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By Inti Landauro and Matthieu Protard
PARIS, Feb. 21 (Reuters) – Net profits of AXA, Europe's second largest insurer, have fallen sharply due to charges related to the IPO of its US unit and a series natural disasters, although AXA hoped that its profits would increase. year.
Its net profit for 2018 fell 66% from the previous year to stand at 2.14 billion euros ($ 2.42 billion), less than the 2, 47 billion expected by badysts surveyed by Infront Data for Reuters.
The company had to record an impairment loss of 3 billion euros on the value of its US unit AXA Equitable, quoted in May 2018 at a price lower than its value in the books of AXA.
The company also had to cover costs related to the restructuring of its activities in Switzerland and the acquisition of XL for $ 15 billion.
Under the leadership of Thomas Buberl, Chief Executive Officer, AXA is in the process of undertaking an in-depth restructuring aimed at strengthening the international market and strengthening the French group in personal and property and casualty insurance.
Natural disasters cost AXA about € 2 billion in 2018, of which $ 600 million is for Hurricane Michael in the United States and a fourth-quarter forest fire in California.
"With respect to natural disasters, we live every ten years," said Gerald Harlin, Director General of Finance.
He maintained that the company's underlying earnings per share targets should increase by 3 to 7% this year and next.
Earnings rose 3% in 2018, while AXA also increased its dividend by 6% to 1.34 euros per share.
Earlier this month, Allianz, the largest insurer in Europe, also posted a rise in profits and could slow down its share buyback program.
$ 1 = 0.8827 euros
Reporting by Inti Landauro;
Edited by Sudip Kar-Gupta
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