Prudential Rallies as Asia Unit Boosts New Business ProfitSarah Jones
Prudential Plc, the U.K.’s biggest insurer by market value, posted better-than-expected new business profit, boosted by “double-digit” sales growth in six South-East Asian markets. The shares climbed.
Profit from new business rose 12 percent to 1.95 billion pounds ($3.1 billion) in the nine months to Sept. 30, the London-based insurer said today in a statement. That beat the 1.9 billion-pound estimate of 18 analysts surveyed by the company. New business profit in Asia jumped 20 percent, while sales in the region increased 15 percent.
“We remain on track to achieve our 2013 growth and cash objectives,” Chief Executive Officer Tidjane Thiam said in a conference call with reporters in London today. “The central point for Prudential is the long term structural trends in Asia remain intact.”
Prudential, which gets almost half its revenue from Asia, has more than doubled in London trading since Thiam took charge in 2009, as markets rebounded after the financial crisis and the insurer expanded into Asia. The stock rose 1.9 percent to 1,266 pence, its biggest gain since Oct. 18.
The company said its rise in sales in Asia has been broad based as it reported an increase of at least 10 percent in its “sweet-spot markets,” including Hong Kong. It also said it remains on target to achieve its last Asian-growth objective of doubling 2009 new business profit to 1.4 billion pounds by the end of this year.
Total sales for the nine months increased 6 percent to 3.27 billion pounds, in line with the 3.26 billion-pound average analyst estimate in the survey. Sales in its U.S. business, climbed 6 percent to 1.2 billion pounds, while the U.K. fell 12 percent to 540 million pounds.
Thiam said Prudential’s investment unit provided a “huge contribution” to earnings with M&G reporting net inflows of 8.9 billion pounds in the nine-month period. Third party funds under management climbed 19 percent to a record 124 billion pounds from the year-earlier period.
Prudential Plc has no relation to Newark, New Jersey-based Prudential Financial Inc.