AIA Group, Asia’s largest publicly listed life insurer, reported an 11% increase in first-half operating profit, reaching $4.16 billion. This growth came from strong sales in Hong Kong and mainland China, along with expansion in Southeast Asia. The company also announced a record high value of new business (VONB) at $3.21 billion, a 10% rise from last year. This figure was slightly below analysts' consensus estimate of $3.25 billion.
Key Details
The insurer's VONB margin stayed stable at 57.1%, helped by a favorable product mix in Hong Kong. However, this was balanced by a shift toward lower-margin products in mainland China and weaker margins in Thailand, where new business declined. AIA operates in 18 markets across Asia-Pacific, with 17 reporting growth. Only Thailand saw a decrease due to a strong comparison from the previous year.
Background
Lee Yuan Siong, AIA's CEO, highlighted that Asia continues to offer big growth opportunities for life and health insurance. He stated, "Powerful structural tailwinds across the region continue to create substantial demand for our professional advice and differentiated products." The company declared an interim dividend of 53.9 HK cents per share, a 10% increase from last year.
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AIA's strong results may boost investor sentiment in the insurance sector, especially for life insurance stocks in Asia. The growth in VONB and operating profit could lead to more interest in AIA's shares and similar insurers. Keep an eye on upcoming quarterly earnings reports from competitors in the insurance market for more insights on sector performance.
Based on reporting by: businesstimes.com.sg, scmp.com