PRU(US:PUK)2025-03-26 10:58Financial Performance - Prudential reported a significant increase in adjusted operating profit, with a year-over-year growth of 12%[13]. - The company achieved a new business profit of £1.5 billion, reflecting a 15% increase compared to the previous year[13]. - Prudential's free surplus generation reached £1.2 billion, marking a 10% rise from the prior fiscal year[13]. - Profit after tax for 2024 was $2,415 million, up from $1,691 million in 2023 on a constant exchange rate basis[103]. - Total profit after tax for 2024 was $2,415 million, an increase from $1,691 million in 2023, reflecting improved operating earnings[172]. - Profit before shareholder tax increased by $856 million to $2,953 million, reflecting a 22% increase in profits from insurance businesses[184]. - Total tax contributions amounted to $1,086 million in 2024, up from $969 million in 2023, driven by higher withholding tax on investment income[196]. - The effective tax rate on total IFRS profit in 2024 remained unchanged at 18%[186]. - The Group's IFRS shareholders' equity decreased from $17.8 billion at the start of 2024 to $17.5 billion at year-end, primarily due to dividend payments and share buybacks totaling $(1.4) billion[198]. Market Strategy and Growth - The company plans to expand its market presence in Asia, targeting a 20% increase in market share over the next three years[13]. - Prudential's strategy focuses on capturing growth opportunities in Asia and Africa, targeting structural growth markets with a commitment to sustainable growth from 2022 to 2027[47]. - The health protection gap in Mainland China is estimated at $805 billion, with a life insurance penetration rate of only 2%[49]. - India has a life insurance penetration rate of 3% and a health protection gap exceeding $350 billion, representing a significant opportunity for Prudential[50]. - The ASEAN markets have a combined population of over 650 million, with life insurance penetration rates at just 1%[54]. - Prudential's agency force includes over 40,000 monthly active agents, representing 60% of the Group's total[57]. - The Group's strategy focuses on multi-market and multi-channel growth, particularly in Greater China, ASEAN, India, and Africa, serving over 18 million retail customers[95]. Customer Experience and Technology - Prudential aims to enhance customer experiences through digital platforms like PRUServices, which saw registrations double in its first year[60]. - The company is investing in technology to improve agent productivity and customer service, with upgrades to the PRUForce platform ongoing through 2025[61]. - Prudential's strategy focuses on enhancing technology and transforming customer experiences[37]. - The company aims to achieve top quartile relationship NPS by 2027, reflecting its commitment to superior customer experiences[159]. Dividends and Shareholder Returns - Prudential's dividend payout ratio remains stable at 50%, ensuring consistent returns to shareholders[13]. - The total cash dividend for 2024 is set at 23.13 cents per share, reflecting a 13% increase from 2023[76]. - The first interim dividend for 2024 is 6.84 cents per share, while the second interim dividend is 16.29 cents per share, both showing growth compared to previous years[74]. - The total dividend for 2024 was approved at 23.13 cents per share, representing a 13% increase[106]. - Prudential announced a $2 billion share buyback program, with $785 million returned to shareholders by 31 December 2024[167]. - The company expects a dividend per share increase of at least 10% in line with its dividend guidance[142]. Operational Efficiency and Cost Management - The company has outlined a strategic goal to achieve a 25% reduction in operational costs by 2026 through digital transformation initiatives[13]. - Central costs unallocated to a segment decreased by 9% in 2024 compared to the prior year, reflecting better control of head office and finance costs[192]. - The Group plans to invest $1 billion in strategic initiatives, with $0.3 billion already spent to enhance business capabilities[102]. Risk Management and Regulatory Environment - Prudential's risk management framework has been strengthened, focusing on geopolitical risks and regulatory changes impacting operations[13]. - The company is subject to regulatory changes and actions from authorities such as the Hong Kong Insurance Authority[26]. - Prudential operates in a continually changing business environment with emerging risks that may impact its operations[24]. - Prudential's operational resilience is critical, especially in relation to external disruptions and cyber threats[26]. Investment and Asset Management - Eastspring, Prudential's asset management arm, has $124.5 billion under management in Singapore and $51.5 billion in India[32]. - Eastspring's funds under management increased by 9% from $237.1 billion at the end of 2023 to $258.0 billion at the end of 2024, driven by positive inflows and market movements[101]. - The Group's regulatory capital position remains strong with an estimated shareholder surplus of $15.9 billion at 31 December 2024, with a cover ratio of 280%[104]. - Prudential's capital adequacy surplus above the prescribed capital requirement (GPCR) was $15.9 billion, with a cover ratio of 280% as of 31 December 2024[174]. Customer Retention and Acquisition - Customer retention increased by 1% to 87% in 2024, reflecting improved customer satisfaction and loyalty[113]. - APE sales from new-to-Prudential customers grew by 13% in 2024, indicating strong customer acquisition efforts[119]. - Bancassurance contributed 41% of the Group's total APE sales in 2024, with APE sales through this channel growing 16% to $2,532 million[126][127]. - Health and protection APE sales through bancassurance increased by 32% in 2024, accounting for over 50% of policies purchased through banks[128]. - New agent recruitment increased by 9% in 2024, with APE sales generated by PRUVenture agents rising by 34% compared to 2023[123][133]. - The customer retention rate stands at 87%, positioning the company well to grow its share of wallet with existing customers[148].