Prudential reported a 25% increase in first-half new business profits on Wednesday but struck a cautious note over the short-term outlook due to Covid uncertainty.
In the six months to 30 June, new business profits rose to $1.18bn from $912m in the same period a year ago. Meanwhile, adjusted operating profit from continuing operations was 19% higher at $1.57bn.
Chief executive Mike Wells said: “We have delivered a resilient performance in the first half of 2021, against a backdrop of continuing economic and social challenges due to Covid-19 and the resulting volatility in consumer activity.
“Our operational performance in Asia and Africa reflects the strength of our strategy and our execution. In the first half of 2021, APE sales from Asia and Africa increased by 17%, while new business profit was up by 25%. This was delivered through our platform of around 560,000 agents and our access to more than 28,000 bank branches.”
Wells said he expects the vaccination programmes being rolled out this year and the next to facilitate a gradual return to more normal economic patterns, “although the pace of these programmes and their effect are likely to vary substantially, and give a degree of uncertainty over the economic outlook and therefore the performance of the business in the short term”.
He noted that there remain significant Covid-19 restrictions in many markets including Indonesia, Malaysia, Thailand and the Philippines, while more stringent limitations on movement have recently been introduced in India, Singapore and Vietnam.
Prudential also said it is still considering a potential equity raising of around $2.5bn to $3bn to boost its financial flexibility and de-lever the balance sheet following the completion of the proposed Jackson demerger.
“Our preferred route is a fully marketed global offering to institutional investors concurrent with a public offering in Hong Kong to retail investors,” it said. “Prudential has held discussions with shareholders, and the allocation of any offering will take into account a number of criteria including the interests of existing shareholders and the strategic benefits of enhancing its shareholder base and liquidity in Hong Kong.”
