Reuters logo
UPDATE 1-AXA says net income rises 14 pct, lifts dividend
February 21, 2014 / 7:23 AM / in 4 years

UPDATE 1-AXA says net income rises 14 pct, lifts dividend

* AXA says 2013 net revenue rises 2 pct to 91 bln euros

* Net income rises 14 pct on constant forex basis

* AXA proposes 2013 dividend of 0.81 eur/share, up 13 pct (Adds details, CFO comments)

By Maya Nikolaeva and Matthieu Protard

PARIS, Feb 21 (Reuters) - Europe’s No. 2 insurer, AXA , said 2013 net income rose 14 percent at constant exchange rates, helped by stronger growth in its life, and property and casualty businesses, as well as a recovery in asset management.

AXA is seeking to lift profitability through price hikes, higher-margin products and 1.7 billion euros in cost cuts by 2015. It is also increasing its footprint in emerging markets via acquisitions.

Full-year net income was 4.48 billion euros ($6.14 billion), against 4.06 billion in 2012, AXA said on Friday. This missed the average analyst estimate of 4.96 billion in a Thomson Reuters I/B/E/S poll, dragged down by a negative impact relating to interest rates and foreign exchange hedging derivatives.

Property and casualty revenue rose 2 percent, helped by a 3 percent price hike and stronger volumes in high-growth markets such as Turkey, Asia and the Gulf countries.

Price hikes and lower claims were partly offset by more severe natural catastrophes, however, with floods and storms in Germany and Switzerland, AXA said.

The combined ratio, which measures profitability in the property and casualty business, improved by 1.1 points to 97.8 percent. A ratio below 100 percent means the company is making an underwriting profit.

An improved investment climate and higher interest rates, mainly in the United States, helped boost life insurance revenue. Unit-linked products, when a part of the premium paid serves to cover insurance and the rest is invested in equity or debt, saw a 14 percent increase in annual premiums.

“Operating profit is being driven by income in the life insurance business, thanks to a strong performance in the United States, Japan and Germany,” said Gerald Harlin, chief financial officer at AXA.

“This confirms that the situation is back to normal in the U.S., which accounts for 20 percent of operating profit in the (life insurance) business.”

The insurer said asset management revenue rose 8 percent, boosted by inflows into real estate and fixed income at its arm AXA Investment Management arm and higher fees at U.S. asset manager AllianceBernstein.

AXA, which said it would raise its dividend by 13 percent to 0.81 euros per share, said adjusted return on equity improved to 14.8 percent from 13 percent in 2012, slightly below the company’s 15 percent target in its strategic plan through 2015. ($1 = 0.7293 euros) (Editing by James Regan)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below