Ping An Group posts US$16.76b operating profit in 2018, up 18.9%

Ping An earned 112.5 billion yuan of operating profit in 2018, up 18.9 percent year on year, thanks to its efforts on customer development and tech-driven business transformations.

Ping An Insurance (Group) Company of China announced late on Tuesday that it earned a 112.5 billion yuan (US$16.76 billion) of operating profit in 2018, up by 18.9 percent year on year, thanks to the company’s efforts in customer development and tech-driven business transformation.

Last year, the Chinese financial conglomerate saw its operating profit attributable to shareholders of the parent company rise 18.9 percent annually to 112.5 billion yuan, while net profit surged 20.6 percent to 107.4 billion yuan, compared with a year ago.

Operating profit serves as an indicator of a company's potential profitability with all extraneous factors removed from the calculation, and it can better reflect a firm’s ongoing core business operations.

Ping An attributed the strong results to its successful customer development strategies. Committed to becoming a world-leading technology-powered retail financial services group, the company has adhered to the philosophy of “one customer, multiple products and one-stop services.”

In 2018, the operating profit of retail business jumped by around a third year over year to 97.7 billion yuan, accounting for 86.8 percent of the whole group, the annual report said.

Meanwhile, its retail customers grew by 11.0 percent to hit 184 million, and almost one in three of the 40.78 million new customers was sourced from the group’s Internet users within its five ecosystems, namely financial services, health care, auto services, real estate services and smart city services.

Ping An Group boasted around 538 million Internet users as of the end of 2018.

Data showed that operating profit per customer grew by 18.1 percent to 531 yuan,  and contracts per customer rose 9.1 percent from the beginning of 2018 to 2.53.

The insurance giant said that about 63.64 million, or 34.6 of its retail customers, held multiple contracts with the group’s different subsidiaries as cross-selling within the group continued to improve.

Also, Ping An furthered its tech-empowered business transformations. From January to December 2018, its technology patent applications increased by 9,021 to 12,051 in three core areas — artificial intelligence, blockchain and cloud computing — and the group had 29,000 research and development staff.

In a separate filing to the Hong Kong Stock Exchange, Ping An announced it plans to use owned funds to repurchase its A-share listed stocks, and said the total amount of funds will be around 5 billion yuan to 10 billion yuan.

Those shares will be reserved exclusively for the employee stock ownership plan of the company, the statement added.

Going forward, Ping An said it will continue to focus on retail customers and will endeavor to empower its financial services and ecosystems with advanced technologies.

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