LONDON (AP) - British insurer Prudential said Wednesday it more than doubled its net profit last year and raised its dividend despite writing off 377 million pounds ($610 million) for the failed attempt to take over the Asian insurance business of AIG.
Prudential reported a net profit of 1.43 billion pounds ($2.3 billion) for 2010, up from 676 million pounds in 2009 and better than analyst had expected. It saw gains in all divisions, with operating profit up 30 percent in Asia, 37 percent in the United States and 12 percent in the United Kingdom.
As a result, the company raised its dividend by 20 percent to 23.85 pence.
Investors cheered the move, sending the shares up 3.9 percent to 741.5 pence in midmorning trading on the London Stock Exchange.
"Prudential reported a terrific set of 2010 results with all key metrics ahead of our forecasts and, more often than not, ahead of top end of market expectations," said Eamonn Flanagan, analyst at Shore Capital.
The results are a significant boost for CEO Tidjane Thiam, who had been in his post less than a year when he launched a $35.5 billion bid for AIA, the Asian unit of American Investment Group Inc. The bid faltered as Prudential shareholders balked at the high price and AIG refused to accept less money.
AIG, 92 percent owned by the U.S. government following a $182 billion bailout, planned to use the proceeds from the sale to make a partial repayment to U.S. taxpayers. Instead, AIG raised $20 billion through an initial public offering of AIA.
The 2010 earnings statement "has pleased investors on most fronts, with significant cash generation underpinned by a 20 percent hike in the dividend," said Richard Hunter, head of U.K. equities at Hargreaves Lansdown Stockbrokers.
"This expression of future confidence in prospects should help to mollify shareholders upset by the distraction of the failed AIA approach last year," Hunter said.