CGNU Interim Results 2001-Pt1

CGNU PLC
2 August 2001


PART 1 OF 6

UNAUDITED RESULTS - 6 MONTHS ENDED 30 JUNE 2001

Strong set of results

 -   Operating profit before tax from ongoing business* up 42% to £977
     million (2000: £679 million). On a modified statutory basis, operating
     profit before tax was £728 million (2000: £531 million)
     
 -   Worldwide life achieved operating profit up 12% to £857 million
     
 -   Record half-year worldwide long-term savings new business sales at
     £7.1 billion
     
 -   New business contribution up to £272 million (2000: £236 million)
     
 -   General insurance operating profit up 124% to £427 million,
     benefiting from the actions to improve performance and lower weather
     related claims
     
 -   Interim dividend of 14.25 pence net per share (2000: 14.25 pence net
     per share)
     

Executing strategy to create value

 -   Leveraging multi-distribution capability worldwide
     
 -   Bancassurance agreements contributing to total sales in continental
     Europe of £2.6 billion, 36% of our total long-term savings sales
     
 -   Assets under management down to £204 billion, reflecting lower equity
     markets and disposals
     
 -   Group combined operating ratio improved to 103%, on track for our
     target of 102% by the end of 2001
     
 -   Exited value destroying businesses, including the sale of the US
     general insurance business
     
 -   Integration on track for completion by the end of 2001, and we are
     confident that we will exceed our merger savings target £275 million a
     year


*      Including life achieved operating profit and excluding results from
       the discontinued US general insurance and London Market operations.
       All growth rates quoted are at constant rates of exchange.

Richard Harvey, Group Chief Executive, commented:

'These are a strong set of results with operating profit up 42% to £977
million. The results included a 12% increase in life achieved operating profit
and a significant improvement in the performance of the Group's general
insurance businesses.

'We continue to capitalise on the substantial long-term savings opportunities
in Europe. We are using strong market positions to grow our business
organically and are extending our distribution capabilities, in particular by
entering into new bancassurance agreements.

'We have taken our first significant step into long-term savings in South East
Asia through our bancassurance partnership with the Development Bank of
Singapore. We are confident of using our expertise in bancassurance to deliver
value from this agreement.

'As the sixth-largest insurance group in the world, and the largest in the UK,
we have the size, expertise, financial strength and brands to succeed.'

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News Release

Enquiries:

Richard Harvey
  Group Chief Executive              Telephone [phone]
Mike Biggs
  Group Finance Director             Telephone [phone]

Analysts:

Steve Riley
  Investor Relations Director        Telephone [phone]

Media:

Hayley Stimpson
  Director of External Affairs       Telephone [phone]
Alex Child-Villiers
  Financial Dynamics                 Telephone [phone]

There will be a conference call today for wire services at 8.15 am on 020 8240
8240. This conference call will be hosted by Richard Harvey, Group Chief
Executive.

A press conference will take place at 10.30 am at St Helen's, 1 Undershaft,
London, EC3P 3DQ.

A presentation to analysts will take place at 12.30 pm at St Helen's, 1
Undershaft, London, EC3P 3DQ. The presentation slides will be available 
on the Group's website, www.cgnu-group.com
Photographs are available from www.newscast.co.uk

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FINANCIAL HIGHLIGHTS

                                                                          
                                                        6 months  6 months
                                                            2001      2000
                                                              £m        £m
                                                                          
Total premiums written (after reinsurance) and                            
 investment sales - ongoing business                      13,842    13,546
                                                                          
                                                                          
Worldwide long-term savings new business sales                            
                                                                          
Life and pensions                                          6,290     5,249
Retail investments                                           763     1,392
                                                                          
                                                                          
New business contribution                                                 
 (before effect of solvency margin)                          272       236
                                                                          
                                                                          
Achieved operating profit before tax - ongoing                            
 business                                                                 
Life achieved operating profit                               857       754
Health                                                        32        34
Fund management                                               24        22
General insurance                                            427       193
Non-insurance operations                                     (7)      (19)
Corporate costs                                             (81)      (97)
Unallocated interest charges                               (215)     (167)
                                                          ------    ------
                                                           1,037       720
                                                                          
Wealth management                                           (60)      (41)
                                                          ------    ------
Achieved operating profit before tax - ongoing                            
 business                                                    977       679
                                                          ======    ======
                                                                          
Modified statutory operating profit - ongoing business       728       531
                                                                          
                                                                          
Achieved operating earnings per share - ongoing business   27.5p     20.9p
                                                                          
                                                                          
Modified statutory earnings per share - ongoing business   20.6p     16.3p
                                                                          
                                                                          
Equity shareholders' funds                                13,061   13,433*
                                                                          
                                                                          
Total shareholders' funds                                 13,261   13,633*
                                                                          
                                                                          
Dividend per ordinary share                               14.25p    14.25p
                                                                          
                                                                          
Net asset value per ordinary share                          590p     606p*
                                                                          
                                                                          
Assets under management                                   £204bn   £220bn*

Notes

Definitions of Group key performance indicators are set out on page 7
*      Figures provided as at 31 December 2000



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