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French insurer Axa says 2007 net profit rose 11 percent

French insurer Axa says 2007 net profit rose 11 percent

Axa SA, Europe's second-largest insurance company by market value, said Thursday full-year net profit rose 11 percent on strong underlying earnings and a gain on an asset sale.
The Paris-based insurer also said it expects positive sales and underlying earnings growth in 2008, despite "a less-favorable macroeconomic environment since the beginning of the year."
Axa said full-year net profit rose to euro5.67 billion (US$8.53 billion) from euro5.01 billion in 2006. The latest figure exceeds analyst expectations of euro5.57 billion ($8.38 billion).
"2008 has started in a less-favorable environment with very volatile and bearish equity markets, a continuation of the liquidity crisis, concerns about a slowdown in world economic growth, lower interest rates and high credit spreads," Axa said.
Axa last month reported a 20-percent increase in full-year revenue, driven by a strong performance in both its life and savings and property-and-casualty businesses.
The company said full-year profit included euro596 million (US$896 million) in so-called fair-value adjustments on certain financial assets and euro252 million (US$379 million) in integration costs linked to integrating Swiss insurer Winterthur, which it bought from Credit Suisse in 2006 for nearly euro8 billion.
Axa also said it booked euro400 million (US$601 million) in write-downs in 2007, mainly on financial-institution equities and bonds, plus euro40 million (US$60 million) related to asset-backed securities.
But those costs were partially offset by a one-time gain of euro480 million (US$722 million) on the sale of Axa's Dutch activities and underlying higher earnings.
Axa's stock has fallen 23 percent since the beginning of the year. The shares closed at euro23.84 (US$35.86) Wednesday.


Updated : 2021-05-10 15:21 GMT+08:00