1999 New Business Results
Prudential PLC
18 January 2000
PRUDENTIAL 1999 NEW BUSINESS RESULTS
Record total funds inflow of over £18bn
Total long term insurance and investment premiums up 61% to £12.3bn
UK insurance and investment premiums up 61% to £7.4bn
Jackson National Life premiums up 43% to £4.1bn
Asia insurance and investment premiums over four times 1998 levels
egg deposits reach £7.6bn - customers exceed 800,000, including 175,000 egg
card accounts.
Prudential's group-wide operations enjoyed a record year in 1999 with
total insurance and investment sales of £12.3bn, up 61% on 1998. Banking
deposits continued their strong performance and now stand at £8.1bn, including
£7.6bn of egg deposits.
In the UK, total insurance and investment premiums of £7.4bn were also up 61%
over 1998. This increase predominantly reflects the continued strong growth
of the IFA channel, which was up 76% to £5.4bn. The IFA channel now accounts
for almost three quarters of Prudential's UK insurance and investment sales.
Sales by M&G for the eight months since acquisition totalled £583m, an
increase of 20% over the equivalent prior year period.
Overseas, Jackson National Life sales continued their strong growth up 43%
on prior year at £4.1bn. Within this result, variable annuity sales were more
than double 1998 volumes at £1.2bn.
In Asia, new business premiums were more than four times 1998
volumes. Insurance sales have more than doubled to £288m, while mutual
fund sales in India were £583m, compared to the seven months' sales of £72m
in 1998.
UK banking operations continue to perform strongly, with £8.1bn of deposits
at year end and an asset book of over £2.0bn. egg now has in excess of
800,000 customers and has accepted in excess of 175,000 credit card accounts
in the four months since launch.
Deputy group chief executive Jonathan Bloomer commented:
'Prudential's new business figures represent another very strong performance
with a record £18bn inflow of funds. This provides further confirmation of
the success of our strategy of broadening distribution reach and increasing
product choice across all of our businesses.
In the US, variable annuity sales were more than double 1998's level and in
Asia sales have quadrupled, representing significant progress in both these
markets.
I am particularly pleased by the progress in integrating M&G with our existing
fund management operations, and egg continues to show excellent growth. The
response to our new egg card has been tremendous and we continue to acquire
new customers at an impressive rate.'
UK OPERATIONS
IFA Businesses
In the twelve months to December 1999, IFA insurance and investment sales
were up 76% to £5.4bn. This reflects the continued strong sales of Prudence
Bond,totalling £1.9bn compared with £1.2bn in 1998, and the inclusion of eight
months of M&G's IFA sales. In addition, the impact of two major bulk
annuities sold by Prudential Annuities in July, added £1.1bn to the result.
IFA sales now account for almost three quarters of UK insurance and
investment sales (1998: 66%).
M&G
M&G sales (IFA and direct) for the eight months to December 1999 were £583m,
up 20% on the same period in 1998. Total funds under management stood at
£20.4bn up from £18.5bn twelve months ago. M&G's corporate bond funds were
particularly successful, attracting new funds of £347m.
Prudential Retail
Consultant productivity continues to improve at Prudential Retail
where insurance and investment sales have grown by 16% over 1998 to £1.8bn.
Over the same period, sales force headcount has been reduced by over 40% to
less than 1,900. 1999 has seen a shift away from our traditional regular
premium pension products, with strong growth in single premium investment
bonds.
Mortgage sales also continue to perform strongly, with a net increase
in Prudential branded mortgage business of £600m in 1999.
egg and Prudential Banking
egg continues to launch new products and expand its customer services. During
1999 egg launched the egg card and internet shopping zone as well as offering
internet only savings accounts and on-line mortgage and loan application
facilities.
JACKSON NATIONAL LIFE
Total insurance and investment sales were 43% ahead of 1998 at £4.1bn,
with variable annuities more than double the prior year at £1.2bn
reflecting Jackson's successful marketing strategies, new product development
and the on-going strength of the US equity market.
Fixed annuities are 23% ahead of prior year at £826m, after a slow start to
the year, benefiting from the recent increases in US interest rates. Fourth
quarter fixed annuity sales of £257m were more than double that in the
equivalent period last year.
ASIA
Total insurance and investment sales in Asia have more than quadrupled
compared to the corresponding period in 1998.
Total insurance sales more than doubled to £288m due, in part, to the
continuing strong performance of the PruInvestor Bond and the PruLink HiSaver
Account in Singapore.
Mutual fund sales in India reached £583m for the year. Gross redemptions in
the quarter totalled £38m bringing redemptions for the year to £272m,
reflecting the liquid nature of the money market funds.
Enquiries
Jeremy Reynolds/Kevin Russell
Prudential Media Relations
Tel: 0171 548 3721/3723
David Doyle
Investor Relations
Tel: 0171 548 3753
PRUDENTIAL PLC - 1999 NEW BUSINESS PREMIUMS - FULL YEAR
Single Regular Total
1999 1998 +/-(%) 1999 1998 +/-(%) 1999 1998 +/-(%)
£m £m £m £m £m £m
UK Operations
IFA Channel:
Individual
Pensions 218 216 1% 50 42 19% 268 258 4%
Corporate
Pensions 593 434 37% 95 53 79% 688 487 41%
Life 2,084 1,434 45% 75 74 1% 2,159 1,508 43%
Annuities 1,805 699 158% - - 0% 1,805 699 158%
Investment
Products 372 54 589% 5 - 0% 377 54 598%
Sub-Total 5,072 2,837 79% 225 169 33% 5,297 3,006 76%
DSS
Rebates 64 33 94% - - 0% 64 33 94%
Total 5,136 2,870 79% 225 169 33% 5,361 3,039 76%
(Schedule 2)
M&G (Direct):
Investment
Products 200 - 0% 8 - 0% 208 - 0%
Total 200 - 0% 8 - 0% 208 - 0%
Prudential Retail:
Individual
Pensions 35 41 (15%) 51 75 (32%) 86 116 (26%)
Corporate
Pensions 4 3 33% 39 47 (17%) 43 50 (14%)
Life 883 608 45% 49 55 (11%) 932 663 41%
Annuities 534 462 16% - - 0% 534 462 16%
Investment
Products 40 81 (51%) 7 15 (53%) 47 96 (51%)
Sub-Total 1,496 1,195 25% 146 192 (24%) 1,642 1,387 18%
DSS
Rebates 175 175 0% - - 0% 175 175 0%
Total 1,671 1,370 22% 146 192 (24%) 1,817 1,562 16%
Total UK Operations:
Individual
Pensions 253 257 (2%) 101 117 (14%) 354 374 (5%)
Corporate
Pensions 597 437 37% 134 100 34% 731 537 36%
Life 2,967 2,042 45% 124 129 (4%) 3,091 2,171 42%
Annuities 2,339 1,161 101% - - 0% 2,339 1,161 101%
Investment
Products 612 135 353% 20 15 33% 632 150 321%
Sub-Total 6,768 4,032 68% 379 361 5% 7,147 4,393 63%
DSS Rebates 239 208 15% - - 0% 239 208 15%
Total UK
Operations 7,007 4,240 65% 379 361 5% 7,386 4,601 61%
Jackson National Life:
Fixed
Annuities 826 670 23% - - 0% 826 670 23%
Equity
Linked
Index
Annuities 431 283 52% - - 0% 431 283 52%
Variable
Annuities 1,187 531 124% - - 0% 1,187 531 124%
Guaranteed
Investment
Contracts 994 1,351 (26%) - - 0% 994 1,351 (26%)
GIC -
European
Medium Term
Note 624 - 0% - - 0% 624 - 0%
Life - - 0% 24 28 (14%) 24 28 (14%)
Sub-Total 4,062 2,835 43% 24 28 (14%) 4,086 2,863 43%
Prudential Asia:
Insurance
Products 182 42 333% 106 79 34% 288 121 138%
Investment
Products 583 72 710% - - 0% 583 72 710%
Sub-Total 765 114 571% 106 79 34% 871 193 351%
Group Total:
Insurance
Products 10,639 6,982 52% 489 453 8% 11,128 7,435 50%
Investment
Products 1,195 207 477% 20 15 33% 1,215 222 447%
Group
Total 11,834 7,189 65% 509 468 9% 12,343 7,657 61%
1999 1998
£m £m
UK Banking Products
Funds Under Management:
Prudential Banking 577 856
egg 7,565 1,332
--------------
Total 8,142 2,188
--------------
Asset Book:
Prudential Banking 1,255 664
egg 802 11
-------------
Total 2,057 675
-------------
General Insurance
UK Gross
Premiums Written 318 310
SCHEDULE 2
Single Regular Total
1999 1998 +/-(%) 1999 1998 +/-(%) 1999 1998 +/-(%)
£m £m £m £m £m £m
UK Operations
Retail IFA:
Individual
Pensions 179 216 (17%) 48 42 14% 227 258 (12%)
Corporate
Pensions 110 45 144% 14 16 (13%) 124 61 103%
Life 2,076 1,434 45% 74 74 0% 2,150 1,508 43%
Annuities 118 93 27% - - 0% 118 93 27%
Investment
Products 49 54 (9%) 3 - 0% 52 54 (4%)
Sub-Total 2,532 1,842 37% 139 132 5% 2,671 1,974 35%
DSS Rebates 64 33 94% - - 0% 64 33 94%
Total 2,596 1,875 38% 139 132 5% 2,735 2,007 36%
Prudential Group Pensions:
Corporate
Pensions 483 389 24% 81 37 119% 564 426 32%
Annuities 147 155 (5%) - - 0% 147 155 (5%)
Total 630 544 16% 81 37 119% 711 581 22%
Prudential Annuities:
Annuities 1,540 451 241% - - 0%1,540 451 241%
M&G IFA:
Individual
Pensions 39 - 0% 2 - 0% 41 - 0%
Life 8 - 0% 1 - 0% 9 - 0%
Investment
Products 323 - 0% 2 - 0% 325 - 0%
Total 370 - 0% 5 - 0% 375 - 0%
Total IFA
Channel: 5,136 2,870 79% 225 169 33%5,361 3,039 76%
M&G Summary (IFA + Direct):
Individual
Pensions 39 - 0% 2 - 0% 41 - 0%
Life 8 - 0% 1 - 0% 9 - 0%
Investment
Products 523 - 0% 10 - 0% 533 - 0%
Total 570 - 0% 13 - 0% 583 - 0%
Notes to Schedules:
1. The table above analyses UK IFA channel sales by business unit and provides
a summary of the M&G new business premiums for the eight month period from
acquisition to 31 December.
2. The figures for overseas operations have been calculated using average
exchange rates. The applicable rate for Jackson National Life is 1.62
(December 1998 - 1.66). After adjusting for the impact of foreign currency
movements, the Group's single premium sales increased by 63%, and regular
premium sales increased by 8%.
3. The 1998 figures exclude the results of the Australian and New Zealand
operations that were sold in that year.
Latest directors dealings
- 13 hours ago Savannah Energy
- 14 hours ago Buccaneer Energy PLC
- 14 hours ago Savannah Energy
- 15 hours ago Carclo
- 15 hours ago Schroder Japan Growth Fund