Insurer Prudential's annual profit rises, company bullish on future growth

By John Biju and Adwitiya Srivastava

(Reuters) - Prudential PLC posted a solid increase in annual profit on Thursday, propelled by strong growth in most of its segments, and robust demand for insurance products in Hong Kong and Singapore.

The London- and Hong Kong-listed insurer expects to grow new business profit and basic earnings per share, based on adjusted operating profit and operating free surplus, by more than 10% in 2025 on a constant exchange rate basis, it said.

"In our view, the most important development is that Prudential is guiding to more than 10% growth in 2025 for all key metrics," analysts at Jefferies said in a note.

Prudential also estimated that dividends per share would increase by at least 10% this year, after declaring a second interim cash dividend of 16.29 cents per share, and a total dividend of 23.13 cents per share for 2024.

The company posted an adjusted operating profit before tax of $3.13 billion for the 12 months ended December 31, a 10% increase compared with the previous year, on a constant exchange rate basis.

Total new business profit grew 11% to $3.08 billion.

CEO Anil Wadhwani highlighted growing demand for long term savings and protection products across the company's markets, and a need for wealth management and retirement planning, particularly in the higher income Asian markets.

"Insurance penetration rates in Asia are low. We have seen good progress in 2024 with improved cash signatures for new business, growth in the number of active agents in the second half (of the year), and actions undertaken to improve our variances," Wadhwani said.

The annual premium equivalent (APE) sales, a gauge of sales volume, for Hong Kong grew 5%, while the Singapore segment posted a 10% jump. The company registered growth in 18 of its 22 markets.

However, it highlighted a challenging macroeconomic environment in China, with a substantial reduction in long-dated government bond yields, which it expects to continue through 2025.

Hong Kong-listed shares were up 0.2% to HK$78.00 as of 0539 GMT.

(Reporting by John Biju and Adwitiya Srivastava in Bengaluru; Editing by Vijay Kishore and Rachna Uppal)