- Adjusted operating profit up 9% to $1.54 billion
- 22 million shares repurchased for £150 million
- First interim dividend of 6.84 cents, up 9%
Shares in Asian focused insurer Prudential (PRU) were up more than 2% in morning trading to 677p as the firm reported a 9% rise in adjusted operating profit to $1.54 billion for the six months ending 30 June.
The shares are down 21% year to date compared with an 8% rise in the FTSE 100 index.
CEO Anil Wadhwani attributed the insurer’s resilient performance in the first half to repositioning its business in the Chinese mainland, adding the ‘structural drivers of growth in Asia and Africa remain intact.’
New business profit was up 8% to $1.46 billion for the first half.
The insurer expects new business profits to grow at an annual rate consistent with the firm’s 2022-2027 profit growth objective.
SHARE BUYBACK CONTINUES
It was double good news for shareholders as the insurer said its $2 billion share buyback was progressing well - as of 22 August, 22 million shares have been repurchased for £150 million.
The firm also increased its first half dividend by 9.3% to $0.0684 per share and expects full year growth in the 7% to 9% range.
EXPERT VIEW
Russ Mould, investment director at AJ Bell said: ‘Prudential’s latest results compare unfavourably with Hong Kong-based insurer AIA which put up a big increase in profit for the first six months of the year.
‘However, after a miserable run for the shares, the mildly positive reaction to Prudential’s numbers suggests the market is willing to give it the benefit of the doubt, helped by the fact full-year guidance is being maintained and by a material increase in the dividend.
‘Chief executive Anil Wadhwani has only been in post for a little over 18 months so he is likely to be given time to turn things around, but he will need to demonstrate that the targets outlined for 2027 are credible before long.’
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DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) and the editor (Martin Gamble) own shares in AJ Bell.
