Prudential posts large profit drop after slowdown in Hong Kong performance

Written by Michael Griffiths

28/08/2024

Prudential has posted an 81% fall in net profit to $182m (£138m) in its opening half results, down significantly from the $947m (£717m) the group reported in H1 last year.

The life insurer, which is incorporated in the UK but focuses on Asian life insurance, cited rising interest rates as well as tougher trading conditions in its key markets of China and Hong Kong as reasons behind its stalling growth.

Prudential’s performance in Hong Kong saw the group register a 3% drop in new business profit, which is a measure of expected earnings from products recently sold, falling to $651m (£492.9m) in the six months to 30 June.

However, Prudential said it had taken steps to “reposition the business” in the Chinese mainland ahead of both regulatory and macroeconomic changes.

Prudential’s CEO, Anil Wadhwani, said: “We entered this year with a clear strategy and a set of outcomes we are confident in achieving by 2027, namely a compounded annual growth rate for new business profit of 15 to 20% and double-digit for cash generation, both measured from a 2022 base.”

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