Prudential Plc Q1 FY2023 earnings call

• Strong 2023 results: Sales up 37%, new business profits up 45%, X economics and IFRS earnings up 8%.
• Hong Kong: Strong rebound, gained market share in domestic and Mainland Chinese visitor segments, and in agency.
• China: Year of transition, pivoted to different product mix, agency grew 25%, optimistic about growth prospects in 2024.
• ASEAN: Malaysia, Indonesia, Singapore had strong performances with established market positions and growth prospects.
• Strategy execution: Early progress seen, confident in delivering 15%-20% growth in new business profit to 2027 and accelerating cash on value generated.

Prudential's 2023 results showed strong performance. Sales were $5.9 billion, up 37%. New business profits were $3.1 billion, up 45%. 17 out of 22 markets had new business profit growth, with 12 on double-digit basis. X economics and IFRS earnings were $2.9 billion, up 8% year-on-year. Hong Kong saw a strong rebound with market share gains in domestic and Mainland Chinese visitor segments. China pivoted to a different product mix, with agency growing 25%. ASEAN had strong performances: Malaysia had strong sales and new business profit growth, Indonesia had four consecutive quarters of new business profit growth, and Singapore had a quality franchise with strong rebound in the second half of 2023. Revenue contribution details: Hong Kong led with strong growth, China transitioned product mix, ASEAN segments contributed significantly.

• Management is increasingly confident in delivering 15% to 20% growth on new business profit to 2027.
• Confident in strategic objectives and deploying capital to drive organic, profitable growth and expand distribution footprint through partnerships.

Q: Michael Chang asked about Hong Kong's growth prospects, the 15%-20% new business profit growth target, and China's bank assurance contribution.

A: Anil Wadhwani said Hong Kong's growth prospects are solid with government GDP growth indication and potential for MCV traffic to reach 2019 levels. On the growth target, they don't cap aspiration and have capital strength. Ben Bulmer and Lilian Ng discussed China's bank assurance contribution and product mix shift.

Q: Charles Zhou asked about China's low interest rate environment and ASEAN outlook.

A: Anil Wadhwani and Ben Bulmer talked about China's fundamental insurance needs and product mix adjustment. Anil Wadhwani highlighted ASEAN's strong market positions and growth prospects with plans to expand distribution.

Q: Edwin Liu asked about Hong Kong's NBP growth and ASEAN's bank assurance opportunities.

A: Anil Wadhwani and Solmaz Altin discussed Hong Kong's growth potential and ASEAN's bank assurance opportunities in markets like Indonesia, Malaysia, Philippines.

Q: Farooq Hanif asked about free surplus generation, investment spend, and health proposition.

A: Ben Bulmer spoke about operating free surplus generation and investment spend. Solmaz Altin discussed the health proposition and its growth plans.

Q: Kailesh Mistry asked about cash remittances, investment spend, and Hong Kong sales mix.

A: Ben Bulmer answered on cash remittances and investment spend. Lilian Ng talked about Hong Kong's sales mix and agent recruitment.

Q: Andrew Sinclair asked about hold-co cash, TEE number, and cash injection in markets.

A: Ben Bulmer and Anil Wadhwani discussed hold-co cash usage, TEE number consideration, and cash injection in markets.

Q: Michelle Ma asked about Singapore's growth driver and market recovery.

A: Dennis Tan spoke about Singapore's growth drivers and Anil Wadhwani discussed market recovery potential.

Q: Larissa Van Deventer asked about margin expansion and Hong Kong's pent up savings.

A: Anil Wadhwani and Lilian Ng addressed margin expansion and Hong Kong's pent up savings situation.

Q: Andrew Crean asked about economic capital, group surplus, and buybacks vs acquisitions.

A: Ben Bulmer and Anil Wadhwani responded on economic capital, group surplus, and the comparison between buybacks and acquisitions.

Q: William Hawkins asked about Taiwan's outlook and medical reimbursement.

A: Anil Wadhwani and Ben Bulmer talked about Taiwan's performance and medical reimbursement issues.

Q: Dominic O'Mahony asked about OFSG trajectory.

A: Anil Wadhwani discussed OFSG trajectory and factors contributing to it.