Prudential sees profits rise as Asia leads the way

Insurance giant Prudential has once again hailed its fast-growing Asian business for helping drive a solid rise in annual profits.

The group posted a 6% rise in operating profits on a constant currency basis to £4.8 billion for 2018.

Profits were boosted by a 14% jump in Asia earnings, to £1.9 billion last year.

Prudential shares edged 1% higher after the slightly better-than-expected results.

Mike Wells, group chief executive of Prudential, said: “In 2018, our financial performance, again led by our Asia operations, is testament to the scale of our opportunity set, the depth of our capabilities and our unrelenting focus on executing our strategy at pace.”

He added the group was “making good progress” in demerging its savings and investment business in the UK and Europe – M&GPrudential – into a separate company to focus on Asia and the US.

But the group flagged the risks surrounding Brexit, as well as the slowdown in the global economy amid the trade row between China and the US and global protectionism.

It said: “As a global organisation, we develop plans to mitigate business risks arising from this shift and engage with national bodies where we can in order to ensure our policyholders are not adversely impacted.

“It is clear, however, that the full long-term impacts of these changes remain to be seen.”

The figures showed that new business profit in life insurance rose 11% in constant currency to £3.9 billion.

But its asset management arm saw net outflows of £11.5 billion last year due to the redemption of a single large institutional mandate, as well as “challenging” financial markets.

Asset management earnings fell 5% to £477 million.

The group’s UK and European business saw earnings lift 19% to £1.6 billion while it suffered an 11% drop in US operating profits to £1.9 billion.