providing a strong liquidity position £1.3bn £1.6bn £1.4bn 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1 Holdco consists of Legal & General Group plc and the Group’s financing company, Legal & General Finance Plc, who provide funding across the Group. .2 Cash stock consists of cash and cash equivalents and liquid investments such as liquidity funds and reverse repurchase agreements. 29 Targeting c.1x HoldCo annual cash outflows
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Outlook
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H1 26 Group Financial headlines 31 H1 26 Core Operating Profit (£m) +7%£918m£859m Core Operating Earnings Per Share (p) +11%12.15p10.94p Solvency II Operational Surplus Generation1 (£m) +3%£790m£766m Solvency II Capital Coverage Ratio2 201%203%2 H1 25 Solvency II OSG per share1 (p) +7%14.16p13.24p 1 Excludes Transitional Measure on Technical Provisions (TMTP) amortisation of £37m in H1 25 and £37m in H1 26. TMTP amortisation now reflected as an operating variance. 2 Prior comparison shows FY25 Dividend Per Share (p) 6.24p6.12p +2%
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Positioned to capture global shifts in retirement savings 32 Value creation through Insurance and Workplace + controlled flows into Asset Management Golden PRT decade(s) £1.0 trn Global PRT flows over next decade Global leader in PRT Defined Contribution accelerating £1.5 trn UK DC assets by 2034 (2024: £0.8trn) Fastest growing UK Workplace platform Savers seeking to secure income £20bn UK annuity flows by 2034 (2025: £8bn) #1 open market Retail annuity provider
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A simpler, more connected L&G to accelerate growth 33 Asset Management RetailInstitutional Retirement Early success: Asset Management Cost Income ratio now at 71% We will provide regular updates on our efficiency progress More opportunities for efficiency across L&G with work already underway Reinvest savings selectively with short payback periods Drive competitiveness and accelerate growth
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‘On track’ to deliver against our targets Asset Management Retail Institutional Retirement Cumulative ANNR (2025-2028) Private Markets AUM3 (2028) Operating Profit (2028) Net flows Workplace DC (2024-2028) UK PRT strain (2024-2028) Operating Profit CAGR (FY23-28) UK PRT (2024-2028) £50-65bn <4% 5-7% £500-600m £100-150m £85bn+ £40-50bn Group Operating Return on Equity (2025, 2026, 2027) Cumulative capital generation2 (2025, 2026, 2027) Core Operating EPS CAGR1 (FY24-27) 6-9% >20% £5-6bn Operating Profit CAGR (FY24-2028) 4-6% Tracking against CME targets and ambitions ON TRACK ON TRACK AHEAD ON TRACK ON TRACK ON TRACK ON TRACK AHEAD ON TRACK ON TRACK AHEAD 34 1 Core operating EPS performance will be measured against the FY24 baseline of 20.23p, prior to any restatement for the non-retained US business. 2 As previously disclosed, the accelerated capital generation of the Meiji Yasuda transaction of £1.2bn will be included in the performance against this metric. The amortisation of TMTP is now excluded from reported OSG, TMTP amortisation will be reported explicitly each period. 3 Includes 100% Pemberton AUM.
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Clear reasons to invest in L&G 35 Attractive, sustainable, and growing capital returns Leading businesses in growing markets Synergistic business model
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Q3 trading update announcement 16th November 2026 L&G will provide a Q3 trading update and regular quarterly trading updates thereafter. Next scheduled market update following H1 26 results.
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António Simões, Group CEO Andrew Kail, Group CFO Laura Mason, CEO Retail Eric Adler, CEO Asset Management Gareth Mee, CEO Institutional Retirement Andy Sinclair, Chief Strategy and IR Officer Q&A
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Thank you Quarterly trading update: 16 November 2026
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Appendix
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26.6% 34.8% 54.4% 70.0% 2023 2024 2025 H1 26 12.15p 19.04p 19.20p 20.93p 2023 2024 2025 H1 26 £918m £1531m £1534m £1623m 2023 2024 2025 H1 26 H2 £790m £1821m £1461m £1530m 2023 2024 2025 H1 26 Key metrics: Group 40 Core Operating Earnings per Share (p) Operating Return on Equity (%) Operational Surplus Generation1 (£) Core Operating Profit (£) Note: 2024 has been restated to exclude non-retained US businesses – 2023 has not been restated. 1 OSG excludes TMTP amortisation of £75m in 2025 and £83m in 2024 H2 H1 H1 H2 H1
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H1 26 P&L £m H1 25 H1 26 Growth % Analysis of core operating profit Institutional Retirement 618 646 5 Asset Management 202 222 10 Retail 237 248 5 Group debt costs (112) (114) (2) Group investment projects and expenses (86) (84) 2 Core Operating Profit 859 918 7 Non-retained US business 22 - (100) Corporate Investment Unit 24 2 (92) Operating Profit 905 920 2 Investment variance (456) (240) (47) M&A and restructuring (57) 1,322 2,419 Profit Before Tax attributable to equity holders 406 1,997 392 Core Operating EPS 10.94 12.15 11 Dividend Per Share 6.12 6.24 2 41
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Divisional OSG
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OSG from continuing businesses1 H1 2025 H1 2026 Own Funds SCR Surplus Own Funds SCR Surplus Institutional Retirement 410 34 444 390 72 462 Of which asset optimisation 72 (3) 69 96 10 106 Retail 127 17 144 141 26 167 Of which asset optimisation 18 (1) 17 26 3 29 Asset Management - Fee 118 (4) 114 156 (13) 143 Asset Management - Balance Sheet Investments 64 (27) 37 60 (14) 46 Central Costs (138) 1 (137) (134) - (134) Divisional OSG 581 21 602 613 71 684 Management Actions 88 31 119 29 71 100 Total Operational Surplus Generation2 669 52 721 642 142 784 43 OSG by business – Own Funds and SCR 1 Excludes TMTP amortisation of £37m in H1 2026 and £37m in H1 2025. 2 Excludes OSG from CIU (H1 2026: £6m, H1 2025: £45m) and discontinued operations. Note: Rounding impacts can cause sum of rounded numbers to be +£1/-£1m different to unrounded.
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Our Annuity Portfolio
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1. As at 30 June 2026, based on assets backing UK annuity business 2. 2.5% of A, 5% of BBB, 25% of BB, 50% of B and 100% of CCC-rated assets default over five years. 30% recovery rate assumed. 3. Solvency impacts shown ignore the change to Own Funds Tier 2 restrictions under stress A 100bps credit spread widening produces only a modest economic impact due to strong asset-liability matching. The reduction in annuity liabilities substantially offsets the fall in asset values, limiting the effect on Own Funds. A larger reduction in SCR results in a favourable Day 1 solvency impact, though this capital benefit largely unwinds over time. Credit Spread Spread widening impacts are mitigated by liability matching and temporary solvency support Under a scenario where 20% of the credit assets downgrade by 1 big letter, the immediate solvency impacts are: • Reduction in Own Funds as downgrades increase SII fundamental spreads (FS) in the matching adjustment calculation; • Increase in SCR as credit risk charges rise. Most of the Day 1 impact reverses through the release of FS prudence and the unwind of additional SCR in future years. Credit Downgrade Impacts are largely temporary, with limited economic loss The vast majority of L&G's credit portfolio is investment grade. Under a severe default scenario2, the impact is c.£0.2bn p.a. of Solvency II Own Funds / IFRS earnings losses. This represents less than 20% of the Group's 2025 basic core operating earnings, demonstrating the resilience of the business model to credit default stress. Credit Default Losses are significant but manageable relative to Group earnings capacity Strong resilience across credit scenarios Annuity credit risk assets by rating1 AAA AA A BBB SIG 0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 FY23 FY24 FY25 £bn Basic Core Operating Earnings 4.8 5.3 5.8 6.3 6.8 Pre stress Own Funds reduction SCR increase Post stress Day 1 SCR increase & FS prudence unwind Post stress, net of unwinds SII surplus (£bn) 4.8 5.3 5.8 6.3 6.8 Pre stress Own Funds reduction SCR decrease Post stress Day 1 SCR reduction unwinds Post stress, net of unwinds SII surplus (£bn) 45
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-1% Rates: Illustrative 5-Year Impact on Solvency II Surplus and CCR -£310m -14% +£290m +7% -£20m -7% Day 1 impact1 5Y flow recovery Impact by Y5 Initial reduction in S2 coverage is temporary, unwinding over time. Supporting metrics: Day 1 → Year 5 Own Funds +£400m +£540m Day 1 positive driven by the SCR hedge, with further upside over time from higher prudence release, Asset Management earnings and lower debt costs, partly offset by lower returns on cash. SCR +£710m +£560m Day 1 SCR impact unwinds over time as annuity liabilities run off. IFRS Equity +£290m +£530m 1. Solvency II sensitivity is based on HY26 disclosures but excluding impacts on Tier 2 debt eligibility. The IFRS Equity sensitivity shown reflects the latest disclosed FY25 position adjusted for the sale of the US protection business. Notes. 5-year flow impacts are illustrative only and reflect the direct impact of interest rate movements on our balance sheet. Actual outcomes will vary as other factors evolve. Amortised Cost accounting smooths rates impacts through IFRS Equity over time. The Group targets a level of interest rate sensitivity within Own Funds to support sustainable long-term Solvency II capital generation across market scenarios. The hedge level reflects both stock and flow effects (outlined below) and is calibrated within the Group's Solvency II operating range and leverage framework and broader financial risk profile. The ‘stock’ and ‘flow’ impacts of lower rates
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Concerns on credit risk exposure overblown 47 Investor Concerns on Credit What it means for L&G Spread widening Downgrades Rotating out of gilts creates strain / is costly Defaults Private credit exposure is very risky We can generate increased earnings when spreads widen - upside potential We actively monitor and manage the portfolio within our risk limits and to manage the capital position of the business In a moderate spread widening scenario, we would expect to be able to meet our IRR hurdles. In a severe spread widening scenario, we can rotate strain neutral 99% Investment Grade and strong track record L&G have received 99.9% of cashflows since 2008 Our portfolio of credit is long-dated, fixed rate and investment grade
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36% 21% 28% 11% 4% Total bond portfolio: £92.9bn² Private credit £22.9bn Infrastructure Utilities Consumer services & goods Sovereign-like assets Traded credit £39.4bn Property- related Cash & Other £110bn1 Rating Geography Sector AAA 4% AA 40% A 30% BBB 25% BB or below <1% UK 49% USA 34% Europe 10% RoW 7% Sovereign 33% Infra 16% Utilities 10% Consumer 8% Real Estate 5% Tech 4% Other 24% 48 Sovereign £30.6bn Only 3% of bond portfolio are BBB- Total global portfolio High-quality, well managed, diversified annuity portfolio 1 Annuity Assets of £90.9bn include £(19.0)bn of net derivatives and non-financial assets. .2 Total bond portfolio represents traded credit, private credit and sovereigns.
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36% 21% 28% 11% 4% Traded credit portfolio: £39.4bn Infrastructure Utilities Consumer services & goods Sovereign-like assets Traded credit £39.4bn £110bn Rating Geography Sector AAA 6% AA 12% A 43% BBB 38% BB or below 1% UK 33% USA 50% Europe 10% RoW 7% Consumer 15% Utilities 16% Infra 14% Banks 11% Str Finance 10% Tech 9% Other 25% 49 Total global portfolio Traded credit: international/defensive/counter-cyclical
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36% 21% 28% 11% 4% Sovereign portfolio: £30.6bn Infrastructure Utilities Consumer services & goods Sovereign-like assets Sovereign £30.6bn £110bn Rating Geography AAA 1% AA 94% A 4% BBB 1% BB or below 0% UK 69% USA 27% Europe 2% RoW 2% 50 Total global portfolio Sovereign portfolio
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L&G have had no defaults since 2009 with only £24m of defaults in 2008 51 IG credit rarely defaults and spreads far exceed default rates 1 Bank of America index of IG corporate spreads. 2 S&P Market Default rates 2005-2025 0 5 10 15 20 25 30 35 40 45 50 0 100 200 300 400 500 600 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 S&P Market Default Rates (bps) IG Corporate Spreads (bps) Year IG corporate spreads (bps) Investment Grade defaults
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Ultimate Parent Sector Country of Risk Investment Value (£m) 1 Kelda Holdings Ltd Utilities UK 282 2 Oracle Corp Communications & Technology USA 231 3 United Utilities Group PLC Utilities UK 209 4 CK Hutchison Holdings Ltd Utilities UK 178 5 FGP TopCo Ltd Economic Infrastructure USA, Germany 169 6 Luppiter Consortium Ltd Utilities UK 162 7 Daiwater Investment Ltd Utilities UK 157 8 National Grid PLC Utilities UK 156 9 TC Energy Corp Energy USA, Canada 148 10 Freshwater Finance PLC Utilities UK 148 £1,840m 8% of BBB portfolio 52 Defensive traded credit BBB exposure Annuity Portfolio backing Global Annuities: Top 10 traded credit BBB exposure
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36% 21% 28% 11% 4% Private credit portfolio: £22.9bn Infrastructure Utilities Consumer services & goods Sovereign-like assets £110bn Rating Geography Sector AAA 2% AA 7% A 45% BBB 43% BB or below 3% UK 48% USA 38% Europe 8% RoW 6% Infra 45% Utilities 12% Real Estate 15% Str Finance 7% Fin Services 6% Consumer 5% Other 10% Private credit £22.9bn 53 Total global portfolio Private Credit: our portfolio is high quality
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54 Investor Concerns on Credit L&G’s Private Credit Portfolio Systemic Risk Exposed to US direct lending Internal ratings are not high quality High CLO exposure Not regulated Investment grade with carefully managed risk limits The vast majority of our exposure is to private placement type debt, predominantly in UK, almost exclusively IG rated. Robust internal rating validation process; results shared with PRA. Regulatory obligation to ensure comparable standard to an external rating. No exposure to rating from Egan Jones. We regularly commission private ratings from the big-3 to validate our results. Ratings team is independent of asset originators/managers CLO exposure is c6% of the private credit portfolio. We’re only materially exposed to AAA, AA and A tranches, with no sub investment grade. Private Credit exposures are not inherently more risky
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Counterparty Sector Country of Risk Year of Investment Rental Income Note (£m) 1 UK Government Government UK 2011-2025 1,932 2 Student Accommodation Provider Infrastructure UK 2023 531 3 UK Water 3 Utilities UK 2025 369 4 UK Corporate Media Media UK 2017 368 5 Amazon Communications & Technology UK 2018-2020 353 6 UK Railway Infrastructure UK 2021 280 7 Moray East Transmission (Wind Farm) Infrastructure UK 2024 270 8 Places for People Group Ltd Infrastructure UK 2014 267 9 UK Water 2 Utilities UK 2016-2019 247 10 International Transport & Logistics Consumer, Non-cyclical UK 2015-2021 241 11 US Utility Utilities USA 2020-2025 240 12 London Residential Infrastructure UK 2019 224 13 UK Water 1 Utilities UK 2016-2019 217 14 Comcast Corp Communication & Technology UK 2020 214 15 Magnavale Gamma UK Limited Real Estate (Debt) UK 2025 208 Total £5,961m1 19% of DI portfolio²Assets are spread between different locations, with long duration cash flows secured against high quality tenants, with limited downside valuation risk e.g. UK Government, Amazon Annuity Portfolio backing Global Annuities: Top 15 Direct Investments by exposure 55 Our Direct Investments are with high quality counterparties 1 Differences exist between this valuation, and accounting valuation reported in Analyst Pack. 2 Based on £31bn DI portfolio (excluding Lifetime Mortgages) backing global Annuities.
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36% 21% 28% 11% 4% Infrastructure Utilities Consumer services & goods Sovereign-like assets Property-related: £11.8bn 56 Annuity property exposure of £11.8bn comprises: • £2.3bn of RVNs. This is the present value estimate of the future vacant possession value of the property (i.e. the value at the end of the lease term) and certain excess rental cash flows and represents our actual direct property exposure in the annuity portfolio. – Not concerned with short-term mark-to-market valuations. Majority of property assets >20yr term to maturity • £3.6bn of RINs. Secured against inflation-linked, long-term leases with primary exposure to IG-rated rental income from underlying tenants, e.g. Amazon and Comcast, or diversified pools of residential tenants – Our priority is the cash flow – 100% of cash flows received over 2022 to HY 2026 – 82% of office space exposure is to UK government departments, with an average unexpired term of nearly 20 years on the lease • £5.9bn of Lifetime Mortgages (“LTMs”). Portfolio LTV of 33% with AA- overall rating. 31% 19% 50% Asset RIN RVN LTM 7% 4% 19% 28%6%2% 33% Sector Retail Leisure Distribution Office Space (Government) Office Space (Non-Government) Industrial and other commercial Accommodation 84% 8% 7% 1% LTM Ratings AA A BBB BB or Below £110bn Direct property exposure in annuity portfolio is limited
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Asset Management Asset Mix
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Derivatives 12% Cash 1% Real Estate 2% Private Credit 3% Corporate Bonds 12% Government Bonds 20%Other Equities 17% UK Equities 4% US Equities 29% 58 £1.2trn AUM Total Equity Total Fixed Income Total Derivatives Total Private Credit Total Cash Underlying asset exposure by asset class Note: L&G internal data – estimated split based on H1 26. AUM includes the value of securities and derivatives positions but excludes joint ventures and associates. 50% 32% 12% 3% 2% 1% Total Real Estate
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Asset Management Balance Sheet Investments £615m £342m £88m £87m £1,132m £622m £299m £102m £77m £1,101m Real Estate Private Credit1 Infrastructure Venture Capital Total H1 26FY25 59 1 Includes 40% stake in Pemberton.
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2023 2024 2025 H1 26 Underlying Assets Under Management by Solution 60 Assets under Management (AUM)1 £1,197bn £1,135bn +4% Index Solutions & Multi Asset Active Private Markets £1,172bn 1 Includes joint ventures, associates and other. £1,242bn