For 1HFY2022, Prudential saw optimistic sales and operational profit results amid considerable macroeconomic volatility during this time.
During the period, the group’s annualised premium equivalent (APE) sales increased by 6% y-o-y to US$2.21 billion ($3.05 billion), or 9% up y-o-y on a constant exchange rate.
“Our resilient operational performance enabled us to maintain APE sales growth over the first quarter, despite considerable Covid-19-related disruption in many markets,” says Mark FitzPatrick, group chief executive of Prudential. “We achieved stronger APE sales growth in the second quarter as conditions started to normalise in most markets.”
Meanwhile, new business profit fell by 7% y-o-y to US$1.10 billion, following the impact of higher interest rates and differences in geographical and channel mix. On a constant exchange rate, new business profit fell by 5% y-o-y.
Adjusted operating profit was up 8% as compared to 6% to $1.67 billion.
However, earnings (or profit before tax attributable to shareholders) for the period plunged by 76% y-o-y to US$300 million.
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The group also registered a loss of US$3.51 billion for the period from continuing operations, compared to the profit of US$1.91 billion a year ago.
European embedded value (EEV) shareholders’ equity from continuing operations stood at a US$5.28 billion loss from the US$1.24 billion profit the year before.
“We are on track to deliver a US$70 million reduction in head office costs by the start of 2023 in addition to the US$180 million saving achieved following the demerger of the UK business,” says FitzPatrick.
In the 1HFY2022, Prudential has declared an interim dividend of 5.74 US cents per share, up 7%, equating to one third of the prior year full-year dividend of 17.23 US cents per share.
“We continue to invest in the business including extending Pulse beyond a consumer app so that it covers Prudential’s key business processes, from enabling agents by using tools designed to enhance productivity, to fulfilment of policy sales and servicing,” FitzPatrick says. “Ultimately we believe this will help drive greater customer centricity and efficiency.”
“In addition, via the Pulse platform, we are able to add additional distribution capability, allowing access to new channels and new customer segments which extend beyond our existing distribution footprint,” he adds.
The Pulse digital platform is focused on the health, wealth and servicing needs of Prudential’s customers, extending beyond the Pulse app to include the group’s key business processes, from enabling agents by using tools designed to enhance hiring and productivity, to fulfilment of policy sales and servicing.
As at June 30, Prudential’s group-wide supervision framework (GWS) capital surplus over the group minimum capital requirement (GMCR), following Hong Kong and China regulatory changes, remains strong and resilient at US$19.4 billion representing a cover ratio of 548%.
Shareholder GWS capital surplus over the group’s prescribed capitalrRequirement (GPCR) was US$16.2 billion, equivalent to a coverage ratio of 317%.
Moody’s total leverage ratio for Prudential at June 30 was estimated to be 22%, well within the firm’s target range of 20%-25%.
Photo: ST
