HONG KONG SAR – August 28, 2024 – Prudential plc (“Prudential”; HKEX: 2378; LSE: PRU) today announced its financial results for the six months ended 30 June 2024.

Performance highlights based on constant (and actual) exchange rates

–> Profit from new business of USD 1,468 million, representing an increase of 8 percent (6 percent) excluding the impact of interest rates and other economic influences and an increase of 1 percent (decrease of (1) percent) taking these influences into account

–> Adjusted operating profit increases by 9 percent (6 percent) to 1,544 million US dollars

–> First interim dividend of 6.84 cents per share (2023: 6.26 cents per share on an AER basis), an increase of 9 percent

–> First tranche of $2 billion share buyback underway. 22 million shares repurchased for £150 million ($192 million) by August 22, 2024.

–> EEV equity (before minority interests) corresponds to 1,644 cents per share (December 31, 2023: 1,650 cents per share on an AER basis). After minority interests, EEV equity was 1,575 cents per share.

–> Free surplus ratio of 232 percent (31 December 2023: 242 percent) and a GWS shareholder capital surplus over GPCR of USD 15.2 billion, corresponding to a coverage ratio of 282 percent (31 December 2023: 295 percent)

CEO Anil Wadhwani commented on the results:

“We entered this year with a clear strategy and a set of results that we aim to achieve by 2027, namely a compound annual new business profit growth rate of 15 to 20 percent and double-digit cash generation, both measured on a 2022 basis. In the first half of 2024, we delivered high-quality new business profit growth of 8 percent, coupled with increased margins (excluding economic factors) and adjusted operating profit up 9 percent. This followed exceptional new business profit growth of 47 percent (excluding economic impact) for the full year 2023, driven by the strong recovery in Hong Kong following the lifting of Covid restrictions and the opening of the border with mainland China. We announced a $2 billion share buyback program to return capital to shareholders while we continue to invest in growth opportunities.”

Economic commentary

Our robust performance in H1 2024 was achieved after we took steps to reposition our mainland China business ahead of regulatory and macroeconomic changes. We also took decisive pre-market actions on medical repricing in Indonesia and Malaysia. Other markets such as Singapore, India and Taiwan performed well due to our continuous product innovation and expansion of our distribution capabilities. Over the past year, we gained momentum in executing our strategy, addressing known challenges and identifying areas for further improvement. We are strengthening our capabilities across all our pillars and enablers and underpinning this with the appointment of senior leaders in key areas of the business. We are focused on converting profits from new business into cash more effectively, managing operational variances and leveraging economies of scale.

In Distribution, while profit from new business was lower in H1 2024 due to high base effects in many markets over the comparable period in 2023, we are intensifying our efforts on the underlying drivers of agency growth with a focus on high-quality recruitment, training and embedding PRUForce, our digital agency platform. Bancassurance performed strongly with profit from new business growth of 28 percent in H1 2024, excluding the impact of interest rates and other economic influences, with Hong Kong, Malaysia, Singapore, Taiwan and Thailand being key markets. We continued to demonstrate our discipline in capital allocation, focusing on high-quality new business, capacity investments and a capital management program.

outlook

We saw a pick-up in sales momentum in June that has continued into the second half of the year. For 2024, we expect new business profits to grow annually, consistent with the rate required to achieve our new business profit growth target from 2022 to 2027. Our industry’s structural growth drivers in Asia and Africa remain intact, and demand for protection, long-term savings and retirement offerings remains strong as broader economic growth returns to our markets. We remain confident of achieving our 2027 financial and strategic objectives.

Notes

The summary financial measures presented above are the key financial measures used by Prudential’s management to evaluate and manage the Company’s performance and position. In addition to the measures prepared in accordance with IFRS standards – IFRS profit after tax and IFRS shareholders’ equity – additional measures are prepared on alternative basis. The presentation of these key measures should not be considered a substitute for, or better than, financial information prepared and presented in accordance with IFRS standards. The definitions of the key measures we use to discuss our performance in this press release are set out in the “Definition of Performance Measures” section later in this document, including, where relevant, references to where these measures are reconciled to the most directly comparable IFRS measure. All measures used by management to evaluate performance (together with IFRS profit after tax) are gross of the amount attributable to non-controlling interests and this presentation is applied consistently throughout this announcement.

The balance sheet figures are presented net of non-controlling interests. For 2024, non-controlling interests include the 49% non-controlling interest in our conventional life insurance business in Malaysia.

Profit from new business excluding economic impacts (and movements therein) represents the amount of profit from new business for the first six months of 2024 calculated using economic factors (including interest rates) as of June 30, 2023 and average exchange rates for the first six months of 2024. The percentage change excluding economic factors excludes the impact of the change in interest rates and other economic movements during the period from the value applicable to profit from new business in the first half of 2023 and applies consistent average exchange rates from the first half of 2024.