Sunday, August 16, 2009

Prudential doubles losses

Source: Straits Times Aug 13, 2009
Prudential doubles losses

LONDON - PRUDENTIAL, the biggest British insurer, said on Thursday that net losses more than doubled in the first half on costs linked to the sale of Taiwanese operations, and as it awaited a new chief executive.

Prudential said losses after tax jumped to 254 million pounds (S$605 million) in the first six months of 2009 compared with a year earlier.

The group had in February agreed to sell part of its life insurance operations in Taiwan to China Life for just one Taiwan dollar.

Prudential's outgoing chief executive Mark Tucker on Thursday said the British insurer expected 'the business environment to remain difficult through the rest of 2009'.

Net losses had widened in the first six months of 2009 from 116 million pounds in the first half of 2008.

Prudential announced earlier this year that Frenchman Tidjane Thiam - currently the group's financial chief - would in October replace Tucker, who departs after 25 years with the group. Ahead of Thiam starting his new role, Prudential on Thursday said it was hiking its interim dividend by five percent compared to a year earlier after it had improved its capital reserves.

The dividend announcement helped Prudential's share price to rise by 4.75 per cent to 501 pence in morning London trade. The British capital's benchmark FTSE 100 index meanwhile struck its highest level for 10 months on fresh signs of a global economic recovery, traders said.

Prudential also said that its operating profit had risen six percent to 688 million pounds in the first half, helped by strong sales growth of its products in the United States.

'While we expect the business environment to remain difficult through the rest of 2009, Prudential is very well positioned to take advantage of any improvement in market conditions,' Tucker said on Thursday.

'I leave knowing that we have an excellent management team in place across the group and I am confident that Tidjane (Thiam) will continue to lead the group from strength to strength,' he added. -- AFP

a blog on: Financial Planning Advice - Christopher Pua

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