Prudential PLC has announced a US$2 billion share buyback program as part of its capital management update. The company aims to return capital to shareholders by mid-2026 and is making progress towards its 2027 financial objectives. CEO Anil Wadhwani emphasized the company's focus on generating growth in both value and cash returns for shareholders over the long term. Prudential PLC plans to prioritize investment in organic new business and enhancing capabilities while pursuing selective partnership opportunities to accelerate growth in key markets.
The company's free surplus ratio, a preferred measure of distributable shareholder capital, is set between 175%-200%. Prudential PLC's historic focus on "with profit" savings, unit-linked, and health and protection business results in a relatively low volatility of free surplus to stress events. As of the end of 2023, the free surplus ratio was 242%, leading to the decision to return US$2 billion to shareholders.
The terms of the proposed share buyback program will be in accordance with relevant shareholder approval obtained at the 2024 AGM. The pace, timing, and form of the proposed return of capital will be subject to market conditions and execution considerations. Prudential PLC intends to continue its existing practice of neutralizing the dilutive effects of Share Scheme and other share issuance on the Hong Kong Stock Exchange through repurchases on the London Stock Exchange.
The company expects to publish its Half Year Results for 2024 on Wednesday, 28 August 2024. Prudential PLC will hold a Q&A call for analysts and investors on Monday, 24 June to discuss the announcement. The accompanying presentation slides and script are available on Prudential PLC's website.
This update reflects Prudential PLC's commitment to delivering long-term value to its shareholders while maintaining a strong capital base to fund organic growth and strategic investments.