Prudential UK's total sales (APE) in the first quarter of 2009 were £180m, down 6% on the same period in 2008, in the face of 'extremely difficult and volatile market conditions'.
Corporate pensions sales of £53m were down 13%, reflecting the inclusion of the large one-off transfer of Nationwide's deposit-based AVC business in the first quarter of 2008.
Sales of offshore products also suffered, down 63% on the same period last year to £7m. This reflected difficult conditions in markets outside the UK as well as Prudential UK's focus on higher margin business in the UK.
However, it was a strong quarter for with-profits bonds with sales of £31m, up 72% on Q1 2008. Prudential UK's share of the with-profit bond market increased from 23% in 2007 to 31% in 2008, with the total market increasing by 77% over the period as consumers continued to seek a more cautious investment approach.
Individual pension sales increased by 57%, driven by the launch in the fourth quarter of 2008 of PruFund as a fund link and PruSelect, an extended range of unit-linked funds introduced across Prudential UK's bond, pension and income drawdown portfolio.
In an environment of falling house prices and the associated increased risk of negative equity, Prudential UK said it maintained its pricing discipline and in the second half of 2008 reduced its loan to value ratio in the lifetime mortgage market.
This resulted in a fall in sales to £3m from £5m during the same quarter last year. Prudential UK says it will continue to maintain this conservative stance until market conditions improve.
The PruHealth business continues to grow and now covers 192,000 lives, up 25% over the last year.
The period was also particularly strong for Pru's asset management arm M&G with gross retail sales of £3.3bn in Q1, up 79% on the same period last year. Bond funds dominated gross inflows during the quarter, accounting for 74% of sales compared with 24% in Q1 2008.
Group wide sales for Prudential in Q1 2009 fell by 5% at actual exchange rates compared with Q1 2008.
Mark Tucker, group chief executive, says: "Prudential continues to perform well in exceptional global economic conditions.
"Back in March we said that we expected the business environment to be very challenging throughout 2009 and that our clear priority was, therefore, to nurture the Group's financial strength through capital conservation and cash generation.
"Our Plan for 2009 is to maximise sales of our most profitable product lines, reduce new business strain and not to specifically target increases in total sales volume."
Two global vehicles
'Further plug advice gap'
Must appoint separate CEOs and boards
Advisers do come out well
Will report to Mark Till