Prudential (PRU) H2 2024 earnings summary

Executive summary

• New business profit rose 11% year-over-year to $3.1 billion, meeting guidance and supporting 2027 targets.

• Adjusted operating profit after tax per share increased 8%, with gross operating free surplus generation at $2.6 billion.

• Dividend per share grew 13% year-over-year; $0.8 billion of a $2 billion share buyback completed, with completion accelerated to end-2025.

• Strategic focus on customer, distribution, health, digitization, and agency productivity, including a new India health JV.

• On track to deliver 2027 objectives: 15-20% NBP CAGR and at least $4.4 billion gross OFSG.

Financial highlights

• NBP reached $3.1 billion, up 11% year-over-year; OPAT totaled $2.6 billion, up 8% year-over-year.

• Gross OFSG was $2.6 billion, with a 2% decline year-over-year due to COVID period impacts, but inflection point expected in 2025.

• Dividend per share increased 13% year-over-year; free surplus ratio at 234%, above the 175-200% target range.

• IRRs on new business improved, now above 25%.

• Asset management operating profit rose 10% to $304 million; funds under management reached $258 billion.

Outlook and guidance

• 2025 guidance targets growth in NBP, operating EPS, gross OFSG, and DPS, all in excess of 10%.

• Confident in achieving 2027 targets: 15-20% NBP CAGR and >$4.4 billion gross OFSG.

• Dividend policy unchanged; dividends to grow in line with net OFSG.

• No material impact expected from BEPS II tax changes; effective tax rate to remain around 17%.

• Transitioning to traditional embedded value (TEV) reporting from Q1 2025.