Prudential Financial Inc. has updated its run-rate margin expansion and implementation cost projections related to a number of programs.
The programs had been expected to result in run-rate margin expansion of $500 million by 2022 and included certain implementation costs of $600 million to $700 million. A portion of the implementation costs is being brought forward, resulting in faster realization of projected margin expansion, according to a regulatory filing.
Implementation costs in the fourth quarter are projected to be approximately $360 million, including a charge related to the company's previously announced voluntary separation program offered to certain U.S.-based employees. Prudential Financial anticipates total implementation costs of approximately $400 million for 2019, about $175 million in 2020, approximately $75 million in 2021 and about $50 million in 2022.
The company is expecting run-rate margin expansion of approximately $50 million by the end of 2019. By the end of 2020, Prudential Financial projects improvement of between $250 million and $300 million, up from $100 million, with approximately $140 million of margin improvement realized in 2020 pretax earnings.
By the end of 2021, the life insurer expects expansion in the range of $400 million to $450 million, up from $175 million. Prudential Financial anticipates a cumulative expansion of about $500 million by the end of 2022.