Prudential plc (NYSE: PUK) reported solid financial results for the six months ended June 30, 2026, with growth in new business, operating profit and cash generation. New business profit increased 8% year over year on a constant exchange rate basis to $1.384 billion, while its new business margin expanded by two percentage points to 40%.
The insurer also reported a 15% increase in operating free surplus generated from its in-force insurance and asset management businesses, reaching $1.791 billion. Adjusted operating profit after tax rose 10% to $1.523 billion, while adjusted earnings per share climbed 17% to 58.4 cents.
Higher Shareholder Returns
Prudential is increasing returns to shareholders following the stronger operating performance. The company raised its first interim dividend by 15% to 8.88 cents per share, compared with 7.71 cents a year earlier.
The company also plans to add approximately $300 million to its previously announced $1.2 billion 2026 share buyback program. The additional repurchases are expected to be completed by December 18, 2026, subject to Prudential receiving net proceeds from the planned sale of part of its stake in ICICI Prudential Asset Management.
Total capital returns to shareholders reached $1 billion during the first half of 2026, highlighting management’s confidence in the company’s capital generation.
Capital Position Remains Strong
Prudential ended the period with a Group Total Embedded Value equity of $39.1 billion, up from $37.8 billion at the end of 2025. The company reported a 209% free surplus ratio and a 268% shareholders’ GWS coverage ratio, providing a substantial capital buffer.
However, IFRS profit after tax fell 27% to $995 million. Prudential attributed the decline primarily to short-term market movements and interest-rate effects, demonstrating the difference between its underlying operating performance and statutory earnings.
Growth Strategy Continues
Prudential is continuing to invest in markets it considers attractive for long-term growth. During the first half, it increased its ownership of its Malaysian conventional life business to 70% and agreed to acquire a 75% controlling stake in Bharti Life in India.
The company also remains focused on health and protection products, agency productivity and bancassurance while using technology and AI to improve customer engagement and operational efficiency.
Outlook for 2026
Prudential reaffirmed its guidance for double-digit growth in 2026 new business profit, operating free surplus and adjusted EPS, alongside double-digit growth in dividend per share.
Management said it remains focused on its 2027 financial objectives, including generating at least $4.4 billion of operating free surplus from in-force insurance and asset management businesses.
For investors, the combination of higher operating earnings, stronger cash generation and increased capital returns signals confidence in Prudential’s growth strategy, despite continued market and regulatory challenges in some of its key Asian markets.
