Just Group Shares Drop Despite Exceeding Profit Target

Just Group (LON: JUST) shares dropped over 15% on Friday despite the company reporting a 34% rise in underlying operating profit for 2024, significantly exceeding its five-year target in just three years.

The retirement income specialist posted an underlying operating profit of £504 million, up from £377 million in 2023, driven by a 36% surge in shareholder-funded retirement income sales to £5.3 billion. 

However, IFRS profit before tax declined 34% to £113 million, impacted by lower non-operating items.

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CEO David Richardson highlighted the company’s strong performance, stating: “We made a pledge three years ago to double profits over five years. We have significantly exceeded that target in just three years and created substantial shareholder value as a result.”

Despite these positive results, the stock came under pressure. As of 8:45 am, it is trading at 138.6p, down 15.03%. It hit a low of 135.8p earlier in the session.

The decline may be due to profit-taking after a strong rise over the last 12 months, while there may also be slight concerns over the IFRS profit before tax or a lower new business margin, which fell slightly to 8.7% from 9.1% in 2023. The company attributed this to business mix changes.

Just Group maintained a strong capital position, with a Solvency II coverage ratio rising to 204% from 197%, and announced a 20% increase in its dividend to 2.5p per share.