Prudential PLC considers $ 2.5 billion – $ 3.0 billion stock increase; Profit increases before tax 2020 – Update

–Prudential said that 2020 revenues increased by Asia, which counteracted a fall in the US

– Jackson spinoff is expected to complete in the second quarter

–The company declared a second interim dividend of 10.73 cents per share

 

By Ian Walker

 

The Prudential PLC said on Wednesday that it is considering a $ 2.5 billion increase to $ 3 billion when the division of its US operations is completed, as it reported a net profit of 9.3% for 2020.

The insurance and investment business said that all stock increases will take place through a global offering to institutional and Hong Kong investors. The extra funds will increase the company’s financial flexibility and utilize the balance sheet.

“As an Asia-focused company, the Group believes that there are clear benefits to increasing both the Asian shareholder base and the liquidity of its shares in Hong Kong. The allotment of all offers will take into account a number of criteria including the interests of existing shareholders,” said the CEO. Mike Wells.

Prudential expects the merger from Jackson Financial Inc. to be completed in the second quarter of this year. The company previously said it plans to wind up its U.S. operations in the second quarter of this year and list them on the New York Stock Exchange.

“The proposed division [of Jackson] will complete Prudential’s structural transition from a diversified global group to a growth business focusing exclusively on unmet health, financial and savings needs of people in Asia and Africa, says Mr.

During the split, shares in Jackson will be distributed to Prudential shareholders, although no terms have been announced yet. Prudential expects to own 19.9% ​​of the shares in Jackson after it is listed, which it plans to sell over time.

Prudential made an IFRS net profit from continuing operations of $ 2.12 billion for the year ended December 31, compared to $ 1.94 billion for 2019.

Adjusted operating income – one of the company’s preferred measures, which removes exceptional and other non-recurring items – was $ 5.51 billion compared to $ 5.31 billion. Prudential said the rise reflects the continued growth of its Asian companies, offset by lower US profits.

Asia-adjusted operating income increased to $ 3.67 billion from $ 3.28 billion, while US operating income decreased to $ 2.80 billion from $ 3.07 billion.

The Group’s LCSM shareholder surplus – an important measure of the balance sheet strength – was estimated at $ 11.0 billion, corresponding to a share of 328%, compared with a share of 309% on December 31, 2019. Method for total local capital or LCSM has been agreed with Hong Kong Insurance Authority, said Prudential.

Gross premiums earned were $ 42.52 billion, compared to $ 45.06 billion the year before.

The Board declared a dividend of 10.73 cents per share and took the total dividend to 16.10 cents.

Shares in London at 0925 GMT increased by 15.5 pence, or 1%, to 1,499.5 pence.

 

Write to Ian Walker at [email protected]

 

(END) Dow Jones Newswires

03 March 2021 04:49 ET (09:49 GMT)

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