Prudential Plans suffers income drop due to eco slowdown, new SEC rules

Prudential Plans Inc. expects its earnings to decline in 2002 from P250 million in 2001, due in part to a slowdown in the economy and new Securities and Exchange Commission (SEC) regulations which include a sharp increase in capitalization and trust funds.

"On the interim, we are looking at a conservative net income in the vicinity of P150 million," Prudential Plan president Jose Alberto T. Alba said yesterday.

Prudential Plans, however, managed to increase its sales for the first two months of the year.

By the end of February this year Prudential Plans had sold 17,801 plans worth P1.23 billion against the industry-wide sales of 129,867 plans worth P6.3 billion for the same period.

Prudential Plans retained its leadership in the educational plans sector with sales of 7,849 plans worth P761.8 million. In the life plans market, Prudential sold 6,899 plans worth P146.5 million.

Alba said Prudential Plans had hoped to grow by 20 percent this year. But because of the new SEC requirements, Alba said they could settle for a 15-percent expansion this year.

Prudential Plans intends to expand its non-traditional distribution network such as telemarketing and new alliances. It also plans to expand its market base to areas outside Metro Manila (AOMM) and among overseas Filipino workers (OFWs).

Prudential Plans executives said the OFW market accounts for nearly 15 percent of total planholder base.

At present, its planholders are evenly distributed between Metro Manila and AOMM. Its traditional sales force accounts for 75 percent of sales while its non-traditional marketing efforts account for the remaining 25 percent.