Negative Annuity margins in Q3 consistent with last year On first view, there was weakness in Annuity margins, -1% in Q3 after weak but positive in H1 (+2%); however, Q3 last year was an even weaker -4% margin in Q3, with both reflecting timing differences before asset investment. In addition, Savings & Retirement margins at 0.6% were also slightly lower than the 0.9% at H1, but stronger than last year on a discrete quarter basis. Similarly, cash remittances were zero in Q3 after £1.1bn in H1, which looks weak, but no cash remittances had been planned. GI COR was 94% in Q3, weaker than H1’s 91.6%, as guided due to weather, but consistent with better than 94% for FY guidance, which is unchanged. We would note that Q3 CORs were worse than Intact reported yesterday (Canada: 93% versus 89% and UK: 95% versus 94%). GI growth slowed from 6% at H1 to 5% at 9m, consistent with our 4% FY forecast. SII ratio, pro-forma for disposals and £4bn capital return, as of Nov 5th, was 197%, consistent with our published FY22E forecast of 198% (it fell from 200% at Q3, due to lower government yields). Outlook for better full year margins and cash remittance unchanged Outlook remains for Annuity margins to improve in Q4, but for FY margin to be below last year, on lower volumes (now quantified at £5-6bn versus £7.5bn last year), and for cash remittances to grow strongly for the FY from last year’s £1.4bn, despite zero in Q3, with the medium-term guidance of cumulative remittances of £5bn through 2023 unchanged. Full year results next catalyst Net neutral to a small negative, in our view, albeit multiples are undemanding. Call at 9am. Aviva trades on c.0.9x Own Funds for 6% yield, rising to 7% in FY23E. Company is guiding to an update on capital return at full year results, when we would also expect an update on medium term targets, with confidence in long-term cash generation key to a sustained re-rating.