06 May 2015

Prudential plc First Quarter 2015 Interim Management Statement

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Prudential plc First Quarter 2015 Interim Management Statement

Asia continues to drive the Group's performance

  • Asia delivers a strong quarter:
    • New business profit up 22 per cent1 to £309 million
    • Eastspring third party net inflows2 of £2.3 billion, up 106 per cent1
  • US separate account assets up 16 per cent1 to £89.2 billion
  • UK increasing its retail sales (up 8 per cent) in new environment
  • M&G external funds under management up 8 per cent to £139.5 billion

Tidjane Thiam, Group Chief Executive, said:

“The Group has made a strong start to the year, particularly in Asia, delivering new business profits of £496 million and APE sales of £1,250 million in the first quarter. This performance demonstrates our continued execution of a clear, consistent and successful strategy centred on Asia.

“In Asia, we remain focused on profitably meeting the investment and protection needs of a growing and increasingly prosperous middle class. Our 2017 Asia profit and cash growth objectives underline our conviction in the attractiveness of this opportunity. The first quarter was a strong step towards the delivery of these objectives, extending our track record of APE sales growth to 22 consecutive quarters averaging 16 per cent1.

“In the first quarter, Asia has achieved strong growth in life new business profit, life sales and asset management net inflows, underlining the region’s importance to the Group’s long-term prospects. Asia life APE sales grew by 28 per cent (34 per cent on an actual exchange rate basis) to £681 million while new business profit grew by 22 per cent (27 per cent on an actual exchange rate basis) to £309 million. Eastspring, our Asian asset manager, also had an outstanding quarter with net inflows from third party retail and institutional business more than doubling from the record 2014 levels to £2.3 billion (£1.1 billion in the first quarter of 2014).

“In the mature US and UK markets, we have continued to prioritise value over volume and maintained our focus on delivering good value to our customers and shareholders.

“In the US, separate account assets, which directly determine our ability to generate IFRS earnings and cash, were 16 per cent higher year-on-year at £89.2 billion. New business profit was £153 million, 28 per cent lower than the previous year due to our decision to capitalise on extremely favourable conditions in the first quarter of 2014, Jackson’s highest ever first quarter, and our subsequent actions later in the year to moderate sales of variable annuities with living benefits. New business profit was also impacted negatively by a decrease in long-term interest rates.

“In the UK,

  • Our focus in the life market remains on providing investment and retirement solutions to an ageing but wealthy customer base. Our flagship with-profits product, PruFund, is at the heart of our product offerings. In the first quarter, our retail life sales grew by 8 per cent due to the growing popularity of PruFund-backed product wrappers such as drawdown, pensions and bonds. Retail new business profit of £34 million was 11 per cent lower primarily reflecting reduced volumes of individual annuities following the 2014 Budget changes. We continue to operate with discipline in the bulk annuity market, writing no transactions during the first quarter and one sizeable transaction immediately after the quarter end. Overall, we believe our strategy is working well in the new environment as demonstrated by the encouraging signs of progress so far.
  • In asset management, M&G grew external funds under management to £139.5 billion, an increase of 8 per cent year-on-year, driven by net inflows from Continental European operations.

“In summary, the first quarter demonstrates the success of the continued, disciplined execution of our proven strategy:

  • Delivering strong, profitable growth in Asia, consistent with our 2017 objectives, by capturing profitably the long-term secular Asian growth opportunity.
  • In the US and UK, focusing on value over volume and generating earnings and cash.

“The prolonged low interest rate environment and the uncertainties around the future evolution of US interest rates continue to pose significant challenges to the global economy. In this context, we believe the quality of our strategy and our focus on disciplined execution position us well to continue to deliver long-term sustainable value.

“We were delighted to announce on 1 May the appointment of Mike Wells to replace me as Chief Executive Officer, with effect from 1 June 2015. Mike has an outstanding track record as Chief Executive of Jackson. I am pleased to be leaving Prudential in the hands of such an experienced leader.

“Our strategy is working well, our execution is good, our teams are strong and I leave the Group confident that Mike will provide strong and effective leadership in the continued delivery of value for our customers and shareholders.

“It has been my pleasure and a privilege to lead Prudential.”

BUSINESS UNIT REVIEW

Through 2014, we have chosen to comment on our international business performance in local currency terms (expressed on a constant exchange rate basis) to outline underlying performance in a period of currency volatility. We have continued to use this basis in the discussion below for our Asian and US businesses to maintain comparability. It is worth noting that so far this year, we have experienced favourable currency movements. As a result and contrary to last year, the constant exchange rate basis that we have used below produces lower progressions than the actual exchange rate basis.

ASIA
Our Asia life business delivered an excellent start to 2015, with APE sales growth of 28 per cent on a constant exchange rate basis (34 per cent on an actual exchange rate (AER) basis) to £681 million in the first quarter. Our Asia business has now delivered 22 consecutive quarters of APE sales growth, averaging 16 per cent.3

New business profit grew strongly, increasing by 22 per cent (AER: 27 per cent) to £309 million reflecting higher sales volumes, partially offset by the negative effect of lower interest rates, mainly in Hong Kong. On a like-for-like basis, new business profit, expressed at constant interest rates4 as at the end of 31 March 2015, grew by 27 per cent.

The distribution mix remained roughly in line with the prior year. Both agency and bancassurance channels (excluding discontinued agreements) achieved sales growth in excess of 20 per cent. Our bancassurance performance was led by our renewed partnership with Standard Chartered Bank, which delivered sales growth of 46 per cent. Ninety per cent of our Asian APE sales remains high quality, regular premium and the product mix continues to be well balanced between unit-linked, participating and protection business, with the first quarter recording strong growth across all three categories.

Hong Kong delivered outstanding APE sales growth of 74 per cent to £246 million in the first quarter. This has been driven by an increase in agency manpower relative to the first quarter of 2014 as well as productivity improvements that have seen higher average case sizes and continued strong demand from mainland China customers. Our bancassurance partnership with Standard Chartered Bank also delivered record APE sales, up 45 per cent, driven by increases in the number of cases per financial service consultant as well as an uplift in the conversion rate from referral to sale.

Our joint venture with CITIC in China continues to make excellent progress, with APE sales growth of 37 per cent to £56 million, driven by broad-based momentum across all channels and a high-quality mix of both savings and protection products. Agency APE sales increased 27 per cent as a result of higher levels of active manpower, while APE sales through the bancassurance channel were up 56 per cent, helped in particular by a strong performance from our partner CITIC Bank. Our track record of growth, with sales increasing at an average quarterly rate of 39 per cent since the beginning of 2013, has seen China become an increasingly important contributor to our overall growth in Asia, which on a 100 per cent basis now ranks as our second-largest market in the region by APE sales.

In Singapore, we have increased our focus on higher-value protection products, which has improved the overall economics of our business. As a result, new business profit increased by 2 per cent, despite a reduction in APE sales of 7 per cent, excluding the bancassurance agreements with Maybank and Singpost which ceased in 2014. Overall APE sales, including these discontinued bancassurance relationships, were 19 per cent lower at £72 million.

The macro environment in Indonesia is currently more challenging than some of our other markets, but we have seen improvements in both agency and bancassurance drive a 7 per cent growth in APE sales to £93 million during the first quarter. We remain confident about our long-term prospects in the country.

We are seeing good results from our refocused business in Malaysia as APE sales grew by 26 per cent to £54 million. This includes the impact of 56 per cent growth in Takaful sales due to our growing Bumi salesforce.

In our other ‘sweet spot’5 markets, Thailand grew APE sales by 4 per cent, reflecting efforts to refocus our key distributors on a more protection-orientated product mix, which saw protection sales more than double and their proportion of total sales increase to 31 per cent. In Vietnam and the Philippines APE sales increased by 18 per cent and 17 per cent respectively, driven by agency sales.

Among our other markets, in India, our joint venture with ICICI is performing well in a challenging market, with APE sales up 47 per cent reflecting the continued improvement in market sentiment seen since the second half of 2014. Our operations in Korea and Taiwan remain focused on continued selective participation, with APE sales growth of 11 per cent and 12 per cent respectively.

Our asset management business, Eastspring Investments, saw net third party inflows for the first quarter of £2.3 billion, more than twice the prior year level. These net inflows were driven by ongoing success in Japan, China and India. Third party funds under management at 31 March 2015 were £29.8 billion, up 48 per cent on the prior year on a constant exchange rate basis. Total funds under management6, which include the assets from our life operations, totalled £86.0 billion, 32 per cent higher than a year ago (2014: £65.1 billion, on a constant exchange rate basis).

The scale and diversity of our business platform in Asia, combined with the positive, long-term structural trends of a rapidly growing and wealthy middle class population with significant savings and protection needs, continues to underpin our long-term profitable growth prospects in the region.

US
In the US, Jackson remains focused on actively managing sales volumes of variable annuities with living benefits to maintain an appropriate balance of our revenue streams and to match our annual risk appetite. As a result, Jackson may experience fluctuations in quarterly sales volumes as we implement management actions through the year to achieve these goals and continue to price new business on a conservative basis, putting value over volume.

Focusing on value, it is important to recognise that Jackson has been delivering earnings and cash primarily through generating fee income on a growing separate account asset base. The evolution of the asset base is a key driver of profitability and over time is a more meaningful indicator than the volume of quarterly sales. At 31 March 2015, Jackson had statutory separate account assets of £89.2 billion, up 16 per cent (AER: 30 per cent) compared to the end of March 2014, as a result of both positive net flows and the growth in the underlying market value of the separate account assets over the period.

In the first quarter, Jackson reported total APE sales of £400 million, a decrease of 15 per cent, with lower sales of variable annuities compared to the same period last year.

APE sales from variable annuities decreased 18 per cent year-on-year to £346 million, reflecting the extremely high sales levels achieved in the first quarter of 2014 and continuing management action to manage sales volumes. As a result, variable annuity volumes excluding Elite Access were 22 per cent lower year-on-year at £272 million. Sales of Elite Access, our variable annuity without living benefits, were broadly consistent with prior year at £74 million. With the success of Elite Access, we continue to improve the diversification of our product mix, with 33 per cent of our first quarter total variable annuity sales not featuring living benefit guarantees (2014: 30 per cent).

New business profit of £153 million was 28 per cent lower year-on-year, reflecting our disciplined approach to sales, a historically strong first quarter in 2014 (our highest first quarter ever) and the impact of the year-on-year decline in interest rates of 80 basis points, which on its own accounted for a significant portion of the decline. The economics of our business remain very attractive and we continue to write profitable new business through sales of prudently priced annuity products.

Fixed annuity APE sales of £11 million decreased 21 per cent compared to the same period last year, primarily as a result of the low interest rate environment. Fixed index annuity APE sales of £10 million remained relatively flat compared to the first quarter of the prior year.

Curian Capital, the specialised asset management company of Jackson that provides innovative fee-based separately managed accounts, had assets under management of £8.6 billion at the end of March 2015 compared with £8.3 billion at 31 December 2014, as a result of positive net flows and market appreciation during the period. 

Recently, the US Department of Labor released a proposed rule pertaining to the fiduciary responsibilities of investment advice providers, which are intended to protect consumers by mitigating the effect of conflicts of interest in the retirement investment marketplace. This regulatory proposal is in its early stages and Jackson will continue to monitor the development and implementation of the proposed rule. A final ruling is not anticipated until late 2015 at the earliest and it is premature to speculate on the likely impact, if any, on Jackson at this time.

Jackson’s strategy remains unchanged, with a primary focus on delivering earnings and cash, while maintaining a strong balance sheet.

UK, Europe and Africa
The UK insurance market continues to be impacted by the introduction of significant reforms to the pension industry which were announced in 2014 and came into force in April 2015. In this challenging context, retailAPE sales7 rose by 8 per cent in the first quarter of 2015, with increased sales of our investment products including onshore and offshore bonds, individual pensions and income drawdown partly offset by reduced sales of individual annuities. Retail new business profit7 fell by 11 per cent, primarily due to the reduction in annuity sales and the impact of lower interest rates. 

Bond APE sales of £76 million increased by 21 per cent, reflecting the strength of our investment proposition. APE sales from onshore with-profits bonds of £56 million were 25 per cent higher, with particularly strong demand for our non-guaranteed range of PruFunds. There is significant ongoing demand for our with-profits funds, with customers attracted by both the track record of performance and the benefit of a smoothed return to help manage market volatility. Offshore bond APE sales were 13 per cent higher, again reflecting the growing popularity of our with-profits funds.

We did not conclude any bulk annuity transactions in the first quarter of 2015 (2014: three schemes, APE sales £73 million, new business profit £50 million). Shortly after the quarter end, however, we have written one bulk scheme with APE of £67 million and new business profit of £46 million. Our approach to bulk transactions in the UK will continue to be one of selective participation, focusing on those opportunities where we can bring significant value to our customers and meet our shareholder return requirements.

Income drawdown APE sales nearly trebled to £14 million and individual pensions APE sales increased by 125 per cent to £27 million, both driven by the expanding market for flexible retirement income and pension products and the strength of our PruFund offering.

During the first quarter we saw the slowdown in individual annuitysales continue from 2014. APE sales reduced from £36 million in the first quarter of 2014, which pre-dated the impact of pension reforms announced in the 2014 Budget, to £14 million in 2015, 61 per cent lower. The proportion of customers deferring the decision to convert their pension savings into retirement income continued to be significantly higher than in the same period in 2014, as customers awaited the introduction of the pension changes on 6 April 2015.

On 26 February 2015 we added the PruFund range of investment funds to the Prudential ISA, generating additional ISA sales of £32 million in the quarter (included within other products) and £95 million to the end of April 2015.

In total, PruFund assets under management have increased 9 per cent to £12.6 billion since the start of the year.

Corporate pensionsAPE sales of £33 million were £7 million lower than the first quarter of 2014, which benefitted from higher new entrants as auto-enrolment came into effect for larger employers. We remain the largest provider of Additional Voluntary Contribution plans within the public sector, where we provide schemes for 72 of the 99 public sector authorities in the UK (2014: 70 of the 99).

We have experienced an upturn in the volume of customer contacts and an increase in requests for valuations of pension funds held after 6 April when the new pensions freedom regulations became effective. It remains too early to discern any meaningful consumer trends at this point.

While the UK retirement income market continues to undergo significant change, our business remains well placed to prosper in this new environment through its ongoing focus on its core strengths of with-profits and retirement solutions.

In Africa, we continue to develop our nascent businesses in Kenya and Ghana. We are pleased to have signed our first bank distribution agreement in Africa with Societe Generale Ghana on 22 April 2015. This has established a long-term partnership in the country, which complements our fast-growing agency force.

M&G
M&G delivered net inflows of £0.7 billion in the first quarter of 2015 (2014: £1.4 billion), reflecting the continued success of our European retail business and stable institutional inflows.

In our retail business, Continental Europe was the primary driver of our results, with net inflows in the region for the quarter of £1.5 billion (2014: net inflows of £1.6 billion). Together with higher market values, this increased international retail funds under management to a record £32.7 billion, accounting for 43 per cent of M&G’s total retail assets. This was partially offset by net outflows of £0.9 billion in the UK retail market (2014: net outflows of £0.3 billion). In aggregate, the retail business achieved £0.6 billion of net inflows in the first quarter (2014: net inflows of £1.3 billion). Total external retail funds under management have increased by 10 per cent year-on-year to £75.7 billion. After a strong start to the year and 14 consecutive quarters of positive net flows, net retail flows in Europe were negative in April. The outlook for retail flows remains uncertain.

M&G’s institutional business generated £0.1 billion of net inflows during the first quarter. Two new segregated equity mandates and new business for higher-margin strategies were balanced by the loss of public debt and property management mandates. Institutional business retains a strong pipeline of fixed income and real estate business, representing new business won but not yet funded across multiple investment strategies. Total external institutional funds under management were £63.8 billion as at 31 March 2015, up 7 per cent year-on-year.

Net fund inflows, combined with positive market movements, increased total M&G funds under management to a new high of £269.6 billion, up 9 per cent on the first quarter of 2014. External funds now account for 52 per cent of that total at £139.5 billion, up 8 per cent year-on-year.

BALANCE SHEET
Our balance sheet remains resilient and conservatively positioned. As at 31 March 2015, our IGD surplus was £4.3 billion, after deducting the 2014 final dividend of £0.7 billion. The IGD surplus is equivalent to a cover of 2.3 times and compares to £4.1 billion at 31 March 2014 (after deducting the 2013 final dividend of £0.6 billion).

OUTLOOK
Our strategy with Asia at the centre of the Group’s long-term profitable growth prospects has continued to deliver attractive returns to our shareholders. Our first quarter performance evidences the quality of our execution, adding to the Group’s strong track record.

The world is facing the impact of divergent monetary policy between the US and the Eurozone/Japan. This has manifested itself in the form of a rising dollar and extremely low and in some cases, negative government bond yields in Europe. We have also observed during the last twelve months a significant fall in the oil price. More importantly, continued monetary easing in Europe has exacerbated an environment of extremely low long-term interest rates across the developed economies, a difficult backdrop for any insurance company. The actions we have taken to improve the quality and resilience of our earnings and de-risk our balance sheet have mitigated the negative effect of this fall in yields but persistently low long-term rates still represent a significant headwind going forward, as evidenced by the impact on first quarter new business profit.

In this challenging context we believe we have a strong position, as our Asian platform is an engine of genuine profitable growth at a time when this is increasingly at a premium.

In Asia, we are focused on capturing the significant long-term opportunity to meet the investment and protection needs of the fast-growing, but mostly uninsured and increasingly wealthy middle class. In the US, we continue to provide investment opportunities and safe retirement income options to the 77 million baby boomers. In the UK, we offer investment opportunities and retirement income to a wealthy but ageing population.

In summary, our leading presence in the under-penetrated and fast-growing markets of Asia coupled with our established strengths in the US and the UK positions us well to continue delivering shareholder value across the cycle.

We are executing well on our proven strategy and remain confident of continuing to deliver sustainable, profitable growth to our shareholders and value to our customers.

Q1 2015 Business Unit financial highlights

New Business Profit (post tax)8 YTD 2015 £m YTD 2014 £m YTD 2015 v 2014 %
AER CER AER CER
Asia 309 243 254 27 22
US 153 195 213 (22) (28)
UK - Retail7 34 38 38 (11) (11)
Total Group Insurance - excluding UK Wholesale9 496 476 505 4 (2)
UK Wholesale - 50 50 (100) (100)
Total Group 496 526 555 (6) (11)
 
Sales - APE YTD 2015 £m YTD 2014 £m YTD 2015 v 2014 %
AER CER AER CER
Asia 681 507 534 34 28
US 400 432 473 (7) (15)
UK - Retail7 169 157 157 8 8
Total Group Insurance - excluding UK Wholesale 1,250 1,096 1,164 14 7
UK Wholesale - 73 73 (100) (100)
Total Group 1,250 1,169 1,237 7 1
Investment Flows YTD 2015 £bn YTD 2014 £bn YTD 2015 v 2014 %10
AER CER AER CER
Gross inflows
Retail 8.6 7.3 7.3 18 18
Institutional 3.7 1.7 1.7 124 124
M&G – total 12.3 9.0 9.0 37 37
Eastspring Investments11 5.2 3.2 3.3 63 58
Total Group 17.5 12.2 12.3 44 43
Net inflows
Retail 0.6 1.3 1.3 (57) (57)
Institutional 0.1 0.1 0.1 (20) (20)
M&G – total 0.7 1.4 1.4 (53) (53)
Eastspring Investments11 2.3 1.1 1.1 105 106
Total Group 3.0 2.5 2.5 16 17
Funds Under Management6 YTD 2015 £bn YTD 2014 £bn YTD 2015 v 2014 %10
AER CER AER CER
M&G 269.6 248.3 248.3 9 9
Eastspring Investments 86.0 62.8 65.1 37 32
Total Group 355.6 311.1 313.4 14 13
External Funds Under Management
M&G 139.5 128.7 128.7 8 8
Eastspring Investments12 29.8 19.2 20.1 55 48
Total Group 169.3 147.9 148.8 14 14

ENDS

Enquiries:

Media Investors/Analysts
Jonathan Oliver +44 (0)20 7548 3719 Raghu Hariharan +44 (0)20 7548 2871
Tom Willetts +44 (0)20 7548 2776 Richard Gradidge +44 (0)20 7548 3860
1 Asia and US quarter-on-quarter percentage increases referred to in this news release are stated on a constant exchange rate (CER) basis unless otherwise stated.
2 Net investment flows excluding first quarter Eastspring money market funds net outflows of £0.3 billion (2014: net outflows of £0.5 billion).
3 On a constant exchange rate basis.
4 New business profit is calculated using end-of-period economic assumptions. If 2014 new business profit is re-expressed based on 31 March 2015 interest rates Asia new business profit would have grown by 27 per cent on a constant exchange rate basis. A more detailed analysis is provided in schedule 4(C).
5 Sweet spot markets are Hong Kong, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
6 Total funds under management include all external and internal funds.
7 The 2014 UK and Europe insurance operations comparatives have been adjusted to exclude PruHealth and PruProtect APE sales of £7 million and new business profit of £3 million, following the disposal of our 25 per cent interest in the businesses in November 2014.
8 New business profit has been calculated by applying the assumptions set out in schedule 5.
9 New business profit is calculated using end-of-period economic assumptions. If 2014 new business profit is re-expressed based on 31 March 2015 interest rates the total Group insurance new business profit (excluding UK wholesale) would have grown by 6 per cent on a constant exchange rate basis. A more detailed analysis is provided in schedule 4(C).
10 Percentages based on unrounded numbers in millions.
11 Gross and net investment inflows excluding year-to-date Eastspring Money Market Funds. Investment flows exclude Eastspring Money Market Funds (MMF) gross inflows of £19.1 billion (2014: £15.7 billion) and net outflows of £0.3 billion (2014: net outflows of £0.5 billion).
12 External funds under management for Eastspring excluding Money Market Funds as set out in schedule 3.

Notes:

1. Annual premium equivalent (APE) sales comprise regular premium sales plus one-tenth of single premium insurance sales and are subject to rounding.
2. Present Value of New Business Premiums (PVNBP) are calculated as equalling single premiums plus the present value of expected new business premiums of regular premium business, allowing for lapses and other assumptions made in determining the EEV new business contribution.
3. NBP assumptions for the period are detailed in the accompanying schedule 5.
4. Period-on-period percentage increases are stated on a constant exchange rate basis unless otherwise stated. Constant exchange rates results are calculated by translating prior period results using the current period foreign exchange rate i.e. current period average rates for the income statement and current period closing rates for the balance sheet.
5. There will be a conference call today for the media at 10.45 (UK) / 17.45 (Hong Kong) hosted by Tidjane Thiam, Group Chief Executive. Dial in telephone number: (UK) +44 (0)20 3139 4830 (Hong Kong) +852 3068 9834 Pin: 91812272#.
6. There will be a conference call today for analysts and investors at 11.30 (UK) / 18.30 (Hong Kong) hosted by Tidjane Thiam, Group Chief Executive. Dial in telephone number: +44 (0)20 3139 4830 / 0808 237 0030 (Freephone UK) Pin: 34418297# Playback (PIN: 656816#) +44(0)20 3426 2807 / 0808 237 0026 (Freephone UK – available from 13.30 (UK Time) on 6 May 2015 until 23.59 (UK Time) on 5 June 2015). Please follow the link for international dial-in numbers – http://wpc.1726.planetstream.net/001726/FEL_Events_International_Access_List.pdf
7. High resolution photographs are available to the media free of charge by calling the media office on +44 (0) 207 548 2466.
8. Prudential plc is incorporated in England and Wales, and its affiliated companies constitute one of the world's leading financial service groups serving around 24 million customers and has £496 billion of assets under management (as at 31 December 2014). Prudential is listed on the stock exchanges in London, Hong Kong, Singapore and New York. Prudential plc is not affiliated in any manner with Prudential Financial, Inc., a company whose principal place of business is in the United States of America.
9. Forward-Looking Statements
This document may contain ‘forward-looking statements’ with respect to certain of Prudential's plans and its goals and expectations relating to its future financial condition, performance, results, strategy and objectives. Statements that are not historical facts, including statements about Prudential’s beliefs and expectations and including, without limitation, statements containing the words “may”, “will”, “should”, “continue”, “aims”, “estimates”, “projects”, “believes”, “intends”, “expects”, “plans”, “seeks” and “anticipates”, and words of similar meaning, are forward-looking statements. These statements are based on plans, estimates and projections as at the time they are made, and therefore undue reliance should not be placed on them. By their nature, all forward-looking statements involve risk and uncertainty. A number of important factors could cause Prudential's actual future financial condition or performance or other indicated results to differ materially from those indicated in any forward-looking statement. Such factors include, but are not limited to, future market conditions, including fluctuations in interest rates and exchange rates and the potential for a sustained low-interest rate environment, and the performance of financial markets generally; the policies and actions of regulatory authorities, including, for example, new government initiatives related to the financial crisis and the effect of the European Union's ‘Solvency II’ requirements on Prudential's capital maintenance requirements; the impact of continuing designation as a global systemically important insurer; the impact of competition, economic growth, inflation, and deflation; experience in particular with regard to mortality and morbidity trends, lapse rates and policy renewal rates; the timing, impact and other uncertainties of future acquisitions or combinations within relevant industries; the impact of changes in capital, solvency standards, accounting standards or relevant regulatory frameworks, and tax and other legislation and regulations in the jurisdictions in which Prudential and its affiliates operate; and the impact of legal actions and disputes. These and other important factors may for example result in changes to assumptions used for determining results of operations or re-estimations of reserves for future policy benefits. Further discussion of these and other important factors that could cause Prudential's actual future financial condition or performance or other indicated results to differ, possibly materially, from those anticipated in Prudential's forward-looking statements can be found under the ‘Risk factors’ heading in its most recent Annual Report and the ‘Risk Factors’ heading of Prudential's most recent annual report on Form 20-F filed with the U.S. Securities and Exchange Commission, as well as under the ‘Risk Factors’ heading of any subsequent Prudential Half Year Financial Report. Prudential's most recent Annual Report, Form 20-F and any subsequent Half Year Financial Report are/will be available on its website at www.prudential.co.uk.
Any forward-looking statements contained in this document speak only as of the date on which they are made. Prudential expressly disclaims any obligation to update any of the forward-looking statements contained in this document or any other forward-looking statements it may make, whether as a result of future events, new information or otherwise except as required pursuant to the UK Prospectus Rules, the UK Listing Rules, the UK Disclosure and Transparency Rules, the Hong Kong Listing Rules, the SGX-ST listing rules or other applicable laws and regulations.
10. The financial information presented in this Interim Management Statement and accompanying schedules is unaudited.

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Prudential plc is an international company incorporated in the United Kingdom, and its affiliated companies constitute one of the world’s leading financial services groups. It provides insurance and financial services directly and through its subsidiaries and affiliates throughout the world, and it has been in existence for over 170 years. Prudential plc is not affiliated in any manner with Prudential Financial, Inc, a company whose principal place of business is in the United States of America, or the Prudential Assurance Company, a subsidiary of M&G plc (a company incorporated in the United Kingdom).