Prudential’s profit for the first half of 2024 plummeted by 80.8% year-on-year (YoY), falling to $182 million. This sharp decline is attributed to reductions in both new business and operational performance.
The company’s new business profit experienced a slight decrease of 1.4% YoY, totaling $1.5 billion. When adjusted for economic factors, this figure represents an 8.0% YoY increase.
Earnings per share also suffered, contracting by 87.2% YoY to 4.4 cents.
Chief Executive Officer Anil Wadhwani attributed the downturn to the exceptional 47% growth in new business profit seen in 2023, which followed a significant rebound in Hong Kong post-COVID-19 restrictions and the reopening of borders with the Chinese Mainland.
Despite the drop in profits, Wadhwani reaffirmed the company’s strategic direction, aiming for a 15-20% compound annual growth rate (CAGR) in new business profit and double-digit cash generation by 2027.
The first half of 2024 saw support from Prudential’s strategic repositioning in the Chinese Mainland, early medical repricing efforts in Indonesia and Malaysia, and robust performances in Singapore, India, and Taiwan. The company is focusing on enhancing cash conversion, managing operational discrepancies, and utilizing its scale effectively.
While new business profit from agency channels declined due to a high base effect from 2023, bancassurance experienced a 28% increase in new business profit, with notable growth in Hong Kong, Malaysia, Singapore, Taiwan, and Thailand.
Sales momentum improved in June, and Prudential expects this trend to persist into the second half of 2024. The company projects that new business profits will align with its 2022-2027 targets, buoyed by strong demand across Asia and Africa for protection, long-term savings, and retirement products.
