AIA boasts strong growth in 2023 financial performance
AIA boasts strong growth in 2023 financial performance | Insurance Business Australia
Insurance News
AIA boasts strong growth in 2023 financial performance
Financial report notes gains across key markets
Insurance News
By
Roxanne Libatique
AIA Group Limited has disclosed its fiscal results for the year concluded on Dec. 31 (FY23), reporting a 33% increase in the value of new business (VONB), escalating to US$4,034 million.
This growth spanned across strategic markets including Mainland China, Hong Kong, the ASEAN region (excluding Vietnam), and India, each contributing to the double-digit rise in VONB figures.
The company also saw its annualised new premiums (ANP) surge by 45%, reaching a new peak of US$7,650 million, with an improvement in VONB margin to 52.6% over the year, marking a notable uptick in the latter half.
AIA’s earnings and capital in 2023
On the financial front, AIA reported a 37% increase in embedded value (EV) operating profit per share, totalling US$8,890 million. The operating return on EV (ROEV) saw a substantial rise to 12.9%, up from 9.4% in the preceding year.
Operating profit after tax (OPAT) recorded a 2% growth per share, with an underlying growth rate of 7% per share. Additionally, the company experienced a 5% increase in underlying free surplus generation (UFSG) per share.
The company’s EV equity, before allocating US$5.9 billion towards dividends and share buy-backs, increased by 7%, with the post-return figure standing at US$70.2 billion, a 2% rise per share.
As of Dec. 31, AIA’s free surplus was reported at US$16.3 billion, supported by a strong Group LCSM coverage ratio.
AIA’s dividends and share buy-back program in 2023
In terms of shareholder returns, AIA announced a final dividend of 119.07 Hong Kong cents per share, culminating in a total annual dividend of 161.36 Hong Kong cents per share — a 5% hike from the previous year.
Through its share buy-back program, the company returned US$3.6 billion to its shareholders in 2023.
Factors that affected AIA’s VONB contributions
Lee Yuan Siong, group chief executive and president of AIA, emphasised the diverse business portfolio and robust distribution platform as critical drivers behind the significant VONB contributions from its key growth markets.
“AIA has delivered excellent VONB growth and a strong financial performance overall. With continued strong business momentum post the pandemic across the group, we grew ANP by 45% to a record high and VONB was up 33% to more than US$4 billion. Our diversified business portfolio and unrivalled distribution platform have enabled us to generate higher VONB from our key growth engines of ASEAN, Hong Kong, Mainland China, and India as well as double-digit growth from 10 markets,” he said.
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