LONDON: Prudential PLC said that growth in Asia continued to push up sales but was offset by falling profits in the UK and US in the first quarter of this year.
The insurer and asset manager reported that so far this year its total annual premium equivalent — a common measure of sales for UK insurers — reached £1.25 billion ($US1.89 billion), a rise of 7 per cent compared with last year. Total new business profits fell 6 per cent to £496 million, however, as the company’s more mature markets contended with government reforms and low interest rates.
Prudential’s chief executive, Tidjane Thiam, is stepping down in June and will be replaced by Mike Wells who is currently head of its North American business.
The group has made a strong start to the year, particularly in Asia,” Mr Thiam said. “This performance demonstrates our continued execution of a clear, consistent and successful strategy centered on Asia.”
In Asia, Prudential saw sales grow by a third. Its sales in Asia have now been growing at an average rate of 16 per cent per quarter for nearly two years.
In the US, Mr Thiam warned that performance would be variable as the company tries to reduce its reliance on selling variable annuities.
Prudential’s UK business is adapting to an overhaul of the pensions market brought in by the government last year, which abolishes a requirement for pensioners to buy an annuity when they retire. Instead, Prudential is hoping to sell more income drawdown products but, unlike its rivals, it isn’t expanding its bulk annuity sales significantly.
