AIA’s sees profit surge of 81.2% YoY in FY 2024

EPS stood at $0.62.

AIA’s consolidated net income for fiscal year ending 2024 (FY 2024) surged by 81.2% year-on-year (YoY) to $6.9b.

For the year, basic earnings per share (EPS) stood at $0.62, 87.9% higher YoY.

The value of new business (VONB) rose 18% YoY to $4.71b, driven by double-digit growth across all segments. 

Annualised new premiums (ANP) increased by 14% YoY to $8.61b, while the VONB margin improved by 1.9 percentage points to 54.5% YoY.  

AIA also reported operating profit after tax (OPAT) of $6.61b, up 12% YoY per share, and remains on track to achieve 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 broadly in line with consensus but highlights key developments beyond the ongoing debate over the group’s share buybacks.

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

AIA’s return to positive operating variances is seen as a positive sign, particularly as medical inflation appears to be stabilising. 

Investment variances were negative but in line with expected sensitivities, with a $1.0b impact from Chinese yields being the most significant factor.

AIA also faces headwinds from the transition to Hong Kong’s Electronic Mandatory Pension Fund (EMPF), which has led to a loss of fees. 

However, Jefferies notes that AIA has not factored in potential savings from lower administrative expenses, suggesting the impact may be overstated. 

The shift could also lead to market consolidation, which may ultimately benefit AIA, given its competitive fee structure in this segment.