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Aviva PLC full-year profit down 26 percent

Aviva PLC full-year profit down 26 percent

Aviva PLC, the British insurance company, on Thursday reported a fall of nearly 26 percent in full-year profits in 2007, but the market reacted positively to other figures in the report.
Operating profit on a European embedded value basis rose to 3.29 billion pounds from 3.25 billion pounds in 2006, the company said, beating analyst forecasts of just over 3 billion pounds.
"Overall a good performance," said Eamonn Flanagan, analyst at Shore Capital, who highlighted the operating figures.
Shares in Aviva, which describes itself as the world's fifth-largest insurance group, rose 4.5 percent to 639 pence (euro8.45 US$12.70) on the London Stock Exchange.
Profit for the year was 2.13 billion pounds (euro2.8 billion US$4.2 billion) in 2007 compared to 2.88 billion pounds a year earlier.
Insurance payouts, especially for summer floods and January storms in Britain, dented profits by 475 million pounds (euro628 million US$944 million), the company said.
On an EEV basis, operating profit for general insurance fell 39 percent to 1.033 billion pounds (euro1.37 billion US$2.05 billion), compared to 1.69 billion pounds in 2006.
European embedded value measures the current value of future profits from a life insurance and pensions provider.
"Aviva is today enjoying the benefits of being a diversified insurer, with solid gains in its life business counterbalancing UK flood damage," said Keith Bowman, analyst at Hargreaves Lansdown Stockbrokers.
Chief Executive Andrew Moss said the company reduced its exposure to equity market volatility by selling 3.4 billion pounds worth of equities in the second half of the year.
"Net asset value per share is up 13%," he said.
Colin Simpson, analyst at Bear Stearns, said Aviva reported "solid numbers."
"This is a good set of results, with more disclosure on the investment portfolio," he said.
"However, there still remains some balance sheet risk here, the U.K. life business writes products that we believe are unprofitable and a slowing global economy will do no favors to the group's growth targets," Simpson added.
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http://www.aviva.com/


Updated : 2021-04-18 20:51 GMT+08:00