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Aviva posts £3.1bn loss and slashes dividend
by Alex Steger on Mar 07, 2013 at 07:42
Life company Aviva has posted a loss after tax of £3.1 billion for 2012 and slashed its dividend from 26p to 19p.
In volatile trading shares in the business were off around 15% at the opening bell at 304.5p.
The £3 billion loss includes the £3.3 billion writedown from the disposals of its US business, and compares to the £60 million profit it posted in 2011.
Aviva’s final 2012 dividend was 9p per share, bringing the full-year dividend down by 27% to19p from 26p and the final dividend down by 44% from 16p.
The company has also announced a pay freeze for its top 400 managers.
In July 2012 the provider announced plans to cut costs by £400 million by the end of 2013 and exit non-core markets or underperforming areas of the business.
So far it has realised savings of £275 million and disposed of businesses in the US, Malaysia, Russia, Holland, Spain and Sri Lanka.
Aviva chief executive Mark Wilson (pictured) said the sale of the US business, for £1.1 billion, around half what it paid for it six years earlier, was responsible for the £3 billion loss.
‘2012 was a year of transition at Aviva,’ he said. ‘The £3 billion loss after tax is driven principally by writedowns we have previously announced due to the agreed sale of our US business.’
Aviva chairman John McFarlane said he regretted that it had become necessary to reduce the dividend.
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