Prudential 2017 profit up 24% YOY ahead of demerger
UK-based savings and protection products provider Prudential has grown after tax profits by 24 percent year on year ahead of the demerger of its global business.
Profit after tax grew to £2.39 billion in 2017 from £1.92 billion in 2016.
“Our clear, consistent strategy, high-quality products and constantly improving capabilities have enabled us to deliver excellent progress across the group, led by double-digit growth in our Asia business,” said CEO Mike Wells.
“The performance of our Asia business is testament to the strength, scale and diversity of our platform in the region, our focus on recurring-premium health and protection business and the quality of our execution. Our Asia life businesses delivered a 15 percent increase in IFRS operating profit and a 12 percent increase in new business profit over the year, while assets under management at Eastspring increased by 18 percent. We continue to develop our capabilities in Asia, building scale and enhancing quality.
“In the US our life business, Jackson, remains focused on meeting the retirement income needs of the growing numbers of baby boomer retirees and extending our products and reach to improve access to the large asset pools of the fee-based advisory market. Jackson delivered positive separate account net inflows of £3.5 billion, with separate account assets increasing by 19 percent.
Prudential is demerging its UK & Europe business (M&G Prudential) from Prudential plc, resulting in two separately-listed companies. On completion of the demerger, shareholders will hold interests in both Prudential plc (Asia and US business) and M&G Prudential.
M&G Prudential, which was formed in 2017 through the combination of the company’s asset manager, M&G, and Prudential UK & Europe, has delivered record levels of external asset management net inflows of £17.3 billion in 2017, contributing to total assets under management of £351 billion, the company said.
The UK and Europe operations increased the operating profit by 10 percent year on year to £1.38 billion in 2017. The US business grew operating profit by 9 percent year on year to £2.22 billion while the Asian business expanded operating profit by 20 percent year on year to £1.98 billion.
“‘Our strategy is aligned to structural trends: the savings and protection needs of the fast-growing middle class in Asia, the retirement income needs of the baby boomers in the US and the increasing demand for managed savings solutions among the ageing populations of the UK and Europe,” Wells explained. “The Group’s performance demonstrates that we are highly effective in accessing the opportunities arising from these trends, and that we are meeting the needs of our customers better than ever before. I am confident that, given the extent of our opportunities and our proven ability to execute and innovate, we are well positioned to continue to grow profitably.”
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