Prudential PLC (LSE:PRU) reported an 8% increase in profit for the first half against a backdrop of continued Covid-19 disruption in many of its markets and cautioned conditions may remain challenging for the rest of the year.
The Asia and Africa-focused insurer posted adjusted operating profits of US$1.66bn for the half year, up from US$1.57bn in the same period last year.
The increase was driven by a 6% rise in life and asset management adjusted operating profit and a 32% cut in costs.
Annualised premium equivalent (APE) grew 9% to US$2.21bn despite “considerable Covid-19-related disruption”, the FTSE 100 company said in a statement.
It added APE sales growth was stronger in the second quarter as conditions started to normalise in most markets.
But new business profit dropped 5% to US$1.1bn, hit in part by higher interest rates and lower sales in Hong Kong, where margins have traditionally been higher.
With the border between Mainland China and Hong Kong remaining closed due to Covid, the Chinese Mainland business contributed close to zero to Hong Kong’s total new business profit in the first half, compared with US$694mln last year, the company said.
Prudential hiked its first interim dividend for 2022 7% to 5.74 US cents.
Prudential chief executive Mark FitzPatrick cautioned that although Covid-19-related impacts appear to be stabilising in its markets, “over the remainder of the year we expect that operating conditions may continue to be challenging”.