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Richard Harvey has surprised us all by announcing he is stepping down as chief executive of Aviva, a post he has held since the group was formed through the merger of Norwich Union and CGU in 2000. He says he wants new challenges but, at 56, he is leaving well before the retirement age of 60. And it was only last September that he told the industry’s Post Magazine: “The normal retirement age is 60 in this office, so we have got a bit of time to go.” His successor will be the finance director, Andrew Moss, but this will be seen as a blow to Patrick Snowball, head of Aviva’s UK operations. A cloud has hung over Harvey since his botched attempt to merge with Prudential last year. More significantly, since 2000, Aviva’s shares are down 9.2 per cent in absolute terms and have underperformed the FTSE-100 by 10.9 per cent, although they look a lot better over the last year.
Lots more retail news today, most interestingly that WH Smiths’ pension scheme is being closed to existing members. You may remember that WH Smith was one of the first companies to adopt liability-driven investing so today’s announcement raises the question of whether that strategy is working as well as hoped.
After M&S yesterday, it is Wm Morrison’s turn to produce evidence of recovery. It has reported Christmas trading figures ahead of expectations with like-for-like sales up by 6.3 per cent over the period. The shares are up 4 per cent in early trading.
There is also good news at last from JJB Sports, which says its Christmas trading performance has been “satisfactory” and in line with expectations, as increased demand for replica kits of Premiership football clubs helped lift revenues and gross profits.
We’ll also take a look at what seems to be a good story in the Wall Street Journal about two hedge funds planning to float: Brevan Howard and Polygon, which is in the news at the moment with Countrywide and Teesland. If true, Polygon will really have to work on its openness: check out its website.
Rumour of the Day: Neil Hume is picking up rumours that BP could announce a rise in its dividend after its share buy-back programme failed to support the share price. The stock, hit by yesterday’s disappointing trading update, is off another 2 per cent today.