Prudential plc Lifts Dividend On 17% Profit Rise

prudentialThe share price of Prudential (LSE: PRU) (NYSE: PUK.US) added 45p to 1,406p during early trade this morning — a 3.3% increase that makes the insurer the leading FTSE 100 riser.

Prudential’s operating profit increased 17% to almost £3bn, with the firm buoyed in particular by its Asian business, which the group describes as a “sweet spot” market.

Operating profit in Asia rose 16% to £1.1bn, driven by strong sales due to the region’s rapidly growing middle class.

All of the firm’s 2013 growth and cash objectives have been met, and the full year dividend has been raised by 15% to 34p per share.

In addition, Prudential and Standard Chartered have announced they have agreed to expand their bancassurance partnership, meaning that Prudential can sell its products to the bank’s client base in 11 countries, including China and India.

The chief executive, Tidjane Thiam, commented:

“We remain confident that our Asian business is well positioned and offers a compelling opportunity to deliver long-term value both for our customers and for our shareholders. A rapidly growing, increasingly wealthy and well educated middle class with significant savings and protection needs underpins demand for our products.”

“We believe the Group is well positioned to continue to deliver good value to customers and attractive returns to shareholders while continuing to manage capital prudently.”

The dividend increase is the company’s third in four years and the company is focused on delivering a growing dividend with cover in the medium term of two times earnings.

In the previous 12 months the share price has increased by 17% while over the last five years the shares have surged an almighty 572%.

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> Mark does not own shares in any company mentioned.