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Prudential boosts dividend by 5 per cent

Prudential has increased its interim dividend by 5 per cent to 6.29p per share as profits on an EEV basis fell 8 per cent to £1.2bn in the first half of 2009 compared with the same period last year.

On an IFRS basis, the firm has posted an increase in operating profit of 6 per cent to £688m compared with the first half of 2008.

The group’s new business sales on an APE basis were down 8 per cent to £1.3bn in H1 2009 but Prudential says its margins have increased significantly over the period due to a focus on more profitable product lines.

The insurer has improved its capital surplus to £3bn at the end of July, although this is before paying out the interim dividend. Capital surplus has increased from £2.5bn at June 30, 2009.

Group chief executive Mark Tucker says: “These results demonstrate a continuing strong performance by the Prudential Group in what remain challenging market conditions.

“As a result of the decision we took last year to focus on capital conservation and cash generation by concentrating on expanding sales in our most profitable product lines, we have been able to manage our investment in new business and improve our margins across the Group in the first six months of the year.”

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