Prudential Financial said that its total adjusted operating income before income taxes came down from $1.6bn in Q1 2019 to $1.19bn in the reported quarter
Prudential Financial headquarters in Newark, New Jersey. (Credit: Derek Jensen (Tysto)/Wikimedia Commons)
Prudential Financial has announced a net loss of $271m or $0.70 per share for the first quarter of 2020 (Q1 2020), compared to $932m net income or $2.22 per share, made in the same quarter in 2019.
The US insurance company’s total adjusted operating income before income taxes came down from $1.6bn in Q1 2019 to $1.19bn in the reported quarter.
On the other hand, its after-tax adjusted operating income for Q1 2020 is $939m compared to $1.26bn for the year-ago quarter.
The firm’s global investment management business – PGIM registered adjusted operating income of $164m in Q1 2020, compared to $214m made in the same quarter in the previous year.
Prudential Financial said that its US businesses division had an adjusted operating income of $619m in the reported quarter compared to $881m in the corresponding quarter in the year before. The insurer said that the drop in the operating income was due to lower underwriting results, a favourable impact from changes in market conditions on estimates of profitability in Q1 2019, reduced net fee income, and lower net investment spread results.
The company’s US workplace solutions, which is made up of retirement and group insurance, had an adjusted operating income of $289m in Q1 2020. In the same quarter of the year before, the US workplace solutions unit made $304m in adjusted operating income.
Prudential Financial’s US individual solutions, which includes the individual annuities and individual life businesses, had adjusted operating income of $353m in the reported quarter. In the same quarter last year, the unit made $577m.
Assurance IQ, a health and life insurtech company, which was acquired last year by Prudential Financial in a deal worth up to $3.5bn, suffered a loss, on an adjusted operating income basis, of $23m in the reported quarter.
The insurer’s international businesses unit, which includes Life Planner and Gibraltar Life & Other, had a Q1 2020 adjusted operating income of $751m compared to $922m in the same quarter in 2019.
On the other hand, Prudential Financial’s Corporate & Other business had a loss, on an adjusted operating income basis, of $342m in Q1 2020, compared to a loss of $412m in Q1 2019.
Prudential Financial CEO comments on the Q1 2020 results
Prudential Financial chairman and CEO Charles Lowrey said: “While market turbulence related to the pandemic adversely impacted our first quarter financial results, Prudential remains ’Rock’ solid with robust risk management, a strong balance sheet, and significant resources to continue to fulfill the promises we have made.
“Looking ahead, execution of our key initiatives remains on track, and we are accelerating a number of our actions.
“Backed by our financial strength and guided by our purpose, we strive to solve the financial challenges of our changing world in support of an inclusive global recovery.”