AEGON reaffirming 2018 financial targets
Aegon management will reaffirm the company's 2018 financial targets and detail additional management actions to accelerate the restructuring of its US business at its Analyst and Investor Conference. Management reaffirms financial targets of: return on equity of 10% through organic growth, expense savings and capital return; EUR2.1B capital return to shareholders in 2016-2018; expense reduction program increased to EUR350M from its original target of EUR200M. Maintains 10% RoE target in 2018. Expects Q4 restructuring charges associated with the expense savings target of EUR20M. Management is announcing new actions to accelerate restructuring in the US: doubling of the 2018 expense savings target to $300M; further net reduction of over 500 positions; closing 3 offices; exiting the Affinity, Direct TV and Direct Mail channels; investing in capabilities to create a differentiated digital offering. The original $150M expense savings plan will be completed in 2017, and the expense savings target to be achieved by year-end 2018 has now been doubled to $300M. As a result of exiting the Affinity, Direct TV and Direct Mail channels, $100M of capital will be released over the next three years, while underlying earnings before tax will be reduced by approximately $25M per annum.