Prudential profits grow on robust Asian demand
Insurance giant Prudential reported Thursday that earnings growth in the third quarter was driven by new business profit in Asia, up 20 percent year-to-date to £990 million ($1.58 billion).
It reported total group new business profit for the year to date of £1.95 billion up 12 percent on this time last year. Third-quarter new business profit for insurance was up 14 percent at £682 million.
Shares of the group were up 2.5 percent on Thursday morning.
In its interim management statement, the group said that the "central point" for Prudential was that "the long-term structural trends in Asia of faster GDP growth, low insurance penetration, a rapidly growing and wealthier middle class, high savings rates and strong demand from the middle class for protection remain intact and are a key driver of sustainable and profitable growth for the company."
Tidjane Thiam, chief executive officer of Prudential, told CNBC the business had done "very well," particularly in the U.S. -- where the group reported an 11 percent increase in total group new business profit year-to-date --- and Asia, despite what he called a difficult macro-economic environment and "FX headwinds" in the third quarter.
In the U.K., where new business profit dropped 10 percent in the year to date to £204 million, Thiam said the U.K. life and pensions had been hit by regulatory changes.
Thiam remained confident the group faced several growth opportunities around the globe, presented by a growing middle class in Asia, baby boomers in the U.S. and even in the U.K. - where he said business had been hit by regulatory changes.
Thiam brushed off rumors that the group could be discussing a spin-off of the Asian or American business when the group meets for its 2013 investor conference in December.
"I'm very relaxed with saying don't expect that. We are pleased with the structure of the group - it's my job to maximize shareholder value and when the share price was much lower we had to be open minded about the composition of the group -we're not wedded to any structure but to a structure that works and this one is working."
"I don't think anyone should expect any drama on December 10, I'm afraid we're going to boring and continue to tell the same story of growth in [business among] the middle-class in Asia, the baby boomers in America and the U.K.," he said
In August the group raised its 2013 interim dividend payout by 16 percent on the back of a 22 percent rise in first half profit, but Thiam refused to say if investors could expect more.
"We think we're going to meet our 2013 targets and we happen to have a lot of opportunities for growth," he said.