ANNUAL REPORT 2001 - Prudential plc

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R EGG PLC Launched by Prudential in October 1998, Egg is the UK’s leading e- commerce financial services brand, and will be extending its reach into France and Germany in 2002. • Prudential completed an Initial Public Offering of just over a 20 per cent share of Egg in June 2000. • Egg plc provides banking, insurance, investments, mortgages and a shopping portal through its internet site and other distribution channels. • Egg plc has more than two million customers and employs some 2,200 staff mostly based at its call centres in Derby and Dudley. www.egg.com JACKSON NATIONAL LIFE (JNL) JNL was acquired by Prudential in 1986. Today, it is one of the top 20 life insurance companies in the US in terms of total assets, and has more than 1.5 million policies and contracts in force. • JNL is a leading provider of fixed, indexed and variable annuities, term and permanent life insurance, and stable value products. • Headquartered in Lansing, Michigan, and employing 2,400 people, JNL markets its products in 50 states through independent agents, brokerdealers and financial institutions (in New York as Jackson National Life Insurance Company of New York). • JNL’s investment portfolio is managed by PPM America Inc., which manages some US$57 billion of US assets. www.jnl.com PRUDENTIAL CORPORATION ASIA (PCA) Prudential began its first Asian operations in India in 1923. Today, it is Europe’s leading life insurance company in Asia, employing around 5,000 staff and serving more than 2.2 million customers. • PCA has operations in 12 countries: China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and Vietnam. These include joint ventures with some of the region’s leading players, including: – Bank of China International for Mandatory Provident Fund business in Hong Kong; – ICICI Ltd (India) for both life insurance and mutual funds; and – China International Trust and Investment Corporation (CITIC) for life insurance. • PCA’s distribution is predominantly through some 60,000 agents, but also through a growing number of other distribution channels including its successful bancassurance relationship with Standard Chartered Bank (SCB). • PCA offers a comprehensive range of savings, protection and investment products. www.prudentialasia.com
GROUP FINANCIAL HIGHLIGHTS 2001 2000 Results Summary £m £m Achieved profits basis results Operating profit before tax UK Insurance Operations: Long-term business 620 708 General business 79 33 699 741 M&G 75 125 Egg (88) (155) UK Operations 686 711 US Operations 319 226 Prudential Asia 415 213 Prudential Europe 8 17 Other income and expenditure (including development expenses) (178) (138) 1,250 1,029 UK re-engineering costs (64) – Operating profit 1,186 1,029 Amortisation of goodwill (95) (84) Short-term fluctuations in investment returns (1,402) (440) Effect of change of economic assumptions (482) – Merger break fee (net of related expenses) 338 – Profit on business disposals – 223 (Loss) profit on ordinary activities before tax (455) 728 Operating earnings per share 41.9p 38.4p Shareholders' funds £8.15bn £8.8bn Statutory basis results Operating profit before tax 622 840 Operating earnings per share 23.3p 30.2p Dividend per share 25.4p 24.5p Insurance and investment funds under management £163bn £165bn Banking deposit balances under management £6.5bn £7.6bn 2001 2000 Total Annual Premium Equivalent Insurance Sales Up 16% to £1,766 million £1,528 million Total Annual Equivalent Investment Sales Up 172% to £1,021 million £376 million Achieved Profits Basis – New Business Profits Up 10% to £673 million £613 million Achieved Profits Basis – Total Operating Profit Up 15% to £1,186 million £1,029 million 01 Prudential plc Annual Report 2001
Page 1 and 2: PRUDENTIAL PLC ANNUAL REPORT 2001
Page 3: PRUDENTIAL AT A GLANCE PRUDENTIAL
Page 7 and 8: GROUP CHIEF EXECUTIVE’S REVIEW WE
Page 9 and 10: The fastest growing age group in th
Page 11 and 12: est growth prospects in the market
Page 13 and 14: Egg 2001 was another year of outsta
Page 15 and 16: Over the last five years, JNL has m
Page 17 and 18: equivalent (APE) basis were £434 m
Page 19 and 20: 69 per cent). The new business marg
Page 21 and 22: differences and other items. The in
Page 23 and 24: However, we have not been discussin
Page 25 and 26: CORPORATE SOCIAL RESPONSIBILITY REV
Page 27 and 28: Executive Directors 1. Jonathan Blo
Page 29 and 30: Nomination Committee Sir Roger Hurn
Page 31 and 32: REMUNERATION REPORT The Remuneratio
Page 33 and 34: Directors’ Long-term Incentive Pl
Page 35 and 36: Directors’ Share Options The Rest
Page 37 and 38: DIRECTORS’ REPORT Principal Activ
Page 39 and 40: SUMMARY OF STATUTORY BASIS RESULTS
Page 41 and 42: Restated † 2001 2000 Long-term Bu
Page 43 and 44: CONSOLIDATED STATEMENT OF TOTAL REC
Page 45 and 46: Restated † 2001 2000 Liabilities
Page 47 and 48: CONSOLIDATED CASH FLOW STATEMENT YE
Page 49 and 50: 3. Significant Accounting Policies
Page 51 and 52: Reinsurance In the normal course of
Page 53 and 54: Linked business funds Certain long-
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5. Supplemental Earnings Informatio
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7. Segmental Information - New Busi
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9. Segmental Information - Net Asse
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11. Jackson National Life - Additio
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15. Investment Expenses and Charges
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16. Tax continued 2001 2000 £m £m
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21. Fees Payable to Auditors KPMG K
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27. Share Capital and Share Premium
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31. Borrowings continued 2001 2000
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32. Contingencies and Related Oblig
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INDEPENDENT AUDITORS’ REPORT TO T
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2001 2000 1999 1998 1997 Analysis b
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SUMMARISED CONSOLIDATED PROFIT AND
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NOTES ON THE ACHIEVED PROFITS BASIS
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6. Cost of Capital On the achieved
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10. Short-term Fluctuations in Inve
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14. Reconciliation of Movement in S
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THE ACHIEVED PROFITS BASIS OF FINAN
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HOW TO CONTACT US Prudential plc La
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ANNUAL REPORT 2001 - Prudential plc

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