Staff Reporter

AIA has announced a remarkable 81.2% year-on-year increase in its consolidated net income for the fiscal year ending 2024, reaching $6.9 billion.

Basic earnings per share (EPS) for the year soared to $0.62, reflecting a substantial 87.9% rise compared to the previous year.

The value of new business (VONB) also saw significant growth, climbing 18% year-on-year to $4.71 billion, fueled by double-digit increases across all segments.

Annualized new premiums (ANP) rose by 14% year-on-year to $8.61 billion, while the VONB margin improved by 1.9 percentage points, reaching 54.5%.

AIA reported an operating profit after tax (OPAT) of $6.61 billion, a 12% increase year-on-year per share, and remains on track to meet its OPAT per share compound annual growth rate (CAGR) target of 9% to 11% from 2023 to 2026.

Jefferies Equity Research views AIA’s 2024 results as aligning well with market expectations but notes important developments beyond the ongoing discussions about the group’s share buybacks.

Key trends include record-high margins in Thailand, a shift towards wealth management in Singapore, and unexpected growth in Other Markets.

The company’s return to positive operating variances is encouraging, especially as medical inflation appears to be stabilizing.

While investment variances were negative, they were consistent with expected sensitivities, with a $1.0 billion impact primarily attributed to Chinese yields.

AIA is also navigating challenges from the transition to Hong Kong’s Electronic Mandatory Pension Fund (EMPF), which has resulted in some fee losses.

However, Jefferies highlights that AIA has yet to account for potential savings from lower administrative expenses, suggesting that the overall impact may be overstated.

This transition could also lead to market consolidation, potentially benefiting AIA, given its competitive fee structure in this sector.