Earnings Labs

Prudential plc (PUK)

Q2 2021 Earnings Call· Wed, Aug 11, 2021

$30.52

-0.21%

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Transcript

Mike Wells

Management

Good morning. I’m Mike Wells, CEO of Prudential PLC, and today we announced our 2021 half year results. Our purpose is to help people get the most out of life. And we do this by making healthcare affordable and accessible and by protecting people’s wealth and by growing their assets. We want to do this for as many people as possible, which is why we want to build the capacity to serve 50 million customers by 2025. Our Asia-focused strategy is expected to support the long-term delivery of future shareholder returns, and as we intend to grow new business profit substantially faster than our markets’ GDP and achieve long-term double-digit growth in embedded value per share. We want to achieve our growth trajectory in a sustainable and socially responsible manner by committing to become net carbon neutral by 2050. We will achieve this in three ways. Firstly, through delivering profitable growth particularly in the big markets of China, India, Indonesia and Thailand. We want to grow our Health & Protection business by making healthcare affordable and accessible, and we want to grow our customers’ wealth in a sustainable way through Eastspring. Secondly, through digitizing our products and services. We are making it easier for customers to interact and stay with us in the way that they choose. The key here is we are doing all this at scale and complementing our existing multi-channel capability. Thirdly, through humanizing our company and advice channels. We are upskilling our people and networks and providing relevant products and broader advice enabling a much more inclusive approach to the segments we serve. Because of our focus on operational improvements and the disciplined execution of our strategy, we have delivered a long track record of strong growth in all our key metrics. Our 2021 interims results…

Mark FitzPatrick

Operator

Hello, I am Mark FitzPatrick, the Group CFO and COO of Prudential. In this presentation I will focus on three key components of our continuing Asia and Africa business, growing value, growing capital, and growing earnings. As we have proposed Jackson demerger is expected to complete in September, Jackson has been classified as held for distribution and presented as discontinued within our half year 2021 financials. Accordingly I will only refer to it briefly in that context. As Mike has indicated, our people, our agents and our partners have performed very well in this half, culminating in positive results across our financial metrics. Compared with the first half of 2020, we have grown new business profit by 25% and grew OFSG, our primary measure of capital generation for our life and asset management businesses by 9% and our GWS shareholder capital surplus by 7%. We also grew Asia operating earnings by 11% and group IFRS operating profit by 19%. And lastly, in-line with our dividend policy which applies a formulaic approach to first interim dividends, the Board has approved a 2021 first interim dividend of $5.37 per share. Turning to my first topic, growing value. Looking at each of our new reporting segments, new business profit for China, Singapore, Malaysia and growth markets all rebounded very strongly, despite COVID-related disruption in many of our markets and reflects higher sales from our expanded product offering, broader roots to market and use of new digital capabilities. In Hong Kong, overall new business profit fell 13%, due to the very low levels of cross-border business compared with the prior period. However, in our domestic Hong Kong business, new business profit was up 16% reflecting our continued focus on high quality Health & Protection business. Supporting that Health & Protection performance, our focus on…