Prudential's 39% leap beats expectations

Published on Wednesday 1 August 2007 12:16

INSURANCE giant Prudential today posted a 39 per cent increase in first-half profits from its continuing operations - well above analysts' predictions.

The UK's second-largest insurer said that total operating profits for the first six months of the year was 1.33 billion.

But its UK business, in the midst of a cost-cutting overhaul that has put 3000 jobs under review, saw headline sales dip by 31 per cent, hit by a lack of bulk annuity deals already seen at peer Legal & General. The firm's fast-growing Asian market continued to drive growth and almost three-quarters of Prudential's sales are now outwith the UK.

Analysts had expected the firm's profits to be 1.19bn at best, with some estimating they would be as low as 1.07bn. The figures exclude the internet bank brand Egg, sold to Citigroup this year and compares to 1.01bn for the previous year if restated to exclude Egg.

The firm said it was on track to make already-announced savings of 195m by 2010 in the UK, with 115m expected to have been saved by the end of the year. It said the remainder would be achieved by either outsourcing or offshoring. Among the jobs under scrutiny are the 2300 workers at its Craigforth office in Stirling.