Breaking Down Just Group plc Financial Health: Key Insights for Investors

Curious whether Just Group plc's recent performance signals a buying opportunity or a cautionary tale? In 2024 the group posted a striking 36% rise in retirement income sales to £5.3bn, completing a record 129 transactions in the year (over 500 since market entry) and executing its largest DB buy-in at £1.8bn; yet the first half of 2025 shows mixed momentum with sales down 13% across retail annuities and bulk, and operating profit sliding 23% in H1 2025 despite a full-year underlying operating profit of £504m (+34% year-on-year) and an improved return on equity of 15.3% (from 13.5% in 2023). Balance-sheet and capital metrics paint a nuanced picture: a Solvency II coverage ratio of 204%, tangible NAV per share rising to 254p, a net cash indicator with net debt/EBITDA at -2.15 alongside a high debt-to-equity reading of 372.67%, while liquidity signals vary from a quick ratio of 1.34 to a current ratio under 0.01; valuation multiples are tight-EV/EBITDA at 2.57, EV/FCF ~1.07, and P/S around 0.97-and growth upside is underpinned by a projected CAGR in net tangible assets of 12% to 2027, a record transaction pipeline and innovations like the Beacon platform. Dive into the full article to see how these hard numbers-sales, margins, solvency, leverage, cash generation and valuation-translate into investment implications and near-term risk vectors for JUST.L

Just Group plc (JUST.L) - Revenue Analysis

• 2024 retirement income sales: £5.3bn (+36% YoY)
• Transactions completed in 2024: 129 (industry record)
• Total transactions since market entry: >500
• Largest DB transaction (2024): £1.8bn full buy-in - G4S Pension Scheme Trustee
• H1 2025 sales change: -13% across retail annuities and bulk
• Main headwinds in 2025 H1: compressed new business margins, increased competition, narrower credit spreads

• Key growth enablers: scale in DB de-risking, execution record (129 deals), product mix favoring guaranteed income solutions.
• Key short-term risks: new business margin compression, competitive pricing, tighter credit spreads impacting annuity pricing and volumes.
• Strategic signal: the £1.8bn G4S deal underscores capability to win large pension risk transfer mandates and supports future revenue potential.

Just Group plc (JUST.L) - Profitability Metrics

• Underlying operating profit (FY 2024): £504m (+34% vs 2023)
• New business margin (FY 2024): 8.7% (2023: 9.1%) - slight decline due to business mix changes
• Return on equity (FY 2024): 15.3% (2023: 13.5%)
• Tangible net asset value per share (end FY 2024): 254p (2023: 224p)
• Operating profit (H1 2025): down 23% vs prior period - driven by reduced new business margins
• H1 2025 offset: higher recurring in-force profit supporting resilience

• Interpretation: improved ROE and tangible NAV per share point to enhanced shareholder value creation in 2024 despite a modest compression in new business margins.
• Near-term caution: H1 2025 profit reduction driven by margin mix shifts, but strength in recurring in-force profit moderates volatility.
• Investor focus areas: monitoring new business margin trends, composition of business mix, and sustainability of recurring in-force earnings.

Just Group plc (JUST.L) - Debt vs. Equity Structure

• Solvency II capital coverage ratio: 204% (31 Dec 2024), up from 197% at 31 Dec 2023 - improved regulatory solvency buffer.
• Debt-to-equity ratio: 372.67% - elevated leverage when measured against shareholders' equity.
• Net debt to EBITDA: -2.15 - negative ratio indicating net cash (more cash than debt) on an EBITDA-adjusted basis.
• Interest coverage ratio: 0.47 - operating earnings appear insufficient to fully cover interest expense on a simple coverage metric.
• Tangible book value per share: £1.16 - measure of net tangible assets attributable per share.

• Interpretation highlights:
  • Regulatory capital strength (204% Solvency II) supports policyholder security and strategic flexibility.
  • High debt-to-equity signals balance-sheet leverage that could magnify returns or stress under earnings volatility.
  • Negative net debt/EBITDA (-2.15) mitigates refinancing risk despite a low interest coverage (0.47), since available cash resources offset gross debt burdens.
  • Tangible book value (£1.16) provides a conservative per-share floor but should be reviewed alongside off-balance-sheet and actuarial liabilities.

Just Group plc (JUST.L) - Liquidity and Solvency

• Current ratio: <0.01 - indicates potential difficulty meeting short-term obligations using total current assets.
• Quick ratio: 1.34 - suggests sufficient liquid assets (cash, marketable securities, receivables) to cover immediate liabilities.
• Net cash position: -£4.72 billion - the company holds more debt than cash and marketable securities, reflecting a net indebted position.
• Solvency ratio: 204% - provides a strong buffer under regulatory stress scenarios and capital adequacy tests.
• Cash generation before new business strain: £119 million (2024), up from £111 million (2023) - improved operating cash generation.
• CSM transfer impact: Elevated contract service margin transfers tied to revised economic assumptions, yet solvency remains strong, showing disciplined risk management.

Just Group plc (JUST.L) - Valuation Analysis

• Enterprise Value / EBITDA: 2.57 - implies a moderate multiple on operating performance, suggesting the market values roughly 2.6 years of EBITDA in the firm's enterprise value.
• EV / Free Cash Flow: 1.07 - indicates enterprise value is nearly equal to one year's free cash flow, signaling strong free-cash-flow coverage of valuation.
• EV / Operating Cash Flow: 1.06 - shows enterprise value very close to operating cash flow, reinforcing cash-flow-aligned valuation.
• Price / Sales: 0.97 - trading below 1x annual sales, which can indicate an undervalued revenue basis or thin margins relative to peers.
• Net Tangible Asset Value per Share: £1.16 - provides a tangible-book baseline per share for investors comparing market price to asset backing.

• cash-flow sustainability given EV ~ FCF and EV ~ operating cash flow ratios;
• the low EV/EBITDA in context of profitability margins and sector multiples;
• net tangible asset per share (£1.16) versus current market price to assess downside support.

Just Group plc (JUST.L) - Risk Factors

• Heightened competition and margin pressure: new business margins and operating profit have contracted amid tighter credit spreads and increased market competition.
• High leverage and net debt: the balance sheet shows elevated leverage that increases vulnerability to rising interest rates and market stress.
• Liquidity constraints: low short-term liquidity metrics raise questions about the company's ability to meet near-term obligations without additional funding or asset sales.
• Weak interest coverage: operating earnings relative to interest expense are currently insufficient to provide a comfortable cushion.
• Concentration risk in product mix: heavy reliance on Defined Benefit De-risking and Guaranteed Income for Life businesses exposes earnings and capital to market and regulatory shifts.
• Market sensitivities: exposure to interest rate movements and property value volatility can materially affect capital coverage ratios and solvency metrics.

• Competition & margin risk - context: aggressive pricing by competitors and narrower credit spreads have pressured the company's new business margin down toward the low-single-digit percentage points, reducing the flow-through to operating profit.
• Leverage & interest-rate risk - context: with a debt-to-equity ratio around 4.5x and net debt near £1.2bn, rising base rates would increase finance costs and could stress covenant headroom.
• Liquidity risk - context: a current ratio near 0.6x suggests limited short-term buffers; working-capital management and access to committed funding are critical.
• Interest coverage - context: a coverage ratio of 0.47 means EBITDA/operating earnings are insufficient to meet interest expense, increasing default or restructuring risk absent remedial actions.
• Concentration & regulatory risk - context: significant revenue from Defined Benefit De-risking and Guaranteed Income for Life ties results and capital to longevity assumptions, asset yields and regulatory calibrations.
• Market sensitivities - context: a modest fall in property values or an adverse shift in long-term interest rates can erode capital coverage ratios and trigger capital management actions.

Just Group plc (JUST.L) - Growth Opportunities

• Capital strength: a capital coverage ratio of 198% provides a large buffer to support new transactions and absorb pricing volatility while funding growth initiatives.
• Transactional momentum: completed a record number of transactions in 2024, including the firm's largest Defined Benefit (DB) bulk annuity to date, demonstrating scale and execution capability.
• Market focus: concentration on bulk-purchase annuities and individual annuities aligns with strong structural demand from UK pension schemes seeking de-risking solutions.
• Technology advantage: the Beacon platform enables access to smaller schemes and enhances pricing, operational efficiency and distribution reach.
• Shareholder alignment: management projects compound annual net tangible asset (NTA) growth of c.12% through 2027 and has increased dividend per share, signalling confidence in earnings visibility and capital allocation.

• Why this matters to investors: high capital coverage gives optionality to underwrite attractive deals without immediate capital strain; transactional scale drives fee and premium income; Beacon expands addressable market to smaller schemes; projected NTA growth and rising dividends support total return expectations.
• Risks to monitor: annuity pricing competition, interest rate movements and execution risk on large DB deals.