Wesleyan has announced its results for the year ended 31 December 2023.
2023 results summary
- Wesleyan demonstrated profitable growth on the previous year with an increase in operating profit* to £12.3m (from £7.2m), despite continued economic uncertainty in 2023.
- Assets Under Management rose to £7.6bn (from £7.2bn).
- Wesleyan’s flagship With Profits Fund produced a gross return of 9.9% before smoothing and charges (2022: -4.7%). The 10-year cumulative gross return for the fund was 84%.
- Good progress was made in-year against Wesleyan’s strategic plans to build a stronger, more sustainable business, including extending the reach of the Wesleyan With Profits Growth Fund onto a second adviser platform and delivering a comprehensive programme of initiatives to improve customer experience, increase sustainability and enhance efficiency.
- The Society’s financial strength meant it was in a position to distribute £10m to its members in the form of a mutual bonus to boost investment returns (paid in March 2024 based on 2023 results).
Further results detail
- The Group remained capitally strong with a Solvency Ratio of 322% (2022: 373%). The Solvency ratio decreased in 2023 due primarily to the planned investment in transformation activities that will provide value in the future.
- There was a fall in Society Premium Income compared to the previous year due to a reduction in sales of investment products, a result of rising interest rates and cost of living pressures.
- Wesleyan subsidiary Practice Plan Group saw record growth in patient numbers reaching almost 1.3 million patients on its dental membership plans in 2023.
- Wesleyan successfully delivered a programme of activity to ensure readiness and compliance with the new Consumer Duty Regulation.
- 97% (2022: 96%) of personal income protection claims paid compared to an industry average of 84.4%**.
- The Group met its aim to be operationally carbon neutral3 by the end of 2023, reducing its footprint by more than 50% on a like-for-like basis from the 2019 base year and offsetting residual emissions through a diverse portfolio of high integrity carbon credits.
- Colleague engagement increased slightly to 7.9 out of 10 (2022: 7.8) which was positive in light of the fast-paced transformation activity colleagues are delivering.
Mutuality highlights
Wesleyan remains committed to its mutual status and was able to deliver benefits to members and communities in 2023, despite the challenging operating environment. In addition to the £10m mutual bonus, the Group invested further in member benefits including:
- £2.7m (2022: £2.5m) financial contribution made to provide discounts to members on selected insurance policies.
- £0.6m (2022: £0.1m) on its 'Member Reward' programme, launched during 2022, offering annual benefits, including retail vouchers and cashback options.
- £0.9m (2022: £1m) donated to good causes through the Wesleyan Foundation, taking the amount donated to £5.9m since it was launched in 2017.
Mario Mazzocchi, Wesleyan Group Chief Executive, said: "Despite the challenging economic conditions, Wesleyan demonstrated steady progress over the year. Our professional customers had to contend with continued cost of living pressures in addition to further uncertainty in their professional lives, with the NHS and education sectors remaining under pressure.
"We are confident that the growth achieved in operating profit is a clear indication that our strategy of sustainable growth is working. The impact of new income streams and more efficient ways of working, alongside our focus on good cost control, has protected us against the worst of the difficult trading conditions in recent years.
"Through increased automation and the streamlining and digitising of communications, we are making it easier and quicker for customers to do business with us, in a more sustainable way. This has, for example, enabled us to reduce the administrative complexity for bereaved customers, while ensuring a faster resolution of claims - providing better outcomes for customers at a difficult time. This is just one of many initiatives delivered over the year to improve the customer experience.
"It is pleasing to see that we are making progress on our journey to becoming a more modern and sustainable mutual that can continue to create brighter financial futures for our specialist customers for many years to come.
"Looking forward, we are focused on improving the service and digital experiences of our customers at the same time as further reducing our cost to serve. This will unlock profitable growth, improved outcomes for customers and greater value for our members."
Chair Nathan Moss added: "Our members can have full confidence that our investment in building a stronger, more sustainable business is working and will deliver value for them over the long-term. We are pleased to announce a Mutual Bonus this year as part of our commitment to members.
"The Board oversaw plans that ensured Wesleyan was well-placed to meet the requirements of the new Consumer Duty and we are continuing to build a culture where good customer outcomes are at the core of our business.
"We also made strong progress in a number of key strategic areas over the year, including progressing our sustainability strategy and enhancing our culture to be more flexible, inclusive and diverse.
"Wesleyan’s performance in 2023 pays testament to the passion and commitment of our people and the Executive team who leads them. I thank them for their hard work and also our members and customers whom we are proud to serve."
* Group operating profit/loss represents profit before investment fluctuations and other accounting and tax adjustments
** Association of British Insurers (ABI); May 2022 (figures published in 2023)