Prudential reports 12pc uptick in new business profit

(Sharecast News) - Prudential reported a 12% increase in new business profit for the first quarter on Wednesday, reaching $608m on a traditional embedded value basis, supported by broad-based growth across its key Asian markets. The FTSE 100 life and health insurer said annual premium equivalent (APE) sales rose 4% to $1.68bn, while the group's new business margin expanded by two percentage points.

It said the strongest contributions came from Hong Kong, mainland China, Indonesia and Singapore.

In Hong Kong, new business profit rose at a double-digit rate, driven by volume growth and pricing actions taken in 2024, alongside the launch of a new multi-currency savings product.

Mainland China also delivered double-digit profit growth through its joint venture CITIC Prudential Life, reflecting a more profitable product mix and a seasonally strong first quarter.

Indonesia maintained momentum from its ongoing operational transformation, with strong growth in health-related APE sales following the rollout of new medical products.

In Singapore, both agency and bancassurance channels contributed to another period of double-digit profit growth.

Malaysia saw a decline in new business profit compared with a strong prior-year period, with results reflecting changes to health pricing and continued reliance on the bancassurance channel.

The 'growth markets and other' segment also delivered double-digit profit growth, with particularly strong performances in Taiwan and the Philippines, though that was partly offset by weakness in Vietnam, where consumer confidence remains subdued.

Prudential's asset management arm, Eastspring, reported funds under management or advice of $256.2bn at the end of March, broadly in line with year-end levels.

Net inflows from insurance operations and retail third-party investors were offset by institutional outflows and other movements.

The group also provided an update on its ongoing legal dispute in Malaysia with Detik Ria, a minority shareholder in Prudential Assurance Malaysia.

Detik Ria had lodged a new claim for $813m in dividends plus interest.

Prudential denied liability, and said it would vigorously defend its position, including pursuing any available counterclaims.

"Our on-going focus on quality growth in new business profit continues to produce attractive returns and capital generation," said chief executive officer Anil Wadhwani.

"Our strong 2025 first quarter new business performance reflects the benefits of our on-going efforts to build and modernise our capabilities to better serve our customers.

"New business profit grew by 12% in the first quarter of 2025, consistent with our guidance that we expect 2025 new business profit to grow by more than 10%."

Wadhwani said new business profit growth in the first quarter was broad-based across the company's markets, driven by higher volumes and a two percentage point margin improvement.

"Across the business we continue to advance our operational efficiency by investing in technology and refining our operating model.

"We have welcomed strong new talent to the business with the appointment of John Cai to lead agency across our markets and serve as regional CEO for Malaysia, Indonesia and Vietnam.

"We continued to deliver shareholder value in 2025 having completed an additional $442m of repurchases under our $2bn share buyback programme between 1 January and 23 April."

Prudential was continuing to evaluate a potential listing of its India asset management business, Anil Wadhwani noted, as discussed in its 2024 annual report, with the intention that net proceeds would be returned to shareholders.

"The current tariff uncertainty does not directly impact our business but has resulted in global economic and market volatility, with the impacts of the latter illustrated by our published sensitivities.

"We remain confident that, despite the wider macroeconomic uncertainty, our robust solvency position and multi-channel, multi-market franchise situates us well for long-term success in this highly profitable and attractive growth business."

At 0922 BST, shares in Prudential were down 2.24% at 786p.

Reporting by Josh White for Sharecast.com.